Young Students Bursary since 2001-02

YSB dates from 2001-02 and is available to most Scottish-domiciled full-time students in HE who are under 25, subject to means-testing.

Value to students

YSB from 2001 shows the maximum amount which has been available over the period.  The table gives the value both in cash and at current ie 2013-14 prices.

YSB increased close to, or even sometimes faster than, inflation in its first  9 years.  Its real terms value peaked in 2005-06.  Increases were very slightly below inflation for the next  4 years, but YSB still remained worth 99% of its 2005-06 value.

From 2010-11, grant levels were frozen. The table shows the effect on the value, again at 2013-14 prices, of the freeze.  For those on the maximum rate, the freeze had a cumulative effect of reducing the real terms value of the grant by £184 a year by 2012-13.

YSB rates were significantly reduced in 2013-14.

Reaction to the initial freeze

The initial decision to implement a freeze was taken rapidly over the course of October 2009. The process underlying decisions for the 2010-11 academic year was explained by the then Cabinet Secretary for Education, Fiona Hyslop, in this statement to the Parliament on 28 October 2009.

A Scottish Government news release from early October 2009 had said:  “The Scottish Government also plans to increase grants for the poorest students receiving the Young Students’ Bursary … Ms Hyslop is to meet opposition parties and student representatives during the next two weeks to agree the final level of increase in the grants for young students.”  In response to that consultation, and an argument that hardship was a more important issue than debt, expressed by the NUS and supported by Opposition parties, the government converted grant to a larger amount of student loan.   The final package included an additional £180 a year in loan for the poorest students, not previously envisaged.

At Committee, also  on 28 October 2009, in response to questioning on the detail of the SAAS budget, Ms Hyslop said: “We should make you aware that we, like the UK Government, have put a freeze on some of what would normally be an uprating of the grants and bursaries that are provided”.  Although the freeze was not referred to in those terms again, in a later statement to the Chamber, the Cabinet Secretary did mention: “a further increase in student loans, rather than through student grants  … Although the strict terms of the motion that the Parliament passed on 21 May might not have been met, particularly the Opposition’s original wish to increase the young students bursary, the main element of it—addressing student hardship—has, I believe, been realised.”  The decision seems to have been clearly understood by all the political parties.

This final package was reported in The Scotsman, with a separate new grant for independent students reported, but no mention of the plans for YSB, in line with this Scottish Government new release announcing  the final package for 2010-11, which was also silent on the bursary decision. 

And then…?

The further 2 years of  YSB cash freeze, with loans used to deal with inflation-proofing, appear to have been uncontroversial.  I have not been able to find any reporting of the decisions for either 2011-12 or 2012-13.

I  have though not yet been able to find any formal press notice or parliamentary announcement of the decision to freeze YSB levels in later years.  It is difficult to tell, therefore, how  widely known it was that its value was declining in real terms.

The position argued for 2010-11 made sense: around £73 less grant in exchange for an additional £180 spending power met the NUS priority on hardship, with a limited impact on debt.  At the same time, a new bursary for independent students had been introduced, going  a fair way to deal with the exclusion of this group from the main scheme of maintenance grants.

The more difficult questions are:

• how far the debt impact on  the poorest students could still be regarded as de minimis about after a further 2 years of freezes; and

• how far this period of uncontroversial grant freezes paved the way for the much larger reductions applied in 2013-14, with its unarguably significant impact on the indebtness of the students from the lowest income homes.  As YSB from 2001 shows, with the freeze now announced for next year,  by 2014-15 students from the poorest homes will be incurring £1168 more a year in debt, compared to 2009-10, due solely to lost grant and before further borrowing required to attain their full entitlement to Scottish Government support.  A few low-income young students caught by tightening of grant thresholds will be £1900 a year worse off by next  year. The continued freeze arguably allowed means-tested grants for poorer students in HE  to become seen as a relatively low priority for the use of government cash and an easy place to make savings.

Since 2012-13  the Scottish Government has been receiving large amounts of funding for student loans through the Barnett formula: see here.  This is a consequence of the extra loan required to underpin the new fee regime south of the border.  The money cannot be used on much else but student loan.   With the cash budget under significant pressure, it has made sense from the perspective of the Scottish Government to find uncontroversial ways to replace grant with loan.  Young Student Bursary ended up in the path of this financial double-hit.