Writing off medical student debt would help address the workforce crisis

5 Oct 23

Forgiving student loans over time would help lower the attrition rate in the medical profession, argues Dr Billy Palmer of Nuffield Trust.


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The crisis affecting the NHS workforce is plain to see. Staff are demoralised, sick, burnt out, striking and – increasingly – quitting. 

Analysis recently published by the Nuffield Trust provides the most comprehensive look to date at dropout rates affecting clinical staff – nurses, midwives, allied health professionals and doctors – examining key stages of their career pathway, from training to entering their chosen career. 

And the results are sobering: one in eight trainee nurses quits before graduating; one in nine midwifery graduates quits before joining the profession; and two in five nurses leave after less than two years in the job. 

With five nursing training places yielding only three full-time NHS nurses and two GP training places producing equivalent to just one full-time, fully qualified doctor, we are facing a staffing crunch that affects students, graduates, patients, and the public alike. This wasted talent represents a poor-value return on the £5bn taxpayers invest in training healthcare professionals.

And while the government’s long-term workforce plan focuses on schemes to increase training through apprenticeships and shorter courses, these alone are unlikely to sufficiently resolve the issues of attrition, participation, and retention. Instead of plugging the leaky pipeline, these measures are like adding more water without repairing the holes. 

But one proposal might stem the flow: an NHS loans forgiveness scheme. This would gradually write off a student’s loan debt in exchange for several years of dedicated service as a nurse, midwife, or as an allied health professional such as a physiotherapist or radiographer. 

This is not an entirely new idea: a model first proposed by London Economics and endorsed by the Nuffield Trust suggests forgiving 30% of the loan balance after three years of service, 70% after seven years, and 100% after ten years. Loans forgiveness schemes are also already in place in parts of the United States, where they have been linked to increased retention, and Canada. 

While it’s difficult to quantify the effects of loans forgiveness – not least because it will depend on how the scheme is crafted – it would almost certainly increase applicants to nursing courses. Student debt has been cited as a reason for would-be nurses quitting during training and can be particularly off-putting for students from poorer backgrounds. 

It’s also likely to have a more immediate effect on staffing levels than increasing training places (and having to wait until they complete their education), because it can secure greater participation from those graduating this year. And if successful, it should significantly improve the financial and overall wellbeing of clinical staff and trainees.

So what’s the catch? Well, it would come with a cost to the exchequer. Based on current numbers joining the NHS, it would cost £230m for each year of nurses, midwives and allied health professionals.

But the Treasury is already losing a large chunk of the repayments it is owed because many people never earn enough to pay off their loans. And imminent changes to the repayments scheme more than offset this cost. 

In fact, if a loans forgiveness scheme was successful in getting 10% more staff to join the profession, the cost to the Treasury would exactly match the amount they are expecting to receive from nursing graduates after raising the repayment threshold this year. 

Writing off student debt in exchange for NHS service would not be a panacea. We know that workload, low morale and work-life balance are the big drivers of attrition in the NHS, and this proposal would need to be accompanied by other measures to drastically improve retention in NHS careers. But inaction is not an option. 

Amid party conference season, with politicians talking of eliminating waste in the NHS and addressing staff shortages, this bold proposal would achieve both. Let’s hope it is an idea whose time has come.

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