Student Finance Update Exeter HE Advisers’ Day 3 February 2011 Katy Barge Student Finance...

Student Finance Update

Exeter HE Advisers’ Day 3 February 2011

Katy BargeStudent Finance ConsultantSouth West

Agenda

• 2012/13 Proposals

• Application Process – launch and deadlines

• Process Improvements

• New Resources for Practitioners

• 99thth December 2010 December 2010: Parliament voted in favour of a tuition fee

increase up to a maximum of £9,000 per annum

• Any reforms will be introduced for those entering higher education in 2012

• Changes will therefore not affect those already at university, those starting in 2011 and those who have left university and are in repayment

• It will be for institutions to decide the level of tuition fees they charge

2012/13 Arrangements

• For those starting university in autumn 2012, details on student support should be announced by Summer 2011

• Students who defer entry from 2011/12 to 2012/13 will have their loans and grants for living costs set at the 2012/132012/13 rates

• A full white paper will be published in spring 2011

2012/13 Arrangements

2011/12 2012/13*

Tuition Fee Loan

Max £3,375

Two tiers: max £6,000 or £9,000

£9000 only in exceptional circumstances

Fee Loans for part-time courses if intensity 25% +

Maintenance Loan

Variable amounts in 3 bands

Means tested

Variable amounts in 3 bands – details to be confirmed

Loans increased for household incomes from £42K - £60K

Not available to part-time students

Maintenance Grant

Max £2,906£25K / £50K thresholds

Max £3,250 - £25K / £42K thresholds

Not available to part-time students

HEI Bursary£338+ for those on full grant paying full

fees

New £150m National Scholarships Programme – obligatory for HEI to participate if fees exceed

£6,000

ApplicationSeparate application process post

UCASNo details yet

Repayment

9% of earnings over £15K threshold

Interest inflation linked (currently 1.5%)

Written off after 25 years

9% of earnings over £21K threshold

Interest £21k - £41K - Tapered inflation RPI + 3%

Written off after 30 years

Early repayment arrangements being considered*Please note that these are ONLY proposals: detailed decisions have yet to be taken, and the package of support available to 12/13 entrants will not be announced until later in 2011

Summary of Proposals

Repayment thresholds will be modified:

– The current £15,000 earnings threshold will be uprated annually in line with inflation from April 2012

– The proposed £21,000 earnings threshold will be uprated annually in line with earnings from 2016 (when first new system graduates start repayments)

– This as opposed to every five years as originally proposed

– No graduate will repay anything until they reach that income threshold

NB. The above is all subject to parliamentary approval

Additional Info

• A student loan is very unlikely to affect your ability to get a mortgage

(The Council for Mortgage Lenders )

• Mortgage lenders are most interested in your monthly income (‘ability to repay’)

• Under the new system monthly repayments lower = greater monthly income

NB. The above is all subject to parliamentary approval

Additional Info (cont)

Loan RepaymentComparison

Income each year before tax Approximate monthly repayment

Now Future

£15,000 £0 £0

£16,000 £8 £0

£18,000 £23 £0

£21,000 £45 £0

£24,000 £68 £23

£27,000 £90 £45

£30,000 £113 £68

£33,000 £135 £90

£36,000 £158 £113

£40,000 £188 £143

£1

8,0

00

£2

2,0

00

£2

6,0

00

£3

0,0

00

£3

4,0

00

£3

8,0

00

£4

2,0

00

£0

£50

£100

£150

£200

£250

Monthly Repayment ComparisonNew System

Old System

2011/12 Launch

• Apply online from Spring 2011:

16th March new Students (deadline 31st May)

14th Feb returning students (deadline 30th June)

• Only 2 deadlines for 2011/12

When To Apply

Online Application Process

• Login via: www.direct.gov.uk/studentfinancewww.direct.gov.uk/studentfinance

• Customer Reference Number (CRN) allocated

• Choose password and secret answer

• Review and submit application online

• Track application progress via ‘My Account’:

- view correspondence/payments

- change bank details

- update profile/security details

- make changes after submission

• Roll-out of verification of household income with HMRC

• The majority of new applicants should not need to send in financial evidence for prior tax year 2009/10

• Designed to reduce the time it takes to assess a new application for the majority of customers

• When we do ask customers to send financial evidence, we will only ask for copies of documents and not originals

Improvements – New Students

• Links in place:

HMRC : confirm household income

IPS : confirm identity

DWP : confirm National Insurance Number

UCAS : personal and course information shared with SFE

Improvements – New Students

• Those who applied for non-means-tested finance will be processed automatically if their circumstances haven’t changed

• They will simply need to sign and return the form they receive from SFE

• New and returning students will be paid NMT support if we are awaiting financial evidence to means test

Returning Students

IAG Resources

for Practitioner

s

IAG Quality Standards Materials• Materials developed with Practitioners

• Linked to national IAG Quality Standards used by Ofsted (fully cross-referenced)

• Resources ready to use with students:- Lesson Plan- 2x scripted PowerPoint presentations

11/12 Quick Start Guide is located here

Fact Sheets• Fact Sheets for particular groups e.g.

- NHS & Social Work students- Disabled students- Care leavers- Students on benefits- Erasmus students/studying abroad- Independent students- Sandwich course students- ITT students

• Electronic format – latest versions online

• Designed for use as:• Quick reference guides• Handouts for events

www.practitioners.studentfinanceengland.co.uk

2011/12 Key Messages for Students

• Do your research early

• Don’t wait until you know where you’re going before applying

• Apply online from Spring 2011:

– 16th March new Students (deadline 31st May)

– 14th Feb returning students (deadline 30th June)

• Send in your signature & your evidence (if requested) promptly

• Let us know straight away if anything changes

• Make use of ‘My Account’

Contact Details

katy_barge@slc.co.uk

07827 449280

http://practitioners.studentfinanceengland.co.uk

Any Questions