Extend part-time loans, IPPR report to urge

Ministers should extend student loans to many more part-time students to remedy a “crisis” in recruitment, a thinktank commission is set to recommend

June 7, 2013

Led by Nigel Thrift, vice-chancellor of the University of Warwick, the Institute for Public Policy Research’s Commission on the Future of Higher Education will call for sweeping changes to stop the steady decline in part-time students since 2010 when it publishes its final report on 10 June.

Part-time students became eligible for student loans for the first time in autumn 2012, but part-time enrolments have now dropped by 40 per cent – 105,000 students – over the past two years.

The commission believes one of the main reasons for dramatic fall in part-time students is the restrictions on which part-time students can receive state support.

Two-thirds of eligible students are denied loans because they have already done a degree or intend to spread their studies over a longer timeframe than permitted, the report will say.

As a result, just 31,700 part-time undergraduates successfully applied for loans last year, despite the government claiming 175,000 part-time students would be eligible.

“Having pioneered globally renowned part-time education through the Open University, the UK now faces a crisis in part-time higher education study,” said Professor Thrift.

“At a time when employers are cutting back on funding, we need to extend access to loans to more part-time students to help them with the cost of their fees.”

The report - other apsects of which have already been publicised - will also argue that a government-funded loan system for postgraduates is also needed and would cost just £41 million a year.

It will argue that graduates could repay their postgraduate loans on income between £15,000 and £21,000, so the state can expect to get most of the loan value back, with a non-repayment rate of just 6.9 per cent.

“Without a fair funding system at the postgraduate level, we risk losing many of the gains made from widening participation at the undergraduate level,” said Professor Thrift.

“In order to ensure that students who can benefit from postgraduate studies have the opportunity to do so regardless of their financial means, we need to extend loans to cover postgraduate students.”

The commission will also recommend that the Higher Education Funding Council for England, the Quality Assurance Agency and the Office for Fair Access should be merged into a single higher education regulator to reduce bureaucracy.

Similar proposals were put forward in the 2010 Browne review of higher education funding, although they were widely criticised within the sector.

Meanwhile, to boost the economy, the report also says the government should transform its network of “Catapult” centres into university-based “Applied Research and Innovation Centres”, based in regions with business capability for expansion and prioritising areas of economic disadvantage.

Designed to bridge the gap between research findings and outputs, and commercialise research, the centres should be funded to the tune of £1 billion a year by diverting funding from R&D tax credits and the “patent box” tax break, which the commission say are poorly targeted on large companies. 

This would be an increase on the £50 million given annually to Catapults, which the commission says are badly funded, lack a strategic remit to support economic rebalancing, and only have limited engagement with small- and medium-sized enterprises.   


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