Lifelong loan laws laid in Parliament

New laws which will stop providers over-charging for higher education courses funded through the new lifelong loan entitlement (LLE) have been laid in Parliament. 

The lifelong learning (higher education fee limits) bill legislates for a new method of calculating the maximum fees providers can charge students for eligible flexible courses when the lifelong loan entitlement comes online in 2025. 

It aims to make the cost of studying modules and short courses at levels 4 to 6 proportionate to the fee cap for full undergraduate study, currently £9,250 per year. 

The bill follows the skills and post-16 education act, passed last year, which amended the definition of a ‘higher education course’ to include shorter, modular courses. 

New laws are now needed to give ministers powers to set tuition fee limits for those courses.

Ministers are pinning their hopes on arresting the decline of flexible and part time students studying higher level courses and boosting higher technical training with the lifelong loan entitlement. From 2025, it’ll give individuals an entitlement to a loan worth “four years of post-18 study”, currently valued at £37,000.

However the Department for Education admits that there are still too many unknowns to properly assess the impact of the policy on equalities and on public spending. 

The government is yet to respond to a public consultation on the loan entitlement, which closed in May 2022, and so is still unable to answer questions on the fundamentals of the policy – primarily, who and what will be eligible.

Another missing piece of the puzzle is access to maintenance support as the LLE only covers tuition costs.

Yet the government claims the LLE entitlement will make higher level courses more accessible to people who are too “debt averse” to take out a full student loan.

They hope the lower fees charged for smaller and more flexible courses will open the doors to older learners, learners with jobs, ethnic minority learners, women and people from lower socio-economic groups.

Researchers at Public First found last year that, while the idea of lifelong learning was popular, the idea of a lifelong loan was not, casting doubt on the premise of the policy. 

Today’s bill creates a new system of credits to measure “learning time” and gives the secretary of state powers to set fee limits for those credits. It also legislates for a “course year” so learners’ access to funding isn’t restricted to the academic calendar.

‘Ambiguous’ lifelong loan impact on providers

An impact assessment published today suggests that providers that most successfully “target and expand into this market” could see increased revenue. 

But it also explains that it is still unknown how learners and potential learners will respond. For example, universities that don’t adapt could lose out if learners start to reject longer HE courses in favour of more flexible provision under the LLE at other providers. 

A HE short course trial is under way, but early signs showed uptake was low. 

Skills and higher apprenticeships minister Robert Halfon said the bill will be “transformational in helping students to climb the education and skills ladder”. 

“Rather than having to be confined to just traditional full degree courses, it will also be offered for new modular funding, and allow them to build up credits to get both the qualification and training they need for jobs,” he said.

Tom Bewick, chief executive of the Federation of Awarding Bodies said: “This Bill can help make the learning system genuinely cradle to grave, with individuals able to access the financial support they need, when it is most relevant to them.

“It will take a cross-party consensus to realise the full potential of the legislation, including acceptance that learning loans are not right for everyone. Grants and maintenance support will also be required. As will reform of the Universal Credit system.”

MPs will get their first opportunity to debate the bill at its second reading. A date has not yet been announced.