Grahame Morris MP

Member of Parliament for Easington

Government’s flawed Further Education Loans system will hurt the UK Economy

July 18, 2012 Press Releases 0

On the eve of summer recess, Parliament had its first opportunity to scrutinise the Government’s flawed plans to introduce a loan system for mature students studying Further Educations courses.

Currently many students in further education pay 50 per cent of their tuition costs, with the Government paying the rest. However, from 2013/14, the Government will replace public funding with a student loans system, making mature students aged over 24 studying at level 3 liable for 100% of their course fees.

The policy is fundamentally flawed and risks putting adults off studying, training or re-skilling later on in life. The Government’s own impact assessments anticipates the loan system will reduce mature student FE applications by 45%, resulting in over 100,000 fewer people aged 24 or over taking FE courses.

Mature students face a “double whammy” of having to take out FE and HE loans if they want to study for a degree, undermining the incentives to progress to university.

Adult learners in FE do not have the same characteristics and commitments as traditional undergraduate students in HE. They often have work, childcare and family commitments that make them less likely to study in the first place and more debt averse. The withdrawal of funding runs counter to the Government’s stated aim of improving social mobility, lifelong learning and risks the UK’s future prosperity.

If the FE loan system was in place today 770 students studying at East Durham College, in my constituency, would be affected, of which 70% are women. Across the North East 16,880 learners will be affected in further education colleges alone.

Further Education hugely benefits the UK economy and society as those with a FE qualification generate £70 billion over their working lives above those without qualifications – for every £1 invested, an apprenticeship generates a return of £40. The plans undermine the knowledge and training bases needed for a more skilled UK workforce, impacting our economy’s global competitiveness.

This is yet another example of a short sighted, short term Government policy aimed at deficit reduction that will not only undermine our economy but also the life chances of people in our community wanting to improve their training, skills, and employability. Undermining our education system is not a path to growth; this latest policy follows on from the disastrous decisions to remove Educational Maintenance Allowance, and the tripling of university tuition fees – despite the Lib Dems pre-election promises.

The introduction of FE loan fee will only compound the worrying trend in Higher Education where, according to UCAS, university applications from mature students have reduced by 11.3%, with an overall decline in university applications of 7.7%.

I will continue to support the vast majority of professionals in the FE sector calling on the Government to delay the introduction of FE loans to afford Parliament the time needed to scrutinise these fundamental changes to our education system.


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Our progress as a nation can be no swifter than our progress in education. The human mind is our fundamental resource.

John F. Kennedy


Education is the most powerful weapon which you can use to change the world.

Nelson Mandela