Tory ministers have been savaged for “sneaking out” a £4billion student loans sell-off as they face a spending black hole just weeks before the Budget.
Universities Minister Sam Gyimah quietly revealed the decision in a written statement yesterday to ensure “vital public services” can be funded.
It came just as speculation was mounting about how Theresa May will fund her pledges to spent £20bn on the NHS and supposedly “end austerity”.
Hauled to Parliament to explain the move, Mr Gyimah insisted the decision was “good for the taxpayer” and would change nothing for students.
But Labour’s Angela Rayner slammed him after the National Audit Office ruled a previous selloff cost taxpayers £900m, plus £600m in lost future income.
The Shadow Education Secretary accused ministers of “sneaking out” the sell-off to help their “terrible position on the national debt” which has billowed to £1.8trillion.
“Just how much public money do we have to lose before the education ministers start learning their own lessons?” she blasted.
Mr Gyimah insisted the decision was not “snuck under the radar” and the loans will only be sold if value for money can be achieved.
But Ms Rayner asked how low a price the government would accept and demanded the “value for money” test is published.
The loans being sold are those issued by English local councils under the pre-2012 system, when they were around £3,000 per year not £9,000, and which entered repayment between 2007 and 2009.
Mr Gyimah said Labour had kick-started the path to sale when in government and claimed “the position of all graduates, including those whose loans are part of a sale, will not change as a result of the sale.”
Current student loans billow at an eye-watering interest rate of 6.1%, compared to just 1.5% for those issued before 2012.