I beg to move,
That this House
has considered the impact of increases in the cost of living on further and higher education students.
I am delighted to see you in the Chair, Sir George. This is a timely debate coming as the new academic year starts. It is based on the two-stage inquiry undertaken during the first half of the year by the all-party parliamentary group for students, which I chair and officers of which are also present. We looked at the impact of the cost of living crisis on higher education students, on which we reported in March, and, in partnership with the all-party parliamentary group on further education and lifelong learning—whose chair, Peter Aldous, I welcome —on FE students, on which we reported in July.
Although many others have been impacted hard by the cost of living crisis, we were concerned that students should not be overlooked. We were not alone in that concern. Petitions Committee staff wrote to me last week to tell me that there have been six petitions to Parliament seeking support for students. It is important that students are not seen as a homogeneous group. In FE and HE, there is enormous diversity of students, including part-time and full-time; distance learners and commuter students; many with families and caring responsibilities, juggling work with study; classroom-based and apprentices; undergraduates and postgraduates; and home and international. Of course, there is the difference in the arrangements and responses across the four nations of the UK.
The current student cohort, though, have one thing in common: the double misfortune of educational disruption from covid and now the cost of living crisis. Our inquiry collated evidence from universities and student unions, and directly from hundreds of students who engaged with us. We drew on the work of others, including the Office for National Statistics, the Sutton Trust, the Institute for Fiscal Studies and Save the Student. I would like to thank Parliament’s Chamber Engagement Team for its work in gathering feedback since the debate was announced. Just over the past couple of days, we have had upwards of 160 students, parents and others contact us.
So what did we hear? First, we heard that the student support system has failed to keep up with rising costs and that it was already unfit for purpose when the cost of living crisis hit, particularly given the decreasing value of student loans. According to the Save the Student survey, the loan fell short of average costs that students face by £439 per month in 2021-22, and that had increased to a shortfall of £582 per month last year. Other factors include the freezing of the lower parental earnings threshold, which means that the proportion studying outside London who receive the maximum student loan fell from 57% in 2012-13 to 38% in 2021-22.
My constituent Elliot is starting his final year at university, and his biggest worry is securing affordable housing. The maximum loan he gets is not keeping up with the prices, and he spends at least two thirds of his loan on rent alone. His family cannot afford to top up his rent. Does my hon. Friend agree that dealing with such financial hardships can be a barrier to excelling at university and that much more financial support is needed to give students the freedom to focus on their education?
I echo the point my hon. Friend makes. Many of the comments that we received reflect the sorts of problems that his constituent faces, and I will come on to some of the wider points that he made.
Another contributory factor, according to the IFS, was the inflation forecast errors used to calculate loan increases, which mean that their real value is lower now than at any time in the past seven years. On top of that, we have had the scrapping of maintenance grants. The cumulative effect has pushed many students to a tipping point. More than a quarter of students were left with less than £50 a month, after paying rent and bills last year. As my hon. Friend points out, rent is accelerating at a significant rate. Our inquiry found 96% facing financial difficulty, with food, rent and energy the biggest pressures, but transport costs were also a key issue and particularly difficult for commuter students, many of whom chose to be home-based precisely to save money. Students have been struggling to get to their classes, access libraries and travel to placements.
The inquiry was a genuine learning exercise for us and we were particularly concerned to hear about the sharp increase in hours of paid employment taken by students. Of our respondents, 61% worked alongside their studies and 37% said that they are working more hours because of cost of living pressures. The Sutton Trust reported that about half of undergraduates missed classes last year due to paid employment. Around a quarter missed a deadline or asked for an extension on a piece of work.
They are often in precarious and insecure jobs. Johanna, one of the respondents to the Chamber Engagement Team survey, said,
“I have had to take several jobs, as the part time job sector is full of zero hours contracts with little stability and no promise of actual work. I am working more than I should have to and my grades are suffering.”
I congratulate the hon. Member on securing this debate. Some of the figures he has given are truly shocking. Does he share my shock that a quarter of universities are now running food banks? The fact that universities are themselves having to provide food banks for students is an indictment of the fact that clearly our young people cannot afford to make ends meet at university. Does he agree we should consider bringing back things such as the maintenance grant so that our young people can focus on learning rather than spend all this time trying to make ends meet?
I thank the hon. Member for her intervention and her support as an officer of the all-party parliamentary group. She is right about the shocking fact she shared about food banks. I will come to that and reflect on some of the recommendations she talks about.
As well as affecting academic work, paid employment also affects involvement in extracurricular activities. People might ask why that matters so much, but it matters enormously because volunteering roles involve networking, team working, leadership skills and wider opportunities. Those experiences give graduates that extra edge in the job market.
