Dear Sir or Madam,

Please could I receive details on profits made by the government by
charging interest on loans issued to students.

Yours faithfully, Robbie Simpson

Dear Sir or Madam,

Under the Freedom of Information Act 2000 I would appreciate if you
could respond to my earlier message, which is reproduced below.

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Dear Sir or Madam,

Please could I receive details on profits made by the government by
charging interest on loans issued to students.

Yours faithfully, Robbie Simpson

##

Thank you for your prompt response.

Yours sincerely, Robbie Simpson

Thank you for your recent email. A reply will be sent to you as soon as
possible (where a response is required). For information, the
departmental standard for correspondence received is that responses
should be sent within 15 working days or 20 working days if you are
requesting information under the Freedom of Information Act 2000.

Your correspondence has been allocated the reference number 2008/0053285

Department for Innovation, Universities and Skills
http://www.dius.gov.uk/index.htm

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Dear Mr Simpson,

Thank you for your email dated 21 June 2008 about student loans.

The Government makes no profit from them, either on individual loans or
across the loans as a whole. The Government not only subsidises the
interest rate charged to borrowers but also absorbs other associated
costs such as where loans need to be written off.

Borrowers do pay interest on student loans, but this is outweighed by
the Government's subsidy. The principle behind the loans is that
borrowers should repay broadly the same amount, in real terms, as they
borrowed. To do this interest is linked to the Retail Price Index (RPI)
thus maintaining the value of the loan in real terms.

Yours sincerely,

Mark Sawyer
STUDENT FINANCE POLICY DIVISION
[email address]

Your correspondence has been allocated the reference number
2008/0053285.

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