Ministers announced that student grants are to be capped because of “difficult economic times”, despite tuition fees rising, prompting concerns for student’s debt problems.
The move to freeze financial support for students, came on the back of news that tuition fees were to rise by 2 per cent from £3,225 this September to £3,290 in 2010, placing further pressure on already overstretched budgets.
Already students have struggled with their debt management but, now that finances are to be stretched even further, lecturers and student leaders are worried that debt problems will be even more prolific amongst the academics.
Sally Hunt, general secretary of the University and College Union, which represents academics, was angered by the news saying: “This is a kick in the teeth for the thousands of people who have already applied to university. We should be doing all we can during these difficult times to make education and learning as accessible as possible. For all the Prime Minister’s warm words and promises that education would not become a victim of the recession, we are yet to see any actions to back up his rhetoric.”
Many students already leave university having received little or no debt advice, and are lumbered with student loan and credit card debts totalling more than £20,000.
David Willetts, shadow skills secretary, said: “In his first week as Prime Minister, Gordon Brown promised to increase financial support for students. But he has run out of money and he has been cutting back support for students ever since. Students from poor backgrounds have been let down by a Government that has given up on them.” Students from the poorest families account for around 20 per cent of all students.
Debt advice organisations receive thousands of calls each year from students that are struggling with their debt management issues, having developed serious debt problems by overstretching themselves with student loans, store card and credit card debts.
Ivan Cooper, Chairman of leading debt management company Chiltern, said: “Students are some of the brightest prospects and represent our future leaders, but more needs to be done in offering them debt advice to cope with the challenging economic times they face.
“Often, students are left with a mountain of loans, overdrafts and credit cards when they graduate, but aren’t fully aware of their options to help them get out of debt.
“Reputable debt advice companies, like Hamilton Locke, The Debt People and Chiltern can help, by offering free debt advice and helping them to find a suitable solution.”
Professional debt solutions include Debt Management Plans (DMPs), Individual Voluntary Arrangements (IVAs), Trust Deeds amongst others, which may be offered following free debt advice.
University applications have risen steeply because of the recession and global credit crisis but, as the number of new places that are available has only increased slightly, up to 60,000 potential graduates may be turned away.
For immediate debt advice, or for further information on a range of prefessional debt solutions, please call the number at the top of this page.