Hitting grades, weakening skills development and limiting CVs—this all means that those from poorer backgrounds, who are the ones relying on ever increasing paid employment, are particularly disadvantaged, reversing the efforts of successive Governments to widen opportunities and ensure that those who take advantage of higher education go on to succeed. Since our inquiry, we are beginning to see the impact on retention, with rising drop-out rates. The sector group, MillionPlus, has estimated that as many as 90,000 to 108,000 students might find it too difficult financially to continue to study.
Responding to all of those challenges, most universities have put more money into hardship funds. Others have developed initiatives to offset the pressures faced by students, though not uniformly. The sector probably could do more. Just last week, the Higher Education Policy Institute published a report saying that those initiatives included supporting students with food costs, providing both means-tested and unconditional hardship funding, and subsidising student activities. And, as Caroline Lucas pointed out, a quarter now have food banks on campus.
University support services have substantially increased their workload, extending the criteria for hardship funds, drawing in more eligibility, and working with their student unions. Our survey found that many students have not always accessed the funds available, either because they were not aware of them, which is a challenge for the sector, or because they did not think they qualified for additional help.
Recently, we have seen some universities moving to a three-day week in their timetabling on some academic programmes, to allow students to fit in their part-time jobs alongside study and to limit the impact of commuting costs. That may offer immediate relief, but it is not a solution.
There are other ways in which financial pressures are affecting life chances. Many students aiming for master’s programmes, which have become important as an additional benefit in the job market, said they were reconsidering. For example, Alex, who also responded through the Chamber Engagement Team, said:
“as a working-class student in my penultimate year, I see my peers consider postgraduate study and I wonder how they can afford it. I’ll never be able to save enough”.
Postgraduate research students told us that they, too, were struggling—that stipend payments are insufficient to meet living costs and that PGRs are ineligible for childcare grants as they are in education: they often cannot access hardship funds because they fall into the gap between the definition of being a member of staff and that of being a student.
There are issues to address across the board. Our evidence confirmed a disproportionate impact on already marginalised and underrepresented groups, disabled students, black and minority ethnic students, care leavers and students who are estranged from their families. The Sutton Trust found that students from lower socioeconomic backgrounds were more affected, with a third skipping meals to save costs. It also found that a fifth, mainly from disadvantaged backgrounds, plan to live at home as commuter students during term time to reduce costs. That might be okay for some. It might work in London, where there is a wide range of higher educational choices. However, it limits university choice and limits course choice for many students across the rest of the country.
Our inquiry made four key recommendations to Government for higher education. First, to provide further hardship funding to universities to enable them to support those most in need. Secondly, to increase student maintenance loans to restore their real value and to maintain that value by taking a similar approach to uprating benefits. Thirdly, to consider reintroducing maintenance grants, as was recommended by the review the Government commissioned from Sir Philip Augar. Fourthly, to increase the household income threshold for the maximum student loan, which has been frozen since 2008. At that point, the threshold was in line with average earnings of £25,000, but those average earnings are now £33,000.
I move on to our further education inquiry. I am sure the chair of the all-party parliamentary group on further education and lifelong learning, the hon. Member for Waveney, who is present, will cover many of the specific points, so I will skim over them a little more lightly. Our evidence found that, although FE students face similar financial pressures, many face additional ones, supporting not just themselves but in many cases having to support their families. FE students who responded to our survey reported difficulties with transport in particular and 72% said they face costs that put them in financial difficulty. Like HE students, they were working more paid hours to make ends meet, struggling to prioritise their coursework and classes and facing negative impacts on mental health.
Retention was also a key issue for colleges, with a decline in student attendance taking up resources to ensure students do not drop out of their studies. That is not just a problem for the colleges. Many students in FE are on technical and vocational courses—I know that is an issue close to the Minister’s heart—providing essential skills for the UK workforce. The Association of Colleges reported to us that bursaries and hardship funds are becoming an essential item for family budgets. It is a bit like the point about food banks. Some reported students walking several miles a day to college so they could use their transport bursary to support their family with food and energy costs.
FE does not have the funding of HE and colleges cannot provide the same support. Of serious concern to us were emerging reports that colleges have been dealing with a significant rise in family tensions and domestic abuse because of cost of living pressures and have been referring more students to supported housing. Shockingly, some colleges told us about increased safeguarding issues, with cash-strapped students vulnerable to criminal and sexual exploitation.
Concerns were also raised about apprentices, with an average wage of £5.28 an hour, not being eligible for the 16-to-19 bursary because of Government rules—apprentices often travel furthest to placements, attend more regularly and are left more exposed to travel costs. We subsequently heard about the particular issue facing young carers doing T-levels, who will lose their carer’s allowance if they study for more than 21 hours a week. So the cost of living crisis is affecting decisions not only about whether to remain in further education, but about the type of course, with many leaning towards shorter courses or those that lead more quickly to securing work, sacrificing ambition and limiting their potential.
