Adding up the hidden costs of university

The debate around affordable higher education usually revolves around tuition fees - but there are far greater costs to going to university.

The debate around the cost of university is extremely misleading. All the focus is on tuition fees, with little or no mention of accommodation costs and living costs. Moreover, there are hidden costs which are not factored into even these categories. All of this means that the real financial situation for aspiring students from disadvantaged backgrounds is far more problematic than any commentary currently acknowledges.

First, it is important to note the real total of an undergraduate degree. As already stated, the debate in the media centres around tuition fees as if this represents the full price of a degree. However, this is a mere fraction of the cost. Living costs and accommodation costs are both huge expenses that are very rarely mentioned. A conservative estimate of living costs is around £3,500 - around £1,150 per term. Most housing costs around £400 per month, which equates to £4,800 per year. The prediction that allowing an increase in the tuition fee cap would create a market has been proved woefully inaccurate. House of Commons Library statistics show that for the academic year 2012/13, the average tuition fee was £8,400. This is only reduced to £8,100 when factoring in fee waivers. So an estimate of the overall cost of one year of undergraduate education at an average university is £16,700.

Second, we must establish the standard support given by Student Finance for students from low-income families. Tuition fees are automatically given as a loan which students only start paying back once they start working. In determining the financial situation of university undergraduates we only need to look at the other two expenditures: living costs and accommodation costs. Going on the estimates made above, this works out at roughly £8,300 per year. However, even for the most supported students, with household incomes under £25,000, there is only one payment to cover these two costs. The maximum maintenance payment, which includes the maintenance loan and grant, is currently £7,177. This leaves an initial black hole of over £1,100.

In addition to this initial funding deficit, there are a number of practical barriers which increase the financial burden further. For example, the figure for accommodation costs does not include a deposit - for most properties this is one months rent plus 100 pounds. Nor, indeed, does this include a cost for an agency fee. This is unlikely to be necessary in the first year when most students live in university accommodation, but in subsequent years this is very common. The agency fee is at least £100, bringing the black hole to £1,700. What's more, the deposit is only returnable after an inspection upon vacating the rented premises. The result of this is the requirement for a further expense of £600, as the next year’s accommodation has to be secured well in advance of receiving the initial deposit back. While the deposits are returned, it still requires students from low socio-economic backgrounds to find the money before it is returned. This brings our black hole total to £2,300.

The fact that this deficit must be filled by the institution creates a complex variety of potential situations, making it incredibly difficult for students to calculate the exact funding gap they will experience. Very few universities can fully ameliorate the funding gap. The University of Manchester, a member of the Russell Group, provides a significant amount of support to eliminate the deficit. Over a third of their undergraduate intake, which is approximately 8,000 per year, receives the ‘Manchester Bursary’. Students with family household incomes below £25,000 are eligible for £1,000 cash grant, and £2,000 in an accommodation discount. This support is sustained throughout their degree. However, this is the exception as most institutions are not wealthy enough to afford this level of support.

The University of West England (UWE), a former polytechnic, has had to dramatically reduce the support it offers students from low socio-economic backgrounds. The money it receives from the Access to Learning Fund has decreased significantly in recent years. In 2006/07, UWE had a fund of £944,544 to distribute through bursaries. In 2012/13, the figure had dropped to £552,358. The consequence of this can be seen in the number of students receiving a bursary. In 2011/12, there were 2,500 students eligible. This figure has fallen to 1,000 in the academic year 2012/13. As a result, a large number of students who meet the criteria for a bursary will obtain no help in narrowing the hole in their finances. However, the UWE bursary is only £1,000, leaving even the lucky students who receive a bursary in a deficit of around £1,300.

For new universities, the situation is even worse. The University of Gloucester, which acquired university status in 2001, offers virtually no support to plug the gap in student finances. For the academic year 2013/14, the institution will offer 206 scholarships through the National Scholarship Programme (NSP). This scheme is worth £3,000 in the first year of study, and £1,500 for all subsequent years. However, this support takes the form of fee waivers. This means that it has no impact on the financial black hole. Students not eligible for the NSP receive a bursary of £500, but only in their first year of study. The consequence of this is that students from low-income families have virtually no support in meeting the immediate funding gap.

These figures will vary according to institution and geography, there is no doubt that most low-income students have a large funding gap of well over £1,000. The amount varies significantly depending on institution and geography (regional prices and diverse travel costs), reaching anything up to £2,500. And this does not even factor in the impact of inflation. According to the Bank of England, the Consumer Price Index has averaged 3.4 per cent over the last 6 years. The impact of this being that every student is taking a real terms funding cut, year after year. If we are serious about increasing diversity and participation, the financial funding deficit for students from low socio-economic backgrounds urgently needs to be addressed.

Students graduating from the University of Birmingham. Photograph: Getty Images.
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Where Labour has no chance, hold your nose and vote Lib Dem

May's gamble, MacKenzie's obsession and Wisden obituaries - Peter Wilby's First Thoughts.

