‘When I use a word,’ Humpty Dumpty said, in rather a scornful tone, ‘it means just what I choose it to mean — neither more nor less.’
– Alice Through The Looking Glass, Lewis Carroll
On 10 July, the Scottish Government issued a news release which stated, among other things (emphasis added):
The number of English domiciled students applying to English HEIs is 455,910, almost 20,000 below the pre-tuition fees level of 475,760.
The Minister for Learning, Alasdair Allan MSP, was then quoted as saying:
I am very pleased to see that a record number of Scots are applying to university both in Scotland and around the UK. This is in contrast with England where application numbers have still not returned to the pre-tuition fee levels. They remain almost 20,000 applicants below their pre-tuition fees level. There can be few stronger arguments for determination to keep education free here in Scotland.
There is a problem here, though. The 475,760 comes from UCAS figures for 2011 (though the press notice did not mention this) when fees were already £3,375 a year in England. The figures being reported are available here (2014 application cycle figures, as at 10 July). It turns out the same, and similarly unreferenced, claim was included in an Scottish Government news release back in January.
For a comparison with the pre-tuition fees level, it is necessary to go further back, at least to 2005, the last year fees in England were free for those at low incomes, or even to 1997, the last year they were free, full stop. Doing that shows that university applications in England have risen by some 120,000 since 1997, an increase of one-third. Compared to 2005, 24% more people from England have applied through UCAS this year, meaning 88,000 additional applicants over the decade (the increase in UCAS applicants from Scotland since 2005 is 19%). [2005 data from here; 1997 data extrapolated from Table 1 here.]
So any claim that applications in England are below the level they were before tuition fees applied would be simply wrong and the latest figures clearly demonstrate the opposite. Indeed, a report based on the same UCAS data in the The Guardian noted that:
The proportion of British 18-year-olds applying to university has reached its highest-ever level, according to figures for undergraduate applications in 2014 – thanks to a surge in applications from London and among women. Ucas, which administers entry to higher education, said there was a 4% increase in the number of applicants to UK universities, despite a small decline in the number of 18-year-olds in the population overall. Young people from the worst-off areas in England are now almost twice as likely to apply to university as they were 10 years ago, according to the Ucas data.
What is stated as being true for the UK here is true also for England – unsurprisingly, given it accounts for over 80% of students. This does not mean all is rosy: as the same report notes, there are signs that higher fees since 2012 have had a more negative effect on some groups than others, particularly mature students and part-time students, and also that the growth in applications from young men from disadvantaged areas has been slower than that for similar young women. But that’ doesn’t alter the fact that there were fees in 2011.
Nevertheless, the claim went on to be widely reported in the Scottish press, at minimum in The Scotsman, The Herald, The Times and The Daily Mail (Scottish editions), The Courier (twice), various local titles and the STV website, as well as a variety of news sites which onwardly post stories from elsewhere.
Some of these reports did refer to the high-point figure being from 2011, but without noting that this was a fee-charging year. The appearance of a reference to 2011 in reports is, it quickly becomes apparent, down to the intervention of the Press Association. In repackaging the SG’s material, the PA reproduced all the statistics in the SG notice with no substantial alteration to the way they were described, with just one exception: it replaced the reference to the high-point figure being “pre-tuition fees” with an explicit description of it instead as being from “the 2011 cycle”. As one would expect, given its role, the PA left the ministerial quote intact. Most of the reports above were in effect the PA release, sometimes credited to it, sometimes not.
There is clear evidence of what “pre-tuition fees” was taken to mean by those who stopped to read it. In this rare by-lined piece, the author, reasonably enough, recast the slightly jargon-y “pre-tuition fees” to “before the introduction of tuition fees.” Similarly, a press notice issued later the same day by another organisation (the SNP) stated: “the number of English domiciled students applying to English HEIs was 455,910 – almost 20,000 fewer than before tuition fees were introduced.”
So far, when the problem with this wording has been pointed out to newspapers or government, no sort of correction or clarification has been published (as far as can be easily seen, happy to be corrected). Perhaps worrying about factual accuracy in this context in Scotland is a bit out of fashion. I’ll keep trying.
Scottish newspaper readers could hardly therefore be blamed for being left with the impression that applications in England are now lower there than they were when tuition was free, a substantially untrue belief which will very probably be repeated in conversations and on-line discussions in future, and which no-one with access to the means to do so in Scotland seems inclined to put right – yet, at least.
This blog is concerned largely with the distribution of student debt in Scotland. All this is marginal to that – except that it’s already clear that beliefs about the effects of policy in England, in particular, have a strong influence on the discussion of student support policy here more generally. It would be best if those beliefs were factually-based.
Perhaps it will be obvious to everyone else who reads it that “pre-tuition fees” means “pre-the point where tuition fees increased from £3375 to £9000“. Perhaps.
‘That’s a great deal to make one word mean,’ Alice said in a thoughtful tone.
Last month the Student Loans Company published its annual statistical round-up of student borrowing in each part of the UK. The figures do not yet appear to have been picked up by the media.
The figures show that in the latest financial year, 2013-14, student borrowing rose most quickly for students from Scotland, increasing in one year by £160m or 58%, from £277 million in 2012-13 to £436 million in 2013-14. The maintenance loan element of borrowing, the part of the system over which the Scottish Government has complete control, rose by 64%, from £249 million to £409 million.
This is the largest percentage jump in student borrowing in a single year in any part of the UK since the mid-1990’s and by far the largest annual increase in absolute terms in Scotland ever (see table at foot of post). It will be interesting to see if this continues to go unnoticed or qualify as “not news”. [Note: it has now been picked up by The Guardian and The Herald.]
The figures are in line with the forecast included in the Scottish budget as far back as October 2012. However the large increase in the budgeted provision barely registered at the time and, significantly, this is the first hard evidence of the forecasts turning into actual debt for Scottish students.
Borrowing also rose in 2013-14 in other parts of the UK, though more slowly. The table below shows the change year-on-year and also since 2011-12, the last year unaffected by the raising of the fee cap to £9,000 for English students. Figures are shown for the combined total of borrowing for maintenance and fees in each country, plus maintenance loans only for Scotland.
| FY 2011-12 | FY 2012-13 | FY 2013-14 | % change: 2013-14 compared to: | ||
| £m | £m | £m | 2012-13 | 2011-12 | |
| England | 5966 | 7144 | 9021 | 26 | 51 |
| Northern Ireland | 228 | 253 | 273 | 8 | 20 |
| Scotland | 236(236) | 277(249) | 436(409) | 58(64) | 85(73) |
| Wales | 265 | 287 | 329 | 15 | 24 |
It’s important to acknowledge that some of the increase in Scotland since 2011-12 is due to funding higher fee loans for Scots going to the rest of the UK: removing that gives an increase in maintenance loans of just 73% since 2011-12. But, surprisingly, a slight drop in the value of fee loans in 2013-14 actually pulls down the year-on-year change over the past 12 months.
Because these are financial – not academic – year figures, they capture systems in transition both in Scotland and England. This means the whole effect of recent changes in these two countries will not have fed through. Not all of the effect of changes in Scotland from 2013 (see below) will be evident here. Similarly, the impact of phasing in higher fees in England from 2012 has not yet fed through completely. The systems – and therefore the figures – for Wales and Northern Ireland are more stable.
Relative borrowing levels across the UK
Scotland now moves to having the second-highest absolute amount of student borrowing in the UK and by extension, and by a decent margin, the largest absolute amount of borrowing among the devolved administrations in the UK.
To give a crude (and that’s all that’s possible at this stage) idea of what this means for actual student debt levels, total borrowing for 2013-14 can be divided by an estimate of the number of borrowers in each country. I have used 2012-13 academic year figures, as these are available for all 4 jurisdictions, using Scottish Government statistics and for the rest of the UK, the most recent figures for the nearest equivalent to total borrowers from the SLC. It is important to be aware however that, as this combines data from two different years and borrower numbers may be growing at different rates in different countries, these figures are neither true averages for each country or precise comparators.
They do however provide a reasonable indication that though pro rata the number of students taking out debt, annual borrowing was still lowest in Scotland in FY 2013-14, the figures for all three devolved nations are converging, while England is pulling away, all of which was predictable from looking at the detail of the systems, examined in more depth here. It needs to be borne in mind also that these are annual figures and that degree courses are generally a year longer in Scotland. The usual caveat also applies that variation round the average can be expected to be greater in Scotland with, uniquely, those at lower incomes from Scotland likely to have above-average debt.
| 2013-14 FY borrowing divided by 2012-13 AY borrowers (£) | |
| England | 8,924 |
| Northern Ireland | 6,214 |
| Scotland | 5,344 |
| Wales | 6,191 |
Background to Scottish increase
The rise in Scotland is a direct result of the Scottish Government’s decision to rely almost entirely on loans for maintenance support from the autumn of 2013, as summarised here.
The Scottish Government will publish figures for the 2013-14 academic year in October, which will show the full effect of the changes. The October figures will also show the extent to which borrowing under the new system is skewed towards the poorest in practice. This data does not allow that to be assessed.
Historic borrowing figures
Also included in the recent SLC data is the average amount of borrowing for those entering repayment (i.e. recent leavers) in each country.
In the past, these figures have been highlighted by the Scottish Government to demonstrate the difference between Scotland and the rest of the UK, although in contrast to some previous years, the SG did not issue a news release about this last month.
This separate post explains why those figures cannot be safely used as a guide to how the student support system functions in Scotland compared to other parts of the UK.
Background figures: Change in student borrowing since 1990
The table below shows the year-on-year change in student borrowing since the introduction of loans in 1990. Figures are cash values.
Sources: UK/England figures from this recent House of Commons Library briefing note. Scottish figures from documents in the Scottish Government’s annual student support statistics eg here
Notes:
- Up to and including 1999, identical rules applied across the UK and patterns of change will have been similar in all 4 countries.
- A figure for actual loan borrowing in Scotland in 1999 and 2000 is not included in the published statistics. However, the amount authorised for loans in each of those years was £155m and £193m. The table below estimates that 97.5% was converted into actual borrowing, based on take-up figures published for later years.
- Separate figures for Wales and NI are not included here: figures going back further than 2009-10 are not included in the latest SLC statistics and though they are almost certainly available, from 1999, systems in Wales and Northern Ireland have either been the same as in England or, in more recent years, policy decisions have been taken to limit the impact of increased debt on student compared to England, so percentage changes in those countries would be expected to be around or below the figure for England.