Our key inquiry recommendations to the Government for FE included providing additional funding support so that providers can increase bursaries targeted at those most in need; reviewing the mandated eligibility criteria for bursary funds—this is an easy one as it does not cost anything—to provide colleges with more flexibility to determine eligibility; considering the case for extending free school meal eligibility so that colleges can provide more subsistence support; considering the introduction of free or subsidised travel for all 16 to 19-year-olds in FE or training; and increasing the apprenticeship minimum wage, including enabling providers to use bursary funds to support apprentices as well as other FE students.
My final point is that, in FE and in HE, the key takeaway from our inquiry has been the particular impact on students from poorer backgrounds. We are seeing the cost of living crisis damaging access and participation, limiting opportunities, affecting lives, levelling down not up, widening the skills gap and weakening our research capacity as a country. I hope that the Minister, and indeed the shadow Minister, will give full consideration to our recommendations.
Order. In view of the number of people hoping to speak in the debate, I am afraid I must impose a time limit of three minutes on Back-Bench speeches. I am sorry, but otherwise the number of people able to take part would be even more limited.
It is a pleasure to serve under your chairmanship, Sir George. I congratulate Paul Blomfield on securing this debate and opening it in such a comprehensive and diligent way. As he said, I chair the APPG for further education and lifelong learning, and I would like to thank the Association of Colleges, which provides our secretariat, for all the work it did in supporting the second stage of the inquiry, focusing on the challenges faced by further education students.
An online evidence session was held, during which we heard harrowing feedback from FE students about the experiences they are facing. Many of those in further education come from less well-off backgrounds and are already making enormous sacrifices to go to college. They are working long hours in part-time jobs, and many are supporting members of their wider family. The cost of living crisis has piled further pressure on them; for some, the burden has become intolerable and they have had no choice but to give up their studies.
Colleges are provided with funding to support students, but this is inadequate, and in many respects the crisis is deepening. East Coast College, with campuses in Lowestoft and Great Yarmouth, has been providing bursaries and free school meals. Two years ago, it was supporting 1,400 16 to 18-year-olds. Last year the number rose to 1,842, and this year the college has already received 2,200 applications, which represents two thirds of its student cohort. The situation is intolerable, and the negative knock-on effects are far-reaching. Many people are being placed under intolerable pressure and are making enormous sacrifices. Colleges themselves find their budgets stretched to breaking point, and that in turn leads to the ever-widening skills gap that affects our economic performance so dramatically.
As we have heard, the July report put forward six recommendations. I would like to highlight one that we speak about a great deal in FE debates: the need for additional core revenue funding for the sector. I acknowledge that in recent years, particularly with regard to capital funding, the situation has improved, but FE gets a raw deal. I urge the Chancellor to address that at the forthcoming autumn statement by providing £400 million additional revenue funding that can address the problems that the sector faces and also alleviate the particular challenge that FE students face.
It is a pleasure to follow Peter Aldous; I profoundly agree with the last point that he made. It is an even greater pleasure, Sir George, to serve under your chairmanship and to be able to congratulate my hon. Friend Paul Blomfield on securing the debate and also on the work done by the all-party parliamentary group for students, which provides material to underpin the debate today.
My own constituency in Newcastle upon Tyne East has a very large student population. Perhaps we are more famous for shipbuilding, heavy engineering and manufacturing cigarettes—all industries that have gone—but we are still famous for having a large student population.
Inflation is an evil that must be exterminated. Mrs Thatcher told us that in 1987 and it made its way into the Conservative manifesto. She might have added that once exterminated, it ought to stay exterminated. For reasons we all understand, it has broken out again and makes us face a series of challenges—some much more easily borne by the rich than by the poor. That is the core point that I want to make in my short address to this debate.
A number of funding authorities have had to address this question. In Northern Ireland, the maximum maintenance awards have been increased by 40%. In Wales the increase is 9.4% and in Scotland, although the support is provided in a different formula, it is a rise of £900 a year, which, depending on circumstances, is an increase between 11.1% and 17.6%. That is the devolved Administrations.
Maintenance loans in England are due to rise, as my hon. Friend the Member for Sheffield Central told us, by just 2.8%. That cannot possibly meet the general challenges of inflation. When we look at the factors that make up the specific pressures on students, such as rent increases, the cost of food, which has been particularly affected by the arable sector price increases, and transport costs as well, we see that students are disproportionately affected. Yet their interests have not been addressed, so they find themselves working longer hours to earn more money to keep themselves and become subject to an enormous amount of stress and anxiety. That could be a separate debate in itself.
