Fees millions will go towards bigger student loans

July 31, 1998

About Pounds 130 million, equivalent to more than half the fees to be paid by students towards their education next year, will have to go to pay forbigger student loans, the government confirmed this week, writes Alan Thomson.

Education secretary David Blunkett writing exclusively in today's THES (page 10) confirms that universities will keep the equivalent of the total amount of tuition feescollected from students in 1999-2000, some Pounds 235 million.

But, he says that, there will be no saving made by abolishing maintenance grants in 1999-2000. The new income-contingentloans, which are being introduced, are more expensive and, Mr Blunkett says, accountfor more than the amount saved by removing grants.

Until resource-based accounting is introduced the full cost of these loans falls on the Department for Education and Employment budget.

Senior officials at the DfEE said this week that tuition fee income is being used to offset the cost of the higher income-contingent loans being introduced in 1999-2000.

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