- Comparison with SLC figures suggests SG loan statistics cover only maintenance loans and exclude fee loans issued for study in rUK: an estimated figure of 64%+, rather than 58%+, is therefore included in the table for 2013.
| Academic Year starting | All UK | England only | Scotland only | |||
| £m | % change yr-on-yr | £m | % change yr-on-yr | £m | % change yr-on-yr | |
| 1990 | 70 | |||||
| 1991 | 139 | 99 | ||||
| 1992 | 227 | 63 | ||||
| 1993 | 317 | 40 | ||||
| 1994 | 539 | 70 | ||||
| 1995 | 701 | 30 | ||||
| 1996 | 877 | 25 | ||||
| 1997 | 941 | 7 | ||||
| 1998 | 1234 | 31 | ||||
| 1999 | 1795 | 45 | 151est | |||
| 2000 | 2204 | 23 | 188est | 25est | ||
| 2001 | 2490 | 13 | 221 | 17est | ||
| 2002 | 2626 | 5 | 224 | 1 | ||
| 2003 | 2712 | 3 | 217 | -3 | ||
| 2004 | 2794 | 3 | 203 | -6 | ||
| 2005 | 2933 | 5 | 2496 | 187 | -8 | |
| 2006 | 3421 | 37 | 180 | -4 | ||
| 2007 | 4020 | 18 | 178 | -1 | ||
| 2008 | 4698 | 17 | 181 | 2 | ||
| 2009 | 5214 | 11 | 193 | 6 | ||
| 2010 | 5567 | 7 | 220 | 14 | ||
| 2011 | 6067 | 9 | 240 | 9 | ||
| 2012 | 7658 | 26 | 250 | 4 | ||
| 2013 | 9714 | 27 | tbc | 64%+est | ||
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.
This post highlighted that the Scottish budget shows a 6.3% fall in budgetted spending on EMAs in 2014-15, but noted that this could simply be a correction of over-budgetting in previous years.
A PQ answered this week confirms that it is a correction rather than a planned cut:
Kezia Dugdale (Lothian) (Scottish Labour): To ask the Scottish Government whether the 6.3% fall in the Level 4 budget figure for educational maintenance allowance between 2013-14 and 2014-15 reflects the expected reduction in actual spending between the two years or an expectation that actual spending in 2013-14 would be closer to the reported actual spend of £27.8 million in 2012-13 than the £31.6 million budgeted for 2013-14. (S4W-21887)
Mr Michael Russell MSP:
The Scottish Government does not expect to reduce actual spending for Education Maintenance Allowance (EMA) in 2014-15. The reduced budget position reflects our anticipated spend for 2014-15 which we consider will be in line with spending from previous years – £27.8 million in 2012-13 and £27.6 million in 2011-12.
EMA is an entitlement in Scotland and the Scottish Government will ensure every individual who is eligible for EMA support receives it. Unlike in England where the EMA programme has been abolished, Scottish Ministers are committed to the EMA programme and value its contribution to helping young people overcome financial barriers to access learning.
A separate parliamentary answer clarifies the data source for the expected drop in the school population. The statistics referred to show a 2% drop expected in the total secondary school population between 2014 and 2015, although how this divides between lower and upper secondary school population is not shown.
Kezia Dugdale (Lothian) (Scottish Labour): To ask the Scottish Government whether it will provide further detail regarding the “changing demographics in Scotland” affecting spending on education maintenance allowance that are referred to in the “explanation of significant changes from previous year” provided in the Level 4 spreadsheet for the 2014-15 budget. (S4W-21888)
Mr Michael Russell MSP:
Education Maintenance Allowance (EMA) is an entitlement in Scotland which means that any person who meets the eligibility criteria will receive EMA support.
The explanation in the level 4 spreadsheet for the 2014-15 budget relates to the revised budget position for EMA rather than actual spend.
This revision reflects the projected decline in the number of secondary school pupils in Scotland.
The projections are available through the following web link – http://www.scotland.gov.uk/Topics/Statistics/Browse/School-Education/PupilProjectionsDataset/PupilProjections2010
As a footnote, the most recent answers do not repeat the earlier mistaken Scottish government line that EMAs have been abolished everywhere but Scotland (they continue in Wales and Northern Ireland). In England, EMAs have been abolished, as the answer notes, and replaced with a more limited scheme, targetted on a smaller number of young people deemed to be in particular need.
There was a short debate at Westminster earlier this week (on 24 June) on proposals by the UK Government to introduce an alternative student finance arrangement for students concerned that conventional student loans under the new model (“Plan 2”) introduced for England and also Wales in 2012 are not compliant with sharia law.
A Whitehall consultation recently closed, seeking comments on a self-contained system under which a pool of funds would be established, from which payments would be made to students while they study. Students in turn would contract to repay what they had taken out, plus a further charitable contribution to the fund, to help future generations of students. The aim would be to make the repayments identical to what students would make under the conventional loan scheme and the scheme would be open to any student, regardless of faith. The fund would be administered by the Student Loans Company, but ring-fenced from its other activities. It is argued that by replacing interest with additional charitable contributions, the same levels of repayments can be obtained as under the conventional loan scheme without breaching sharia law principles.
David Willetts, Minister for Higher Education told Parliament this week that this model had been approved by Islamic finance specialists (although there has been some suggestion in the press of concern that the model was not compliant). It has the support of the NUS. It is not yet certain however that it will go ahead.
The old loan scheme, as still used in Scotland and Northern Ireland (“Plan 1”), appears not to be regarded as a problem, as interest is pegged to RPI: it is the introduction of real-terms interest in the new scheme which has raised the issue. However, playing down the delay which there will have to be in introducing any new scheme, which wouldn’t be available until 2016 at the soonest, David Willetts noted during the debate that many Muslim students are still taking out Plan 2 loans.
The BIS consultation refers to the UK Muslim community and the proposals do not explicitly suggest access would be limited to English and Welsh domiciled students, although that might be regarded as implicit, given it is presented as an alternative to Plan 2 loans. Making this a UK-wide scheme would open up the interesting possibility that Scottish students (of any faith and none) could opt for this scheme if they preferred the higher income threshold for repayments and shorter write-off period applying in the Plan 2 scheme. As noted elsewhere on this site, for those who do not expect to be high earners, the English and Welsh Plan 2 system is potentially cheaper, even with its higher interest rates. It might seem odd to imagine students shopping around in this way: but it’s not entirely implausible.
Presuming however this development is directly relevant only to students domiciled in England and Wales, it remains interesting as an extension of the general debate about loans. Indeed, the more explicit linking of contributions to the benefit of future generations has echoes of the model of graduate contribution proposed by the Cubie Committee in Scotland. Although the graduate endowment was not put in place on Cubie’s terms – a wholly separate endowment fund was not set up – the legislation did include a specific provision that income from the endowment should be put towards student support. It’s interesting to see this sort of thinking now re-surfacing from a different direction.
Indeed, the proposals in the BIS paper, with a ring-fenced fund and a reasonably high income threshold are in these respects closer to the Cubie model than the version legislated for in Scotland in 2000 – although the sums being sought from students are of course a great deal higher than Cubie’s £3,000, even allowing for inflation. If the SLC could absorb this model, what possibilities would open up for ringing changes on the way the resources available through the SLC are packaged and conceptualised for the devolved nations?
The Scottish Government has often defended the Scottish system of student support from criticism by drawing attention to differences in what it terms the “average student loan debt” in each part of the UK. This post discusses the limitations of these figures.
The Student Loans Company publishes figures every June for the average amount owed by students in each part of the UK at the point they “enter repayment” – in effect their “final debt”. The figure represents the amount students owe on the 1 April after completing their course, or after dropping out. The latest such figures are now available, with the Scottish figure now standing at £7,600, an increase of 11% from last year. It is this data set which the Scottish Government has often used as the basis of inter-country comparisons on student borrowing.
How these figures are used
A government press notice [Free tuition keeps debt down] made these figures its headline in June 2012, but the same and later versions of these figures have also been quoted more recently elsewhere.
Speaking in the Scottish Parliament in June 2013, the Cabinet Secretary said:
Let us look at student debt figures, which are crucial. The UK graduates survey in 2012 showed clearly that the average student loan debt for Scottish students at that stage was £6,480, compared with £17,140 in England and £13,650 in Wales—that is without student fees. [Note: the source is the SLC, as above: the figures do include fee borrowing, albeit at the pre-2012 level of just over £3,000 a year.]
In a letter to The Scotsman on 25 November 2013, in response to a report on student debt, the Cabinet Secretary observed:
The Scottish Government is committed to the principle of free education and pays the fees of Scots-domiciled students who choose to attend university here, meaning that levels of debt are much lower than in the rest of the UK. For example, figures published by the Student Loan Company year show that average student loan debt for Scottish students is £6,850 compared with £18,740 in England and £14,910 in Wales.
I would be grateful if any future stories could reflect such geographical context and the differing the policies of the Scottish and Westminster governments to avoid giving our prospective students and their families the wrong impression.
These figures were quoted again on 8 November 2013 in the response to PQ S4W-17799, which asked the Scottish Government “what analysis it made prior to the publication of the 2013-14 draft budget of the impact of changes in student support in 2013-14 on the level of debt that will apply to students from lower-income households?”. The Cabinet Secretary responded:
Based on the support arrangements that apply in 2013-14, students from Scotland from the lowest income households who are eligible for a total maintenance package of £7250 will accrue a maximum annual debt of £5,500.
This policy was considered in the context of debt figures published annually by the Student Loan Company, the latest version of which shows that average student loan debt for Scottish students is £6,850 compared to £18,740 in England and £14,910 in Wales.
They were quoted by the Cabinet Secretary again in a parliamentary debate on 8 January 2014:
It is absolutely clear that, if we look across these islands, Scottish students have a great advantage, as debt levels have soared elsewhere. … Student debt levels are soaring. I will give members the figures. Student Loans Company figures that were published in 2013 show that the average student loan debt for Scottish students is £6,850. In Wales, it is £14,910 and in England it is £18,740. Those figures tell members the truth: higher education in other parts of these islands is being monetarised. It will not be monetarised in Scotland.
