House of Commons Library

The value of student maintenance support

Published Wednesday, June 28, 2017

How have student maintenance support levels changed over time? How has the balance between grants and loans changed? What will the Chancellor's Budget announcement on the ending of grants mean to this and to potential students?

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 Summer Budget 2015 changes

The Chancellor announced on 8 July that new students from 2016/17 will receive all their maintenance support as loans -maintenance grants will end. At the same time the maximum value of support will increase to £8,200 (from its 2015/16 level of just over £7,400) for students living away from home outside London.

Recent changes in maintenance support

Maintenance grants, maintenance loan levels and income thresholds were all frozen in England at 2009/10 levels in 2010/11 and 2011/12.

2012/13 saw full grant levels for new students from England increased by 12%, maximum loan levels by 11%; changes to income thresholds and fee loans were extended to part-time students.

The full grant increased by 3.2% in 2013/14; 1% higher in 2014/15 and frozen in 2015/16. Maximum loans amounts were frozen in 2013/14, increased by 1% in 2014/15 and 3.3% in 2015/16. Income thresholds were frozen in 2012/13, 2014/15 and 2015/16.

New students from 2016/17 will receive all their maintenance support as loans; maintenance grants will end. At the same time the maximum value of support will increase to £8,200 in 2016/17 (from its 2015/16 level of just over £7,400) and £8,430 in 2017/18 for students living away from home outside London.

Key trends in the real value of the maximum maintenance support package over time are:

  • A gradual real reduction during the 1960s
  • A partial reverse in this cut in the late 1970s before further real cuts in the 1980s
  • The introduction of loans in 1990/91 which initially increased the value of the overall support package and gradually replaced grants over time.
  • The total value of support remained at around £5,800 a year (September 2016 prices) during most of the 1990s and up to 2003/04.
  • The reintroduction of grants in 2004/05 and the new grant in 2006/07 both resulted in jumps in the maximum value of support
  • The 2012 reforms increased the size of the support package for new students. Subsequent freezes or below inflation increases in grant and/or loan rates mean real values have fallen somewhat since then.

 

Trends in max value of support

 

This note looks at the value of the support for student maintenance since the late 1970s, shows the changing balance between grants and loans, describes the impact of this on public spending and looks in some detail at recent announcements on income thresholds for grants and loans. It includes a comparison of the changes to loan and grant rates in 2012/13, the current rates and the proposals made by Lord Browne.

The following Library publications give more information about changes in this sector:

The aim of this note is to look at trends in the level of support for maintenance, not specific eligibility criteria or additional grants/allowances for different groups of students. Details of these for students from England, Wales, Scotland and Northern Ireland can be found at:

More detail on loan and grant levels, income thresholds and variations by where the student lives, studies etc. can be viewed on the Student Loans Company’s website.

Commons Briefing papers SN00916

Author: Paul Bolton

Topics: Higher education, Students

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