2016 Postgraduate Loan Applications
2016 looks to be an extremely busy year for those pursuing a postgraduate degree. George Osborne’s proposed plans will allow more than 40,000 students to explore the possibilities of further education on top of their respective degrees. The loans are scheduled to be available from the academic year starting 2016-17.
The government says the plan could increase the numbers of students entering postgraduate study by about 10,000 a year, increasing the competition to acquire a place on a master’s course. Competition could prove to be a positive in this otherwise highly scrutinised scheme, by raising the academic demands met at each university, meaning that students looking to pursue a master’s will have much, much more choice in where they want to go, and what they want to study.
There are however, some stipulations to this government- backed scheme that have not been received warmly. Notably, the Treasury made it abundantly clear that those students over the age of 30 will unfortunately miss out and not be eligible for the loans.
The head of the Student Money Advice Team at the University of East London, Sinead McCarthy is deeply opposed to the age cap, stating that it puts major restrictions on those who want to better their learning for the world of work. She is also opposed to the amount, believing that it is far from enough and does not coincide or accrue with an acceptable living wage, adding ‘even if you worked part- time.’
There has been further criticism as a result of these requisites set by the government. Russell Group universities and other leading institutions have publicly opposed the age restriction, questioning the fair play of the incentive scheme- the Universities of Leeds, York, Manchester, Sheffield, Warwick and Newcastle want to ensure fair access to postgraduate education. It was claimed in a report produced by the universities that the assumption that students over 30 are more financially capable was false and therefore misleading. Instead it highlighted that students above this age tended not to have a strong financial position.
There are also some concerns over repayment issues. Since the postgraduate loans would be paid back at the same time as undergraduate loans, graduates would be losing roughly 18% of any income over £21,000 to loan repayments alone once their earnings reach the £21,000 threshold. Once income tax and National Insurance contributions are accounted for, the current plans for repayments could see graduates taking home only 50% of anything they earn over £21,000, potentially leaving them with little spare cash at the end of each month. Tied with the concerns that the proposed £10,000 is not enough to cover a student’s living costs, particularly as this amount has not taken into account the location of where a student is studying. London is of course, the most expensive place to study. Master’s degrees cost around £8,000, whereas the UK average is £6,000, and given that the London living wage amount does not amount to Osborne's calculations, this could leave as little as £2,000 for students to live on for the entire academic year.