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Medical students unlikely to repay student debts during working life

The average UK medical graduate is unlikely to ever fully repay large debts incurred whilst studying, which could affect recruitment, researchers have claimed.

A new analysis of salary data which looked at actual income of doctors, posed against record-high tuition fees and living costs, also showed that females were even less likely to ever be able to repay debts because they earn less per hour than male counterparts.

The researchers concluded such debts could lead to students opting for other careers, or looking to study abroad.

The findings, published in BMJ Open, contradict National Audit Office (NAO) calculations predicting most doctors can pay off £71,000 debts within 25 years.

Researchers said this deviation was explained by their study looking at actual earnings of graduate respondents - from national Labour Force Surveys between 1997 and 2014 – while the NAO model used NHS pay scales.

Their analysis of salaries for 4,286 medical graduates working more than 30 hours a week showed that the average doctor will have outstanding debts after 30 years, which is when they get written off.

The paper said: ‘The NAO presented a single simulation for a doctor graduating with an initial debt of £71,000, suggesting that they would clear the debt 25 years after graduating.

‘However, in the simulations presented here, neither a male nor a female medical graduate with an initial debt of £70,022 would ever repay the debt before it is written off.’

The researchers reached their average debt figure working on the assumption that a medical student would pay £9,000 in annual tuition fees for four years of studying, while the fifth and final year’s fees would be covered by the BMA and NHS bursary, leaving graduates with a total tuition fee debt of £39,946.

Taking into account maintenance loans, a student living away from home but studying outside of London would have a debt of £70,022, with a minimum debt of £64,000 for students living at home but studying outside London and £82,000 for London students not able to live with their parents.

The study authors said that ‘such levels of graduate debt may affect the recruitment of students to a career in medicine in the UK as some may choose alternative careers and others may decide to study medicine abroad’.

They further warned policy makers that ‘even small changes in the student loan contract in future will have substantial implications for lifetime wealth across different income groups, across male and female graduates, and on the sustainability of the student loans system’.

Their research showed that the gender pay gap begins to develop at age 30, growing progressively to a peak at age 55 when female doctors are earning 35% less than their male counterparts. According to the study, this was not because they worked less but because their hourly wage was signficantly smaller, with career breaks and flexible working due to motherhood posed as a possible explanation.

The BMA’s medical students committee chair Harrison Carter said: ‘This study echoes our repeated concerns about the financial plight of medical students facing graduation debts of at least £70,000.

‘The decision to allow medical schools to increase tuition fees to as much as £9,000 was a damaging move that places substantial financial barriers in front of the next generation of students from low and middle income families, and now this study suggests that those earning less will end up paying more, which is completely unacceptable.’

It comes as Pulse reported that a third of GP training positions for the August 2015 intake remain unfilled following the first round of recruitment.

Readers' comments (29)

  • I think there is a bigger picture to look at.

    We would like those who have had the biggest investment in training to use those skills as much as possible. Having bigger and bigger marginal rates of tax means that there is little incentive for some of those people to work harder (I am sure we can all see that if there is no prospect of paying off the full amount student loan repayments are nothing more than a tax).

    If you are lucky enough to have a taxable income approaching 100k, there is already little incentive to work harder. Adding in another 11% tax is not really going to incentivise you to work that 5th day.

    Your next 20k earned might cost you 28% pension, 11% student loan, 65% tax+NI+loss of personal allowance. (Taken off consecutively not together). Add in extra indemnity costs, extra travel expenses, more expensive meals at work etc and things get even worse.

    I am not looking for sympathy - because I do not do that extra day. But there needs to be an understanding that the system has invested a lot of money in to training GPs (and other highly trained/ highly paid professionals). There also happens to be a massive current shortage. Incentivising them to use those skills should be seen as a priority - not an inconvenient expense.

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  • Finally I don't understand why people seem to get so angry at those who send their children to private school (from the comments above).

    It's convenient to forget that they directly save the taxpayer 5k per child per year. Maybe that amount should be taken off any student loan repayments.

    DOI: I have no children.