It is a pleasure to speak in this debate, Sir George; I congratulate Paul Blomfield on securing it. He and I have worked together over many years. His careful stewardship of the APPG inquiries is typical of his attention to detail and his passion—shared, I know, by the Minister, my right hon. Friend Robert Halfon—for education as an engine for social mobility.
I was very pleased, both as Chair of the Education Committee and as a local MP with a large university and many excellent colleges in my patch, to be able to serve on the inquiry and contribute to it. There are a number of strong recommendations, which I want to endorse, including more targeted bursary funding and an increase in the earnings threshold for the first time since 2018. I hope my right hon. Friend on the Front Bench will be able take some of those up.
The two reports from the all-party group highlight several concerning trends for students, which look set to fundamentally alter how young people see the comparative value of different further and higher education routes. Where that increases the attractiveness of earn-while-you-learn approaches such as apprenticeships, it might in some senses be welcome, but where it reduces students’ ability to complete their courses or participate in the wider life of universities, including clubs, volunteering and community engagement, and where it risks increasing drop-out rates or requires students to spend so much time working that their studies and mental health suffer, it is a concern.
Local students at the University of Worcester wrote to me with a number of concerns that they wanted to be raised in this debate. They point out that the cost of living is acutely affecting those who live on their maintenance loans and feel that a number of the existing schemes to support people with the cost of living specifically exclude students. They say that student accommodation costs have risen 60% in our area in the last decade, and 68% of students who responded to their survey say that they can no longer afford course materials. One third of students have considered dropping out because of finances, and one third—compared with the quarter highlighted in the all-party group’s report—have been left at the end of the month with less than £50 after rent and bills. They call for an increased student finance package and tailored cost of living support for students. In that respect, the recommendations of the all-party group are very welcome.
The Education Committee has also heard concerns that students taking T-levels find that they cannot complete their courses because of cost of living pressures on their families; in many cases, they are transferring to apprenticeships to earn while they learn. I highlight the recommendation, which echoes the point made by my hon. Friend Peter Aldous, about FE funding in our report “The future of post-16 qualifications”; I gently say to my right hon. Friend the Minister that the figure cited in the Government’s response—that there is an increase of 2.2% for the FE sector—is clearly not enough. I know that he will want to make the case to the Treasury for more, and I hope that he will use the reports from the all-party group to strengthen that case.
I also highlight very briefly the Select Committee’s recommendation on allowing students and people in study to access the 30 hours of childcare. We think that that is an important part of the offer; it would ensure that people with parenting and caring responsibilities do not drop out of education and out of the opportunity to increase their earnings potential through upskilling.
I am grateful for the opportunity to have spoken.
It is an honour to serve under your chairship, Sir George. I thank my hon. Friend Paul Blomfield for securing this important debate.
Further and higher education students in my constituency of Liverpool, West Derby and across the country are facing immense pressure from the cost of living crisis, with rising bills, inflation and the Government’s real-term cuts to students’ maintenance loans. The maintenance loan simply does not allow students to cover basic costs or to live and study in dignity. The National Union of Students reports that more than a quarter of higher education students are left with less than £50 a month after covering rent and bills, and that 42% are surviving on less than £100. The impact on students’ health, wellbeing and education is devastating. Some 22% of surveyed students say that they often skip meals to save money, and, shamefully, a quarter of universities now have food banks.
A staggering 90% of students say that the rising cost of living is negatively impacting their mental health. Students are the very future of our country, and they are being driven into poverty simply for wanting to go to college and university to study. Surely higher education should be seen as a right accessible to all who want to go—an investment in a public good that is essential to the future success of this nation.
At a recent talk in Parliament with a superb class of sixth-form students from St John Bosco, in West Derby, about their plans for the future, it absolutely broke my heart to hear that many of the students felt that higher education was simply not an option for them because of the cost involved. I often hear talk about glass ceilings in politics; listening to the class that day reinforced my view that the cost of higher education for the working class was now becoming one of the biggest glass ceilings of all.
For over a decade in power, the Government have completely failed to support students in Liverpool, West Derby and right across the country. The coalition Government scrapped the education maintenance allowance, and the bursary fund that replaced it has less than a third of the EMA’s budget and stricter eligibility criteria that have excluded many who desperately need that support. That simply cannot go on. We need systemic change. We need an end to the underfunding of our entire education system, an end to under-investment in students and an end to the failed free market experiment in higher education.
“urgently and dramatically increase the level of maintenance support”.
I also call on him to listen to the APPG’s recommendations, which were outlined by my hon. Friend the Member for Sheffield Central. Finally, I ask him to listen to students in West Derby who are calling for tuition fees to be abolished and for a system of non-repayable financial support to be put in place so that they are not excluded from accessing higher education. Students and their families in West Derby deserve nothing less.
