Analysis: As well as funding reforms Augar review marks a shift away from the idea of university as the best choice for all students.
When the Augar review of post-18 education and funding in England was announced by former prime minister Theresa May in February 2018, it was seen by many as a kneejerk response to Labour’s better than expected performance in the 2017 general election, buoyed up Jeremy Corbyn’s pledge to scrap student tuition fees.
It was a time of mounting concern about spiralling levels of student debt and the loss of maintenance grants for the most disadvantaged. But while those concerns rightly persist today, the overriding drive behind the reforms unveiled by the government on Thursday will undoubtedly have been to lower the cost to the Treasury of financing England’s increasingly unwieldy student loan system.
The figures are eye-watering. According to the Department for Education, the value of outstanding loans by the end of March 2021 was £161bn and it is forecast to rise to half a trillion pounds by 2043.
To help tackle the debt, the student loan repayment period will be extended to 40 years and the repayment threshold lowered to £25,000. It will hit graduates – particularly lower earning graduates – hard, but will save the Treasury and the taxpayer billions.
But behind the long-awaited finance reforms, there has also been a shift away from the idea of university as the best choice for all students and a rowing back on earlier Labour ambitions to get 50% of 18-year-olds into universities.
A new consultation on a minimum qualification requirement to access loans to go to university has already been branded an attack on social mobility and disadvantaged students. Under the proposals, students who fail to gain a grade 4 GCSE pass in maths and English, or two E grades at A-level, will be blocked from accessing student loans and therefore going to university. In 2021 fewer than 5,000 students entered higher education without GCSE passes in English and maths.
In a briefing to the media, higher and further education minister, Michelle Donelan insisted it was not a “definite” direction of travel: “But it is something that I think it’s right that we explore as an option. We used to have an entry requirement in this country of two Es,” she said.
“We all know that there are young people that get three Es every year that feel compelled and pushed to go to university before they’re ready, and I think that that is doing them a disservice.”
The government will also be keen to use its reforms to crack down on what they describe as “low value” courses which they say saddle students with debt while doing little to increase their earnings – and crucially their ability to pay off their loans. The government is keen for students to study the kind of degrees which will guarantee graduate earnings.
There is also a new consultation seeking views on a lifelong loan entitlement for people to retrain flexibly at any time in their lives, worth the equivalent of £37,000, or four years of post-18 education. According to one sector insider it could be “the most significant education reform of the 2020s so far”, though it may well end up being significantly watered down.
While the headlines will focus on changes to loan repayments and minimum entry requirements, the government’s reforms also include interesting plans to cut the cost of foundation year courses and a new national state scholarship to support high-achieving students from disadvantaged backgrounds access higher education, further education and apprenticeships.
“Overall, people who hate the government will claim today’s package lets students, graduates and universities down,” said Nick Hillman, director of the Higher Education Policy Institute and a key government adviser when the current loan system was set up. “Meanwhile, those who love the government will claim it is a bold set of reforms. In reality, it is a quite carefully balanced package that sends some powerful signals about the government’s priorities.”