‘Our new age of inflation means attitudes among lower and middle-income parents are changing’

Prof Zahir Irani, deputy vice-chancellor at University of Bradford, warns that the convergence of new economic pressures and tuition fee policies risk harming the sector’s efforts to widen participation.

In the wake of the cost-of-living crisis, a new White Paper is needed on the affordability and funding of HE. This new approach is needed not only because of the pressures that our new age of inflation is putting on students and their parents – but for bigger issues of equality and diversity in the UK and to address what is already happening to the perception of the cost of HE. We cannot let new economic pressures undo the gains in social mobility made over recent years.

Our new age of inflation means attitudes among lower and middle-income parents are changing. Weighing the cost of living versus the size and nature of student loans is more of a talking point than it was: the expense of university is less accepted as a short-term cost for a long-term reward.

The Institute for Fiscal Studies (IFS) has pointed out some unhealthy trends in government decision-making since 2008, describing its approach as a “tightening of financial screws”.

Freezing the parental earnings thresholds and limiting increases in the size of maintenance loans compared with inflation has steadily made HE less of an attractive proposition for low- and middle-income households. The lower income threshold was set at £25,000 14 years ago, and with inflation should now be £34,000, but it hasn’t moved and isn’t anytime soon. As a result, there is a growing expectation that parents will fill in the gaps and pay for the leap in living costs. This expectation is a massive assumption that households are in a position to do so and will be able to prioritise spending in this way.

What is the purpose of higher education? What new models for funding and loan support can help the situation? To what extent are we willing to pay for inclusivity?

Loans are looking less attractive. With the increases in the Retail Price Index (RPI), the cost of borrowing for students has spiked to a massive 12%. According to the IFS, interest rates on student loans are expected to be a “rollercoaster” for years to come — encouraging more uncertainty and more stories about the impact of big increases on repayment bills. There is still a big question mark — and no consensus — on whether inflation is transitory or here for the long-term.

It is clear where the policy turn on HE is heading. Legislation proposed at the Queen’s Speech and in a now-closed consultation on HE reform will mean access to student loans is dependent on minimum eligibility requirements, potentially either a minimum of a grade 4/C in English and maths GCSE or two E grades at A-level. The understanding is that this would disproportionately affect ethnic minority students and people from lower-income households. Around a quarter of school pupils eligible for free school meals, says the IFS, would not be able to access a student loan.

University education is an essential part of encouraging social mobility: a pathway for people of any background (and age) to think about and see their potential differently, gain higher skills and realise ambitions. HE makes it happen in practical ways. This principle has been at the heart of decades of efforts to reverse the sector’s history of elitism, widen access and make universities an engine of inclusivity. Universities such as my own, the University of Bradford, lead the way according to the Higher Education Policy Institute’s (Hepi) English Social Mobility Index, which measures and compares the impact universities have on social mobility, graduate outcomes and how this improves learner life chances.

A good 21st-century society needs a basis of equality. Employers and the economy share urgent demands for higher skills, digital tech specialists, engineers, healthcare, and management professionals. Without support for diversity in the system, we could see a great deal of capacity and talent disappear. Quietly, step by step, more people from less-advantaged backgrounds will decide that a lower-skill – but paying – job makes far more sense than training.

Loans are looking less attractive. With the increases in the Retail Price Index (RPI), the cost of borrowing for students has spiked to a massive 12%.

Equality — trying to create a level playing field by making sure an ability to pay is not the most important (or only) factor — comes at a cost for taxpayers. Rather than allowing the role of HE to drift, for there to be new assumptions about who HE is really for and who can actually afford it, there has to be open debate and conversations.

What is the purpose of higher education? What new models for funding and loan support can help the situation? To what extent are we willing to pay for inclusivity? Is there a bigger role for employers to play in sponsoring and investing in future talent streams?

It is early days. For the moment, levels of Ucas applications continue to break records, but that is only because the impact of the cost of living, rising inflation and perceptions is yet to be revealed. Conversations around dinner tables about the viability of higher study – who is paying for what – are becoming very different.

Prof Zahir Irani is deputy vice-chancellor at University of Bradford. 


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