What these figures tell us – and what they don’t
It is true that the gap between the raw averages in this data set is large and the absence of fee payments undoubtedly does much to explain that.
But as a way of comparing the various UK systems, particularly as they are functioning now, these figures have serious flaws. They are in particular a very poor guide to current and prospective students in Scotland as to how much debt they can expect in absolute terms.
The principal difficulties with these figures are:
- they are historic, providing a snapshot of the debt position of a cohort of students who entered the system several years ago and which has now left. The effects of more recent policies which increase debt – whether raising the fee cap to £9,000 in England or lowering grants in Scotland – will not show up. Even the most recent figures deal only with those who left in the summer of 2013, before the recent Scottish grants reductions took effect.
- many more students in Scotland do relatively short courses. A much larger minority of those entering repayment in Scotland have studied a course lasting only one or two years. This pulls down the total average final debt figure. Direct data on the average period of study is not available, but by using detailed figures on historic average borrowing, it is possible to show that the SLC’s average final debt in Scotland has consistently represented only around two-thirds of the average amount that a 4 year honours degree student would have accumulated (see table below). By contrast, a similar calculation for other UK jurisdictions shows that the final debt is only marginally below what would be accumulated on average over the three years of a standard honours degree (see table below). So comparing Scotland with the rest of the UK using these figures is in effect comparing the cost of two-thirds of a standard length degree course with the cost of a whole one. If the most recent SLC figure in Scotland reflected four years of average borrowing for those graduating in 2013, it would be around £11,000.
- there is wide variation round the average in Scotland, with those from the very lowest incomes borrowing well above the average. In other parts of the UK, borrowing is much more evenly spread by income. A Scottish student assessed as having nil income who finished in 2013, having borrowed the average amount for that group for each of the past four years, would have had a final debt of around £18,500 (see table below), much the same as the average final debt in other parts of the UK at that point and almost two and a half times the average of £7,600 for Scotland.
In short, there is no doubt that free tuition has played a significant part in keeping down average final debt in Scotland. But so has the greater number of students not studying all the way to degree level, and even more so the relatively low borrowing by those from higher income homes.
Most importantly, the very large rise in student borrowing expected by the Scottish Government as a result of this year’s changes to student support make these figures of entirely historic interest, except perhaps for Welsh and Northern Irish students (in NI) for whom the system is not changing so radically as in England or Scotland. Under the new Scottish arrangements, the differences in average debt levels for students between Scotland and the other devolved administrations will be much reduced.
So the SLC’s historic final debt figures are very different from current average annual borrowing and therefore do not provide relevant information on how much absolute debt is now likely to be incurred by current or prospective students in Scotland, particularly those from low incomes. Nor are they a reliable guide to the degree of difference between Scotland and the rest of the UK, especially the other devolved administrations.
As the Cabinet Secretary rightly says, it is important young people considering higher education are not given the wrong impression by the way figures are used in reporting and debate. For that group, these figures are among the least useful, while even for those with a more general interest in the issues, they still do little to illuminate the effects of current policy.
Technical notes
Note: the calculations of cumulative borrowing below are not adjusted for interest. Interest rates were the same across the UK in this period, for all the cohorts concerned. Adding interest would further reduce the figures in % and “implied period” columns, but would not alter the general picture.
Figures in bold are the latest SLC ones for actual final debt in each country.
Scotland: comparison of cumulative average actual annual borrowing over previous 4 years with actual final debt
| Repayment cohort (leavers in previous year) | Average borrowing for maintenance over previous 4 years: cumulative | Actual average final debt | ||
| £ | £ | Actual final debt as % of average 4 year borrowing | Implied borrowing period (years) | |
| 2010 | 9250 | 5950 | 64 | 2.6 |
| 2011 | 9440 | 5980 | 63 | 2.5 |
| 2012 | 9910 | 6450 | 65 | 2.6 |
| 2013 | 10540 | 6830 | 65 | 2.6 |
| 2014 | 11240 | 7600 | 68 | 2.7 |
Rest of UK: students entering repayment in 2014. Comparison of cumulative three year actual annual borrowing (source as above) with actual final borrowing. Fee loan averages from House of Commons Library research: English figure provided used for all three countries, as fee systems were functionally identical for this cohort. Higher average maintenance borrowing in England than Wales or Northern Ireland for this cohort is likely to be due partly to the number of students in London, which attracts additional loan for living costs.
| E | W | NI | |
| Average borrowing for maintenance over previous 3 years: cumulative | 11050 | 9160 | 9380 |
| Average fee loan over previous 3 years: cumulative | 9665 | 9665 | 9665 |
| Total average loan over 3 years: cumulative | 20715 | 18825 | 19045 |
| Actual final debt as per latest SLC figures | 20100 | 17310 | 17720 |
| Actual as % of 3 year actual borrowing | 97 | 92 | 93 |
| Implied period of borrowing | 2.9 | 2.8 | 2.8 |
Average borrowing by Scottish students assessed as nil income: average loan accumulated over 4 years. Source: Table 12 of Scottish government statistics , various years.
| 2009 | 4265 |
| 2010 | 4508 |
| 2011 | 4805 |
| 2012 | 4965 |
| Total over 4 years | 18543 |
| as % of Scottish average final debt (£7,600) | 244% |
I have been asked by some people how this site started: the answer is, by accident.
One of my responsibilities in the civil service, more than a decade ago, was student support. Once you’ve worked closely on something, you never completely lose interest, but student funding wasn’t something I followed in detail afterwards: other jobs and, latterly, family life were keeping me busy enough.
Around 18 months ago – and around 18 months after I’d left the civil service with no particular intention of ever revisiting this topic – something I saw one evening made me want to check a fact which was most easily done by looking at the Student Awards Agency for Scotland’s website. I can’t remember what it was, it didn’t seem very important at the time, but most probably a news story about tuition fees. It was simple curiosity and the sort of thing many of us do with news stories all the time these days.
When I went on-line, I found myself looking at the (then) next year’s figures for student support and was surprised how low the figure was for grants. I could remember it had been higher in cash terms ten years before. I was surprised I couldn’t remember any fuss about grant cuts, but put that down to having been very busy, particularly in my last few years in the civil service. Still pursuing my original question, whatever it was, I went back a year in the figures, to 2012-13, and was even more surprised to see that the grant was a lot higher. The cuts, in other words, were topical right now – they hadn’t yet taken effect. Yet even though I’d have said I’d been following the news pretty well over the past year, and this was a topic I had some interest in, I couldn’t remember seeing anything about them.
And that surprised me more. Because I knew that grant cuts increased debt and I could remember how much political and media heat had been generated a decade before by the issue of student debt. In particular, I could see that the extra debt due to grant reductions was going to be much greater for some students than the debt saving which had been produced by the high-profile abolition of the graduate endowment a few years before.
I need at this point to make a declaration for transparency: I’d worked on the endowment’s introduction as an official, so I remembered very clearly why it had been controversial and was confident reading the figures, but – and this is important – however committed I was to doing the best job I could on it at the time, I hold no special brief for it now as a policy. That’s the point about civil servants – they do the government’s work, not their own and the best response I can offer to anyone who finds that alien is provided by Yes Minister (quote at end of post).
My simple initial question was, where was the debate about what was happening with grant? When a bit of googling showed that, despite a couple of attempts in the parliament to raise it, the issue simply hadn’t generated much heat or even much media attention, I got more curious. What had changed in Scotland?
Everything since has flowed from that initial curiosity. I googled a bit more. Looking at the government press notice brought out how opaque the public announcements had been. The emphasis in the news release, and elsewhere, on the Scottish system being “best in the UK” made me look for the supporting analysis. When it became obvious that neither the Scottish government nor the press had published that, I looked up the figures for England for myself and did some comparative calculations. I almost (like lots of people in Scotland) forgot about Wales and Northern Ireland – but it was looking at the Welsh system as an afterthought, I’m ashamed to say, which produced some of the most surprising comparisons. I found government statistics on student borrowing and budget projections which showed rapidly rising student debt.
After I’d amassed a lot of calculations, all done in spare moments, it became clear there was an interesting story to tell which wasn’t being told, and I thought I’d have a go at putting it into words. Once I’d done that for myself, again in spare moments, I thought the results were important enough to be worth sharing more widely and I set about looking for ways to do that (including this site). I continue to do so.
It was just a thread I started pulling, in other words. Each answer seems to raise a new question, it still deserves more attention and no-one else seems to be looking – so I keep at it, with three motivations.
The first, which has grown the more I have worked on this, is a conviction that the current system is profoundly unfair. It is simply not right that graduates who started out from poorer homes will have to pay more of their future earnings back to the state than those who did not: that is absolutely regressive, other parts of the UK avoid this and, tellingly, I have yet to hear anyone acting in any official capacity come out and defend that outcome. The focus is always on other things – absence of fees, comparisons with England, students’ immediate spending power, UCAS statistics. Whatever system of student support we have, and whatever levels of graduate debt we agree are defensible – or at least unavoidable, given the financial context – that debt should not be distributed in a way which penalises people for starting out poor.
Second, even if it turns out my views are not shared by most people in Scotland, I’d argue we ought to be talking about what is happening here in more accurate terms. If the belief is that it doesn’t matter if most poorer people end up with quite a bit of debt to get a degree, as long as some students can still end up with little or none, then let’s say so in terms. Points made in discussion and material in the public domain too often fail to reflect properly the reality of the system. We should do better. Until we do, it will be impossible to know whether the current system commands general support despite its unequal effects, or because these effects aren’t understood.
The last reason I stick with this is out of a curiosity about Scottish political debate. Why don’t we worry about this? Why are we better at quoting the fee costs for English students than the debt costs for poor Scots? Why do stories that surface on this vanish quickly without trace? Why has the parliament not done more to seek detailed explanations from the government about the effect of these changes on poorer students? And why hasn’t the press picked it up more? What are the dynamics – and values – which make tuition fees hypnotically fascinating and student grants, and debt for poorer students, a non-issue? Why, in short, are grant cuts not a cause celebre up there with fees and charges? How does this blind-eye fit with Scotland’s self-perception as being progressive and socially just?
There are questions here that go beyond student support. Meantime, however, this aspect of student funding remains under-discussed and so that’s what this site continues to focus on.
