Why don’t more Scots find no-fee higher education good value for money?

The recent Higher Education Policy Institute and the Higher Education Academy 2014 Student Academic Experience Survey, published on 21 May, reported that 70% of full-time undergraduate students in Scotland felt their degree course provided good or very good “value for money”, compared to just 41% in England.  Within that, the equivalent figure was 52% under the old, lower fee system and for those in the sample subject to new £9,000 fee cap, just 36%.  The report of the survey described the difference between Scotland and England as “not unexpected given that Scottish and other EU-domiciled students from outside the UK, who constitute the vast majority of students at Scottish institutions, effectively pay no fees.”

The existence of a gap is no surprise.  However, given the difference between a charge of  £9,000 a year and zero, the size of that gap –   36% vs 70% – is surely less than might have been expected.   It is true that only 8% described their course as actually being poor value, compared to 33% in England. Still, a further 22% felt their course was “neither poor nor good” value.

Of course, some students in Scotland do pay fees. The HEPI/HEA report notes that “eighty-three per cent of respondents at Scottish institutions were either from Scotland or other EU countries and effectively pay no fees”.  While that means 17% of the sample were fee payers, it is  very unlikely that none of these felt their course was good value for money. This year, some fee-payers in Scotland are still paying less than £2,000 a year under the old rules. It seems far more plausible that in Scotland, as elsewhere, at least four out of ten fee-payers are in the “good value” group.  That suggests of the 30% “not good value group” it is pretty likely that only around 10% were fee payers – and therefore that the remaining 20% were not.

Even if that’s only roughly right, it suggests that a large minority of the 83% getting their higher education at no charge did not feel they were getting good value for money. That’s worth further explanation.

We need to be careful here not to read this as an indictment of the quality of Scotland’s fee-free higher education. The survey asked separately about the quality of courses. In Scotland, 88% of students were satisfied with the quality of their course, just above the UK average of 86%. What that 30% figure really does is remind us that even for Scots in Scotland higher education is not free, especially for those who have little or no access to help from their families, in cash or kind.

Indeed, a picture is steadily emerging across this and other data of a poorer minority of Scottish students who are having a very different financial experience from the rest.

As detailed elsewhere, Scottish Government statistics published last year have already shown how in Scotland in 2012-13 the poorest students accounted for a disproportionate share of student borrowing from the Student Loans Company. This was before substantial reductions to student grants which took effect last autumn and will have increased average borrowing further for poorer students. This probably helps explain why elsewhere in the HEPI/HEA survey 10% of Scottish students reported that improving financial support for “hard-up” students was the thing they most wanted universities to spend more on and 29% put that in their top three priorities.

At the other extreme, one-third of Scottish students managed to avoid taking out any loan in the last academic year, a much higher proportion than elsewhere in the UK. As it happens, a similar proportion (34%) of the HEPI/HEA sample in Scotland regarded their course as “very good” value for money, around four times more than in any other part of the UK. That suggests that there may be a strong and rational correlation between leaving university largely debt free and regarding the experience as very good value.

The latest data from HEPI/HEA therefore simply adds to the evidence that among Scots in Scotland the experience of student funding is stratified.

• One group is emerging with little or no debt and appears to regards itself, understandably, as getting very good value for money. Data analysis shows that this group comes largely from better-off backgrounds and is likely to be driving the difference in value for money assessments between Scotland and the rest of the UK.
• Another group is incurring debt close to or below the Scottish average. This is still a relatively low amount in UK terms and they are likely to account for many of the 36% who find the Scottish system good, if not very good, value for money. They come predominantly from middle to high income backgrounds.
• The last group, mainly from low to middle incomes, is incurring the largest debts. Among these is a group of students drawn overwhelmingly from the poorest backgrounds who, with grants now much reduced in Scotland, are often facing no real alternative to a debt of over £20,000 for a degree (for mature students taking their full package of support, the figure is now over £26,000, as their grant is especially low at £750 a year). The existence of this last group offers the most compelling explanation of why Scotland’s system of “free higher education” appears not to be regarded as good value for money by a significant minority of those it serves.

Meantime, figures for 2012-13 recently provided by the Student Loans Company show that while actual annual student borrowing (for fees and living costs together) was higher on average elsewhere in the UK, particularly in England as the new fee regime was phased in, it was also much less differentiated by income (see here).

In Scotland alone therefore there are now in effect two systems for those who study in-country. There is the free (or at least relatively cheap) one we hear about most often, experienced largely by those students whose families can help them with their living costs. Then there is the other, more expensive one which is barely acknowledged and experienced overwhelmingly by the minority of students who are most reliant on help from the state. The perspective of that second group may be largely absent from the general debate, but the initially surprising outcome for Scotland of the recent HEPI/HEA exercise serves as a further reminder that they exist.