The Institute for Fiscal Studies says that the poorest of students are leaving universities with £57,000 debt.
According to data from the Institute for Fiscal Studies (IFS), students with the bottom third lowest income leave universities with a £57,000 debt. It found that tuition fee changes ended up charging students £9,000 per year, with the third of students with the lowest incomes “better off by an average of £1,500.”
It found that reforms including maintenance grants “in favour of loans” has left students from lower income households are graduating with up to £57,000 in debt- the highest debt levels in the country.
Graduates are also hit with extremely high levels of interest. The repayment threshold for student loans was set to £21,000 till 2021. Repayments from lower-income students have jumped up by almost 30 percent since 2012.
Laura vander Erve, the report author, said: “Universities are undoubtedly better off under the current system than they were before the 2012 reforms.”
She also explained that because low-cost “arts & humanities” majors receive the most funding increases, interest subjects were much larger than for students in engineering and science subjects- at 47 percent in comparison to just 6 percent, respectively.
“This does not sit comfortably with the government’s intention to promote typically high-cost STEM subjects,” van der Erve added.
Comments On the Finding
Sally Hunt, the general secretary at the “University and College Union” agreed that the government should do something about this. She noted that “politicians of all stripes” are noticing this issue.
“Successive governments’ efforts to transfer the bill for higher education teaching onto graduates have created unsustainable levels of debt, with students from low and middle income backgrounds being hit the hardest by the repayment burden,” she said.
However, Jo Johnson, the universities minister, defended the existing education system.
“The government consciously subsidies the studies of those who for a variety of reasons, including family responsibilities, may not repay their loans in full,” he said.
“This is a vital and deliberate investment in the skills base of this country, not a symptom of a broken student finance system.
“And the evidence bears this out: young people from poorer backgrounds are now going to university at a record rate—up 43% since 2009.”
Johnson continued: “We should of course not be complacent. That’s why we have set up a new regulator, the Office for Students, and introduced the Teaching Excellence Framework to help ensure students get value for money from their fees.”