(From The Whisky Priest: “Bernard, I have served eleven governments in the past thirty years. If I had believed in all their policies, I would have been passionately committed to keeping out of the Common Market, and passionately committed to going into it. I would have been utterly convinced of the rightness of nationalising steel. And of denationalising it and renationalising it. On capital punishment, I’d have been a fervent retentionist and an ardent abolishionist. I would’ve been a Keynesian and a Friedmanite, a grammar school preserver and destroyer, a nationalisation freak and a privatisation maniac….”)
A recent study of young people’s views on the impact of poverty on education raised the issue of the cost of attending school, even when the school place itself is provided for free (Learning Lessons, discussed here).
That’s a prompt to recall that there is a system of payments for young people between the ages of 16 and 19, the Education Maintenance Allowance, which was introduced with the express purpose of encouraging young people to stay on in post-compulsory education, partly by helping them with extra costs. It is available to those in school or an FE college (a concession for home schooled young people was also made in Scotland, which appears still to exist). EMAs are administered under national rules by local authorities and the Scottish Funding Council. The official EMA website is here. 34% of school pupils between 16 and 19 received an EMA payment in the latest year for which figures are available, 2012-13. (Reporting on the scheme has become noticeably less detailed recently: here is the 2008-09 report for comparison.)
These statistics also provide the long-term spending pattern. Unusually, the historic data on spending is provided only for sub-categories (by institutional type or gender), so the overall spending pattern over time is not immediately clear. However, the total can be easily calculated and is shown below (see table at foot of post: real terms figures calculated by this author using Treasury GDP deflators). From its high point in 2008-09, spending on EMA has fallen by around £11m or 29% in real terms. For reasons discussed below, Scotland will not be not alone in having seen a large reduction in EMA spending. Also, EMA is demand-led and demographics and economic context will therefore be important factors, alongside changes in eligibility, which affect total spending. All the same, EMA joins means-tested student bursaries in higher education and Disabled Students Allowance as an example of falling spend in recent years on targeted, non-repayable grant support.
In 2014-15, the budget for EMAs in Scotland is falling by 6.3% (8.2% in real terms: see Level 4 spreadsheet for 2014-15 budget here), from £31.6m to £29.6m. The Scottish Government has explained that “This slight reduction to the overall budget reflects the changing demographics in Scotland.” Even assuming the weekly payment will continue to be frozen in value at £30, 6.3% seems a large single year drop to expect in spend. This is not least as the number of claimants rose by 3.3% in 2012-13, as the government’s own recent news release highlighted. Within that, the statistics show that the number at younger ages was rising.
However, actual spending in the 2012-13 academic year was only £27.8m, against a budget that financial year of £31.6m (level 4 spreadsheet for the previous budget here). So the relationship between budget and actual spending is not straightforward here and there’s more to understand about how far the fall in 2014-15 is due to an expected real reduction in spending or, for example, a correction of past over-budgeting. A further complication here is that around half of EMA spend comes from local authorities’ general resources, so the national budget figure is not for a dedicated pot of cash, but must be partly based on the notional allowance included for EMA within the overall local government settlement.
Background
EMAs were introduced by the UK government in England as a pilot in 1999 and then fully implemented in 2004, with the (then titled) Scottish Executive having full devolved responsibility but choosing to go down the same route, as did the rest of the UK. EMAs did not have cross-party support at Westminster (here and here are short and useful summaries of the arguments and evidence about them). Some research suggested that they had a limited effect on staying on rates. Other research argued that staying on rates had improved and some institutions said that they had improved attendance and performance (payment was partly linked to this). Around 39% of all 16-19 year old school pupils in Scotland received EMA support in the academic year 2008-09.
In 2009-10, the first reductions made to the scheme were in Scotland, after the Scottish Government’s ’16+ Learning Choices – First Step Activity and Financial Support’ consultation. Payments of £10 and £20 available at incomes up to just over £30,000 were removed and the income threshold for the £30 payment was lowered slightly to bring it into line with that of the ‘away from home’ element of further education bursaries (£20,351). An additional, higher, income threshold (£22,403) was also introduced for families with more than one dependent child. It’s worth pausing here to notice that this should mean that one-third of 16 to 19 years olds in school come from households with incomes below the low £20,000s and therefore fall into the group most affected by the higher education grant reductions described in detail elsewhere on this site, and for whom the Welsh system of student support in higher education is generally better.
In 2010-11 a bonus payment for good attendance and performance was also removed in Scotland, which reduced spending by £6m (around 20% of the budget at the time). This was linked to an overspend in 2009-10. These changes, which for two years left Scotland with the least generous EMA scheme in the UK, were controversial. However, the UK Government’s announcement during 2010 of its decision to abolish EMAs from 2011-12 left Scotland in a more generous state than England, which quickly became the dominant narrative and central to the rebuttal of any questioning of the reductions in Scotland. This model of defence by comparison with England is of course familiar from the discussion of student funding in higher education. In spring 2011 it was announced that just under one-third – £180m – of the English £560m EMA budget would be recycled into a new, more closely targeted scheme, with £1,200 a year being offered “to those with the greatest needs, such as pupils in care, care leavers and the severely disabled”, plus a discretionary fund for schools and colleges. This has however never been treated as a relevant development by the Scottish Government in its comparative descriptions.
Indeed, the Scottish Government’s 2011-12 draft budget went further, stating “In contrast with the decision to remove it in other parts of the UK [emphasis added], the Scottish Government will continue the Educational Maintenance Allowance (EMA) scheme” (p26) and “In other parts of the UK, the Educational Maintenance Allowance (EMA) scheme – the flagship programme for supporting young people from low income families – is being removed.” (p28). Leaving aside any questions about the English replacement arangements, this was technically incorrect in a more fundamental respect. EMA continued (and continues) in Wales and Northern Ireland. In 2011, Wales followed Scotland in removing the £10 and £20 payments and the bonus, although it uses income thresholds for the £30 payment which are slightly higher. Northern Ireland has also moved to the single payment of £30 a week, on very marginally higher thresholds than Scotland. The conflation of “other parts of the UK” with England is also familiar from the way comparisons are made with student fee policy elsewhere in the UK by the Scottish Government. This mistake has been repeatedly more recently, in “Europe 2020: Scottish National Reform Programme 2014“, published by the Scottish Government on 29 April this year, which states: “In contrast to other parts of the UK, the Scottish Government has retained the Education Maintenance Allowance (EMA)”. Official publications really ought to be more precise.
Conclusion
To give an idea of scale, because spending on means-tested HE grants is falling so much, in the current academic year spending on the main bursary for young students in HE is likely to be not much more than one and a half times the EMA budget. So EMA is an increasingly significant proportion of the non-repayable support available to young people from the lowest incomes in full-time education. As discussed at length elsewhere on this site, more living cost support for young people in HE is of course available, but largely as loan.
Although EMA as a tightly mean-tested form of payment does not sit neatly within the Scottish Government’s general preference for universal benefits, Scottish Ministers appear to continue to be supportive of it: the recent Child Poverty Strategy stated “Scottish Ministers remain committed to having this support in place for the lowest income households.”
Learning Lessons argues that its findings raise policy issues which need attention. What the future may – and should – hold for EMA might be worth bearing in mind there.
Barnett formula footnote
EMA is an interesting case study for Barnett formula effects. Prior to 2011-12, the Barnett consequentials of policy in England worked in Scotland’s favour. £560m at 8.6% (I think this is the right percentage – it is near enough for this purpose) gives £48m, much more than Scotland was spending on the same scheme. This may be because of the difference in the age structure (England has a younger population) or institutional arrangements (young people tend to move into higher (or further) education at a younger age in Scotland). But the post-2011 £180m gives a consequential of just over £15m, and did create a new pressure on the Scottish budget. Even then, some reporting suggested that transitional arrangements conceded after the original announcement might mean spending on EMAs in England falling less sharply to begin with. So this is an example of where a cut made in a Whitehall budget certainly will have created a shortfall for the Scottish budget, but the impact has been less stark than might be expected from the simple fact of the abolition of the original EMA scheme for young people in England.
EMA total spending
| Academic Year | Total Payments (cash) | Total Payments (real terms) |
| 2006-07 | 32,433,285 | 37,533,311 |
| 2007-08 | 33,340,440 | 37,636,240 |
| 2008-09 | 35,441,160 | 38,909,131 |
| 2009-10 | 33,191,690 | 35,466,512 |
| 2010-11 | 27,177,220 | 28,300,760 |
| 2011-12 | 27,613,140 | 28,100,687 |
| 2012-13 | 27,817,195 | 27,817,195 |
Save The Children Scotland and Scotland’s Commissioner for Children and Young People have just published this timely report, Learning Lessons, on young people’s views on poverty and education in Scotland. Its findings are based on surveys and qualitative research undertaken in a number of schools, mostly with high or at least above average free school meal entitlement.
The average for free school meal entitlement is just below 20%, so even in the institutions chosen, a large proportion of the young people are likely to have been commenting based on their observations and perceptions, rather than their own situation. The people taking part were not asked about their personal circumstances, so it isn’t possible to break the survey results down further, to see how perspectives varied between those who are and are not directly affected by coming from a low income home. But that’s a minor caveat. This is a valuable piece of research, not only for school education, which was its focus, but for the higher and further education systems, too.
First, young people highlighted that even in a “free” education system learners face additional costs which are hard to avoid and can be a significant burden at low incomes. In this case, issues commonly mentioned included uniform, meals, materials, books and school trips. The last won’t come as a surprise to anyone with a child in school who has ever wondered how low income families, particularly those with several children, cope with the routine need to find cash for various “extras”, which are not really extra at all, if a child is to take part fully in school life. The interviewees noted this could come down to something as basic as a properly stocked pencil case and materials for domestic science. Of course the school system has ways of helping families at low incomes, usually tied to receipt of benefits. But, again as many will know, beyond special arrangements for uniform and meals, these systems tend to become more informal and behind-the-scenes, and therefore potentially less reliable and more embarrassing to apply for.
So this report is a very helpful reminder not to confuse the absence of teaching charges with the absence of unavoidable cost, and that it is those at low incomes who stand to be most disadvantaged when we do.
Second, young people were concerned that some, if not all, of those from low income families would lack a place at home where they could study quietly. They were also worried about some homes lacking an internet connection.
