Welsh graduates with Plan 2 student loans will have their repayment threshold frozen for another three years, in a move that could increase the amount deducted from pay as wages rise.

The Welsh Government confirmed on Wednesday, 11 November, that borrowers will begin repaying once earnings exceed £29,385 a year throughout the 2027-28, 2028-29 and 2029-30 financial years.

The lower and upper thresholds used to calculate interest will also remain unchanged, at £29,385 and £52,885 respectively.

Graduates on Plan 2 repay nine percent of earnings above the repayment threshold. Keeping the limit fixed means pay increases could trigger deductions that would have been smaller if the threshold rose.

For example, someone earning £35,000 throughout the year would repay about £42 a month under Plan 2, assuming their earnings remained steady.

Deputy Minister for Skills and Tertiary Education Cefin Campbell acknowledged the impact, saying: "This is not a decision I wanted to take."

He blamed the UK Government's freeze on equivalent English loans and the limitations of the shared Student Loans Company and HM Revenue and Customs systems.

Although Welsh ministers set the rules for Welsh borrowers, he said separate thresholds could not be introduced without years of technical changes.

The decision is relevant to former students from across Wales who took out Welsh Plan 2 loans, including graduates now working locally.

It follows months of criticism about the fairness of student loan repayments.

In August, Ceredigion Preseli MP Ben Lake joined a cross-party call for an urgent review of the system, arguing that graduates faced unfair terms and mounting debt.

Mr Campbell said Welsh borrowers still benefited from maintenance grants and some loan cancellation measures. He said a review of higher education finance would examine future arrangements.

The freeze applies to Plan 2 borrowers; different repayment plans operate under different thresholds.