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Higher Education

Volume 712: debated on Monday 20 July 2009


This Government are committed to expanding higher education.

There are currently record numbers of students in higher education with 300,000 additional students in the system since 1997. Government spending on higher education is over 25 per cent higher in real terms than in 1997. By contrast, funding fell by 36 per cent under the previous Government.

Our expansion of higher education is more important now than ever before, as we continue to invest in developing a highly skilled workforce that is well placed to win the jobs the future economy will offer.

Demand for places this year is unprecedented, demonstrating that people continue to see higher education as a good investment and a valuable route to a good job and rewarding career.

We want to support all those with the aspiration and ability to succeed in higher education. Work with the sector indicates there are institutions able to recruit more students to meet the increased demand without compromising the quality of their offer.

Therefore an extra 10,000 higher education places will be made available to universities this year to support more students in going to higher education this year.

The Government will pay the student support costs for extra places in courses related to the New Industry, New Jobs agenda such as science, technology, engineering and maths—areas which will equip young people with the skills they need for the jobs of the future.

The package will fund the financial support for these students, which includes, for full-time students the fee loans to cover the cost of the tuition fees charged by institutions.

Institutions wishing to take additional students will be able to charge students on full-time courses in England up to £3,225 in tuition fees in 2009-10, the same as for other students. A tuition fee loan is available to eligible students to cover the full cost of the fee.

No additional teaching grant from HEFCE will accompany these additional students. It is for universities to manage their own admissions and we are confident that many will want to offer high quality places to students on this basis.

This is a fiscally neutral change—the costs of supporting the extra students will be met through reprioritising existing budgets and reducing the optional five-year holiday on repayment of student loans to two years.

The repayment holiday on student loans was announced in July 2007. All students starting a higher education course in 2008-09 or later, taking out their first student loan and having a repayment start date of April 2012 or later are entitled to a repayment holiday. The intention is to help borrowers to manage their finances if there are other changes in their lives. Qualifying borrowers will now be offered the choice of putting their student loan repayments on hold for up to two years as opposed to up to five years as announced in July 2007.

The expansion described here is a proposition affordable to the Government and viable for universities in order to meet an important need; helping thousands more people achieve their ambitions.

It is up to individual institutions whether or not or how many places they want to offer on this basis and we will ask HEFCE to oversee the process.

This funding for student support, which will be reprioritised from within existing BIS budgets, is in addition to the extra funding for additional student numbers provided in this year’s HEFCE grant letter. That funding was expected to result in an additional 3,000 full-time entrants in 2009-10 as well as growth in part-time entrants.

As a result of this announcement, we expect that there will be 50,000 more accepted applicants this year than just three years ago.