Independent panel calls for enhanced student support funding

15 Jun 15

Funding to help students with their living costs needs to be increased and better targeted, an independent report has suggested.

The Student Funding Panel, an independent panel set up by Universities UK, assessed major issues and options for reforming the current £9,000 fee system in the future.

Its report said university funding in England was “broadly fit for purpose”, “did not require wholesale reform” and “needed to be given time to work”. But it recommended that maintenance support for students should be enhanced.

As part of its evidence gathering, the panel collected submissions from a range of organisation and individuals – including responses from over 3,000 students and selected “witnesses”.

Findings from the survey showed that 58% of students were worried about living costs, more than the 42% who were worried about fee levels.

“Evidence collected by the panel from students suggests that they are more concerned about the level of maintenance support they receive while studying than they are about the long-term debt arising from the increase in student loans,” the report said.

It added that funding for maintenance support needs to be improved “in terms of quantity and targeting”.

The panel also suggested that it was important to look at the options for bringing down the costs in the student loan system.

It said that if concerns about the long-run costs to government of the loan subsidy increases in the short term, then the student loan repayment threshold of £21,000 in the current system could be frozen to achieve the best balance of outcomes for students, graduates, government and universities. This could mean more students would pay back loans as salaries rise in line with inflation.

The report also looked at a number of longer-term options for reforming the student funding system including tying university funding more closely to the earnings of their graduates or privatising the provision of loan funding.

But the report noted that none of the “longer-term options analysed was thought to be sufficiently well-developed to be capable of being implemented at present (if at all)”.

UUK chief executive Nicola Dandridge said it was encouraging that there is no evidence to suggest that the student funding reforms had deterred students from applying to university, but the report was clear “that a number of improvements to the system are required”.

“An important challenge to be addressed is enhancing financial support for students’ living costs,” she said.

“Universities UK believes that the student funding system must be sustainable and support affordable, high-quality higher education. Any evolution of the current system in England must ensure value for money for students, prevent students from under-represented groups from being deterred from study, and be financially sustainable for both universities and the government.”

  • Judith Ugwumadu

    Judith Ugwumadu joined Public Finance International and Public Finance online as a reporter after stints at Financial Adviser, Global Security Finance and The Sunday Express. Currently, she writes about public finance, public services and economics.

    Follow her on @JudithUgwumadu_

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