Student loan finance should be added to the maths curriculum at secondary schools, according to the head of the university admissions service.

Backlash over student loans has simmered in recent months - particularly regarding plan two student loans, which have left some graduates with snowballing debts despite years of making repayments.

Interest on plan two loans, taken out between 1 September 2012 and 31 July 2023 in England, is charged at the rate of Retail Prices Index (RPI) inflation, plus up to 3 per cent extra depending on income.

Repayments start when graduates earn a salary of £29,385 and the interest rate means that many people see the balance of their loan rise significantly, despite making regular repayments.

As such, the Labour government has faced calls to reverse the freeze on the threshold at which repayments start.

Dr Jo Saxton, chief executive of the Universities and Colleges Admissions Service (Ucas), said pupils should be taught how the loans work before they arrive at university, telling The Times that many young people understand the concept but they struggle to calculate repayments.

She said: “As somebody who used to work with schools and has done a lot on qualifications, it made me think this should be in the national curriculum.

“It should actually be in GCSE maths as a real example. Because the concepts of percentage and compound interest and all of those things are taught.

“But giving the applied example - given that we’re in a position where just under half of young people are proceeding to university - I think it should be in there.”

Dr Saxton also said that 90 per cent of incoming university students intended to work alongside their studies, which has risen sharply in recent years.

This has a big impact on whether students live at home or move away for university, with some not wanting to give up their part-time jobs.

“They don’t want to go too far. Often students start a part-time job in sixth form and they know that it’s difficult to get jobs,” she said.

“Once they’ve got them, they’re reluctant to give them up so they will study somewhere where they can come back at weekends or it might be part of what’s contributing to the growth in the live at home students.”

Last month, education secretary Lucy Powell said the “egregious” student loans system “needs looking at” amid concerns over costs for graduates.

She told BBC Radio 5 Live: “The Government has committed to a review of that.

“It is… very much at the top of my in-tray as the secretary of state.

“And, you know, I want to make sure that we look at this so that it’s fair for students. And it’s a real cost-of-living issue for young people because there’s about a 10-year sort of timeframe for people on this plan two as well.

“So, they’re paying high repayments and never, ever paying off the capital of their student loan.”

Asked whether it was something she would deal with, Ms Powell said: “I can’t make any promises, but, you know, it needs looking at.”

At the last budget, then-chancellor Rachel Reeves caused a furore when she froze the repayment threshold at £29,385 for three years from 2027, leaving graduates worse off than if it had risen with inflation.

Above that level, graduates pay back nine per cent of everything they earn.

When they were first created in 2010, the plan two loan threshold was meant to be uprated with inflation each year, but it has been frozen on several occasions since 2016.