Augar Review

The Augar review extends well beyond HE, consider all post-18 education provision (c.f. Browne, 2010). The review is focused on England and the English student funding system, however this will affect Oxford’s financial situation which will have knock on effects for all students. This report will focus on Oxford, and Oxford graduates.

Currently, and English undergraduate student studying at Oxford (excluding financial support such as bursaries) pays £9,250/year in tuition fees. They can take out a loan for this (as well as a maintenance loan of up to £8,700, depending on house hold income). In return they pay back 9% of what they earn over £25,725 for thirty years (or until they’ve paid off the debt). The gov’t further supports courses which are expensive to teach such as medicine by paying the University directly.

Skills, Apprenticeships and FE

Key proposals

· Life-long learning loan allowance

· Loans for equivalent or lower qualifications

· More funding for FE

· Ofstead responsible for all apprenticeships

These proposals are designed to augment FE provision, and make it easier for students to get funding to pursue non-University level courses. This increases the options for graduates who have only undertaken a three year degree, who will be able to obtain gov’t funding (through a loan) for training when they finish their degree.

They may choose to pursue this further study at a university, which is good for the University. However, the overall impact of the proposals is intended to reduce the numbers of students in Universities, so this is likely to be damaging to them. This is unlikely to impact Oxford. Oxford may be less likely to offer apprenticeships if Ofstead (the schools regulator) are responsible for them, as this may require involve a higher level of oversight.

Higher Education Institutions

Key proposals

· Per student resource frozen until 2023

· 7.5k tuition fees

· Teaching grant to make up shortfall for Universities, but with greater differentiation by subject

· Extra support for high quality specialist institutions

· Centralised funding following disadvantaged students

· Threat of contextualised min entry requirements for gov’t loans/number cap

Student finance is addressed in more detail below, however lowering fees to 7.5k/year will only benefit those who currently pay off over 80% of their tuition fees (i.e. the wealthiest graduates).

The fee cuts allow the University to have greater choice over which Universities receive funding (c.f. the current scenario where this is primarily dictated by students’ decisions). This will be positive for Universities which teach a high proportion of courses the Gov’t is keen to incentivise (most likely STEMM1) and harmful for others. The caveat is the funding for ‘specialist institutions’, although more information is needed on what this means.

Improving funding for institutions which take more disadvantaged students will likely encourage Universities to take more disadvantaged students. Freezing funding for Universities will unsurprisingly harm Universities, although Augar’s view is that the sector as a whole can survive it.

Student Contribution System

· Pay-back threshold to drop to median non-grad earnings

· Repayment period extended from 30 years to 40

· Removal of real2 interest rates during study

· Cap on lifetime repayments to 1.2 times full loan (in real terms)

· Change terminology

These changes will mean that more graduates will end up paying back more of their loans. Currently, only the top 20% currently fully repay their loans. Lowering the pay back threshold will increase both the number of people who pay any money back, and the amount that those who pay money back will pay back.

Removing real interest rates during study will have a similar effect to dropping tuition fees, although lowering tuition fees also benefits students who don’t take out the loan. The cap on lifetime repayments will again only benefit those students who come close to paying off their loan.

Changing the terminology to ‘contributions’ instead of repayments may encourage debt-averse students to attend University.

Will any of the proposals come to fruition?

This is beyond the scope of this document, however there are reasons to think that this will be implemented at least partially, as the problems highlighted by the Augar report are agreed to be problems by a wide range of commentators.

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