Student cash bid would see debt ‘ balloon’

Fears over funding overhaul plan

SCOttiSh students will be encouraged to take up thousands of pounds worth of debt under radical proposals.

According to a review led by a Scottish Government commission, everyone studying at universities and colleges should be entitled to an annual income of £8,100, made up of loans and bursaries.

this could see some youngsters encouraged to take an additional £2,000 in loans over their four years of study – despite a previous pledge by Nationalists to ‘dump the debt’.

the review has recommended an overhaul of the entire student funding system, including an annual income based on the living wage. however, this would come at huge expense to the public purse, adding at least £16million to annual costs.

A minimum income of £7,250 is currently in place through a mixture of loans and grants for university students from families with a household income of less than £17,000.

But proposals f or a new social contract for students in Scotland would make funding of up to £8,100 available to all students.

however, those from middleclass families would be expected to borrow the maximum of £ 6,225, with l ower- i ncome households able to access grants adding an additional £1,875.

At present, university students can borrow up to £5,750 to help pay for living costs.

the report endorses SNP manifesto pledges to cut the loan write-off period by five years to 30, keep interest rates low and up the student loan repayment threshold to £22,000.

Scottish Lib Dem education spokesman tavish Scott said: ‘this report is a cry out for repairing the damage the SNP have inflicted over the last decade. Young people from disadvantaged backgrounds are worse off i n Scotland than England.

‘the SNP slyly slashed bursaries for those needing help the most. they promised to end all student debt but have instead overseen its ballooning.’

Student debt has almost doubled since the SNP came to power in 2007 – from £6,000 to

‘Slyly slashed bursaries’

£11,740. it has abolished tuition fees but there are concerns about the availability of money for youngsters to fund accommodation and living costs.

EiS general secretary Larry Flanagan said: ‘While Scotland has taken significant steps to widen access to tertiary educa- tion in recent years, it is clear that much more needs to be done to ensure young people and potential adult learners are not debarred from accessing courses for financial reasons.

‘A return to a system of student grants and the removal of the prospect of debt from student loans would both widen access to education and provide a knock-on boost to Scotland’s economy.’

Luke humberstone, president of NUS Scotland, said: ‘the current student support system is broken. the poorest students in higher education are forced to take the greatest debt, while f urther education students have no guarantees that they will be entitled to any support.’

Review group chairman JayneAnne Gadhia said: ‘Our recom- mendations are based on a new social contract for students.

‘the establishment of a minimum student income is an essential step forward in delivering fairness and helping to ensure money is no longer a reason for dropping out of courses.

‘Non-repayable bursaries will continue to be focused on those from the lowest income backgrounds. And students can, if they so wish, access high quality student loans – on the best terms in the UK.’

Minister for further education Shirley-Anne Somerville said: ‘the report sets out a number of recommendations that would fundamentally change the way students in Scotland are supported financially.

‘it is only right that we now take the time to consider these recommendations in detail. We will set out our next steps in due course.’