Graduates of North East universities owe more than £10bn on Plan 2 loans

Graduates of the North East's five universities collectively owe more than £10.1bn in outstanding Plan 2 student loan balances, according to a Financial Times analysis of Student Loans Company data obtained under freedom of information law.

The university-level figures put Newcastle University highest in the region by average balance, at £53,849. Northumbria University Newcastle has the largest total balance, at £2.78bn, and the largest number of alumni still carrying Plan 2 debt.

The local pattern partly follows the FT's national finding that Russell Group graduates carry the highest Plan 2 balances. The average Russell Group alumnus repaying a Plan 2 loan owes £52,412, against an all-institution average of £45,498.

But the North East data also complicates that story. Northumbria is not a Russell Group university, yet its average balance, £51,523, is higher than Durham University's £50,737 and well above the national all-institution average.

The five North East universities between them account for 205,070 alumni still carrying a Plan 2 balance:

Institution	Avg balance	UK rank
Newcastle	£53,849	43
Northumbria	£51,523	72
Durham	£50,737	83
Teesside	£45,044	148
Sunderland	£43,927	158

Plan 2 covers students who started undergraduate degrees in England between 2012 and 2022. Unlike the loan plans either side of it, interest on a Plan 2 balance rises above inflation once a graduate's income passes £52,885, up to RPI plus three percentage points, so a well-paid career can leave the balance growing even as the graduate makes large monthly repayments.

That mechanism is why the FT framed the data as more than a league table of student debt. Rethink Repayment founder Oliver Gardner told the FT the figures showed graduates in relatively well-paid professions "seeing their loan balances soar despite making significant monthly repayments." The Commons Treasury Committee accused ministers in July of mis-selling student loans, education secretary Lucy Powell has called Plan 2's interest rates "egregious" and the Treasury has warned that reform could cost more than £5bn.

For the North East, the value of the data is what it says about the universities themselves. Newcastle fits the national pattern: a Russell Group university with a high average balance. Durham sits below Newcastle and Northumbria on this measure, despite its Russell Group status and four-year degree patterns in some subjects.

Northumbria is the local outlier. Its scale explains why it has the largest total Plan 2 balance among the five, because it has more alumni with a balance than any other North East institution in the FT table. It does not, by itself, explain why the average balance is higher than Durham's.

That points to the limits of the data. Average debt by university can be shaped by course length, maintenance borrowing, student background, dropout rates, the mix of graduating years in the repayment population and the earnings of former students. A graduate earning more may repay more each month, but under Plan 2 may also face a higher interest rate. The result is a system in which higher earnings do not necessarily mean a fast-falling balance.

The data measures debt by university attended, not by where a graduate lives or works now, so it does not show how much North East households owe. Durham and Newcastle in particular educate large numbers of students who leave the region after graduating.

The regional significance therefore lies in the universities rather than the current location of the borrowers. Together, the five institutions account for more than £10bn of outstanding Plan 2 balances, while Northumbria shows that high graduate debt is not confined to the Russell Group.