IFS: England’s student loan change to hit poor and minority ethnic people harder

Young people from low-income or minority ethnic families are the most likely to miss out on a university education if the government goes ahead with plans to restrict student loans in England, according to research.

Almost one in four recent undergraduates who received free school meals (FSMs) at the age of 16 would not be able to get student loans under the government’s proposals, the Institute for Fiscal Studies (IFS) has revealed.

The government’s planned reforms to the student loan system in England includes blocking access to applicants who fail to achieve at least a grade 4 or C in English and maths GCSEs.

But the IFS found that the policies under consultation could effectively bar a high proportion of students from the poorest families, as well as many black, Bangladeshi and Pakistani students.

“A blanket minimum eligibility requirement would disproportionately impact students who haven’t had the same opportunities and support to meet the attainment threshold, and would result in a widening of socio-economic gaps in access to university,” said Laura van der Erve, an IFS senior research economist and an author of the research.

The study found that about 23% of black undergraduates at English universities would have failed to qualify for student loans if the government opted to use the GCSE benchmark, along with about 13% of undergraduates from Bangladeshi and Pakistani backgrounds. But the minimum grades would have affected just 7% of white British undergraduates.

The IFS said the impact would be reduced if the requirement was for school-leavers to have at least two Es at A-level or equivalents. Only 5% of current undergraduates previously on FSM would have been affected, although they would still be disproportionately affected compared with other groups.

The researchers noted that while students who did not achieve the proposed minimum qualifications have lower degree results than their peers, nearly 80% still graduate and about 40% achieve a first class or upper second class degree.

Larissa Kennedy, president of the National Union of Students, said: “This government parrots the language of ‘levelling up’ but these proposals are classist, ableist and racist. They cruelly target those from marginalised communities, and seek to gatekeep education.”

The IFS also found the requirements would restrict applicants to courses where graduates are in high demand by employers.

Elaine Drayton, an author of the research, said the GCSE minimum grade was a “blunt tool” for cutting student numbers: “While it would remove access to student loans for entrants on low-earnings courses like creative arts and communications, it would heavily impact some subjects with strong earnings returns such as business and computer science.”

The Department for Education (DfE) said the proposals were still being considered and no final decisions had been made.

“Our consultation is inviting views not on how we close doors but on how we ensure that there are many routes to improve a person’s career and life opportunities – whether that is ensuring students are best prepared for university through a foundation year or helping them pursue an apprenticeship or further education,” the DfE said.

Matt Western, Labour’s shadow minister for universities, said: “Parents and grandparents across this country are incredibly proud of their children for securing a place to study at our world class universities. It couldn’t be clearer that the Conservatives do not share those ambitions.”

Michelle Donelan, the universities minister, attempted to revive the government’s efforts to pass a bill mandating freedom of speech on campuses in England.

In a speech to the conservative Policy Exchange thinktank, Donelan claimed that a “small cabal of the intolerant” was causing a growing threat to academic freedom at universities.