University students in England are graduating with higher levels of debt than those in any other English-speaking country, a new report has revealed.
According to the Sutton Trust, English students who graduated last year under the new £9,000 fees regime owed an average of £44,500 - higher than their American counterparts, and more than those in Canada, Australia, and New Zealand.
Closer to home, however, the situation isn’t much better as the findings also highlight the growing complexity in arrangements in the UK nations, with different fee levels in Scotland from those in the rest of UK.
As well as this, grants are available in Wales that enable Welsh students to take up places at English universities for less than £4,000 a year - rather than up to £9,000.
Anglophone nations with the average graduate debt per student (2015):
- England - £44,500
- Wales - £19,000
- Northern Ireland - £18,200
- Scotland - £9,400
- United States - US$29,000 (£20,500)
- Canada - CAN$28,500 (£15,000)
- Australia - AUS$39,700 (£20,900)
- New Zealand - NZ$50,000 (£23,300)
When compared with England, the typical US graduate faces debts ranging from about £20,500 for students studying at public/private non-profit universities, to £29,000 at private for-profit universities.
This is partly due to generous scholarships, with the average graduate of private non-profit US universities - which include the Ivy League - finishing with £23,000 of debt, despite the typical course lasting four years compared to three in England.
However, the report does note that UK graduates benefit from an income contingent system held by the state. These are compounded by interest rates of up to three per cent over inflation, but some of their American counterparts face even higher interest rates, with loans that are not income contingent.
Chairman of the Sutton Trust, Sir Peter Lampl, described how the “massive” increase in tuition fees to £9,000 - along with the abolition of the maintenance grant - has meant the poorest grads in England could be facing total debts of over £50,000, with interest.
He said: “The cost of going to university has become so expensive that more young people should seriously consider higher level apprenticeships, preferably to degree level.
“By choosing this route, they will earn while they learn, incur less debt, and develop skills which are greatly valued in the workplace. We need more good apprenticeships to offer genuine alternatives to university degrees.”
The Sutton Trust says it is, therefore, recommending “better coordination” between higher education ministers from all four UK nations in order to rationalise student funding policies across the UK.
As well as this, the social mobility charity added that an annual assessment of the impact of tuition fees changes by the Business, Innovation and Skills (BIS) Select Committee in the House of Commons is also required.
In a statement, a BIS spokesperson insisted that England’s student funding system is “fair and sustainable.”
The spokesperson said: “More people than ever before are now able to benefit from higher education, and the application rate for students from disadvantaged backgrounds is at a record level.
“As the OECD has recognised, our student funding system is fair and sustainable.”
The statement added that the system removes financial barriers for anyone hoping to study, and is backed by the taxpayer with outstanding debt written off after 30 years.
The spokesperson concluded: “Graduates only pay back on earnings above £21,000 and enjoy a considerable wage premium of £9,500 per year.”
Author of the report, Dr Philip Kirby, acknowledged that there are features of the UK system that are better than those in the US - particularly the income contingent loans collected by HMRC.
However, he added: “With significant access gaps remaining, proper monitoring of the changes to student funding from this September is crucial.”
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