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Postgraduate loans in England

Published Tuesday, March 6, 2018

This briefing provides details of the postgraduate loans systems in England, including the rationale for their introduction, the consultation process and the eligibility criteria.

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From the 2016-17 academic year, non means-tested loans of up to £10,000 have been introduced for English-domiciled postgraduate students taking masters courses at higher education institutions in the UK. (Loans are also available for eligible EU-domiciled students taking masters courses at institutions in England). The Government has additionally confirmed that it will introduce non means-tested loans of up to £25,000 for doctoral students from the 2018‑19 academic year.

This briefing provides information on the development of policy relating to postgraduate loans, including the rationale for their introduction, the consultation process and the eligibility criteria. It refers only to the English loans schemes.

Concerns with the previous funding of postgraduate study

The public funding available to postgraduate students has traditionally been limited compared to that available for undergraduates. Concerns were raised that a lack of available funding could be contributing to a decline in the number of UK postgraduate students, particularly those on taught courses, and could limit social mobility. Such concerns led a number of reports to recommend the introduction of some form of postgraduate loans system.

Postgraduate masters loans

In the Autumn Statement 2014, the then Chancellor announced that the Government intended to introduce a new system of income-contingent loans for postgraduate students under the age of 30 on taught masters courses from 2016-17. The March 2015 budget additionally announced that the Government intended to introduce income-contingent loans of up to £25,000 for doctoral students and students on research-based masters courses.

In March 2015, the Coalition Government published a consultation on the proposed loans systems. In its response to the consultation, published in November 2015, the Government stated that loans of up to £10,000 for both taught masters courses and research-based masters would be available from 2016-17. Under the scheme:

  • Non means-tested loans of up to £10,000 are available to eligible students aged under 60 on eligible one or two year full-time masters courses. Students studying part-time at a minimum of 50% intensity of full-time study, or on part-time courses of two or three years with no full-time equivalent, are also able to access loans.
  • Individuals who already have a postgraduate masters qualification are not eligible.
  • Eligible courses include taught, research, distance learning or professional masters courses across all disciplines.
  • Loans are available to eligible students studying at a publicly funded higher education institution in the UK or at an alternative provider with degree-awarding powers. Students ordinarily resident in Scotland, Wales or Northern Ireland are not eligible.
  • The repayment rate will be 6% and loans will be repaid concurrently with undergraduate student loans.
  • The repayment threshold will be £21,000 and will be frozen until 2021.
  • Repayments will commence from April 2019, but individuals will be able to make voluntary repayments before this time if they wish.

In 2015-16, home and EU entrants to taught postgraduate courses were up by 22% among full-time and 9% among part-time students. The funding council has attributed these increases to the introduction of loans.

Loans for doctoral students

Budget 2016 reaffirmed the Government’s intention to introduce loans for doctoral students and a technical consultation on the proposed scheme was launched in November 2016. The consultation closed in December 2016.

Budget 2017 confirmed that the Government would introduce doctoral loans from the 2018-19 academic year. The Government’s response to the consultation was published on the same day as the Budget. Under the scheme:

  • Non-means tested loans of up to £25,000 will be available to eligible students under the age of 60 as a contribution towards the costs of completing a doctoral qualification.
  • Eligible students ordinarily resident in England will be able to take their loan to any UK university with degree-awarding powers. Individuals ordinarily resident in Scotland, Wales and Northern Ireland will not be eligible for loans.
  • The repayment rate for the loans will be 6%. For students also with a masters loan, repayment will be taken through one single postgraduate loan repayment of 6%. Repayment will be made concurrently with repayment of any undergraduate student loans.
  • The repayment threshold will be £21,000, which will be frozen until 2021.

The full eligibility criteria will be set out in regulations prior to the introduction of the loans.

Commons Briefing papers SN07049

Authors: Susan Hubble; David Foster; Paul Bolton

Topics: Higher education, Students

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