Elsewhere on this site there is plenty of evidence that, in Scotland uniquely within the UK, due to our very low levels of student grant student debt is distributed very unequally, resting largely on the poorest, who can now expect a final debt for a 4 year degree of over £20,000, while debt is much lower, and often zero at higher incomes. As a result, graduates who started from poorer homes face a higher de facto tax on their future earnings than those who came from better-off ones, and the rhetoric of “free higher education” largely describes the experience of the better off.
It is impossible to get anything like the same degree of interest in this in Scotland as in the prospect of any debt whatsoever for tuition fees. This seems to be rationalised by a belief that living costs are different, because students can always choose to reduce them, mainly by living at home, while fees are compulsory.
When young people from poorer homes leave school and move into higher education, the accommodation issues brought out in this research will not suddenly go away for them and their families. They may even become more acute, as students are expected to spend more time studying independently, internet access is likely to become essential and college or university is likely to involve a longer and more expensive journey than school. At the same time, families may be in urgent need of extra space for younger siblings, and students very possibly keen to relieve tight family budgets of pressure.
As this earlier post shows, the idea that for most poorer students living cost debt is a matter of choice was already at odds with the statistics. This research reminds us of some of the reasons why.
The reported government response to Learning Lessons was in general terms: “Learning should be about the ability to learn, not the ability to pay [note: echoing the defence of the current arrangements in higher education] but all of the evidence shows that children from disadvantaged backgrounds are more likely to experience worse outcomes in education than those who enjoy greater advantages. This is completely unacceptable and the Scottish Government is committed to narrowing this attainment gap and reducing child poverty.”
As this reports demonstrates, the cost of getting an education – what you need to be “able to pay for” – is not just the cost of tuition, and the focus on charges for teaching to the exclusion of all other costs fails to recognise that from school right through to university, poor families are simply much less “able to pay” other essential costs on behalf of their children.
Linked post
Learning Lessons raises questions about how young people are helped with extra costs at school. For older pupils, Education Maintenance Allowances must be part of the answer. A separate post here looks at those.
As a final point, the material on this site concentrates on funding issues and it is that aspect of Learning Lessons on which the discussion above concentrates. However, the report is about much more than financial support and has plenty of valuable material that goes well beyond funding. Many of the messages are familiar from, and potentially helpful in, debates about widening access to higher education.
It was already possible to show from the published data that those at the lowest incomes were most likely to take out a loan, with 88% of those assessed as nil income (mainly mature students) and 79% of those at incomes below £10,000 borrowing. These figures are for 2012-13, the latest year for which the information is available. The average take-up rate for Scottish students was 67%.
A recent parliamentary answer allows this data to be divided further between students on degree and “sub-degree” courses (the latter are mainly HN students, who equate very closely to those in FE colleges).
This shows that take-up rates are highest for nil income students on sub-degree courses, 91% of whom take out a loan, with an average new borrowing that year of £5085. Mature students are strongly concentrated in that group. At the next lowest incomes, where young students make up the majority, it is those on degree courses who are more likely to borrow, with take-up rates of between 77% and 82% at incomes up to £30,0000. Sub-degree students are between 63% and 74%. The actual amounts borrowed at degree and sub-degree do not vary much within income categories, however.
The likeliest reason that mature students and low-income students on degree courses are more likely to borrow is that they have less opportunity to reduce their borrowing by living with their parents. Degree provision is less likely to be located within an affordable, practical commuting distance of students’ homes than college-based HNs and the content of particular degree courses is more specific to individual institutions. Both of these mean that to do the course they want, degree students are more likely to have to live away.
At incomes over £30,000, the individual income categories become less reliable. For all students over this income, plus those who did not provide income details because they claimed no means-tested support, the take-up rate was 47% for sub-degree students and 59% for degree students. At these higher incomes, it seems plausible that higher family contributions are the principal reason students make less use of loans.
Why does this matter?
It is sometimes assumed that living cost loan is more “optional” than fee debt, not least because, it is asserted, students can reduce their costs by living at home. These figures are a useful indication that the possibility of not borrowing is not only less of a reality particularly for mature students and those from poorer homes generally (we knew that already) but it is also less of an option for those who want to study to degree level, almost certainly because living at home would create a greater constraint on their ability to study. So, the poorer you are and the higher the level to which you wish to study, the more likely it is you will have to borrow, reinforcing the tendency of the Scottish system to entrench inequality.
The figures also remind that in 2012-13 the variation round the average of £3115 was wide: between £5085 and £1964 in this breakdown (and £0 including the non-borrowers). We will not know for a few more months what pattern the 2013-14 figures show. These will reveal the effect of the grant reductions and higher loans which came in this academic year.
Background figures
| All | Sub-degree | Degree | ||||
| Income as per SAAS data | Take up rate | Average | Take up rate | Average | Take up rate | Average |
| % | £ | % | £ | % | £ | |
| Assessed as nil | 88 | 4965 | 91 | 5085 | 85 | 4865 |
| < £10k | 79 | 3715 | 74 | 3705 | 82 | 3721 |
| £10,000 – £19,999 | 73 | 3625 | 66 | 3695 | 77 | 3595 |
| £20,000 – £29,999 | 74 | 3565 | 63 | 3495 | 78 | 3587 |
| Over £30k* | 57 | 1983 | 47 | 2093 | 59 | 1964 |
| Total | 67 | 3115 | 65 | 3715 | 67 | 2902 |
*Includes all those who did not declare their income to SAAS: EU students removed from the totals for income undeclared.
Sources: All from SG statistics October 2013, linked above – take-up rate calculated by author; sub-degree from PQ response S4W-20192: answered 27/03/2014, linked above – take-up rate calculated by author; degree by extrapolation from first two data sets by author.
Note: Students on sub-degree courses are more likely to come from lower income backgrounds. Separate post on that to follow.
A recent Guardian article reported work I had done showing how recent cuts in student grants in Scotland are increasing debt for poorer students, more than cancelling out the impact of abolishing the graduate endowment in 2007. I had calculated that this left students from better-off backgrounds as the overall beneficiaries of policy in Scotland in recent years.
Fifty people took the trouble to respond. Two-thirds of them disagreed, often strongly, with my analysis. It remains controversial in Scotland to question the way we go about funding students, so the critical reaction was no surprise. Some of the arguments were familiar. The one I hadn’t expected, however, was that the poor should simply expect more debt as a result of going to university.
“So, students from poorer backgrounds may leave university with higher levels of loan debt than those with family backing. Hardly ground breaking news,” said someone who described himself as working in higher education in Scotland, in the most recommended post on the thread. Others observed: “Higher income families children certainly start, continue and end with a financial advantage – nothing will change that fact! “ … “All that this indicates is that students from wealthier backgrounds benefit from having, er, wealthier backgrounds.” … “Poorer students are always going to leave uni with more debts … That is such an obvious truism it’s not worth a newspaper article, let alone a report”… “Short of a Bolshevik revolution, that’s not going to change.”
Yet in fact there is nothing inevitable about sending our poorest students out into the world with the most government debt. Even in the absence of Bolsheviks, it does not happen in any other part of the UK. Using higher maintenance grants, all three other countries do more to recognise inequalities in family income. As a result, only for Scottish students is it true that the lower the income, the higher the government debt. Within Wales, where the maximum grant is over £5000, lower-income students are not only the lowest borrowers but even with fees will usually end up with less debt than their Scottish peers. That’s another story, however.
The poorest were anyway already doing pretty well, several people suggested. As one poster explained: “As far as I was aware, ‘poor’ students get a higher bursary, or used to, which they never had to pay back, I knew people getting thousands of pounds, so I dunno how that makes them ‘worse off’.. whereas I have taken out £4K loans every year, so after 4 years will have to pay back £16K. (however ive been putting it all into my savings account to buy a flat in the future)”. The maximum grant for a young student in Scotland is now £1,750, falling to £1,000 when incomes reach £17,000. The expected borrowing to go with that next year is £5,750.
It was “unfortunate”, one poster admitted, that students who started out from poorer backgrounds are likely to end up owing the government the most. Yet even those who were generally sympathetic to more use of grant, as some were, saw no evidence of a systemic failure, only an essentially good system that could perhaps do better.
There was fierce resistance to the idea that Scotland’s low grants were in any way related to its decision to prioritise spending on fees. “There should be more financial support for living costs for students from poorer backgrounds. I think we can all agree on that. However why is this being linked to tuition fees?” Both should be possible, some said.
Well, in theory, yes. But in practice governments make choices. Spending on grants and fees comes out of a single pot at the Student Awards Agency Scotland (SAAS). There is less money in that pot than there used to be and, with fees sacrosanct, the cuts to it have fallen exclusively on grants. Annual spending on these will have reduced by at least £40m, or around one-third, by next year. Meantime, had the graduate endowment continued, it would now be providing SAAS with a cash injection of over £30m a year. It may not be comfortable to admit, but what’s available for grants has clearly been affected by policy on fees.
On the thread, only one poster identified herself as currently being a low-income student. She was from England, and praised the low fee/high grant regime she enjoyed as a pre-2012 entrant. Another referred to a friend who felt “betrayed” that grant cuts of £1000, and more, had been imposed on students mid-course, with no announcement. Otherwise, the views of current or soon to be students with incomes below the grant line appeared, as so often, to be absent from the discussion.
So perhaps it is not surprising that those defending the current model for funding students in Scotland seemed not to see providing grants as such a priority task for the state as preventing charges. Make tuition free and the important job is done, was the common message.
Under the post-war settlement, by contrast, free tuition and decent levels of student grant for students from lower income families were both seen as essential. Other parts of the UK have departed from free tuition, most dramatically in England, but resurrected grant. In Scotland, by contrast, free tuition is vigorously defended as an entitlement but grant is diminishing and regarded as, at best, a “nice to have”. For most living costs, though not for any element of fees, loan will do. As a result, only in Scotland are those who start university with limited access to family support likely to sign away to the state a great deal more of their future earnings than those whose families are better-off.
I can’t agree with those who see no fundamental problem with that and suspect we might usefully hear more from those most affected by our changing attitude to grant. But any discussion here is a start.
It may be a while before many of us will honestly be able to say that we have read much, or even any, of Thomas Piketty’s Capital in the Twenty-First Century. Even so, accounts of the book such as the one recently given by Paul Mason in The Guardian are enough to make you wonder what Piketty would do, given the chance to redesign any of the various student support systems currently in use in the UK.
