Are postgraduate loans on the horizon?

Source: Miles Cole

There is a long list of people who oppose the English undergraduate loan scheme on the grounds that it appears unsustainable. There is a similarly long list of people who want loans extended to postgraduate students.

Intriguingly, these two lists overlap a great deal. A Venn diagram with a circle for those who dislike the current system of undergraduate loans and another for supporters of postgraduate loans would have more people in the middle than in just one circle or the other.

Take Liam Byrne’s pamphlet Robbins Rebooted, published by the Social Market Foundation in August. In it, the Labour shadow minister for universities, science and skills complains that the undergraduate loan scheme is “a time-bomb waiting to go off” and “a free-market experiment gone wild”. Later in the same piece, he writes warmly of proposals from the thinktank IPPR (the Institute for Public Policy Research) and the University Alliance for postgraduate loans: “On my tours of various campuses, a postgraduate loan system consistently comes out as the second most important priority after cutting the headline undergrad fees cap.” (Notably, this section has been watered down in the version of the pamphlet on the Social Market Foundation’s website, but it survives in the version on Byrne’s own website.)

Similarly, the National Union of Students has hosted raucous protests against the undergraduate loan scheme, but wants loans for postgraduates so badly that it has proposed that three new loan schemes should be run concurrently.

At the 2010 general election, Julian Huppert, the outspoken MP for Cambridge, was such a strong supporter of the NUS’ anti-fees pledge that he signed it twice – once just before the election alongside Nick Clegg and once afterwards on his own. But he has long pushed loans for postgraduates, including at this year’s Liberal Democrat Party Conference.

It seems illogical to say that undergraduate loans are so flawed that they will not save money while also arguing that England can afford to extend them to postgraduates. But such views are not completely incoherent. The stance reflects the different starting points of undergraduates and postgraduates. Smaller loans for undergraduates and more loans for postgraduates both equal more taxpayer funding. Moreover, some supporters of postgraduate loans also want to see changes to the undergraduate finance system in order to improve affordability, while others argue that postgraduate loans could have tougher conditions, such as a lower repayment threshold, to improve repayment rates.

The challenge for politicians is less how to reconcile seemingly contradictory views and more how to ensure that the electorate listens for long enough to grasp such nuances.

Ironically, the most fervent supporters of the undergraduate loan scheme inside the coalition have been silent on whether they want loans extended to postgraduates. In one sense, they are right not to rush to judgement, and the mission groups would probably complain if they did. The Russell Group asks whether extending student support to postgraduates would bring new regulations in its wake. Others point out that as many postgraduates do not emerge directly from full-time undergraduate study, they may have a different appetite for debt from those who do. The civil servants I used to work with listen diligently to such concerns and will advise ministers accordingly.

Other postgraduate funding models are possible. The 2010 Browne report had very little to say on postgraduates, but we have gone from famine to feast since. As well as worked-up proposals from thinktanks and mission groups, the Higher Education Funding Council for England is spending £25 million on piloting a range of different approaches. Extending loans to postgraduates may seem the best idea around now, but these pilots could show it to be an overly simple answer to a rather complicated question.

Byrne said in his pamphlet that there is a “rumour” that the coalition will come forward with proposals on postgraduate funding in the Autumn Statement on 3 December. In fact, it is more than a rumour: it is a commitment in black and white, made in this year’s Budget documents, that will be hard to wriggle out of.

So the key question now is will the coalition pre-empt the results of the Hefce pilots? That would be a rejection of evidence-based policymaking but would also give it something concrete to say at the 2015 election to the first cohort of students paying £9,000 tuition fees, who complete their undergraduate studies around the time of the election.

Or will ministers put off the tricky decision to another day, perhaps by establishing a review of postgraduate finance that will not report until after the 2015 election? If so, it would not be the first time that a tricky higher education issue has been kept out of election manifestos through the device of an independent inquiry. But although it would give the politicians some cover, it would also offer nothing to the first post-Browne students blocked from further study because of financial constraints.