This General Election policy briefing, the third in our new series of briefings ahead of the next election, looks at the student maintenance system, which determines the amount of money students have available for day-to-day living costs throughout university.

While the tuition fee system has received much political and media attention in the last two decades, far less attention has been paid to student maintenance. But for many students, this funding is of more immediate importance, and can have a major impact on whether they can afford to move away from home, how much paid work they need to undertake during their studies, and even whether they can afford to go to university at all.

The abolition of maintenance grants – which did not have to be paid back – in 2016 also means the student maintenance system puts the highest debt burden on students from the poorest families, and rather than a system which enables young people from all backgrounds to attend and thrive in higher education, it impacts on the university choices of some, and for others whether they attend university at all.

With the cost of living crisis exacerbating these challenges, this briefing illustrates why student maintenance is an issue which needs to move up the political agenda ahead of the election.

  • Students living away from home outside of London can currently receive a maximum maintenance loan of £9,978 per year. However, the average student in this group spends £11,400 per year on essentials. Essential costs are higher than the maximum loan for 57% of students, and for 19% of students, housing costs alone are higher than the available loan.
  • For the 2024/25 academic year, students will be £2,000 worse-off than if rises in maintenance support had been in line with inflation since 2021/22.
  • For the 2023/24 academic year maintenance loans in England have only increased by 2.8%, despite recent high levels of inflation. This compares to a 11.1% increase for the worst-off students in Scotland, a 9.4% increase for all undergraduates in Wales, and a substantial 40% increase in Northern Ireland (although it should be noted this was from a much lower base level). England is the only UK nation which currently does not offer maintenance grants.
  • Over a quarter (28%) of undergraduates have skipped meals to save on food costs, with a third (33%) of students from working class families doing so. Others have taken on extra part-time work, with almost a quarter of students reporting they had missed a course deadline because of a job.
  • Parental income thresholds, used to determine the income levels at which parents are expected to contribute financially to their child’s living costs at university, have remained frozen. If these thresholds had increased with inflation since 2016, families on £32,535 or less would be eligible for the maximum loan, compared to the current much lower threshold of £25,000.
  • Since the abolition of maintenance grants, students from lower income backgrounds have been leaving university with the highest levels of debt. New analysis by London Economics for the Sutton Trust estimates that poorer students could graduate with £60,100 of debt, 38% higher than the £43,600 for those from wealthier families.
  • Students from disadvantaged backgrounds are also the most debt averse, with the risk that in the current system, poorer students will feel limited to options closer to home, or will be put off from attending university altogether.
  • Young people in school are increasingly concerned about the cost of living as a student. Of those with financial worries about university, the proportion citing cost of living increased from 17% in 2014 to 29% in 2023.
Recommendations for next government
  • The next government should re-introduce maintenance grants for poorer students and increase the overall amount of maintenance available to better reflect students’ costs. They should also widen eligibility for support, by increasing the parental income thresholds used to determine the level of support, which have been frozen since 2008.
  • We suggest a model which does all of the above, alongside changes to repayment terms to make the system more progressive, with higher income students paying back more than under current terms, and lower repayments for lower income graduates. Such a system would make £11,400 per year in maintenance support available to students from the poorest homes, £4,121 of which would be in the form of a non-repayable grant. This system would cut the debt gap at graduation between students from richer and poorer families in half, from £16,500 to £8,100, extend eligibility to tens of thousands more students, and and would come at no additional cost to the Exchequer.
  • Other options explored here include a more generous student grant system (which would equalise the maintenance loan available to all students, with grants making up the difference), and an increase in overall maintenance levels achieved entirely through an increase in maintenance loans.