One month on: student support responses to the COVID crisis around the UK (and a footnote on institutional funding)

This piece, written in late March, considered how governments across the UK might respond to the sudden loss of earned income many students would be facing. It argued that for some students additional earnings are an essential part of making ends meet and that one quick response would be to increase maintenace loan entitlements, particularly for those not already entitled to the highest levels of support, with decisions about how to treat those loans long-term left for later. I said, “I’d be surprised if people in government and higher education across the UK are not already looking at action in this area”.

A month on, what action has there been?

Reducing students’ costs

This is an equation with two sides.  Students not being asked to pay rent for accommodation they are not using is the main obvious reason the crisis might cause their costs to come down.

Action here appears to have been patchy. Rent waivers for university-owned accommodation look pretty widespread, although sometimes on condition of leaving almost immediately, which not all students affected may have found easy to manage.  Some of the large commerical providers, such as Unite, also made early decisions to release students from contracts. Not all mass private providers have, however, nor all individual private landlords (see this story from Northern Ireland, for example). There has been one survey (I’m not quickly finding the link but will add it if I can later) which appeared to confirm that students were far from guaranteed rent reductions.

Students living at home already were not in a position to benefit from rent waivers, and some may be in households where the collective income has suffered more generally and the pressure to contribute will feel greater than before.  These students are likely to be saving more than others on transport costs, especially where refunds on season tickets are available (as in the Greater Glasgow area), but as in the case of Glasgow, these refunds may take a while to arrive.

Part-time students will have been particularly vulnerable to sudden income loss, although they are also more likely to be in more permanent forms of employment covered by some sort of emergency income protection.

Income

On the income side, responses have varied across the four nations.

In England, the Student Loans Company site has posted this Q&A. The message is reassurance of business as usual, with some compassionate concessions on administrative points. If the household income on which support was originally calculated has suddenly dropped this year,  the 2019-20 entitlement can be recalculated, as current rules allow, but not immediately, also following current rules.  The only clear change in immediate practice or policy appears to be that students overpaid in previous periods will not be pursued for now for repayments.

Welsh students are offered a very similar set of  Q&A, as are those from Northern Ireland.

The Scottish Government appears to be the only one so far which has released any additional cash: what is described here as a “£5 million package of emergency financial support”. The detailed notes describe this as made up of  £2m for further education and £2.2m for higher education, in addition to a previous £0.569m for HE (implying a total  amount £4.769m).  The £5m (the figure widely used by others: on the SAAS website, in the NUS press release welcoming the announcement here and in press reporting) therefore looks at first sight to involve some rounding up, by £0.231m (4.8%), unless there is a further reserve whose placing is still undecided. The HE component is to be disbursed by HE institutions as part of their hardship funds.

The SG announcement is a positive move (though it would be better for trust in government if it had been subject to less gung-ho rounding) and intelligently takes advantage of hardship funds as a rapid route for dispensing cash. But it will not stretch far. There are around 120,00 students in full-time undergraduate HE supported by the Scottish Government (£4.79m/120,000=£23), plus many more part-time and post-graduate ones, and ones from outside Scotland but who have had to stay here, all of whom could in theory have a call on hardship funds.

According to The Guardian today NUS president Zamzam Ibrahim has “called on the government to set up a £60m student hardship fund to help support those who are struggling financially.”  This would suggest extra support in England on a similar level to what has been offered in Scotland.

It is not clear if there is any appetite across the UK for a larger scheme, and what support there would be for one based on releasing additional loan, or what sort of take up such a scheme might have. Outwardly at least the authorities appear to be relying for now on the loss of earned income for students not giving rise to immediate critical hardship on a scale that requires major action.  That feels optimistic.  The Guardian also reports that “An NUS survey of 10,000 higher and further education students across the UK … found that up to 85% of working students say they will need additional financial support because they have lost their jobs as a result of the pandemic and subsequent lockdown.”

Even if access to additional loan could not be made available very quickly, an announcement of loan extensions coming in a couple of months might still help. Many students rely heavily on earnings over the summer, a period student funding is already not designed to cover. Full-time students are not eligible for unemployment benefits.

Of course, there will be students who have picked up extra shifts in supermarkets, for example, but the loss of opportunities in the hospitality and leisure industries is going to hit hard. My instinct remains that a more systematic, structural response is going to be needed to avoid many students facing serious hardship up to and including to the point where they may have to drop out, simply in order to obtain benefits. Only the Welsh system, which offers all students the maximum amount for living costs, has some in-built insulation, and even that may not be enough.

Zamzam Ibrahim is reported as believing that “students were in danger of being overlooked”.  At the moment that looks a reasonable worry.  I still hope people are looking at the more substantial options for intervention here.

Footnote

While student support has not received much obvious attention, the large financial risks to universities have been widely discussed, with talks reported already to be underway between universities and governments in different parts of the UK. The central issue, massive anticipated losses in income, particularly  due to a large fall in overseas students, has been well-covered across the media.  The Wonkhe website is a good place to look for lots of thought-provoking pieces on what HE faces and how it might need to respond. Alex Usher in Canada has been pressing for institutions to grasp the full implications of students being unable to return to campus in any number until at least January.

