Martin Lewis: The 5 changes needed to improve the current student finance system

This is the discussion to link on the back of Martin's blog. Please read the blog first, as this discussion follows it.

Please click 'post reply' to discuss below.


  • HornetSaver
    HornetSaver Posts: 3,732 Forumite
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    For me, the repayment aspect for tuition and maintenance loans should be split out.

    If the state pays up front for the cost of a student's living whilst they're studying, then for me the student should in general be repaying that in full. The thresholds for that should be along the lines of Type 1 loans - all but the very lowest earners should be contributing to paying that off, and a large majority should end up doing so in full.

    Whereas when it comes to tuition, they should only be on the hook for repaying if this has actually translated into significantly better earnings than the typical non-graduate could expect over their career. The threshold for this element should be at a very minimum median earnings.
  • Mrs_Arcanum
    Mrs_Arcanum Posts: 23,976 Forumite
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    edited 31 May 2018 at 8:01AM
    Odd thing is, students who are confident enough to understand the system are not bothered by what Martin calls a graduate tax, nor the huge sums involved.

    Government and opposition definitely need to understand the system and refer to the repayments as a graduate tax.

    The thresholds at which parents are expected to help need reviewing and clarifying, along with proper allowances for siblings and pension contributions. The student loan forms are not at all clear in this respect.

    Universities could do more to help. Oddly if you are from a low income family and therefore getting the maximum maintenance loan, they will throw even more help your way. Where the ones who could use help are often from the middle income families, helping as best they can, but still leaving their children short of funds.

    Cap on fees rising for a while. Throwing money at universities does not improve or increase the number of tutors. - This is one of the biggest gripes students have over something their loans are paying for.
    Truth always poses doubts & questions. Only lies are 100% believable, because they don't need to justify reality. - Carlos Ruiz Zafon, The Labyrinth of the Spirits
  • HornetSaver
    HornetSaver Posts: 3,732 Forumite
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    Government and opposition definitely need to understand the system and refer to the repayments as a graduate tax.

    Problem is, who?

    The Tories begrudge all taxes that are referred to as tax and love those which are referred to as something other than tax. "Community Charge", anyone?

    Labour some would say are somewhat too fond of the word tax. And besides, their political opponents would - and genuinely gain traction by - stating that Labour had brought in a graduate tax, even if they literally just changed the name.

    The SNP's flagship policy is to use Barnett to ensure no tuition fees.

    And the Lib Dems' best bet at this point is to choose not to acknowledge the existence of a university system.
  • James005
    With parental support being implicit in the Student Loans mix, this should include a change in ceasing Child Maintenance Support liability for estranged parents only up to the age of 19 as currently this only forces (for those bad parents who need to be forced!) financial support to cover the college years for their children and not the university years too!
  • maybird_2
    maybird_2 Posts: 27 Forumite
    Maintenance is definitely the problem (I speak as a parent supporting two HE students and someone who has worked in the university sector and seen students struggling and in tears because of their lack of maintenance: 'my parents are on a good wage but they have a big mortgage and my little brothers are still at home', 'my dad doesn't agree with my subject choice and isn't prepared to fund it', 'I work two jobs but it still isn't enough to pay rent and eat and I am too tired and hungry to do my assignments')

    As a family who have experienced in the last few years of student support: P60 employment, two redundancies, going self employed, fluctuations in earning only clear enough at the end of the financial year once the books are done - we can say with confidence that the SFE system of parental income assessment is not fit for purpose. It cannot cope with changing circumstances and is parlous for the self-employed. It insists on a 'current year income' guess or the income of two years ago (instead of the often more pertinent income of last year). This needs to be improved.

    My suggestion would be that all students receive an annual "allocation" of a sufficient amount to fund their maintenance, irrespective of whether their parents are rich, poor or in the worst hit category (the 'just about managing') and irrespective of whether the parents support the student's choice of subject (they are either adults or they aren't). The students and supporting parents (if any) would then have the choice how much of this amount is drawn down. Those parents who can afford to pay the whole maintenance for their kids may pay it. Those who can afford to 'help out' will pay what they can to cut down the amount of debt/interest and not be worrying that if their circumstances change their kids will suffer because there will be a 'safety net' and those who can't afford or don't want to support their kid(s) don't have to contribute at all. That way the whole income assessment structure of SFE can be wiped out with all the bureaucracy savings that involves and students know they will have enough to live on but are free to to use all of it/ part of it or none of it according to their circumstances. There must surely be some way to make this work.

    Thanks for continuing to campaign on the issue of student finance.
    Waddle you do eh?
  • badmemory
    badmemory Posts: 7,903 Forumite
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    Full maintenance loan as they are 18 & adults so no actual parental responsibility. Also no interest added until they FINISH their course especially for the fees element of loans.
  • liz_bartun
    liz_bartun Posts: 183 Forumite
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    Also a change the placement year situation please?

    My daughter is on a sandwich course and the placement is not paid. Student finance pay a very small maintenance loan in this year as placements are expected to be paid. However, it is 'the norm' in the animal related courses that placements are unpaid. This appears to be completely ignored by the universities/student finance.

    My daughter has had to save so hard and I don't know how she has managed to eat while on this placement year. On the rest of the course she is entitled to the full loans, etc because of my low income. I cannot afford to help her out financially. I know this has severely affected her mental health (which is another huge issue that needs a massive shake-up).
  • LooosyLoo
    I think all points are very valid.

    As a mature student I am possibly more “worldly wise” than my younger counterparts and have always felt that they (we) are being shafted multiple times over from a variety of directions!

    SFE messed up my application for 2017/18 through their opened admitted succession of errors meaning that I didn’t get paid any money until late October and they only conclusively sorted out their mess in December. I am a “disabled” and “mature” student with house and financial responsibilities. I got myself into spiralling debt with a particular creditor which I am still struggling to manage and I have been so stressed out it has made me mentally unwell. What’s sickening is that it could all have been preventable and far more easily resolved than it was. They are accountable to nobody so their shocking policies, conditions, and service is inflicted upon unsuspecting customers (students) who have to basically “do or die”.
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