Loans for life – and beyond

Credit: Kirsten Colligan

Is parental income a fair indicator of financial aid?

When you hear the word “university”, what is the first thing that pops into your head? Freedom, independence, the future, parties, studying… or for many, debt. Most students, despite diverging social backgrounds, associate university with large sums of debt. For non-Scottish students especially, it’s a daunting thought that the pathway to a supposedly better, brighter future is littered with worries about money and survival. My partner and I are both English and are therefore subject to the £9,250 a year tuition fee loans charged by the University. We are completing 11 years of university between us and will total over £175,750 in student debt. Nonetheless, this financial liability is not split evenly between us. Tuition fees are standardised by each university, but maintenance loans are not. The amount of financial aid allocated to each student is devised based on parental income. The question is, is this a fair calculator?

The amount of money available to students is structured around tiers of household income. The first tier begins at £25,000 and under. If the parents of the person who wishes to attend university fall into this category, they are eligible for the maximum amount of student maintenance loans. As each tier of parental income increases by £5,000, the amount of money available to the student subsequently depletes. However, this hierarchy is capped at a household income of £62,180. Hereafter, students with parents earning above this amount will all be eligible for the minimum student loan.

Now, this is a bit of a controversial topic – between parents, between politicians and between young people ourselves. Many declare that if it weren’t for maintenance loans, they would be unable to attend university at all due to lack of funds to pay for the bare minimum of a roof over their heads, basic living costs and necessary study materials. However, there is a very prominent debate that university is meant to be the epitome of autonomy: a chance to be freed from adolescence and home restrictions, and to finally make something of yourself based purely on hard work and intellect. Many see university as a chance to begin on an even playing field before embarking on the future. How can the cord truly be cut if the system still refuses to acknowledge us as independent adults from our parents, and base our income upon theirs?

This is a tricky point to make as the supposed purpose of tiered loans is to force an equal playing field. For instance, if we all received the same standardised maintenance loan, the chances are, many middle and upper-class parents will still contribute a lot to their children, thus putting them at a financial advantage to their peers. Having students from low income families on a higher loan is supposed to relieve some of the financial worries of working-class students and encourage middle-class parents simply to make up the difference between their child’s lower loan and the highest loan – so that everyone is equal. But this is not the reality. One of the main issues is that the loan tier is capped at £62,180. This means that the child of someone whose household income is exactly this amount will receive the same amount as a child from a family with a household income of £200,000. Therefore, while numerous people agree that loans should remain tiered, many argue that the tiers need to be stretched out further than the current £5,000 gap.

Furthermore, many students who are obliged to take the highest maintenance loan for financial aid are forcefully trapped with a crippling debt that their lower maintenance loan peers are not. This is a paradox in itself due to the typically working-class stance that the debt acquired from higher education is not worth it; whereas middle and upper-class students are statistically shown to be more comfortable with acquiring debt, as they view it as delayed gratification. Therefore, it ends up with the students who fear debt the most actually being ones burdened with more of it!

Is it time to bring back student grants to relieve many students from the lifelong weight of student debt? But if we do bring back grants, how would they be allocated? Would they be given to students whose household income is very low, or be given out based on academic achievement? Or would this be a failed meritocratic dream due to the outstanding grades often guaranteed to those who are privately educated and therefore more likely to be financially comfortable – again excluding lower-income students from attending university? Or perhaps it is time to tackle the interest rates attached to student debt? No matter which route we take, students across the UK are calling for change and actual equal opportunities as they embark on their academic pursuits.