Guest post by Brian Hipkin (@brianadamdan), Former Vice Chair AMOSSHE and CEO ReFRAME HE Consultancy.
Well it’s here at last, 465 days in the making, weighing in at over 200 pages accompanied by 50+ recommendations; the Augar ‘Review of Post 18 Education and Funding’ has emerged blinking into the light. It enters a radically different political landscape than the one that formed the backdrop to its creation in February 2018. Its main protagonist is days away from resignation, Brexit is consuming all the political oxygen and Parliamentary arithmetic means that the primary legislation required for any change to the headline Student Fee is unlikely to be passed this side of a General Election.
So, what is likely to survive and to have an impact on the everyday lives of Students, particularly those that are struggling to finance their way through Higher Education?
Today’s headlines will be all about the proposed cut in maximum tuition fee from £9,200 to £7,500 and the reintroduction of Maintenance Grants. The reality for students at University today is no change
If Augar’s recommendations are accepted it is only those students starting Higher Education in 2021 that will see any changes. However, these are in reality very small.
Whilst still studying your loan will attract interest at RPI rather than RPI + a percentage as it does today, a saving of approximately £200 per year on your accumulating debt whilst you are studying.
On graduation once you pass the earnings threshold you will still pay at 9% of your earnings, so no change.
Students graduating this summer will have to be earning approximately £27,500 before they start to have to repay. Under Augar if you are starting HE in 2021 by the time you graduate in 2024 the threshold would have gone back to £25,000 and will rise in line with average earnings after that and you will have to wait until 2064 to have any unpaid loan written off.
The levels of Maintenance loans are proposed to be tied to the National Minimum wage level for 21 -24 years old working for 30 weeks a year.
For a student starting HE in 2021, living away from home and studying outside of London this would represent a reduction, from a maximum of £9,095 rather than a projected 2021 figure under the present system of £9,212.
When income contingent Maintenance grants were removed in 2016, they had a maximum value of £3,299. Augar proposes their return, the maximum grant available is likely to be £3,000.
Tuition fee loans and maintenance grants are proposed to be extended to study at level 4 and 5 but will only be available if study is undertaken a ‘high quality’ institutions.
But what of the headline reduction in Tuition fees? The existing fee level of £9,200 will continue to be frozen until 2021 creating an 11% real effect cut in University incomes. In 2021 it is proposed that the maximum fee is reduced to £7,500 and after 2023 it will rise annually by RPI.
The gap in funding will be made good by directly by Government.
This last recommendation comes with the threat that unless Universities look to become more efficient and less reliant on large numbers of students on low cost degrees, cross subsidising high cost ones, the report would encourage Government via the OfS to directly intervene and channel the ‘top up’ direct funding to ‘high quality’ course with ‘better’ outcomes for students as judged by earnings, as well as STEM subject with higher delivery costs.
The much-trailed recommendation to deny students with three D’s at A level access to loans and maintenance grants, does not directly appear in the Review. It is retained as ‘big stick’ held over the heads of Universities in order for them to address the perceived issue of low ‘value for money’ for students as defined by poor employability, low post-graduation earnings and poor retention. They will have until 2022 to address these issues, if they fail to do so OfS will intervene to impose contextualised minimum entry thresholds, a selective numbers cap or a combination of both.
However, tucked away in the detail is the recommendation that funding should be removed the first year of Foundation degrees that form part of level 6 qualifications, making then effectively 4-year degrees. Where these exist, they are the most common point of entry into HE for those with DDD or below. The aim is to redirect these students into either Access Courses or into the world of work. If enacted this recommendation could have the greatest impact on widening participation.
Disappointingly, despite references to Student concerns over their cost of living outweighing concerns over Tuition fee levels, the report contains very little to help Students control their costs. Even with over 75% of Student’s outgoings spent on Accommodation, Augar leaves it to the OfS to look more closely at these costs. Simply asking it to provide better and more consistent data on costs, rents, profits and quality. However, this can only really be applied to University run Accommodation rather than the burgeoning private provider sector.
Unashamedly geared to reducing the cost of HE on the taxpayer, (Augar calculates this to be a reduction of £500 per student per year), there is little apart from the return at a lower level of maintenance grants for students to cheer.
Indeed, Augar admits that the Panels’ proposals will make HE slightly more expensive for students and anticipates a surge in applications for September 2020 to beat the start of changes in 2021.
So, whether all the recommendations are acted upon or if they slowly drowns in the tangle weed of a Parliamentary hiatus and Brexit dominated spending reviews, Students will still need to develop their financial capability and deliver value for money for themselves.