Student and graduates protest at parliament over interest rate hike on student loans

Hundreds of students, graduates and sympathizers demonstrated in The Hague on Wednesday to protest against the increase in the interest rate on student loans. They protested opposite the temporary building of the Tweede Kamer, the lower house of the Dutch parliament in The Hague.

Protestors were carrying signs with messages such as "No interest for students," "Mom is angry," and "Interest at 0%." Chants include "Not my fault" and "Unlucky generation, we demand compensation."

The Education Executive Agency (DUO) announced two weeks ago that the interest rate on student loans would be five times higher next year, increasing from 0.46 percent to 2.56 percent on 1 January 2024. This increase is the highest level in 14 years. The interest rate on student loans is linked to the interest that the government itself pays on loans with a five-year term. The interest on student loans stood at 0 percent for six years. However, with rising capital market interest rates, borrowing has suddenly become much more expensive than anticipated.

According to the national student union LSVb and FNV Young & United, the interest rate increase is most unfair for the generation that did not receive a basic scholarship. "On the government's advice, they accumulated high student debts. For some of them, they now face an interest of several hundred euros per month, posing a significant financial burden," explained the organizations orchestrating the protest.

The loan-based financing system for students was introduced in 2015 and was abolished by the government this academic year in favor of reinstating the basic grant. Students who pursued their studies studies during this eight-year period under this system are referred to as "the unlucky generation." Over 330,000 people had a student debt of over 30,000 euros at the start of this year, Statistics Netherlands (CBS) calculated.

Several political parties have already proposed reducing the interest for the "unlucky generation." D66 and SP presented a proposal on Tuesday to set the interest rate at 0 percent, while GroenLinks/PvdA is considering a freeze. PvdD wants to abolish the interest, and NSC from Pieter Omtzigt aims to keep the interest rate very low for ten years.

SP leader Lilian Marijnissen said during the protest that the Tweede Kamer should settle this before the election recess, which begins on Friday. "It's not bad luck, it was just a damn political mistake," she said.