Hardship cash funds 'sprees'

Students admit to using aid for the poorest to finance social lives. Victoria Gittins reports

Middle-class students are exploiting university hardship funds to subsidise their social lives, shopping sprees and holidays, The Times Higher has been told.

Candid admissions from former students point to widespread misuse of the Pounds 97 million hardship system, which is paid for by the taxpayer and designed primarily to support students from poor backgrounds, single parents and the disabled.

One of its other roles is to bail out students if they run out of cash.

In most cases, students apply to hardship funds for a non-repayable grant of between £100 and £3,500 and a top-up to their student loan, which must be repaid as part of that loan after graduation. Grants are given only if loans are approved.

Students admit to knowing that they are exploiting the funds, which are administered by universities, but many say that they feel little guilt because funds are so easy to obtain.

One former student at Lincoln University applied for and received financial assistance in the form of a £500 loan top-up and a £500 grant.

She said: "My friends told me it was really easy to get money from the hardship fund. They knew someone who had applied and got £1,000.

"I wouldn't exactly say I was poor, although I paid my accommodation myself, my parents paid my credit cards off for me, so there was no need for them to give me £500.

"I needed it because I didn't have any money, but that's because I spent it all on alcohol, clothes and handbags. The bank statements I gave them had items like £200 bills from clothes shops. Most of my friends applied for it."

Students at Lincoln were required to fill in an application form and provide evidence of their financial situation such as bank statements, local education authority notification forms and letters from the Student Loans Company.

But the student said that it was easy to prove poverty. She said that some students had more than one bank account and that they provided statements from the one with the least money in it.

Another former Lincoln student considered applying for hardship funding at the end of her third year but got cold feet even though she was in debt.

She said: "A lot of people on my course were doing it. My friend, who had received the grant, gave me all the documents I needed and suggested that I claimed to be living in a student house and give a friend's address.

"But I didn't go through with it. I would have felt guilty even though I was really in debt."

Ann Harris, student revenue manager at Lincoln, said that students applying for a loan did not have to talk to staff about their reasons for needing financial help.

She said: "We do checks on the information that students give us. And I like to think that we have a fair sense of judgement."

Ms Harris said that applications were frequently declined but she admitted that money was not reaching some of the students who really needed it.

She said: "We have recently done a survey of our students and found that some of the students who could be really benefiting from the fund were not aware of it."

A former Nottingham University student told The Times Higher that he received a £500 loan top-up and a £500 hardship grant despite generous financial support from his parents.

He said: "My parents gave me quite a lot of money. They paid all my fees, my rent and gave me £500 a term throughout the whole time at university. I didn't have a budget, I'd just spend and spend and spend until it was all gone.

"I just ticked the grant box and a week later I got a cheque from the hardship fund."

As things turned out, he saved the hardship grant in a separate savings account and used it as spending money for the summer holidays.

Other university officials administering funds said they did not have the time or resources to investigate all applications. They also stressed the need for a swift turnaround in giving out money to needy students.

One student support officer at a London institution said: "The turnaround process was particularly quick to give swift financial help to students in difficulty. Because the process is so quick, there isn't time to talk to every student. A lot depends on resources available in the department as to whether one can look into fraudulent claims."

A spokesman for the Department for Education and Skills said: "Abuse of the system is unacceptable. We look to higher education institutions to ensure that hardship funds are targeted at those with greatest need."

From September, hardship loans and grants will be replaced by the Access to Learning Fund. It will offer one non-repayable fund that consolidates the top-up loans and grants.