Increased student debt could turn people off higher education
updated on 14 February 2013
A report by YouGov SixthSense has revealed that students studying in the United Kingdom had a collective debt of almost £20 billion in 2012-13, and are also spending more than their collective incomes.
Commercial debt and money owed to friends and family accounted for approximately 15% (£3 billion) of the total debt, with the vast majority being owed to the Student Loans Company, which is owned by the state. The report showed that 72% of students make use of a student loan from the company, while 40% are in receipt of non-repayable maintenance grants. Nearly half of students (47%) also received financial help from parents and family members. This means that the average student in 2012-13 owed £940 to financial companies and a further £469 to family and friends. In terms of independent income, 31% of students were reported to be in part-time employment, which could be a contributing factor for the student population spending more than its income in 2012-13, even when factoring in income such as student loans. Last year, student spend was £21 billion, while total student income was £20 billion.
Student debt is also set to rise dramatically, following the increase in tuition fees to a maximum of £9,000 per year. The report revealed that the increase will impact the numbers of young people who will want to go to university when they finish school, with 28% of SixthSense's respondents claiming that a university education is not worth the high cost. Critics have claimed that the fee rises are precisely designed to discourage more people from attending university.
James McCoy, research director at YouGov SixthSense, said: "Our research shows that despite students getting financial help from the government, their parents, and taking part-time jobs to support themselves, most are still spending more than they are taking in. As a result, over a quarter of students say university is not worth the cost of the new, higher tuition fees. There is a very real threat that more young people will opt to skip university altogether."