Here is Mason’s summary: “Piketty’s argument is that, in an economy where the rate of return on capital outstrips the rate of growth, inherited wealth will always grow faster than earned wealth. So the fact that rich kids can swan aimlessly from gap year to internship to a job at father’s bank/ministry/TV network – while the poor kids sweat into their barista uniforms – is not an accident: it is the system working normally. If you get slow growth alongside better financial returns, then inherited wealth will, on average, “dominate wealth amassed from a lifetime’s labour by a wide margin”, says Piketty. Wealth will concentrate to levels incompatible with democracy, let alone social justice. … 21st-century capitalism is on a one-way journey towards inequality – unless we do something”.
At least one commentator has already suggested that Scotland’s system of free tuition is an example of exactly the sort of thing Piketty would approve of. However, once the whole Scottish system of student funding is considered as a package, as it should be, the opposite seems more likely to be true. Unlike any other part of the UK, Scotland expects the highest levels of student debt to fall on those who started out from poorer homes while many from better-off backgrounds are likely to leave university with little or no debt at all. The children of the poorest will therefore have to forego more of their future earnings than the children of the better-off, even if their wages are lower. That is a policy which will clearly make it harder for people from poorer families to “amass wealth over a lifetime’s labour” while advantaging those with more family money behind them. Piketty would surely see such a system as part of the problem rather than the solution.
Even a modest attempt to reallocate Scottish student debt more equally across the income spectrum would almost certainly be fiercely resisted by many at higher incomes. Referring to Piketty may be popular. Following his arguments to their logical consequences is likely to prove less so. As Mason puts it: “[Piketty] calls some of [his solutions] “utopian” and he is right. It is easier to imagine capitalism collapsing than the elite consenting to them.”
A longer reflection here (Piketty) on where Piketty’s arguments might lead for students in higher education.
Belated links to the pieces in last week’s Guardian reporting on The Fairest of Them All?
This one looks at how systems compare across the UK.
This one looks at the redistributive effect of decisions taken in Scotland over the past few years.
There was some subsequent coverage in The Herald and also The Huffington Post.
The detailed calculations on which the Guardian pieces concentrated are here (for the comparison between Wales and Scotland) and here (for redistributive effects within Scotland).
Searching for recent information on the current DSA review, I found this Scottish Government news release from March 2009 announcing the outcome of the previous DSA review. It says:
“In response to the interim findings, we have already increased the maximum threshold of the non-medical help allowance for disabled students by 60 per cent. Today, following the recommendations from the final report, we will be putting in place additional measures to improve the help available, from ensuring students no longer have to meet the costs of a DSA diagnosis to extending the DSA provisions to cover support with voluntary tutorials.”
The paradox is that – as an earlier post on this topic showed – spending on DSA peaked in 2008-09 and then started to fall. See here: DSA spend and claims The fall in spending in Scotland after 2008-09 was not reflective of a UK-wide trend, for example.DSA UK comps
So the news release describes changes which might have been expected to lead to an increase rather than decrease spending. Yet implementation of the review coincided with a fall in spend not seen anywhere else in the UK. That’s got to be a puzzle worth understanding better.
As far as I can tell, there’s not yet been an announcement on the Disabled Students Allowance consultation in Scotland (see here: the consultation paper was issued last June).
Meantime, the Student Loans Company has just provided a breakdown of DSA spending by income category in England, Wales and Northern Ireland (as an unexpected level of detail in response to a broader FoI request). The data tables are here DSA in England, Wales and NI by income 2012-13.
These figures show that there is not any strong relationship between the average value of awards and household income. In Wales, awards tend to be higher at lower incomes – but it’s not a very strong effect. The bottom graph here shows the pattern DSA graphs.
However, total spending on DSA does show a clear relationship with household income. Spending from the DSA budget is weighted especially towards those assessed as having nil income (eg mature students, those leaving care), as the top graph above shows, reflecting a greater likelihood that these students in particular will make claims. They receive a significantly larger share (between +70% and +90%) of DSA spending than their presence in the student population alone would predict, in every one of the three countries. Those at incomes up to around £20,000 also receive a higher share than those further up the income scale, though the effect is clearest below £10,000 and less strong after that.
Although Scotland is unique in publishing information on broad spending categories by income, it does not publish it at this level of detail, so a comparable analysis of the Scottish figures can’t be included here (though such data could no doubt be easily obtained for Scottish DSA). It would be very surprising however if the same general pattern did not hold, given how consistent it is in all three other jurisdictions and how closely aligned student systems in the UK were before devolution – DSA is part of that legacy. The Scottish DSA guidance SAAS DSA guidance 2014-15 quotes some similar figures to those in the press articles linked below, for example, though more expert readers may be able to spot important differences.
Last month, David Willetts announced plans to restrict more tightly what would be provided through DSA in England, principally on the grounds that much of what had been provided historically through DSA could now be expected as part of what institutions should themselves routinely provide. That prompted a very critical reaction from NUS, see here. This very interesting piece by Sarah Lewthwaite at King’s College London challenges the argument that technological changes and changes in institutional practice mean DSA is becoming less necessary.
The Scottish review has a different aim, suggesting only that the budget should be parcelled out from national government to those making assessments locally, who would then be responsible for its management day-to-day. My earlier post considered the questions that raised.
We believe that HEIs are better placed to consider how to respond in many cases, including giving greater consideration to the delivery of their courses and how to provide support.
… is a quote from David Willetts’ statement last month, but would not have looked out of place in the Scottish consultation paper. While the Scottish Government is not suggesting that DSA spending will be cut, or the rules changed, between 2010-11 and 2012-13 spending on DSA in Scotland had already fallen substantially in real terms, particularly once the transfer in of cash from the defunct travel grant scheme is excluded from comparisons. Similar explanations to the ones challenged in the Lewthwaite article have been used in Scotland to explain falling spend.
On these updated figures from the SLC, on the headline figures the average value of award in Scotland stands at 76% of figure for Wales and 85% of that in England last year. Once the new travel grant money is removed, the figures are 70% and 78% – though that comparison may be harsh, as it is clear from the Willetts statement that DSA in the south is used for some travel costs as well. Combine that with a much lower proportion of students being in receipt (3.1% as against 5.9% in Wales and 5.4% in England – these figures remain much the same as in the data originally analysed) and the picture is of much lower overall spend on DSA in Scotland than in these other two countries. Relative to the total size of their student populations, England spends around 90% more than Scotland and Wales 125% more. Only Northern Ireland is very slightly lower than us.
As my previous post observed, Scotland is the only part of the UK to have seen a steady fall in spending over the past three years (again, excluding the travel grant effect) and a drop in claimants between 2009-10 and 2012-13. Even if the plans to restrict DSA in England were to reduce spending on it very substantially, that would just bring the cash dedicated to disabled students there more closely into line with what’s already quietly come about in Scotland, and Northern Ireland too. Perhaps because England is addressing this through an overt policy change, the move down south is – unsurprisingly – proving more visible and contested. But the net result for students may be much the same.
In Scotland, this information from the SLC is a prompt that any changes to DSA are most likely to affect most those students with the least access to family funding, simply because they use the scheme much more. Practitioners doubtless know this already, but these figures provide the hard evidence. Given that in Scotland these students are already likely to be borrowing far more for their living cost support than their better-off peers and have seen real-terms reductions in their maintenance grant from 2013-14, this is a reminder that the DSA review remains one to watch, in the context of the wider debate about how well the Scottish system treats those from the most disadvantaged backgrounds.
Technical notes
The population data for England, Wales and Northern Ireland have been taken from figures provided in the same SLC FoI response, for maintenance loans. In all 3 countries, this set of figures captures the largest group of students. It is around 90% complete (ie a little over 10% of students don’t take out a maintenance loan). Non-borrowers are likely to come more from higher incomes, so using this data will tend to under-estimate the number, and therefore the proportion, of such students in the system – and over-estimate the proportion of lower-income ones. However, for the purpose of these comparisons it is a good enough data set. If anything, the assumption used here will tend to under-estimate the weighting of DSA towards low incomes – but the calculations could only be marginally affected by access to 100% accurate data, to which this author does not currently have access.
The SAAS data shows that in 2012-13, £7.487m was spent on DSA in Scotland, with 4,045 students in receipt. A separate PQ answer identified that £0.574m of spending in 2012-13 was on travel awards, transferred into DSA when the main travel grant scheme was abolished in Scotland in 2011-12.
This post provides more detail on the comparison of the borrowing expected in the Scottish and Welsh systems at low incomes, supplementing the tables in The Fairest of Them All? The figures are relevant to all Welsh students, wherever they study in the UK, but only to Scots when they study in Scotland. Scots leaving Scotland to study will be borrowing for the full cost of their fees, in addition to the figures shown here.
The graphs linked below show how for at least a third of students from the lowest incomes (technical note A below), the Welsh system is particularly favourable for those doing the commonest undergraduate degree, which takes 3 years in Wales and 4 years in Scotland. 3 year honours degrees remain rare in Scotland. For low-income students, the Welsh system also performs well for those on one year (eg HNC) and 2 year (eg HND) courses. For students on 4 year courses where full fees are payable for all 4 years (technical note B), the situation is more mixed, with Welsh mature students still generally facing less debt, but young students facing more.
These figures exclude the additional means-tested bursary funding provided directly by institutions, to which Welsh students will have much greater access (technical note C). There are plenty of examples where at this income range, such extra support is high enough to remove any excess debt where this does occur. As these schemes are uneven in effect they cannot be easily included here, but leaving them out does mean these comparisons provide an incomplete picture and will tend to underplay the ability of low-income Welsh students to keep their debt down, compared to Scots in Scotland.
The figures shown as bars compare the difference where students take out their full package of support, which at these incomes is between £283 and £1033 higher per year in Wales, for students living away from home. The line graphs show what the difference would be if students in Wales only borrowed enough to have the same spending as a Scot.
The comparisons are different for mature and young students, because mature students in Scotland are on a lower grant rate and expected to borrow more.
