大象传媒

14 September 2011 Last updated at 16:11

Q&A: Tuition fees

From September 2012, universities in England are raising tuition fees to up to 拢9,000 per year, amid major budget cuts to institutions' teaching budgets.

The controversial policy, backed by parliament in December 2010, sparked angry street protests. It was developed as the government's response to a review of higher education funding by former BP chief Lord Browne.

Universities in Scotland, Wales and Northern Ireland will also be able to raise their fees from 2012, but their home students will not be affected.

How much?

The government is allowing universities in England to charge up to 拢9,000 per year for undergraduate courses, raising the cap from its 2011/12 level of 拢3,375.

Universities wanting to charge more than 拢6,000 have to undertake measures, such as offering bursaries, summer schools and outreach programmes, to encourage students from poorer backgrounds to apply.

This access agreement has to be approved by the . You can see lists of tuition fees by university on the 大象传媒 News website (England and Wales) and (England only).

How will students pay the fees?

The government will lend students the money for fees, which will be paid back when they graduate and begin working. The fees will not have to be paid up-front.

The threshold at which graduates have to start paying their loans back will rise from 拢15,000 to 拢21,000. This will rise annually with inflation.

Each month graduates will pay back 9% of their income above that threshold.

The subsidised interest rate at which the repayments are made - currently 1.5% - will be raised. Under a "progressive tapering" system, the interest rate will rise from just inflation (RPI) for incomes of 拢21,000, to 3% plus inflation for incomes above 拢41,000. Interest of inflation plus 3% will be charged while the student is studying.

If the debt is not cleared 30 years after graduation, it will be cancelled.

What will happen to grants and loans?

In England, maintenance grants are set to rise from 拢2,906 to 拢3,250 for students from households earning less than 拢25,000.

But partial grants will only be available to students from households with incomes of 拢42,000, instead of the current cut-off point of 拢50,000.

Means-tested loans will continue. While loan amounts have been increased, the threshold for those receiving the most generous ones (拢5,500 for students living away from home but outside London) has been lowered from 拢50,000 to about 拢42,000.

What is the long-term cost?

Students taking three-year courses charged at 拢9,000, plus full maintenance loans, will leave university with about 拢43,000 of debt.

But the government says the lowest-earning 25% of graduates will pay less in total than they currently do. But, , most others will pay more - the highest earners almost double what they currently pay.

The IFS says that, assuming fees of 拢7,500, for about half of graduates, the plan is essentially a 9% graduate tax for 30 years, because they will not finish paying off the debt by the 30-year cut-off point.

Modelling of the system depends to an extent on the assumptions made. A , including a "ready reckoner" spreadsheet, are available explaining the system. Moneysavingexpert.com also has and.

Is there any extra support for students from low-income families?

Universities wanting to charge more than 拢6,000 have to set out measures to recruit more students from poorer backgrounds - and also to support them when they are studying.

All students who get a full maintenance grant in 2011/12 receive an extra 拢338 a year bursary. This will end. But a National Scholarship Programme has been set up, with the government committing 拢50m in 2012-13, rising to 拢100m and 拢150m in subsequent years. The Higher Education Funding Council for England has . The institutions will then, in general, be expected to match the funding and therefore double the total amount available.

Universities have to use the money as bursaries of at least 拢3,000 for students with family incomes of less than 拢25,000. No more than 拢1,000 can be given as cash - the rest will be fees discounts or reductions on services such as accommodation. Information is available from individual universities, which will also handle applications.

When will the proposals take effect?

September 2012. Students applying in 2011 who defer entry to 2012 will have to pay the increased fees. But students who have begun their courses before 2012 will not be affected in their later years of study.

Can I repay early?

You may be able to - for a fee. The government has launched a . It suggests charging a fee (eg 5%) on repayments over a certain yearly amount (eg 拢1,000 or 拢3,000) - possibly making this apply only to graduates earning over a specified amount (eg 拢60,000).

What about part-time students?

In England, from 2012, universities can charge up to 拢6,750 per year fees for part-time courses. The student loans system has been expanded to cover fees for students studying between 25% and 75% of the equivalent of a full-time course. Maintenance loans are not available, but students may be able to apply for bursaries from universities.

Will universities get more money?

Universities argue that much of the money raised from raising tuition fees will simply replace major cuts to teaching budgets, especially in arts and humanities subjects.

Teaching grant cuts of 6% for 2011-12 have already been announced, with a further 16% reduction expected the following year - although by then universities will be getting income from raised fees. Teaching-related capital funding for universities has also taken a hit - 54% in 2011-12.

Cuts of 40% to the higher education budget over four years were announced in the spending review on 20 October 2010.

How are universities funded?

In the UK as a whole, income from fees - including fees paid directly by students such as postgraduates and overseas students - makes up about 29% of universities' total funding, which was 拢25.4bn in 2008/09.

Another 35% comes from government funding bodies, while the rest comes from other sources such as research grants, endowments and investments.

In England, the balance of funding is going to change - with much of the cost of university courses switching from the taxpayer to the student.

What does the proposal mean for the rest of the UK?

Scotland does not charge Scottish students fees. In 2011-12, students from elsewhere in the UK have to pay 拢1,820 per year to study at Scottish universities. But from 2012, universities will be able to charge up to 拢9,000 for students from elsewhere in the UK.

The Welsh Assembly has announced that fees will rise to up to 拢9,000, as in England, but the government will pay fee costs above 拢3,465 a year for Welsh students studying at any UK university. Funding for universities in Wales has been cut by 12%.

Ministers in Northern Ireland have said that tuition fee levels will rise only in line with inflation for home students for the next four years, and will be capped at 拢3,465 in 2012. Fees for other UK students will not be capped "but are not expected to exceed 拢9,000", the Northern Ireland Executive says.

Maintenance loans and support grants vary between the nations:

	Max maintenance loan (London figures in brackets)	Max grant for students from low-income homes	Income threshold for max grant	Further details from
England (2012)	拢5,500 (拢7,675)	拢3,250	拢25,000
Northern Ireland (2012)	拢4,840 (拢6,780)	拢3,475	拢19,203
Scotland (2011)*	拢5,417**	拢2,640	拢19,310
Wales (2012)	拢4,745 (拢6,648)	拢5,000	拢18,370

* 2012 figures not yet available

** A large proportion of the Scottish student loan is means-tested. This means, for example, that students from families earning more than 拢61,000 a year can borrow only 拢915 a year. For students receiving grants, the amount they can borrow as a loan is reduced by the amount of the grant.

What about loans in the rest of the UK?

Wales is essentially adopting the same system as England. Although students will be borrowing less, they will pay back their loans once their graduate incomes hit the 拢21,000 repayments threshold, with the same sliding scale of interest.

But Northern Ireland and Scotland will be keeping the old systems, although students will be able to borrow up to 拢9,000 a year for fees, and the repayments threshold will rise to 拢15,795.

Students borrow and repay their loans under the system for the nation in which they are resident when they apply - so a Scottish student studying in England would borrow up to 拢9,000 fees under the Scottish system, and have to begin repayments at the 拢15,795 threshold.