MPs call for rehash of student support to woo poor

July 12, 2002

Education maintenance allowances for further and higher education students should be introduced along with variable interest rates on loans, MPs said this week.

The Commons' education and skills select committee' report on post-16 student support also called for an increase in the maximum amount that students can borrow, to reflect the true costs of studying. The earnings threshold at which students start repaying their loans, currently £10,000, should be raised, the report says.

It states that it is essential that a support system be introduced that "will encourage poor or otherwise disadvantaged students to continue their studies".

It recommends that the government thoroughly explore "the costs and implications of a seamless support system, based on the education maintenance allowance model, spanning further education and higher education. Such support should continue as far as the conclusion of the first year of a higher education course.

"The current zero real interest rate for student loans subsidises those from affluent backgrounds while providing insufficient funds to those from poor or otherwise disadvantaged circumstances.

"It is our view that there is considerable scope for development of models of student support which are based on adjustable interest rates. Such models would enable fine tuning according to prevailing economic conditions or policy."

Earlier in the week, Wendy Piatt, senior research fellow at the Institute for Public Policy Research, told a conference of education staff that tuition fees should rise for those who can afford to pay. She said that differential fees could generate income for the sector and that loan interest rates should reflect the government's cost of borrowing.

Dr Piatt said: "There is a strong case for a redistribution from higher to further education and from the more comfortable to the less well-off students."

Peter Scott, vice-chancellor of Kingston University, told the same conference: "Middle England will pay for higher education, whatever it costs. The people we put off (through student debt) are the very people we are trying to attract.

"Unless we change, if this 50 per cent target it to be achieved, it is going to be by taking duller and duller members of the middle classes."

Mandy Telford, president of the National Union of Students, called on the government to bring in targeted grants but not to charge students more than they already pay for their education.

She said: "We must not create a two-tier system where only affluent people can access any course at any university."

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