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EU students: should there be any Scottish interest in the current UK consultation?

September 4, 2014

BIS, the department responsible for higher education in Whitehall, issued a consultation earlier this week which proposes requiring EU students to be resident in the UK for 5 rather than 3 years, in order to be entitled to loans and grants towards living costs if they are studying in England.  Fee loans have no previous residence requirement and no change to that is proposed.

It is not clear how far the issues raised in the paper might be similarly relevant to Scotland or how far there could be any cross-border effects of any change.  However, given the large increase in government-supported EU students in Scotland in recent years, what’s happening here is at least worth watching.

Here are a few extracts from the paper:

The number of EU nationals claiming living cost support has increased dramatically and this is posing an undue burden on the student support budget. In 2009/10 AY there were around 11,600 EU nationals who received living cost support at a cost of £75m. This had risen to around 22,800 awards in 2012/13 AY amounting to £162m.Of this £162m, maintenance loans are by far the biggest component at £101m.

In addition, a further £61m was awarded in maintenance grants and other targeted support grants which are not repaid and represent 37% of the funding awarded to these students. The average maintenance loan (at £4,500) and the average maintenance grant (at £2,280) are higher than those paid to UK nationals. This will in part reflect the fact that around 68% of EU nationals accessing student support are mature students, that is they are aged 21+ years. They are therefore much more likely to be assessed as independent, and therefore will not have parental household income taken into account in any means testing….

Understandably different student support arrangements operate across the EU which reflect individual countries higher education systems; with only around half of all EU countries offering any form of maintenance support. The eight countries which do specify a residency requirement for living cost support are those which are net importers of EU nationals for higher education study. Of those eight countries Austria, Belgium, Denmark, Finland, Germany, the Netherlands and Sweden require five years residency in the home country before students become eligible for living cost support. The EEA countries also have a residency requirement for living cost support: Iceland (5 years), Liechtenstein (3 years) and Norway (5 years).
At present England is more generous when compared with these other EU countries; and a change to a five year residency requirement would bring us in line with these countries. The majority of those countries have residency requirements for EU students that are longer than those that apply to their home nationals.
By far the majority of EU/European Economic Area (EEA) countries do not offer any maintenance support to HE students. Of the 31 EU/EEA countries, 12 do not offer any living cost support and a further 3 countries only offer living cost support where there are shared bilateral agreements in place. In addition the amount of maintenance support is frequently a relatively small amount. The table in Annex C provides more information.

Questions for Scotland

The Scottish Government has not issued a parallel paper.  However, as this post notes, EU students make up a  larger proportion of government-supported students in Scotland than they do in the rest of the UK.  Scotland also applies a three year residency rule.

The main questions begged by the BIS consultation for Scotland are:

  • what is the total spend on living cost support for grant and for loan for EU students in Scotland?
  • is this sustainable?
  • might the proposed change in England increase the number of EU students coming here?

In 2012-13, SAAS reported that it supported 13,385 EU students.  [Note: the original version of this post assumed that the £24million recorded by SAAS as spent on EU students was equivalent to the £161 million noted in the BIS paper as spent living costs: however,  on further examination, the £24 million must be simply for fees. Any spending on EU nationals meeting the residency test for living costs appears to be subsumed into the category of “Scottish domiciled” students, in which case the amount spent is unknown. It is also not immediately clear whether the 13,385 includes only those EU students who do not meet the residency test, or includes those who do. The former would be more logical, but that would suggest an even higher number of EU students, which at first sight seems unlikely, given that BIS  states that in England there were just 33,900 students who took out the fee loans available to EU nationals without need of any residency test, plus 22,800 who claimed some form of maintenance support.]

Although grants in Scotland have fallen since 2012-13, the potential amounts students can borrow have risen substantially. So the total figure claimed by EU students seems likely to be rising, but the mixture changing.  The cash budget for student support in Scotland is under heavy pressure, but loans budget ought to be less so, as it is not having to sustain a £9,000 fee regime.  It is therefore possible that the particular way that living cost support for EU students falls out means that there is not the same pressure to change the rules in Scotland and the costs are more sustainable.

Residency at present means residency within the UK.  So if the Scottish rules do not change, EU students who have been resident in other parts of the UK for more than three, but fewer than five years, will have an incentive to relocate to Scotland by the 1 August (for autumn starts) prior to the start of their course, provided that they can show that this is not simply for educational purposes.  How far the numbers concerned, or the financial difference, would be big enough to have a noticeable effect is another issue.

There are already  various exemptions to the residency rules, for the families of migrant workers for example: more on the detailed rules as they operate in Scotland is available here.  This will reduce the number affected by any rules changes.  Nonetheless, by definition, increasing the qualifying period will mean some students losing support.

It will be worth watching how this consultation proceeds, although the potential cross-border effects and read-across to Scotland are both hard to make out for now.

The rules for domestic students

The BIS paper also asks, discreetly at the end:

Do you think that this extension to a five year residency requirement should also be applied to UK nationals for the purposes of applying for living cost support?

What happens with this is even more worth watching.

The BIS consultation closes on 10 November.




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