I congratulate Paul Blomfield on setting the scene. A term used often in this Chamber applies to him: he is truly a champion of education, particularly further education, and he has shown us his knowledge today.
I have spoken countless times in Westminster Hall and the main Chamber about how the cost of living is impacting people from all walks of life, and we must have sympathy for students in further and higher education. None of us is a stranger to how extortionately expensive it is to attend universities and colleges nowadays, and I have no doubt whatever that the cost of living crisis has added to that significantly. Back in March, when the impact of the crisis was still at its peak, we took many steps to ensure that students across the UK were supported. In some areas, rents were frozen and public transport for students was altered. Inflation in the UK had been running at more than 10% since the start of the last term, and students are still feeling the impact.
Some constituents have contacted me to ask, “What is the point in going to university?” When students and young people say that, we have to realise just how important it is to address this issue. Fees and the costs of books, accommodation and transport are not doable for some families. One of my staff members used to travel to university on a return train ticket, which cost £10.50 when she attended between 2018 and 2021. The same ticket today is £16.50. Students must travel at least three or four times a week, so that is £50 a week, or £200 a month, for a student to attend their place of education. Some students are attending university three or four days a week and working full time as well, and they are just about making ends meet. As the darker and colder weather approaches, many fear that circumstances will arise whereby they simply cannot afford to continue. That means dropping out, which is even worse. Many are already having to resort to asking their parents for help or seeking emergency loans.
I ask the Minister, who is a good Minister—as he knows, everyone in the House respects him, which is important to put on the record—to speak to Student Finance Northern Ireland about maintenance grants in Northern Ireland. The price of fuel, electricity, rent and food has gone up, but Student Finance NI does not deem it necessary to increase maintenance grants accordingly. The hon. Member for Sheffield Central referred to some of the costs that have risen.
We often talk about how young people are the future and how we build the environment we live in today to encourage them. The fact is that they feel beaten before they have started, with excessive, debilitating bills coming from every direction and hitting them head on from all sides. More needs to be done. We are all making the same request as we approach this winter, to ensure that our further and higher education system across the United Kingdom of Great Britain and Northern Ireland is sustainable and workable for all. Let us do something for our students, and let us do it today.
It is a pleasure to serve with you in the Chair, Sir George, and I congratulate my hon. Friend Paul Blomfield. He said almost exactly what I would have said, but I would not have put it so well. Colleagues of different parties have made similar points, so I will try not to repeat them.
I find myself returning to the point made by the Institute for Fiscal Studies that the value of maintenance loans for students from the poorest families is at its lowest in real terms since 2016-17, and the poorest students in England are more than £1,000 worse off than in 2021-22. Like Jim Shannon, I respect the Minister, but he has to explain how the Government have allowed this situation to develop, because there has been a paltry rise in the maintenance loan. I am sure he is embarrassed about it. He ought to be embarrassed about it on behalf of the Government, and they need to do something about it.
I will make a few quick points about the city of Cambridge, which I represent. Cambridge is a genuine education city, with fine universities, an excellent further education college and brilliant sixth-form colleges. But as the Cambridge University Students Union points out, although the University of Cambridge is a very wealthy university—perhaps the wealthiest in Europe—sadly Cambridge is also the UK’s most unequal city on some measures. In CUSU’s words:
“Students must pay extortionate rents, College bills and other hidden costs, while maintenance loans and University and College bursaries have been largely stagnant. Disparity across the collegiate University means that students’ experiences of both applying for and receiving necessary funding differ vastly.”
There are many different experiences, but the fact that one of the Cambridge colleges has had to set up a food hub speaks volumes about the situation in which we find ourselves.
I am grateful to Harvey Brown, the CUSU welfare and community officer, for pointing out the pressure on postgraduate students in particular. He said that some had been in touch to say that there is simply nowhere they can afford to live in Cambridge, with some suggesting that living in a tent was the only means of staying in the city to finish their studies. He also talked about postgrad and international students, who are reliant on scholarships and often depend on extortionate visas, and the visa criteria for international students being harsh, with some having to prove progression to maintain their visa.
There is a range of complicated issues here, but clearly something needs to be done to improve the situation. I also echo the points about further education students. I was told this morning that some are paying £2,000 a year in rail fares just to come to and from Ely for their education.
I will conclude by observing that there is quite a furore in the papers about the triple lock. Is it not extraordinary that there is not a furore about this generation, which is actually suffering here and now? Would it not be wonderful to see that on the front pages of the newspapers tomorrow?