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  • We can all resign from the NHS and go private and charge whatever is needed to get doctors. Surely, a society cannot exist without proper medical care.
    No point looking to the Govt., the papers or patients.
    The BMA as the doctors Union has a duty of care to it's members to provide a proper pay/ conditions contract. Otherwise they should just close and not take subscriptions.
    If you take my subscription then you must look after me.
    The BMA is more interested in seat belts, plain cigarette packaging, smoking in cars and other such no doubt laudable stuff, while 40% of their member.s are depressed, while GPs leave or resign.
    The problem is not the debt, it is the earnings.
    £60 profit for patient year for 7 consultations and 35 other contacts [ blood tests, prescriptions,letters,phone calls] per average patient year illustrates the problem.
    In this age of candour and litigation, I would say to any aspiring doctor - choose a speciality with private practice if you wish a reasonable, debt free life,
    Do not become a GP.

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  • @ 10.40pm

    The worry is the enormous pension contributions and costs saddled on partners may end up being a way of screwing more tax out of you. It makes sense IF government honours its agreement but it doesn't have a great track record unfortunately.

    Given the risks of dealing with an unreliable partner, ie the state, this is a reason why those that can are locuming and setting themselves up as limited companies and taking responsibility for their own pension and tax arrangements. Worry that the job is so tough (talking from what I have experienced and seen) that unless partners can cash out earlier many will pass away before they can enjoy their hard earned retirement. At least if its your own pension fund the money will pass onto your family and could help GP's children with their debts establish themselves in life. Those that don't make it to retirement will see their pension pot being handed back to the state.

    Is is this equation that could tip the balance against the NHS pension scheme and pull the plug on the NHS in the end. Government needs to defene the pension scheme to the hilt but it doesn't have the money and is dismantling it.

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  • What we see on this thread is that GPs are money-driven and only concerned with self-enrichment. Needs or wants?

    Maybe medical schools would do better to invest public money in trainee doctors with a vocation and a sense of public service rather than banker wanabees.

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  • @ 1.05pm

    Looks like another deluded Daily Mail / doctor hating troll who thinks the state owns doctors. The title of the article is "Medical students unlikely to repay student debts during working life." Legitimate concerns regarding this hardly makes doctors "banker wanabees" or lacking "a sense of public service".

    Responding to such crass comments unfortunately is only giving you the attention you crave.

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  • Anonymous | Other healthcare professional | 22 April 2015 1:05pm

    in all areas of life there needs to be a reason for doing a job, some people work because they have no choice, or because they love doing that job, or because they like the prestige, or the money etc..

    the problem is that doctors know they could have done any other career they wanted - why? because most are straight A students, high achievers and grafters. I could have chosen almost any field I wanted so why choose medicine ?

    1. job security
    2. progressive pay and good salary
    3. well respected career
    4. transferable skills
    5. contributing to society
    6. interesting and varied work
    7. for the nurses (joke)

    my point is that people choose medicine for a range of reasons.

    I do not know a single doctor who is working only because of the public good and contribution to society.

    nowadays going back to my list ;

    1. job security is gone - the job is more risky with severe consequences including imprisonment, being struck off, burn out, suicide etc
    2. progressive pay and good salary - pay has gone down and there are many other professional jobs that pay better
    3. well respected career - the media hates us and being a bank robber gets more respect nowadays
    4. transferable skills - still applies
    5. contributing to society - yes but society doesn't recognize this
    6. interesting and varied work - there are lots of careers especially in science that are just as or even more interesting.

    I've said time and time again - no doctor will have a problem with recruiters saying to applicants we want vocational doctors only who will work for free - and you are welcome to try but don't be surprised if 99% of doctors leave for the private sector.

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  • What no-one has commented on is that the reason the debt is so bad is than it has annual compound interest applied at 3% above CPI, from the 1st year at medical school, which multiplies the amount paid back to at least £115K over a lifetime. Initially for many years the ex-students are only paying off interest. I have a 3rd medical student daughter in the first year of these new debts. It is a really tough choice trying to decide whether to pay tuition fees up front (if you have savings) or save and give them a deposit for their 1st property. It has been pitched very cleverly. Yes doctors earn well above average but the they bloody earn it. The next generation have an additional 9% tax on income above £21K in effect for 30 years and increased pension costs - emigration will seem very attractive for the whole lot.

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  • Simply illustrates for the new generations why cost benefit ratio doesn't work. As medicine takes some of the brightest compared with other top 10% graduates (rather than averages for all graduates as often quoted) young doctors earn a pittance. Why are these young kids still applying in their droves (or at least the girls are). At son's academic public school lots of girls go into medicine but few boys. I suspect because they realise in the future they wont earn proper professional remuneration.

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