A new lease of life for advanced learner loans?

By: Esme Winch

Managing Director

Wednesday 18 October 2017

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One of the key announcements at the Conservative Party conference was the increase in the payment threshold for student loans. Although the policy only applies to graduates who took out student loans introduced in 2012, it was launched as part of a raft of policies which appear to be trying to appeal to the younger demographic. Although at time of writing the official guidance is yet to be updated, the Department for Education (DfE) has clarified that this new threshold will also apply to advanced learner loans.

Will this help the struggling advanced learner loans policy? We’ve seen continuing reports of the low take-up of advanced learner loans, with over half the budgeted amount underspent since 2013. As a key source of funding for learners looking to upskill themselves, this is a cause for concern.

So how can we account for the lower than expected uptake? There are a few considerations to surmise: perhaps the negative connotations associated with ‘loans’ and debt are to the detriment of the policy in an era of ongoing austerity. Another consideration is the lack of promotional activity from the DfE and a reliance on providers to promote the loans which has led to a lack of awareness amongst learners. This, of course, is coupled with time often having to be taken out of full-time work to undertake learning. This adds financial pressure on to the learner and with a competitive job market, saturated by degree educated graduates, there are never any guarantees – for anyone.

What is certain is that the lack of demand for higher level courses among adult learners is leading to the lack of demand for loans. With increasing uncertainty in the labour market, as well as a need to rapidly upskill the economy to meet future demands, we need more people taking higher level courses. This has been intensified with the focus on Institutes of Technology and the emerging Industrial Strategies.

With priorities for adult education increasingly focused on progression for unemployed learners and legal entitlements, advanced learner loans should be given their time in the spotlight.

There are a range of factors holding people back, but will this new policy ignite the interest once more? In lower paid sectors, it may increase the appeal of loans as the repayment threshold may well exceed the employees’ future earning capacity.  Ultimately we need accompanying clarity around the longer term industrial strategy and greater guidance and support for learners for loans to truly succeed.



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