This graph shows the position for mature students at household incomes up to £25,000. Wales comp Scotland – mature students graph
For these students, debt will be lower for those from Wales, unless (a) they have an income over £23,000 and are on a two year course (eg HND) – although even then the extra debt is due all or mostly to their having more to spend or (b) they are paying full fees for 4 years south of the border. For 4 year courses at incomes assessed as below £22,000, the extra debt is also all due to the extra spending they will have. Only around 5% of mature students seem likely to have incomes of £22,000 or more (technical note D).
This graph shows the position for young students at household incomes up to £25,000. Wales comp Scotland – young students graph
For these students, before taking account of any institutional bursaries:
- all Welsh students will have less debt if they who can complete their course in three years anywhere in Wales, England or Northern Ireland, when a student in Scotland would take four;
- Welsh students on one year courses will have less debt up to £22,000: over that figure, there is extra debt but it is all due to extra spending power;
- Welsh students on two year courses will have marginally more debt, although under £22,000 the extra debt will all be due to having more to spend;
- Welsh students paying full fees for four years will have more debt than Scots on four year courses, though around £17,000-£18,000 that will all be due to extra spending. For those on four year courses, the combined effect of fee discounts for years abroad or workplace placements, and access to local bursaries, will determine whether their final debt is lower in practice.
These figures compare the position as at April following the end of the course. The further implications of the different loan schemes used in different parts of the UK are considered here and here.
Technical notes
General
The figures provided are for the academic year 2014-15 and for full-time students.
The figures take into account the interest which will accumulate on loans while students study, up to the point when they become liable for repayment, in the April after they complete: this takes into account that the interest on loans is higher in Wales. They also include the write-off of the first £1,500 of loan debt to which the Welsh Government is committed, which is takes effect once repayments start.
The figures are shown over the range £16,000 to £25,000. At all incomes between £0 and £16,999, the figures are the same and omitted simply to avoid compressing the graph.
The figures are for debt for Welsh students living away from home, excluding additional allowances for London. Welsh students living in the parental home will have less debt, but also less to spend. Scottish students are all on the same package, whether they live at home or away. In every part of the UK, the majority of students live away from home, although the proportion living with their parents is higher in Scotland than elsewhere.
The full data is available here.Wales-Scotland debt comps up to £25k for blog
A According to data from the SLC, in 2012-13, 38.8% of those under the latest grant arrangements for Welsh students were eligible for the full grant (household income up to £18,300), in Northern Ireland the figure is 39% (incomes up to £19,000) and England 45% (up to £25,000). In Scotland 35% of Scottish students receiving support from SAAS were assessed as having an income below £20,000. In all jurisdictions some students will never seek government help, and these will tend to be disproportionately well-off. Even allowing for the data under-stating the number of better-off students, one-third is likely to be a cautious estimate of the proportion of students whose incomes are assessed as being under £25,000.
B For four year courses, for the additional year spent abroad or on a placement in industry students will not pay the full fee and may have access to other living cost funding (such as ERASMUS programme grants). Fee reductions are not applied in a standard way. However, for years abroad English universities are limited to charging no more than 15% of the fee.
C Means-tested institutional bursaries or fee waivers are most extensive in England, where they are a formal part of the system. Around half Welsh-domiciled students study in England. There, bursaries of at least £1,000 a year are widely available up to incomes of around £16,000 and most schemes give support up to around £25,000. Welsh universities offer such help more variably. Scottish universities run a variety of bursary schemes, but for Scottish students awards under these are available on far more limited terms and rarely (if ever?) with an automatic link to household income. The grids here provide a useful overview. The English grid suggests NSP awards are usually limited to English students, but checking individual schemes shows that they are more often open to students from across the UK, though some may offer lower rates to Welsh students, to recognise they are receiving more government help with fees. In the Scottish grid, the means-tested bursaries are mainly limited to students from other parts of the UK who are paying fees and are not available to Scottish students.
D The response to a recent PQ showed that 95% of awards under the Independent Student Bursary in 2012-13 were made to students at this income level, with very small numbers at each of the higher income points. It is unlikely that there are a large number of “missing” mature students from this data, except possibly some at lower incomes who are excluded from grant entitlement for reasons other than income.
This post provides the detailed data underlying the calculations at pp43-47 of The Fairest of Them All? on the net effect on Scottish students at different incomes of grant reductions and the abolition of the graduate endowment, over the period from 2006-07 to 2014-15.
The graphs showing how all young students at incomes below £30,000 face net higher debt as result of grant reductions, even after taking account of the abolition of the graduate endowment, are provided again here, with the associated data tables added GE and grant effects. The largest losses are at incomes between around £17,000 and around £24,000. Up to £30,000, young students studying for:
- 1 year (eg HNC) are between £1,000 and £2,000 worse off,
- 2 years (eg HND) are between £2,000 and £4,000 worse off,
- 4 year honours degrees are between £2,000 and £5,000 worse off,
- for 5 years, which will include many moving from an HN to a degree without full credit, as well as courses such as medicine, are between £3,000 and £7,000 worse off.
At low incomes, only mature students are better off, because they received no grant in 2006 and now do, though less than they did between 2010 and 2012, and they remain those most indebted group of students, overall.
The calculation of a £20m annual gain for those from higher incomes was reached by working out:
- what the total annual take from the graduate endowment would be now, had it continued at its previous level in real terms (£2,700). This was calculated using the figure provided by the Scottish Government at the time of its abolition for the number of students who would be liable (11,500), uprated to reflect the general growth in the number of students receiving fee support from SAAS for a first degree over the period (10%). That gives just over £34m. A different process for estimating this figure, based on government figures on actual income in 2006-07 (p41), gives £32m. The calculation is not very sensitive to different assumptions about growth in numbers: reducing that to 5% only removes around £1.5m. So assuming a figure over £30m for total income looks solid.
- how much of this would have fallen to students from incomes above the mid-£30,000s. In the report, I used an estimate of 60%, reflecting that while around half of SAAS-supported Scottish students fall into categories below £40,000 (leaving half above) the groups who were not liable for the endowment (mature and HN, especially) account for a disproportionate number of poorer students. So students from higher incomes will make up more than half the group liable for endowment. In fact, a more detailed exercise to remove mature and HN students suggests the split is likelier to be around 67%/33%.
Additional support for assuming students from better-off backgrounds were more likely to pay the endowment comes from this Scottish Government report, which noted that: “In 2011-12, 60.5% of full-time first degree students from Scotland’s 20% most deprived areas who were in the first year of a course would have had to pay the graduate endowment fee if and when they completed their course. This compares with 73.7% of such students from non-deprived areas in Scotland.” In passing, the report also estimated that the absolute number of new students in 2011 from the 20% most deprived areas who would have been liable to pay the endowment, was 1,235. It adds that students from this background had a 78% completion rate. So of students coming from the poorest 20% of neighbourhoods in Scotland, fewer than 1000 appear to have benefitted from paying the endowment – before taking into account their grant losses.
Note: these web versions correct the grant figures at 4 income points (£24,25, 34, and 35k): the original report used figures for grant for young students in 2014-15 which were £500 too high in each case and therefore underestimated the grant loss over the period in these four cases. No other figures are affected.
The Student Loans Company has just provided figures on average actual borrowing by income in England, Wales and Northern Ireland in 2012-13. The figures, with those already published for Scotland, are here UK debt distribution data. They cover all borrowing, for fees and maintenance and provide for the first time up-to-date comparisons by income of actual student borrowing across the UK.
How debt is shared
Looking at what students actually borrow in Wales, Northern Ireland and England, debt is shared quite evenly across the student population by income. Although students at higher incomes in these jurisdictions are in theory subject to higher loans, in practice within each of these countries graduates are leaving university with reasonably equal amounts of debt, regardless of their family background. This is what you would expect from the design of the schemes and taking account of higher loan uptake at lower incomes.
The picture is starkly different for Scotland. Here, students who are assessed as having no access to family support take out more than twice as much debt per head as they would if debt was shared equally among students. These are mainly mature students, but also lone parents and those leaving care.
Those at the next level up, with incomes up to £30,000, carry almost one-third more debt than they would if it was equally shared.
Those at incomes over £30,000 on average are carrying just over half of what they would, if debt was equally shared.
These 2 graphs show how the share of borrowing by income compares across the UK. The second one charts this against differences in average borrowing. UK debt shares
Actual borrowing levels
As a result, the annual figures for average actual borrowing by those deemed to have zero income in Scotland is already 85% of the figure for Wales, or only £750 lower. The gap opens up as incomes rise and is especially wide at incomes over £30,000. Here’s a graph showing the figures. Average loan per head in UK
These are annual figures, so it can be predicted that at the lowest incomes, Scottish students doing a degree and usually studying for a year longer, will in practice have more debt, in some cases nearly one-third more, than those from Wales or Northern Ireland.
These figures also predate the large grant cuts which took effect in Scotland in 2013-14. Just as the English averages will be higher again in 2013-14, so will the Scottish ones, as grant cuts and living cost increases provided purely through loans are applied to all SAAS-supported students, not only new entrants. These increases are likely to add between £1000 and £2000 to average borrowing for students at lower incomes.
The Welsh system is relatively stable. Next year Scotland stands a good chance of catching up and possibly even over-taking Wales for annual actual borrowing for some or all of the poorest third or so of students.
Is this a problem?
Not according to most of people who drive the debate about higher education and student funding in Scotland, who – it needs to be said repeatedly – largely come from the sort of backgrounds where people benefit most from this arrangement, although they may not realise that their benefit is being provided at the expense of others who start with fewer advantages.
Maybe the poorest students don’t mind carrying most of the debt, in the interest of keeping higher education much cheaper, or even free, for others. Or maybe they just don’t know they are doing it. It would be good to know which.
A post bringing together a range of information about Europe from the OECD’s Education at a Glance 2013 and Eurostudent IV Social and Economic Conditions of Student Life in Europe 2008-2011, both rich sources of comparative data on higher education systems.
On this data, only Denmark, with free tuition and the second highest public spending in the OECD on higher education, (more than) matches the UK in the extent of student support, while also managing similarly high graduation rates. Even then, it scores less well on inclusivity than some others.
Europe at a glance
The dominant pattern in Europe is for lower fees than in the UK, but also more limited participation, particularly when measured as achieving a higher education qualification, rather than simply initial access. On the most recent OECD data, graduation rates in the UK are 25% to 50% higher than in most other European countries. The exceptions are Ireland, Iceland, Denmark, Slovenia and Poland.
