David Davis has reportedly called for the Tories to pull a U-turn on university tuition fees and cancel student debts.
The Brexit Secretary is said to have argued student debt is preventing students from contributing to the economy.
A source close to Mr Davis told The Sunday Times he said if the student loan book was an independent company it would have written off many of the loans as bad debt.
“With such a low repayment ratio, if the student loans book were an independent company its credit rating would be low and auditors would insist you write down the debt,” the source told the paper.
“Doing so will help the younger generation get mortgages and would give them more money to spend, which would raise tax revenues for the Treasury. The mythical debt depresses everything.
“He would urge the Treasury to start with the answer and look at the financial structures to see if there was a better way for students that doesn’t leave the debt to hang over their entire lives.”
It comes after Theresa May pledged to review the tuition fees system.
The Government has pledged to freeze fees at £9,250 a year and increase the salary graduates need to earn before they pay back their loans from £21,000 to £25,000.