In 2007 Gordon Brown allowed rumours to circulate that he would call an early general election for the spring of 2008. When he failed to do so, he was considered a coward and a ditherer and never recovered. Theresa May has tried a different strategy. After firmly denying that she would call an early election and killing off speculation about one, she suddenly announced an election after all. Will this work better for her than the opposite worked for Brown?

The Prime Minister risks being seen as a liar and an opportunist. Her demand for “unity” at Westminster is alarming, because it suggests that there is no role for opposition parties on the most important issue of the day. If Labour and the Lib Dems are smart enough to co-operate sufficiently to rally the country against what looks like an attempt to instal an authoritarian, right-wing Tory regime, May, even if she wins the election, could find herself weakened, not strengthened. I never thought I would write this but, in constituencies where Labour has no chance, its supporters should hold their noses and vote Lib Dem.

Taken for granted

I wonder if May, before she took her decision, looked at the precedents of prime ministers who called unnecessary elections when they already had comfortable parliamentary majorities. In 1974, after three and a half years in office, Edward Heath, with a Tory majority of 30, called a “Who runs Britain?” election during a prolonged dispute with the miners. He lost. In 1923, Stanley Baldwin, a new Tory leader sitting on a majority of 75 obtained by his predecessor just a year earlier, called an election because he wished to introduce tariffs, an issue strikingly similar to the one raised by Brexit. He also lost. The lesson, I think (and hope), is that prime ministers take the electorate for granted at their peril.

China’s long game

Commentators compare the crisis ­involving North Korea and the US with the Cuban missile crisis of 1962. It doesn’t feel that way to me. For several days that year, nuclear war seemed, to my 17-year-old mind, all but inevitable. I went to the cinema one afternoon and felt surprise when I emerged three hours later to find the world – or, at least, the city of Leicester – going about its business as normal. Two nuclear powers were in direct confrontation. The US threatened to invade communist Cuba to remove Soviet missiles and blockaded the island to prevent deliveries of more weapons. Soviet ships sailed towards the US navy. It wasn’t easy to imagine a compromise, or who would broker one. Nobody doubted that the two sides’ weapons would work. The Soviet Union had carried out nearly 200 nuclear tests. North Korea has claimed just five.

For all the talk of intercontinental missiles, North Korea at present isn’t a credible threat to anybody except possibly its neighbours, and certainly not to the US or Britain. It is in no sense a geopolitical or economic rival to the US. Donald Trump, who, like everybody else, finds the Middle East infernally complicated, is looking for an easy, short-term victory. The Chinese will probably arrange one for him. With 3,500 years of civilisation behind them, they are accustomed to playing the long game.

Mussel pains

Whenever I read Kelvin MacKenzie’s columns in the Sun, I find him complaining about the size of mussels served by the Loch Fyne chain, a subject on which he happens to be right, though one wonders why he doesn’t just order something else. Otherwise, he writes badly and unfunnily, often aiming abuse at vulnerable people such as benefit claimants. It’s a new departure, however, to insult someone because they were on the receiving end of what MacKenzie calls “a nasty right-hander”, apparently unprovoked, in a Liverpool nightclub. He called the victim, the Everton and England footballer Ross Barkley, who has a Nigerian grandfather, “one of our dimmest footballers” and likened him to “a gorilla at the zoo”.
The paper has suspended MacKenzie, a former Sun editor, and Merseyside Police is investigating him for racism, though he claims he didn’t know of Barkley’s ancestry.

Several commentators express amazement that Sun editors allowed such tripe to be published. It was not, I think, a mistake. Britain has no equivalent of America’s successful alt-right Breitbart website, disruptively flinging insults at all and sundry and testing the boundaries of what it calls “political correctness”, because our alt right is already established in the Sun, Express and Mail. To defend their position, those papers will continue to be as nasty as it takes.

Over and out

Easter is the time to read the cricket annual Wisden and, as usual, I turn first to the obituaries. Unlike newspaper obituaries, they record failures as well as successes – those who managed just a few undistinguished performances in first-class cricket and, most poignantly, some who promised much but died early. We learn of a 22-year-old Indian who, during demonstrations against the alleged molestation of a schoolgirl, was shot dead by police and whose grieving mother (invoking the name of one of India’s greatest batsmen) cried, “Bring my Gavaskar back!” In England, two young men drowned, having played one first-class match each, and a 22-year-old Sussex fast bowler, described as “roguish” and “enormously popular”, fell off a roof while celebrating New Year with friends in Scotland. In South Africa, a young batsman was among five municipal employees killed when their truck crashed; the local mayor fled the funeral as his workmates “chanted menacingly” about unpaid wages.

Among the better-known deaths is that of Martin Crowe, probably New Zealand’s best batsman. In a Test match, he once got out on 299 and reckoned the near-miss contributed to the cancer that killed him at 53. “It tore at me like a vulture pecking dead flesh,” he said. Cricket can do that kind of thing to you. 

Peter Wilby was editor of the Independent on Sunday from 1995 to 1996 and of the New Statesman from 1998 to 2005. He writes the weekly First Thoughts column for the NS.

This article first appeared in the 20 April 2017 issue of the New Statesman, May's gamble

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