Loans for part-time students

April 10, 1998

LOANS may be extended to poorer part-time and further education students if the Treasury agrees to change accounting rules.

Higher education minister Baroness Blackstone said it would be "enormously costly" to extend loans to all part-time students regardless of income.

But, she said, if student support comes off the public sector borrowing requirement, in the long term those in financial straits may be allowed to borrow maintenance money.

Her comments will add to pressure on chancellor of the exchequer Gordon Brown to agree to the change.

Addressing a conference on student choices last week, Baroness Blackstone said: "If we move towards loans accounting and loans are treated as assets rather than counting against the borrowing requirement, we will perhaps be able to look at the issue of whether some kind of loan arrangements may be made available to those part-time students, who, on the basis of their financial position, may need help."

Margaret Hodge, chair of the education select committee, expressed similar sentiments in this month's edition of The Lecturer, the magazine of further education lecturers' union Natfhe.

She said beating student poverty in further education may depend on persuading the Treasury to run a loan system separately from the PSBR.

But Local Government Association education chairman Graham Lane, whose Further Education Student Support Advisory Group reported to Baroness Blackstone this week, said loans would only help further education and part-time students studying at higher levels.

"We felt loans would be of no interest to the run-of-the-mill further education student whose chances of employment were uncertain," he said. "The idea that loans could substitute for some kind of grant support, particularly for poorer students, is wishful thinking. The fear of debt would be too strong."

Instead, his group has suggested a Pounds 400 million package of support for these students, including waiving examination fees, subsidies for transport and equipment and grants for the poorest.

John Brennan, policy director at the Association of Colleges, said changing the accounting rules would not necessarily release more public money for loans since the government would be wary of worrying the City.

But he supported any move to give more support to part-time students in further education. "If we are going to encourage people to improve their qualifications we have to give them some incentive," he said.

Stephen McNair, director of research at NIACE, the national organisation for adult learning, said: "We have argued for parity for part-timers in student support and say it would not be significantly more expensive. This idea would be a step in the right direction."

A spokesman for the Committee of Vice-Chancellors and Principals said: "We are in favour of extending loans to part-time students if the money is available. Reforming PSBR is something we have been pushing for in the last few years."

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