It comes after a string of voices calling for reform of the student loans system, which sees many graduates on Plan 2 loans unable to pay them back faster than the interest rises
Student loan thresholds will be unfrozen in a "couple of years", the Minister for Children and Families has promised to LBC.
Josh MacAllister has defended the student loan system as "fair" and said the thresholds at which graduates repay are being held to keep inflation down and get the economy growing.
He admitted that these decisions were "not easy or straightforward" but they were "balancing a whole bunch of different groups and making sure, on the whole, it is fair."
It comes after a string of voices calling for reform of the student loans system, which sees many graduates on Plan 2 loans unable to pay them back faster than the interest rises.
LBC's heard of workers who have been paying back their loans for years – while seeing their total amounts owed to the government spiral upwards.
Campaigners are calling for fresh reform of the system – for the government to look at interest payments which differ, the level at which loans are repaid, and the type of interest rate which is used to calculate it.
Health Secretary Wes Streeting told LBC on Wednesday that he thinks there needs to be a national conversation about the student loan system.
But the Chancellor's defended the system as "fair" – and said it's not right that those who don't go to university pay for those who do.
Mr MacAllister, the children's minister, told LBC: "We want to make sure overall that we achieve a couple of objectives. One is that there's fairness in the system overall for those who go to university and for those who haven't had the chance to go to university.
"We need to make sure that those graduates on Plan 2 loans are able to repay in a fair way.
"And I think we are getting the balance right because we're making sure that people only start to repay when they start earning. I think it's just under £30,000 pounds.
"That threshold will be frozen only for the next couple of years, and that is to make sure that the budget adds up in the round.
"The reason for that is so that we can get interest rates down and inflation down and get the economy back to where it needs to be so we can get growth.
"So none of these are easy, straightforward decisions, but we are balancing a whole bunch of different groups and making sure, on the whole, it is fair."
He said the government had also started to fund other forms of higher education – like apprenticeships and colleges – better too.
But there's a debate at the heart of government about whether there's an issue.Mr Streeting, himself the former head of the National Union of Students admitted it is “tough for younger graduates" to pay back their loans, which continue to rise given high rates of interest.
He said that debts are written off after 30 years, he appreciates that this is not an "inspiring message” and it is “very demoralising” for graduates to see spiralling balances.
He said: “There's a debate for us to have as a country on what our priorities are… all the variables come with cost.“
The Chancellor thinks I could do something on student finance, but it's going to cost me X amount, which will be billions, or I could fund the NHS or special needs children.
"It is a debate clearly rumbling and worth having. For younger graduates, it feels quite tough at the moment.”
Yesterday the Liberal Democrat leader Ed Davey – whose party raised tuition fees to £9,000 a year along with the Conservatives in the coalition government, said that the system wasn't fair.
He told LBC's Tom Swarbrick: "The current system isn't fair because things that we had in the original system which made it much fairer were taken away.
"Number one was maintenance grants. When the system was set up maintenance grants were there to help people from low income backgrounds. The conservatives took them away and that's created one of the biggest unfairnesses in the system.
"The second unfairness which is made way worse by the conservatives and I'm afraid Labour is also making it worse is the freezing of the point at which people repay their loan that is creating real hurt amongst graduates on low and middle incomes actually and I think that the government's going to have to review that.
"It's got to make it fairer. Sorting out maintenance grants would be one way linked to at least unfreezing the point at which people make those repayments."