Some of this debate applies UK wide, but by no means all. The debate in England about tighter management of unconditional offers, and fears that some universities will scoop the pool to the detriment of others, to fill missing overseas student places, does not resonate in Scotland, where de facto number controls on recruitment by each institution persist.

While the loss of overseas students affects all parts of the UK, as HEPI research showed in 2017, backed by more recent work by Audit Scotland, Scottish HEIs are unlike those in England in relying on cross-subsidy from overseas students to prop up domestic teaching costs, which are not fully covered by the funding the Scottish Government provides direct to universities for the teaching of Scottish undergraduates. Scottish universities which have fewer overseas students as a proportion of their intake were already living closer to this problem than those with more: but it now becomes a clear sector-wide issue. As argued  here (in 2015, this is a long-standing point) despite the rhetoric about differences in HE systems across the UK, participation in the market for overseas students is a central part of Scottish Government HE strategy, for financial as well as soft diplomacy reasons.

Whether Scotland will see a drop in students from the rest of the UK is also something to think about: we are a net importer of such students, who make up around 10% of UK undergraduates here. System-wide, these students will also bring in more funding per head than Scots, though less than overseas ones. They will provide a marginal income gain but, more importantly, simply by coming here they help to sustain the sector at its present size. If students are rattling round an emptier the English system, fewer may wish to come to Scotland. The psychology of the pre-vaccine COVID era, with increased risk of sudden lock downs, may also encourage people to stay closer to home, at least for a while. We don’t know yet what will happen there, but it’s an additional exposure Scottish universities face.

As a further obvious point, while universities everywhere in the UK are now pitching for support in a context of massively increased demands on public funds but reduced tax income, Scottish ones do it from a position where their core teaching budget is already part of that competition, in contrast to other parts of the UK, particularly England and Wales. So what is given with one hand is at greater risk of being taken away by another.

Lastly, although Scotland may get its Barnett share of any rescue package devised by the UK government for institutions in England, we have a larger university sector than England, proportionate to population size. So any funds coming north will have to be spread thinner.  (Conversely just for once Northen Ireland will see some benefit from being substantially under-provided.)  On the other hand, the Scottish Government was on the cusp of an HE-related windfall, with EU students falling out of free tuition, which would have been expected to release around £90m over the next 4 years. The debate about what to do with that money will presumably just have taken something of a swerve.

As a policy response to all this, there still seems as yet no political appetite in Scotland for providing a new source of income for institutions by introducing loan-backed tuition fee contributions of any size, for any group of domestic undergraduates.  This is despite the Scottish Government having never used anything like its full share of the student loan pot: several hundred million pounds should in theory therefore be there for easy taking, were fees introduced (the only way this could realistically be accessed: more here https://twitter.com/LucyHunterB/status/1248593756884029440?s=20).  There are signs today that university leaders are beginning to challenge the assumption that this policy cannot be discussed: see here.

The lead time for introducing any policy change on fees would be at last a year. An election for Holyrood is scheduled for 2021 (already a year later it should have been).  It is hard to imagine a more acute test than the current choices facing politicians of how far free tuition remains an existential policy for the SNP, which must surely anticipate it will remain the largest party, how far other parties continue to regard the issue as untouchable and how far questioning voices in the sector are prepared to challenge the existing policy.

Shortening how long students spend obtaining a degree (most often expressed as the four year degree debate in Scotland, but other versions of this argument are available) does not yet appear to be under discussion. Indeed, there is potential for serious Government-institution tension over degree length. The last thing the universities will want right now is a reduction in how many years the students they do still have are funded to spend with them, while the government has never been more incentivised to bring down the cost of producing graduates. I’ve seen one suggestion that the logic of sticking with free tuition would be (in effect) nationalising the universities, so at least they cannot technically go bankrupt: while that would be radical in constitutional terms, it would not address the fundamental balance sheet problems.

I wonder if one other issue which might be on someone’s radar is that a drop in non-Scots would be an opportunity to reverse Scotland’s lower acceptance rates for domestic applicants over the past decade. However, while that would deal with a detriment experienced by recent and current cohorts of Scottish applicants, in the absence of any change to fee policy, it is only helpful to universities if accompanied by further fee income from the government cash budget, taking us back to square one; and the knock-on effects of letting more students into university would be likely to be a drop in the take up of short-cycle HN courses in colleges, passing on some of the unversities’ problems to that tier of the system.

Substantial changes may well be needed to traditional HE systems in many jurisdictions, in response not just to immediate pressures but the longer term consequences of current events, and, like any country, Scotland will have its own particular issues there. But short-term institutional financial survival is what appears to be weighing most heavily on people’s minds across the UK right now, unsurprisingly enough.  And this perhaps also explains why addressing immediate pressure on student incomes remains, I think, an area of unfinished business.