I am lucky enough to represent the Leeds North West constituency, which has one of the biggest student populations in the country. Our universities and their students boost Leeds’s culture and economy, and provide lifelong homes for people like me who never quite manage to leave. I have heard from students in my constituency that they are taking more and more hours of work in attempts to cover their basic costs. It is not surprising that research shows that 49% of students have missed lectures or seminars, which they themselves are paying for, to undertake paid work. A quarter of students report that they are less likely to finish their degree as a direct result of the cost of living crisis. Even after receiving maintenance loans and bursaries, students in Leeds North West, and up and down the country, are unable to pay their rent and are at risk of homelessness.
The main universities and their student union executives in Leeds, and I am sure across the country, are doing outstanding work to support students. Leeds Beckett University has gone above and beyond with measures such as absorbing 80% of the increase in rental costs for those living in student halls, providing a hot meal for £2 every lunchtime for every student, and doubling the allocation of its student hardship fund to £3 million. Similarly, great work is being done by the executive officers at Leeds University Union, such as paying for additional course materials, tackling period poverty on campus and developing a basic needs hub for students. Last year, LUU offered 200 free breakfasts all the way through December, as well as a free night bus service. It is also campaigning for a real living wage for student staff.
According to the NUS, 92% of students state that the cost of living crisis has had an impact on their mental health, with 31% categorising that impact as major. We have a situation on our hands that has been worsening for a decade and is now impossible for the Government to ignore. We already know that black students, students with disabilities and students from areas with high levels of deprivation are more likely to drop out of university and less likely to obtain a first-class degree. Trans and non-binary students, as well as students of colour, are more likely to have an income of less than £500 a month. By failing to protect them, this Government are devaluing the education of all students who do not have the luxury of generational wealth.
The Tories have consistently degraded the worth of higher education. We saw it when they tripled university tuition fees, we saw it when they introduced cuts to education and anti-strike laws, and we are seeing it now as they leave students at the mercy of food banks and help from their university, student union or even other students. The fact is that students should not be setting up food banks on campus, or missing out on their education in order to prioritise a part-time job. PhD students should not be left without protections or adequate pay. The APPG recommendations on the cost of living crisis take up some of those points. I hope that the Minister will listen to them and act on this crisis in our universities for our students, which will have a real-life and real-world impact on our economy.
It is an honour to serve under your chairmanship once again this afternoon, Sir George. I thank Paul Blomfield for securing this important debate as we embark on a new academic term.
The current cost of living crisis has been felt acutely by the student population, who are particularly vulnerable to price rises. Monthly living costs for students have risen by 17%. A recent report by the Higher Education Policy Institute showed that 64% of students were skipping meals to save money and that a quarter of universities have set up food banks for their students, as Alex Sobel mentioned. Ultimately, such pressures can force students out of university and eventually out of the workforce. We cannot afford for that to happen.
Daniel Zeichner mentioned international students and the difficulty they have with visa fees. International students who are in the UK with a stipend or have some funding sometimes have restrictions put on them that prevent them from working, so they are incredibly vulnerable and they really have no way out of that situation. Working could affect their visa or their stipend, so they are in a very difficult situation.
I note with concern the recent calls from some hard-right Tory MPs—I hope that the Minister is ignoring them—to block particular low-achieving school pupils from taking out loans that would allow them to continue their studies. It would be useful if the Minister would confirm that he will disregard such calls from that group of MPs.
There has been a big impact on further education as well, and those in further education often come from a more disadvantaged background to start with. The issues around further education have been mentioned by a number of Members, notably the hon. Members for Waveney (Peter Aldous), for Strangford (Jim Shannon) and for Sheffield Central.
The hon. Member for Sheffield Central mentioned the cost of travel, saying that it was more difficult for many students to get to courses, so I hope that he welcomes the recent policy of the Scottish Government that gives every young person up to the age of 22 free bus travel. That has removed so many burdens from that group of youngsters. That is a policy that the UK Government could implement across England and Wales. It would make such a difference to young people, and would not be particularly costly.
Mr Walker mentioned childcare costs and it is important that we consider that many students have such costs. Being able to access the 30-hour offer would make a big difference to them and enable them to access their university.
Ultimately, everything that we are talking about means that students increasingly find themselves unable to stay on top of their studies. Grades can suffer and in some cases students will drop out altogether. It is notable that new data from the Office for Students affirms that students who were eligible for free school meals are the most likely to drop out of university; in fact, they are almost 10% less likely to complete their courses than students from more affluent backgrounds.
We have heard a lot—from the hon. Member for Cambridge, Mr Brown and the hon. Member for Strangford, among others—about increasing maintenance loans to keep up with inflation. The maintenance loan is significantly higher in Scotland than it is in England. That does not mean that it will always be enough, but it is certainly a step in the right direction, and increasing it would be an easy way for the UK Government to support students.
