The cost of learning

November 22, 1996

PART-TIME work and borrowing have made students better off but the most vulnerable continue to face serious financial disincentives to higher education, according to a new survey.

While the average student income for those under 26 rose from Pounds 3,031 in 1988/89 to Pounds 4,575 in 1995/96, single parents owed ten times more than the average student.

The survey by the independent Policy Studies Institute is the third on student finances commissioned by the Government since 1988/89. PSI interviewed 1,971 students between March and May.

The shortfall: Overall student expenditure was Pounds 5,091 compared to an income of Pounds 4,907, a shortfall of Pounds 184. Loans, grants and parental contributions averaged Pounds 2,917 but this failed to cover even essential spending which averaged out at Pounds 3,058, leaving a shortfall of Pounds 141.

The report says: "Students now have more money at their disposal (in real terms) than in either 1988/89 or 1992/93, but much more of it is earned or borrowed against future earnings."

The cost of children: Lone parents and parents whose partners were unemployed were significantly less well-off. Children cost students an extra Pounds 1,976 in 1995/96. The maximum a parent could claim in child benefit and additional grant came to Pounds 1,185, leaving a shortfall of nearly Pounds 800.

Elaine Kempson, who wrote the report with Claire Callender, said: "Education is an important route out of benefit dependency for lone parents and yet these are the students who, more than any others, are experiencing severe financial hardship."

Expenditure: An overall expenditure breakdown shows students spent Pounds 1,180 on accommodation. They spent less (Pounds 506) on items essential to their courses than they did on alcohol and tobacco (Pounds 511). About a quarter of total expenditure went on entertainment, including cinema, theatre, sports, clubs and alcohol, and tobacco.

Income: Two-thirds of respondents worked during the academic year and a third said they worked continuously. Average employment earnings for students under 26 increased from Pounds 187 in 1988/89 to Pounds 621 in 1995/96.

More than half of all students (54 per cent) took out loans with the Student Loans Company, compared to 35 per cent in 1992/93. Just over two-thirds of men from social class D and E sought loans compared to 44 per cent of women from class A. Parental contributions have declined (see pie chart).

Miranda's experience

Miranda, a mature student at a London college, prefers to remain anonymous for fear of alienating those from whom she is seeking help. A divorced mother of three, she is struggling to complete a degree in sociology and social policy. She has an autistic son of 14.

Since starting her degree this autumn she first had to fight for a correct grant assessment, which originally excluded her single-parent allowance. She now receives Pounds 6,375 per annum.

As a lone parent she is entitled to income support and has just been told that she is entitled to 10p a week and Pounds 2.52 towards her mortgage a week. She will receive more money in vacations, but has to apply again in December.

Miranda has also had to take out a student loan of Pounds 2,035 (the London rate) as this is taken into account when evaluating income support - whether she has taken one out or not. No other loan counts towards income support. She would not be entitled to college access funds unless she had taken out the loan. She is yet to hear how much she may receive through the fund.

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