Student support is generally much more limited across Europe (with the exception of the countries discussed below), so that students’ access to private resources – their “ability to pay” – is a more significant issue. As long as successful widespread participation, and avoiding reliance on “ability to pay”, are policy goals in Scotland, a certain wariness might be advisable in seeking justification in practice in most of Europe for the status quo here.
The high support group
Eurostudent IV notes:
It appears that public support in all Scandinavian countries, England/Wales [note: Scotland should be similar] and The Netherlands reaches a high share of the student population (over 70%) and the state is a significant contributor to the recipients’ income (state assistance makes up between over 40% and 70% of recipients’ total income).
But the UK, not least Scotland, is unusual in the majority of students being limited to loans (only apparently otherwise the case in Iceland, Turkey and Latvia). Other countries, including Norway and Sweden, do however use loans as a significant element of what they provide, and always at higher interest rates than in Scotland.
The Netherlands charges fees (around £1,500), as does England and Wales (around £3,500 at this date). 10% of Norwegians are liable for fees of up to around £7000. The Scandinavian countries otherwise charge no fees to their own students.
(a) Value of support and student satisfaction
The total value of state support is more restricted in Finland than the other countries: there, and also in the Netherlands, on average students’ own earnings are their single largest source of income. Only in England and Wales, Norway, Sweden and Denmark is the single largest block of student income from the state. (No data on this for Iceland.)
Student satisfaction with their total income from all sources is generally in top half of the table for this group of countries, but Italy and a few others occupy the top spots. Attitudes are unusually sharply divided in Finland and Norway, depending on how much students have.
(b) Debt
Neither of these sources compare levels of student debt. However, as:
- Iceland uses only loans upfront for students support and its students are pressing for more to be converted to grant;
- Swedish students expect debt at levels similar to students in the US public system; and
- in 2004, Norwegian students reportedly faced £15,000 of debt,
it seems likely that the debt levels of non-Scottish UK students under the pre-2012 fee regime were paralleled at least in these cases. Limited reliance on family contributions make it unlikely that Scotland’s pattern of skewing debt towards the poorest is found elsewhere.
(c) The chance of getting a higher education qualification
Importantly, in this group only Denmark and Iceland achieve similarly high graduation rates to the UK: Norway, Sweden, Finland and the Netherlands are all well behind, despite high initial entry rates. Sweden, in particular, has a non-completion rate of around 50%. Credits towards a degree are reported to have reasonable currency in the Swedish labour market, which may help explain this. Non-completion is also particularly high in Norway. The Swedish system has also seen the least growth in the numbers in the general population with a higher education qualification over the past decade, with the lowest figure in OECD for this.
(d) Inclusion
Eurostudent undertakes complex analyses to compare how “inclusive” systems are. It notes: “Only few countries’ higher education systems can be classified as socially inclusive…. Ireland, Finland, The Netherlands and Switzerland“. Interestingly, these four countries all have relatively generous, but not the most generous, schemes of student support by European standards: the Irish and Swiss schemes are targeted on a smaller proportion of students than in the UK, Netherlands or Scandinavia.
Norway and Denmark do well on some but not all measures, so could also be considered among the more inclusive systems in Europe. Sweden is similar, but a bit more weakly so. Scotland is not part of this survey, but was included in the previous report, covering 2005-08. At that point, it was listed among the countries with an inclusive system. The rest of the UK is not assessed in either report, but from what information is shown, and the similarity of performance in widening access across the UK, might be expected to do at least as well as Sweden. Iceland is not covered.
(e) Public spending
In the period surveyed, across the OECD, only the four mainland Scandinavian countries had public expenditure on higher education (including research) which exceeded 2% of GDP. Iceland, the Netherlands and Ireland cluster between 1.4% and 1.7% (OECD average 1.4%). The UK is low, at 1%, reflecting the shift to loans for fees (the figure ought to be higher for Scotland). However, spending in higher education institutions per student from all sources is pretty similar across the group. Using the OECD’s “purchasing power parity” measure, it clusters round £6,000. Ireland is highest (though this may since have changed) and Sweden the lowest, with the UK just above the average. So students in all these countries benefited from similar levels of total spending.
This table contains some of the OECD data quoted above, mainly from 2010 or 2011. The Eurostudent material is less easy to extract as single figures.
| Graduation rate for first-time degree or sub-degree | Entry/non-completion rate | Growth in HE qualification rates in generalpopulation 2000-10 | Students (f/t and p/t)receiving some form of state support | Total public spending on higher education as share of GDP | |
| % | % | % | % | % | |
| United Kingdom | 62* | 64++/28 | 4.7 | 71 | 1 |
| Iceland | 59 | 68+/u | 6 | 63 | 1.6 |
| Denmark | 55 | 62++/19 | 3.9 | 78 | 2.4 |
| Finland | 45* | 69-/24 | 2.7 | 54 | 2.2 |
| Sweden | 43 | 60+/47 | 1.9 | 95 | 2 |
| Norway | 42* | 76-/41 | 3.4 | 83 | 2.6 |
| Netherlands | 40 | 60/28 | 3 | 85 | 1.7 |
| OECD average | 51 | 60+-/32 | 4.2 | u | 1.4 |
u = unavailable
Graduation rate for all forms HE, excluding international students * indicates deduction by author of estimate for international students using related data and/or includes added estimate for non-degree HE using related data, where OECD figures not directly provided
Entry rate for degree-level HE, excluding international students: + indicates excluded non-degree likely to be more than 10%; ++ excluded non-degree likely to be more than 20%; – indicates figure includes international students, no alternative OECD figure available
The graduation, entry and non-completion rates are each calculated using separate methodologies and cannot be simply related to one another, as contrasting the Danish and UK figures shows.
A bit more on cross-European comparisons. Although the most useful comparisons avoid looking at single factors in isolation, this post is about fees, because the Education and Culture Committee is currently thinking about how the UK compares on this issue with other parts of Europe, as it examines what could happen to Scotland’s system of free tuition.
Joan McAlpine MSP, treading with care, got it pretty much right:
“It is RUK, or rather—because I know that there are different systems in Wales and Northern Ireland—England that is completely out of step with Europe in terms of the fee level. Is that correct?”
George Adam MSP was a bit wider of the mark, however, with:
“the country next door is, unlike a lot of other European countries, charging tuition fees for students”.
As this useful briefing note from Eurostudent shows (look for the one called “Impact of Fees” in the list) the principle of a student fee/contribution of some sort is accepted across higher education in Europe as the norm (and is also common in the OECD more generally: see Table B5.1 Education at a Glance). [Update: the data omits no-fee (mostly) Scotland, Iceland and Greece, but also Northern Ireland, Albania, Bulgaria, Hungary and Belgium, which all charge fees, as well as most states in former Yugoslavia and Ukraine, whose fee policy I can’t quickly establish.]
[Update: fuller data from Eurostudent quoted here shows that “around 60 % of all Bachelor students in cross-country average actually pay fees. In Italy, Turkey, Ireland, England/Wales, The Netherlands, Portugal, Croatia, the Slovak Republic, Switzerland and France at least 75 % or more of the Bachelor students are subject to paying fees. In Italy, England/Wales, The Netherlands, Portugal and Switzerland, is the cover ratio (almost) 100 %. In the case of 6 countries – Germany, Estonia, the Czech Republic, Malta, Austria and Romania – the share of Bachelor students paying fees is below 50 %.” Though the position in Germany has since shifted, even taking account of the no-fee countries not included, it must still be the case that the majority of students in Europe are in fee-paying systems, even if not all of them pay fees.]
It turns out that the Nordic countries, and Scotland, are unusual in having zero fee regimes for their domestic students, though in Germany fee regimes have also lately been reversed. Even then, around 10% of Norwegian students go to private institutions which charge fees (loan-assisted, as in the UK) of up to £7,000, while all students are expected to a pay a small “semester fee” (£30-£70) each semester towards student services. This must explain why the briefing note shows that tuition fees accounted for 6% of Norwegian students’ upfront expenditure, averaged across the student population as a whole. [Update: more detailed figures from Eurostudent showed that, on top of fees, Norwegian students devoted 8% of their spending to ‘other regular study costs’ , the highest share in any of the many European countries surveyed. This covers expenditure on training, private lessons and further education.]
The figures in the note are from the period 2008-11, at which point fees in the rest of the UK were around £3,500 a year, still generally higher than elsewhere. So it’s surprising at first sight that tuition fees accounted for a lower share of regular student spending in “England and Wales” than in 4 other EU countries covered, at average of 17% across the (undergraduate, EU) student population in the UK.
Above England and Wales in this list are Finland’s near-neighbours, the Baltic states, which all charge fees [Update and correction: Turkey is also higher, but Estonia is just below] . Latvia turns out to have some students paying fees around £9,000, if they study medicine. Otherwise, fees there are more in the range £1,500 to £3,000. In Lithuania, they are between around £800 and £4,500 a year. In Estonia, they are £1,200 to £4,750.
The Republic of Ireland is also above England and Wales here. With a headline student contribution of around £1,200 at the time (it will be c£2,300 in 2014-15), tuition fees accounted for an average 22% of student expenditure. This probably reflects that those students liable for the student contribution had to find the money upfront themselves. There’s no equivalent to the UK’s fee loans. In the Netherlands, a headline fee of around £1,500 translated into 15% of students’ day-to-day expenditure.
The low(er than you might expect) UK figure almost certainly reflects that most students defer their fees through the use of a loan and only a few pay upfront in cash. If so, it is possible that the increase in the fee cap to £9,000 may have little impact on where the UK sits in this particular chart.
Apart from a minority of students in a few countries, it remains true that the headline level of fees now charged in England (and the devolved administrations for border-crossers) is unusually high within Europe, and exceptional for a whole system. That – rather than the principle of fees – is of course the more relevant point for the debate about future cross-border movement. Even then, what access rUK students would have in future to living cost support if they study cross-border is also salient (see here) and only lightly touched on by the Committee so far.
More generally, as the briefing note shows, there’s more to the debate about the impact of tuition fees on students than a comparison of headline charges. And as the OECD and Eurostudent both argue, there’s much more to comparing student finance systems than comparing fees. Both have produced useful figures which help look at student finance systems in the round. More on the useful material they have produced on this theme to come.
Adventures In Evidence 