Of course, in Scotland we also have free tuition, because educational mobility should be based on the ability to learn and not on the ability to pay. I have great respect for the hon. Member for Sheffield Central, but he must accept that the Labour party is not in a good position just now on tuition fees, having rolled back its commitment to abolish them. It would be useful to hear where Labour is planning to go with that.
It is a pleasure, Sir George, to serve under your chairship today and to speak on behalf of my hon. Friend Matt Western.
I start by congratulating my hon. Friend Paul Blomfield on securing this extremely important debate, on all his campaigning on this issue and on his deep expertise in it, which has been of such value to the House. He has highlighted so many issues, as have other hon and right hon. Members, including the creaking nature of the student support system, the impact of increased hours of paid employment, impacts on life chances and wellbeing, and impacts on international students. I pay tribute to the work of the all-party parliamentary groups for students and on further education and lifelong learning. It is wonderful to see the chair of that APPG, Peter Aldous, here and to recognise the contribution that he has made.
We have had strong contributions, including from my right hon. Friend Mr Brown, Mr Walker and Chair of the Education Committee, my hon. Friends the Members for Liverpool, West Derby (Ian Byrne), for Cambridge (Daniel Zeichner) and for Leeds North West (Alex Sobel), and Jim Shannon. I also pay tribute to the work of the Sutton Trust, MillionPlus and other important research organisations. I note the vital role performed by universities and further education colleges in supporting students and their life chances, especially through this difficult time, as well as their key role in our education system and economy, and their support for businesses, our industrial strategy and our regional growth agendas across the country.
I am concerned that students have been an afterthought through the pandemic and then through the cost of living crisis. Inflation has skyrocketed into double digitals. The inflation rate for food items stands at 14.9%. We know that the causes of the cost of living crisis, while partly global, can be traced to choices that successive Conservative Governments have made that have reduced our resilience, and this is an important debate for us to continue to have. The situation is even more acute with our need as a nation to look at how we grow the economy and to ensure that we have opportunities at every stage.
A report released just last week by the Higher Education Policy Institute found that universities are being forced to take steps to support their students during the cost of living crisis that were previously unthinkable, whether that is having a food bank or recognising that many need food vouchers. It begs the question: which part of Britain is not broken? It is important to recognise that this impacts the ability of those institutions to support that transformational potential, which is their purpose of supporting students to take advantage of learning and improve their life chances. ONS research found that the cost of living crisis affects students’ academic performance, skills development, and health and wellbeing.
I will close with a few questions to the Minister, because he will see that the evidence clearly points to the negative impacts of the crisis on our students. The Conservative party should have solutions that are in line with, and part of, how we grow the economy, which is the first mission that we will have as a Labour Government. Has the Minister looked at which students are most impacted by the cost of living crisis? Will he take this opportunity to commit to an equality impact assessment of the impact of rising prices on students? What assessment has he made of the cost of living crisis on discouraging applications from students for certain courses, as has been raised by MillionPlus? How is he working with the FE and HE sectors on the challenges that they and their students are facing? I look forward to the Minister’s response.
It is a pleasure to serve under you, Sir George. I congratulate Paul Blomfield on securing the debate. He is an expert on higher education in this House and is widely respected. This is my first debate with the new shadow Minister, and she, too, is widely respected across the House. I know that we will have fierce debates, but I wish her well. I thank everybody who has spoken in the debate. I completely accept the pressures that students in further and higher education are facing, just as I accept that most people across the country are facing enormous cost of living challenges. I see that in my own constituency of Harlow. I am committed to social justice and I am keen that we do everything we can to support disadvantaged groups to progress up the ladder.
We need to set the context: £400 billion was spent on covid, alongside the war in Ukraine and our significant debt. However, even with that very difficult economic context, we are still doing everything we can to help disadvantaged students. Because of the number of Members who spoke and the short time left, I will write to individuals if I do not answer their points in the debate.
I will start with FE and apprenticeships. Students in vulnerable groups—young people in care, care leavers and those on disability-related benefits—may be entitled to yearly bursaries of up to £1,200. We have allocated £160 million to FE for discretionary bursaries. That is almost a 12% increase. That helps students with travel costs and the cost of books and equipment. That is an issue that has been raised by the APPG.
On apprenticeships, the hon. Member for Sheffield Central talked about the apprentice minimum wage. That increased by 9.7% to £5.28 an hour. I appreciate that that is not a huge amount of money, but the latest data shows that the median gross hourly pay for apprentices in 2021 was £9.98 an hour. A 2021 survey showed that pay increased with level of apprenticeship, from £8.23 an hour among level 2 apprentices to £13.84 among degree apprenticeships and £15.11 an hour among level 6 non- degree apprentices. We are investing £40 million to support degree apprenticeships to encourage more people to take them up. We have had more than 180,000 since we introduced degree apprenticeships in 2014. Those students have no debt; they earn while they learn. I gave the hon. Member for Sheffield Central the figures for what they are likely to earn. We know that they are going to get good, skilled jobs.
