The student loan system operates on assumptions, and what Student Finance labels you as can make or break your university experience. Students are experiencing a harrowing reality; it’s splashed on the front of newspapers and discussed in political circles at length. It is also felt in our bank accounts, friendships, courses, housing (or lack thereof), hunger and mental health. Over half of students in the UK are working on average 13.5 hours on top of their studies, with many working well over that, and 1 in 5 students have considered dropping out due to cost of living. Many students experience these difficulties, and all students receiving a loan are left with a looming cloud of debt once presented to us as a faux-altruistic aid to the ‘best years of our lives’.
Until the late 80s, higher education in the UK was essentially free, with grants covering fees and living expenses. In 1990, Thatcher introduced income-contingent loans through the Student Loans Company, while grants covered fees. In 1998, Blair universalised tuition fees at £1000 a year, partly covered by grants and loans. Over time, fees have risen, interest rates have climbed, and loans have increased alarmingly, leaving students struggling to cope with current financial levels.
The system is becoming increasingly flawed. Unipol found that accommodation costs are taking up almost all of the average student loan in the UK, with rent increasing by 14.6% in two years and loans by only 5.2%. The average student receives just £496 a month from their loan when average monthly living costs are estimated to be £1,078 (£439 in rent and the remainder in bills and living expenses). This leaves students £57 after rent payments per month. This has led to an increase in students turning to increased paid work hours or more unconventional methods, such as sex work (3% of students as of 2023). These statistics paint a picture that largely underserves students’ financial needs.
This can be attributed to the rising cost of living and the flawed means-testing system adopted by SLC. Students are entitled to a maximum level of support depending on their parent’s income; the IFS found that for every additional £1 a parent earns, the student loses 14p in support. The lower threshold is held at £25,000 and has been since 2008, regardless of growth in nominal earnings. This stagnancy is rejecting thousands of students from apt financial support. Furthermore, in the current economic climate, families with higher thresholds, especially those with multiple children, struggle to offer appropriate financial support to children on lower loans. And yet, the system remains the same.
These flaws don’t even capture students’ difficulties in complex familial situations. The SLC system decides who is considered family; they often force step-parents or partners to be included in calculations, and students who claim estrangement must provide evidence of no contact prior to and throughout their studies. Recent findings suggest that some students have been penalised for involuntary or minimal contact with estranged parties.
We cannot continue with a system based on assumptions—assumptions of family support, forceful assumptions of what individuals define as definitive estrangement, or, worst of all, that complex situations are disguises for system abuse. Students are not concerned with ‘robbing’ the system; they are concerned with being able to afford to live.
These issues preempt the post-uni reality of repayment. Recent BBC reports found that the highest outstanding student debt is £230,000, and the average graduate leaves university with a debt of £44,940. It is not surprising that the Sutton Trust and HEPI identified that the loan situation is having an increasingly discouraging effect on working-class students’ higher education aspirations. With a now-tiered repayment system due to new plan introductions, students are experiencing varying levels of debt guilt and fear.
We come to university with a narrative of vibrancy, community, and opportunity. Too often, students are actually faced with no financial security and a constant struggle to decide whether or not they can afford to live at the most basic level. I would say that our current system is not only flawed, it is inhumane. This is an explicit call for all student representatives to fight for a better system for all students and for the system to gain the empathy and efficacy students deserve.
