Budget’s student finance proposals will reduce government spending on higher education, but will raise debt for poorer students

Two major changes to student finance were proposed in the Budget. The replacement of maintenance grants by loans from 2016–17 will raise debt for the poorest students, but do little to improve government finances in the long run. The proposed freezing of the repayment threshold for loans, on the other hand, will – if implemented – significantly improve government finances because it will result in an increase in graduate repayments.
These are the main findings of a new briefing note published today by the Institute for Fiscal Studies (IFS), funded by the Economic and Social Research Council. More...