We have increased something I was very keen on: the bursary for care leavers. That was something I asked for and pushed for the moment I got this post. The bursary for care leavers who undertake an apprenticeship will increase from £1,000 to £3,000, so I am trying to do everything I can in these difficult economic times to help the most disadvantaged.
Let us move on to higher education. A lot has been said about the problems that students face. We have frozen the maximum level of tuition fees, against significant pressure. We have done everything we can on that. We are trying to minimise the debt burdens for graduates wherever we can. The hon. Member for Sheffield Central mentioned transport. He will know that, for students in South Yorkshire, there is a zoom 16-18 pass. It is 80p a journey on bus and tram.
I want to make a wider point to all hon. Members who spoke. They talk about disadvantaged students being denied the chance to go to university. A lot of that came up today, including from Ian Byrne. Actually, the figures show that disadvantaged students are going to university in record numbers. Not only that, but they are about 73% more likely to go to university than they were in 2010. That is something that I am very proud of. Daniel Zeichner asked what I am proud of: I am very proud that we are helping more disadvantaged students to attend university, and that we created 5 million apprentices, increased the number of degree apprenticeships and introduced the apprenticeship bursary.
We previously helped students living in private accommodation with energy bills. Alex Sobel mentioned mental health. We have given £15 million to the OfS to help universities with mental health provision. We are doing a lot of work on that, and I refer him to previous debates in the House on this subject.
There is more support for students who have disabilities, who get maintenance grants on top of that, of course. None of that was mentioned. We give £276 million—an increase of £16 million over the past year—to the OfS to help disadvantaged students across our HE system.
If I can, I will. I genuinely would love more time to bring people in.
That is a lot of money. I have examples: the university in the hon. Member’s own constituency has a £500 cash bursary, and in Liverpool, vulnerable students get bursaries of close to, I think, £2,000. We are trying to target significant help at disadvantaged students with that £276 million. The hon. Member for Sheffield Central will know that postgraduate master’s students can apply for loans of £12,000 per annum, and doctoral students can apply for loans of £28,000.
My hon. Friend Peter Aldous talked about core funding. He will know that skills funding is increasing by £3.8 billion over the Parliament, with £1.6 billion extra for 16 to 19-year-olds. We have just increased core funding by £185 million this year and £285 million the next year, on top of £125 million, as he knows. Wherever possible, we are trying to put more money into further education. My hon. Friend’s college has had a significant amount of capital funding and core funding, so I think he will be pleased with that. I hope that also answers some of the questions that the distinguished Chair of the Education Committee, my hon. Friend Mr Walker, asked.
On rental accommodation, I am sure the Minister will agree that too often students find themselves having to go for substandard accommodation due to price constraints. Will he consider that in delivering future support?
Of course, accommodation is up to the universities and private tenants—although we also work closely with the Department for Levelling Up, Housing and Communities—but I will look at that important point, because we want students to live in quality accommodation.
On the £276 million figure for the hardship fund, calculations from the House of Commons Library suggest that, while the cash value per student has increased in the last two years, in real terms it has actually fallen each year, with the 2023-24 level expected to be around 21% less in real terms than 2019-20. Will he look again at the amount of resource going into those budgets? Against inflation, it really is not enough.
If I can answer with a final, quick point about the £276 million, there were lots of universities —I can give figures from up and down the country—with bursaries of between £500 and £2,000 going to the most vulnerable students. We are trying to target help.
To conclude, there is one thing that has not been mentioned at all. Everyone here has looked at this in isolation from all the other help the Government are giving to hard-pressed families up and down the country. It is important to remember that the Government are spending around £94 billion—£3,300 per household on average—helping families, which includes students in FE and elsewhere, along with apprentices, to try and help them in every way we can. As in Sheffield and throughout the country, many of our universities and colleges are doing a great job in difficult circumstances, and the Government are targeting help at those who need it most while being fair to both students and the taxpayer.
I have to say that I was not sure whether securing the last debate before recess would do justice to our reports, but the number and quality of contributions from colleagues prove that my doubts were misplaced. I am grateful to everybody for their points, and I think there were a number of common themes from both sides of the House.
I know the Minister knows that his response does not go far enough and that we are in danger of reversing the achievements that have been made in widening participation in post-school education. I hope that our reports will be helpful to him, as Mr Walker pointed out, in making the case to his colleagues in Government, because the issues will not go away until we see real change.
Question put and agreed to.
That this House
has considered the impact of increases in the cost of living on further and higher education students.