Uni funding: what if there's nothing in place by September?

Thursday 18 January 2018

Parents of students heading off to university in September this year are getting increasingly worried a promised new funding support package won't be ready in time.

Adding to the families' concerns is the fact that, as the proposal currently stands, around 200 of them will be actually worse off under the proposed new system,

Nicki Heath, a leading member of the Student Loan Support Group, said that while many parents got excited when the Treasury Minister, Senator Alan Maclean, made his shock announcement of funding support as part of the 2018 Budget debate - all students in households earning less than £150,000 may have their tuition fees paid in full by the government - they are now starting to realise that there is nothing actually set in stone. She said: "Not everyone realised that before something could  actually happen, there was a process the proposal had to go through, including the consultation and the Scrutiny before it would go back to the States. 

"We tried to tell them it was only a proposal, that we didn't have any details yet. But some people don't always understand how things work and because the announcement was made as part of the Budget Debate, people thought it was happening. It's not the case. The UCAS registration closed on Monday. A lot of people have taken the Chief Minister and the Treasury Minister's word that it would be something in place to solve the problem of higher education funding by September. What happens if it's not the case?"

On top of fears of a potential delay comes the fact that 2018 marks the first year an annual £1,500 loan from NatWest will not be available. The bank announced in 2017 they "wouldn’t be continuing with the current scheme." They however offered alternative proposals which the Treasury Minister considered. He confirmed: "Local banks provided financial modelling on the administration and debt levels of potential loan schemes when the Treasury was examining all options for funding higher education." 

Pictured: Senator Alan McLean, the Treasury Minister, said he would be surprised if his funding proposal is not accepted by the States.

Ms Heath said: "While it might not seem a lot for people, the loan represents £4,500 over three years which go towards maintenance costs. Some families rely on it to spread the cost after the degree finishes. People who have the problem now, with the current system, will find it even more difficult with the grant system. It is not improving the situation for them but making it even harder. It's about families who have to fund the difference between the maintenance grant and the actual cost and, unless another source of funding, whether through loan or borrowing, can be identified, they won't be able to.

"We are concerned that if something doesn't happen, the situation will be worse that what it currently is."

But parents in the Student Loan Support Group are not just hoping for the States to agree to the proposal. They want the proposal to address the concerns that were raised as part of the consultation, which received 3,000 responses the Treasury Minister revealed. Some of those concerns were mentioned during a Scrutiny hearing with the Education panel. 

Deputy Tracey Vallois asked the Treasury Minister about families on income support who will see their claims affected by the new system, and higher education "get in the way of the family's finances." She also mentioned families who indicated that they will be worse off because of the higher child allowance tax being taken away. The Treasury Minister replied that this particular situation would affect around 200 people but that his department understood that there were "some areas that need more work on" in the proposal.

Pictured: Under the current tax system, families can claim an increase in your tax exemption threshold for their children in higher education.

Ms Heath said: "We don't know what the proposal is going to be. The Minister has said it will not be what it was for the consultation. Problems were identified in the proposal especially for people in middle or in the lower incomes who will be worse off because the Higher Education tax allowance will be phased out. 

"It is difficult we are group made up of so many different families, some have one children to put in higher education, others have four. Some are low-paid, some are on the higher end, some have businesses which mean their income fluctuates. All we could do when people highlight glaring deficiencies is give the information to Scrutiny. We have to wait and see, we can only hope that since the Treasury Minister said that Education was a priority he will have listened to the people and solved the problems that people have identified."

The worst case scenario for parents would be to see the proposition rejected by the Assembly. Ms Heath said: "We are getting worried about this. The debate is in March, if the proposal doesn't go through, then it will be the election. Who knows who will be in the Assembly? It will put us back right where we are when this Assembly started, less the Natwest loan." 

Ms Heath had hoped that the Education Minister would have a 'Plan B' ready, in the event that the proposal would be rejected, but his Department replied it was a "financial issue." When asked about what plans they had in place the Treasury Department replied: "Education is a priority and the proposed investment will help Jersey students reach their potential. There is currently no reason to believe that this proposal cannot be delivered in time for September 2018. If the new proposals cannot be implemented in time, existing financial support will remain in place."