In a report published this month, the liberal think-tank Centre Forum have outlined their vision for the funding of taught master’s degrees for UK students. The solution would be based on the undergraduate loan system with potential students being able to borrow up to £10,000 and begin repayments when they are earning £15,000 or more. A student earning £21,000 or more would payback £540 per year, allowing enough time for a £10,000 loan to be repaid over the following 30 years.
According to figures from the report, the number of UK students studying master’s courses has only increased slightly between 2003/4 and 2007/8. In this period the rise of total students studying at UK Higher Education Institutes rose by 29,115, with only 5,599 UK students. Meaning that only 1 in 5 new postgraduate students come from the UK.
The logic behind introducing a loan system for taught master’s is simple; investing in skills development would benefit the UK economy through higher tax revenues for the government as those with master’s earn on average 15% more than those with first degrees. The current alternative for students who do not secure any funding for their further study is to utilise career development loans. These are subsidised loans from the private sector that allow students to borrow up to £10,000, while the government pays the interest on the loan for the duration of the course and one month after. Payments from a career development loan total over £200 per month beginning one month after the course finishes. Given the current job market the thought of students have to begin repayments almost straight away regardless of earnings is a very daunting prospect.
According to Centre Forum, the upfront cost of the scheme would be between £0.5-£1bn per year and would be ready for implementation in 2015, but would initially only be available to students with first class or upper second class honours. Students who do not fit this criteria would not be eligible for the £10,000 loan. If this proposal were to be taken up by the government, leaving out students who have not reached a minimum of a 2.1 would be extremely unfair, especially as the report acknowledges that some students may have under performed due to circumstances beyond their control.
The principle of greater access to higher education is of course a good thing, but with undergraduate tuition fees increasing to £9,000 a year from 2012 and most universities set on charging the maximum, most students will leave university with approximately £43,000 of debt when maintenance loans are taken into account. The prospect of students choosing to enter postgraduate education and take up a loan of up to £10,000 could leave students finishing their higher education with eye-watering amounts of student debt- in excess of £50,000. A figure that is bound to deter students from undertaking postgraduate study, especially when UCAS applications by UK students for undergraduate courses have dropped 12% and 10% of A-Level students interviewed by ComRes put off completely by university as a result of the fee increase.
Rather than topping up student indebtedness even further, shouldn’t the government be investing in skill development and innovation by making more funding available for postgraduate students? Instead, there is less funding available for postgraduate study as a result of the coalition cuts to university funds. The EPSRC are cutting number of the PhD it funds by 1,002 and the AHRC are cutting funded Masters courses from 607 to 490. Students in the UK may decide the best option for postgraduate study is overseas, where EU citizens are exempt from tuition fees in countries such as Sweden and other countries across Europe have far more affordable master’s courses.