Education news

Means-tested tuition fees proposal would mean poorer students pay nothing

A means-tested system could cut average student debt by a third, the Sutton Trust says

STUDENTS from the richest homes should pay £12,250 a year in tuition fees, while going to university should cost the poorest nothing, it has been suggested.

A means-tested system could cut average student debt by a third, with those from the most disadvantaged families benefiting the most, according to a new study published the Sutton Trust.

The social mobility charity also called for grants designed to help less well-off students with living costs to be reintroduced, warning that it is an "absolute scandal" that the poorest are graduating with the highest levels of debt.

Students in the north pay £4,030 a year if they take degrees at home, or up to £9,250 if they attend institutions in England, Wales or Scotland. Students from Britain attending Queen's University Belfast or Ulster University must pay £9,250.

Before May's assembly election, former minister Stephen Farry published options for securing a sustainable higher education system. With Stormont finances expected become even tighter, it is feared a tuition rise may be the only available source of extra income. Annual costs ranging from £6,500 to £9,000 are being considered.

Last month, the British prime minister announced that in future, graduates will not have to start repaying these loans until they are earning at least £25,000 - up from the current £21,000 threshold.

The move came amid growing debate about university funding - an issue which has been in the spotlight since the general election when Labour made a high-profile promise to scrap tuition fees. The pledge was credited with winning the party support among young voters.

An analysis conducted by London Economics for the Sutton Trust concludes that raising the repayment threshold will mean that 45 per cent of student debt will never be paid back, while around four fifths of graduates will not repay their loans in full. The debt is written off after 30 years.

The Trust has called for a means-tested system, with those from a household with an income of under £25,000 paying no tuition fees, those from homes with an income of over £100,000 paying £12,250 and a sliding scale for those in between.

Currently, students graduate with an average debt of £46,000, the report said.

The 40 per cent poorest students have average debts of £51,600, mainly due to needing larger maintenance loans, while those from the 20 per cent richest households have average debts of around £38,400.

A means-tested fees system, and bringing back maintenance grants, would cut overall average student debt in half to £23,300, and reduce it by 75 per cent for the poorest students to an average of £12,700.

Sir Peter Lampl, Sutton Trust chairman, said: "It's an absolute scandal that the poorest students graduate with the highest debt. A typical graduate will leave university with whopping debts of £46,000 while young people from households in the lowest 40 per cent of earners will graduate with debts of nearly £52,000. These debt levels are almost double those of American university graduates.

"We are proposing that fees should be means-tested and maintenance grants reintroduced so that those from low income families incur the lowest debts. Our proposals are an affordable and fair alternative to the current system where fees are not means-tested and there are no maintenance grants."

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Education news