Russia set to introduce student loans to help boost quality

February 10, 2006

Russia is considering introducing a student loans system to help fund its higher education sector.

With student numbers approaching 6 million and with annual federal funding of £4 billion, which is only half the amount needed to support Russia's 600-plus state universities, legislation to bring in a system of state-guaranteed loans is likely.

These state-backed student loans, administered through private banks under Ministry of Education control, could be introduced as early as this autumn if parliamentary and presidential approval are given.

More than half of Russia's state university students - and those at the country's 400 private higher education institutions - pay for their tuition and living costs despite a constitution that guarantees tuition-free study to all first-time students.

Boris Sazonov, an adviser at the think-tank, the Federal Institute for Educational Development, said: "The tradition of free education is becoming more of a burning issue."

President Vladimir Putin has identified education as a national priority.

"We can keep free education for all, or understand that if the state wants to educate people the state must introduce a system that enables people to study and ensures the quality of provision," Mr Sazonov said.

The scheme for low-interest subsidised loans and post-graduation repayment terms of up to ten years or more forms part of a proposal for spreading state funds further by guaranteeing to part-fund students on a sliding scale, with the brightest students expected to pay a smaller proportion of tuition and living costs. A typical student with average grades would receive a grant of 70 per cent of tuition and living costs and be eligible for "state-guaranteed credit" for the remaining 30 per cent.

A more radical scheme, which Mr Sazonov hoped Education Minister Andrei Fursenko would introduce next year, would not be reliant on private banks.

Repayments would begin when graduates started earning above-average salaries.

Tuition fees are about £1,600 a year for most courses, but up to Pounds 12,000 to £25,000 for prestigious courses and institutions.

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