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Students: Debts

Volume 458: debated on Monday 19 March 2007

To ask the Secretary of State for Education and Skills what estimate his Department has made of the average level of personal debt existing students will have accumulated at the end of their degrees. (127770)

[holding answer 15 March 2007]: The Student Income and Expenditure Survey 2004/05, published on 30 March 2006, is a comprehensive study on students' income, expenditure, borrowing and debt.

It showed that English domiciled full-time students graduating in academic year 2004/05 anticipated, on average, a total debt of £7,918. For those commencing courses after the introduction of variable fees in the 2006/07 academic year we expect average student debt of around £15,000.

A generous package of support is now available to students. The Government have re-introduced non-repayable grants of up to £2,700 for full-time students. In 2006/07 around half of new full-time entrants were eligible for a full or partial grant. Non re-payable bursaries, typically worth £1,000, are available from universities and colleges to those from low income backgrounds. Additional help is available to students facing financial hardship from the Access to Learning Fund administered by individual higher education institutions.

Student loans are available for tuition fees, as well as living costs, so no student has to find their fees before or during their studies. These loans are repayable only after a student has left their course and only then when their annual income reaches £15,000. The rates of interest are well below that of commercial credit and students only pay back in real terms the amount they originally borrow.