Scrapping maintenance grants is more vicious than it looks

It will now be much harder for poor students to attend university and for those that do - they should be aware that the terms of the loan, including the interest rates, can be changed.

Annie Teriba
20 July 2015

Flickr/christian.senger. Some rights reserved.

Poverty is costly. As James Baldwin once wrote, “anyone who has ever struggled with poverty knows how extremely expensive it is to be poor.” The current government seems determined to ensure that the poorest get the largest bill for their economic recovery.

This month, in the latest of a series of ideological attacks on access to higher education, George Osborne announced that the Conservatives are set to scrap maintenance grants for the poorest students. There was uproar, for a bit. Then people were told that it would be replaced with increased student loans. National Union of Students President Megan Dunn trotted out a slogan fit for the Troika - #cutthecosts. Facebook murmured with false outrage in the form of status updates which said ‘this is sort of bad’ in all manner of creative ways. Apparently the guilt ridden middle classes were placated by the myth that university would still be “free at the point of entry”.

To students like me, the message is clear: join the army, get an apprenticeship but don’t even think about a Russell Group. With £9k fee caps set to be linked to inflation for the country’s most prestigious institutions and grants to be scrapped for loans of up to £8,200, the annual cost of a degree will be at least £17,200, plus interest, for those who most need help to access university education. After jumping through the barriers of structural inequality, the poorest will pay the most for their education.

Most frightening is that, when the offering shifts from a grant to a loan, students are far less likely to take out all of what they are entitled to. Currently, this support is used to reduce the debts students incur by 50p for every pound of grant they receive. Had I been faced with a choice of scrimping today or being saddled with more debt in the future which would affect my ability to get a mortgage and leave me making payments for even longer, I would have chosen the former. When you know what bailiff letters look like, you are far less likely to take out more than you think you need. Having been that wide eyed first year, who had never seen such a large sum in her account, I know how easy it is to under-budget when there isn’t a safety net. Like me, many working class students will be budgeting for the first time and will do it wrong, leaving them stranded at the end of each term.

 This move will make the wealth divide on campuses even starker, and exclude working class students from accessing a social life on equal footing with their peers.

“They won’t be poor when they pay it back,” the chorus sings “they’ll be earning £21k”! However, the most unavoidable truth is that none of us know any of this for sure. To reveal that the student loans packages people are signing up for will never be set in stone would be catastrophic for our access efforts but to say otherwise is to be disingenuous. We focus so much on what the government is doing to fees in the future that we forget what it can do to those who have already graduated. As the Student Finance England terms and conditions say:

“The regulations may change from time to time and this means the terms of your loan may also change.”

The choice is sign up to these terms or don’t go to university. We got a glimpse of the possibilities this innocuous looking line could open up in 2013. Project Hero, commissioned by the government recommending a retrospective hike interest and the privatisation of around £45bn of the student loan book, was leaked to the Guardian.

And it's not only interest hikes; these vague terms and conditions tell us nothing about what it will be like to repay student loans. This simple sentence means that any of the terms of our loans can change. That means, if it so pleases, the government can lower the income threshold for repayments, push back the date of debt forgiveness and increase the monthly repayment rate. It is for this reason that grants are always preferable.

This government has laid bare its intentions for higher education: more marketisation and more inaccessibility. Unfortunately, wishful thinking has the power to transform myth into common sense. We keep singing from the same hymn sheets while the party of government has made it abundantly clear that it is willing to use that neat line in the T&Cs to sell us a false promise of fair access to university. Graduates are an easy target, but sell-out working class students like me, who left behind inner city council estates in the hope of something better, and it is us who will have to pay for their sins. Unless we fight this shameless attack on maintenance grants, we are complicit in thrusting the most disadvantaged students further into the clutches of this country’s nastiest loan shark: a Conservative government trying to eliminate a deficit whilst it cuts taxes for the rich. This policy will do little more than tax working class students for their disadvantage as the cost of poverty continues to rise at the whim of the Tories.

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