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New lending to Scottish students exceeds £0.5bn for first time

June 18, 2015

Today’s SLC statistics on student debt not only provide figures for those leaving the system (see here), they also cover existing students.

The figures show that total new lending to students in 2014-15 was £516.2m, breaching the £0.5bn mark for the first time.  Fee loans account for some of this, but the bulk of the growth is in living cost loans.

Here are the figures for the last three years, taken from Table 1 in this document.

2012-13 2013-14 2014-15
Maintenance loans 248.8 409.2 485.2
Fee loans 28 27 30.9
Total lending 276.8 436.2 516.1
+58% +18%

The increase will be due mainly to the new system brought in in autumn 2013 still feeding through: its introduction spanned the financial years 2013-14 and 2014-15.  This should account for most of the increase seen here.  In 2014-15, there was also a small increase in loan entitlements (worth £250 per student) which will have increased borrowing a little.  There does not look to have been any significant increase in the proportion of students taking out a loan. The statistics due in October will confirm what is driving the increase.

The budget figure for 2014-15 (£468m) was for net new lending, that is total lending after taking account of any repayments.  So these figures are interesting because they are first information we have on gross/total new lending under the new arrangements in Scotland.

In terms of annual lending, England still made something over double the use of loans pro rata its size (its total lending was around £10 billion) and also saw an 18% increase. The other two devolved nations lent less in absolute terms than Scotland: Wales £359m, Northern Ireland £298m (both saw a 9% increase). This is still more in relation to size, but their gap with Scotland is lower, at more like one and half times as much.

As always these comparisons bring out that Scotland is generally still a lower debt system, but not fundamentally different from the rest of the UK in relying increasingly heavily on the use of student loans.




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