George Osborne has revealed he will be extending government loans to almost 250,000 new students, and phasing out maintenance grants altogether.
New loans will be made available to part-time students, those studying in further education, and to all postgraduate students. Meanwhile loans will replace grants for student nurses.
Osborne had previously revealed in last year’s Autumn Statement a postgraduate loans scheme, but said at the time the new funding would only be available to students under 30 years old. The government will now raise the cap so all students under 60 can take out postgraduate loans from 2016/17.
The Conservative chancellor also said replacing “unaffordable maintenance grants with larger maintenance loans” will save over £2bn per year, but critics say this will deter poorer students from taking on additional debt.
The plans were revealed during today’s autumn spending review in which he outlined the state of the economy and his fiscal plans for the years ahead.
Speaking in the House of Commons this lunchtime, the chancellor said: “In the budget I announced we would replace unaffordable student maintenance grants with larger student loans. That saves us over £2bn a year in this spending review and it means we can extend support to students who have never before had government help.”
He continued: “Today I can announce that part time students will be able to receive maintenance loans, helping some of our poorer students, and we’ll also for the first time provide tuition fee loans for those in higher skills and FE, and extend loans to all postgraduates too.”
“Almost 250,000 extra students will benefit from all this new support that I am announcing today.”
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The National Union of Students (NUS) labelled George Osborne’s decision to open postgraduate loans to students of ages up to 60 as a victory for the ‘#CapsOff’ campaign.
The union also attacked the government’s plans to phase out bursaries for student nurses and replacing this direct funding with loans, saying: “saddling them with over £40,000 of debt will risk prohibiting access to the healthcare profession.”
The NUS released a statement reading: “We agree with the chancellor when he says education is the “foundation of opportunity and skill” – so now is the time for him to put his money where mouth is and prevent further cuts to the sector.”
NUS president Megan Dunn said: “The axing of bursaries for student nurses is disgraceful. It is crucial that healthcare students are not deterred from courses because of huge loans, especially when many will already have substantial debt from previous degrees. 50 percent of student nurses have children, and will naturally be more cautious when it comes to taking on extra debts.”
She continued: “Students are facing a crisis in the cost of study and living. These are not statistics on a spreadsheet, these are people who have to choose between putting food on the table and paying the electricity bill. These are people who will be forced out of education, losing often their only chance to empower themselves and their future.
“NUS will fight further cuts to our institutions, our courses and our resources, and continue to make the case for public investment in education and the future generation of this country.”