Access Funds and Hardship Loans: Review (Hansard, 25 January 2000)

§ Baroness Blackstone

My right honourable friend the Secretary of State for Education and Employment has today announced a package of extra measures for 2000–01 and 2001–02 to widen access to higher education and tackle student hardship in England and Wales. The full year cost of the package has been estimated at £68 million. This honours the commitment he gave to Parliament on 13 July 1998 to monitor the new student support arrangements introduced after the Dearing Report. It also builds on the findings of the review of access funds and hardship loans carried out last autumn.

The system of student support is working well: full-time entrants to higher education have increased by nearly 5,000 this year and more money is now going into universities and colleges. The system is fair and equitable to students, families, and the taxpayer. But our review highlighted the specific financial concerns of older students, notably the costs of childcare, especially for lone parents, school meals, and travel. The review also found that mature students, in particular, need guarantees of financial support if they are to undertake and complete courses of higher education. These new measures target extra help at full-time mature students, disadvantaged young people and parents on low incomes with children in higher education.

In 2000–01, £17 million will be set aside for non-repayable access funds bursaries for mature students of up to £1,000 per student, according to need, available at the start of the academic year. Further support, depending on circumstances, will also be available from a hardship fund of £57 million for students who run into financial difficulties during the course. Hardship loans will remain available to mature students but they will no longer have to take out a hardship loan before receiving support from the hardship fund. We will additionally provide an income-assessed grant to meet the cost of school meals for students with dependent children aged 4 to 16. We have also decided to ease substantially the income assessment for mature students, who will now be able to have £7,500 of their income disregarded without losing entitlement to student support, instead of a minimum of £820.

In 2001–02, three further measures will be introduced to widen access and tackle hardship. We will raise the parental contribution threshold from £17,370 (at 1999–2000 rates) to £20,000, which will mean that around 50,000 more families on modest incomes will no longer have to contribute towards their children's higher education. We shall also review the other contribution thresholds. Up to £10 million will be available for non-repayable bursaries through access funds of up to £1,000 for young students from disadvantaged backgrounds, building on schemes already developing at a number of universities. Both these measures will help students from families on low incomes with no history of entry to higher education. We will provide further help for mature students by introducing a means-tested childcare grant, based on the actual costs of childcare of up to £100 a week per child, for those with dependent children, which will be 195WA fully disregarded by the Department of Social Security for benefits purposes.

Where necessary, we will make amendments to the Education (Student Support) Regulations 1999 and the Education (Mandatory Awards) Regulations 1999 196WA to give effect to these changes for 2000–01. Amendments to regulations to give effect to the changes for 2001–02 will also be made in due course. Changes to the guidance on the use of the access and hardship funds will be given to the Higher Education Funding Council for England, and individual higher education institutions, shortly.