Would £15 million a year sound a reasonable investment to provide students and businesses with support to help our economy to recover from the pandemic and in the longer term start to combat our productivity crisis?
That’s all it would take to provide part time students taking higher technical qualifications or other level four and five courses with maintenance loans to give them a chance to fund their living costs and end a stark unfairness in the student support funding system.
The Prime Minister’s speech at Exeter College last year and the Skills for Jobs white paper made it plain that the government sees skills (and particularly technical skills at levels four and five) as a crucial component of the UK’s economic recovery from the coronavirus pandemic and securing its future prosperity outside the European Union.
A grand plan for skills
From next September, the government will roll out the first of a new set of level four and five higher technical qualifications. Significantly, and very positively, the white paper confirms that students studying these HTQs at colleges will, for the first time, be able to access the student finance system for their tuition fees.
The current student loan system will also be replaced with a new lifelong learning entitlement which will enable students to draw from the equivalent of four years’ post-18 education funding in chunks down to individual modules. This should help to dispel the common notion among potential learners that they are wasting their loan entitlement if they don’t apply for a bachelor’s degree in the first instance.
Level four and five qualifications are a particularly attractive option for mature learners. They are a less significant commitment than a bachelor’s degree in terms of time and money, and still lead to salary gains while leaving the option open to progress to a level six qualification at a later date. Research by NIESR has shown that in certain subjects, learners with level four and five qualifications can even out-earn their degree-educated peers.
Unfortunately, the 2012 increase in tuition fees caused a big reduction in these learners, with the number of part-time mature students studying at levels four and five declining by 67 per cent between 2009-10 and 2016-17.
Creating more flexibility and fairness in the loan system and opening it up to colleges could be a first step in tackling this decline and provide a route into higher level study for tens of thousands of potential learners. Colleges have a greater geographical spread than universities, making them more accessible to mature learners who have less mobility due to work and family commitments. The more managed learning experience of the FE environment may also be beneficial for those students who have been out of formal education for some time.
However, the potential for this vital reform is hampered by one key omission. The white paper appears to limit the loan book extension to tuition fees, and will not include loans for maintenance. This is already the case for part time level four and five qualifications at universities and is almost certainly the reason that nearly all of the students studying part time at these levels at my institution, London South Bank University, do so as apprentices or employer-sponsored students.
The pound in their pockets
The coronavirus crisis is causing major structural shifts in our economy. Many of the lost jobs in sectors such retail, hospitality and tourism are unlikely to return. When coupled with automation and the rapid pace of change in technology which could make 10-35 per cent of UK jobs redundant in the next 20 years, there is a clear need for greater access to retraining and short course support.
Research by MillionPlus into the attitudes of mature learners and the barriers they face has shown that maintenance costs are identified as their main financial preoccupation. Without maintenance support, it is simply unrealistic to expect individuals, who may have mortgages and dependents to support, to give up work or reduce their hours in order to study for an HTQ or another level four or five qualification.
The cost of providing maintenance loans would be modest, which means this vital reform is well within reach. By nature of being shorter courses, the Resource Accounting and Budgeting (RAB) charge on them is lower and mature students who are already in work can begin making payments back immediately. At the same time, more technically-trained individuals within our economy will almost certainly lead to higher productivity and tax receipts which offers huge medium and long term benefits to the UK.
At present rates, providing maintenance loans to the 3,815 students enrolled in HNC and HND part-time programmes at English HE providers in 2018-19 would add approximately £15 million per year to the loan book. If the number of students studying these courses doubled – as the government seems keen to encourage, it would still only cost £30 million.
This small financial commitment would show the government commitment to providing learners and businesses the support they need to help our economy to recover from the pandemic and combat our productivity crisis and fulfil the vision set out in the white paper.