Restricting access to student loans will hit ethnicity minority students hardest, IFS warns

Requiring young people wanting to go to university to have passed GCSE maths and English to be eligible for student loans will disproportionately affect ethnic minority students and increase already large socio-economic gaps in higher education, the Government has been warned.

The Institute for Fiscal Studies has published research showing that plans for a blanket ‘minimum eligibility requirement’ would have had a much bigger impact on participation by black, Bangladeshi and Pakistani students than on white British students.

Around seven per cent of white British undergraduates from state schools would have been impacted by the GCSE English and maths requirement, and around 10 per cent of Chinese and Indian students. In contrast, nearly one in five (18 per cent) Bangladeshi and Pakistani students would have been affected, and nearly one in four (23 per cent) black undergraduates.

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This reflects the fact that ethnic minority pupils from these groups have much higher university attendance rates than their white counterparts despite similar age 16 attainment.

Concerns have been raised about proposals to limit who can receive a student loan.Concerns have been raised about proposals to limit who can receive a student loan.
Concerns have been raised about proposals to limit who can receive a student loan.

The GCSE requirement would have excluded more than one in five 18 and 19-year-old entrants to social work courses and nine per cent of 18- and 19-year-old entrants to education courses from obtaining student loans. These are subjects where there are low returns in terms of earnings, but which have high social value.

Laura van der Erve, Senior Research Economist at IFS and an author of the research, said: “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.

"Providing additional support to ensure all students leave school with basic levels of literacy and numeracy would be a better way to make sure all pupils, including those who go on to attend university, have the skills needed to succeed. This would be particularly valuable in the context of England’s internationally low levels of basic skills."

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Elaine Drayton, Research Economist at IFS and an author of the research, said: ‘Requiring students to pass GCSE maths and English in order to be eligible for student loans would be a blunt tool for targeting undergraduate provision with poor employment prospects.

"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, with 13 per cent and 17 per cent of age 18–19 entrants affected, respectively. Other courses with low returns but considerable social value would also be impacted, including social work and education.”

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