Select Committee on Education and Employment Minutes of Evidence

Examination of witnesses (Questions 380 - 389)



  380. Did you find differences between universities? Given the same socioeconomic background, do you have any data on the difference between universities or the types of universities.
  (Professor Callender) There was no analysis done by old and new universities because the DfEE wanted that.

Mr Marsden

  381. I want to ask one final question, which I did promise Lindsey I would give her an opportunity to respond on. I am going to the quote Claire's statistic, so she may wish to comment as well. In the executive summary of your report, Claire, you say about expenditure by students, I am quoting now from the executive summary: "The average expenditure on accommodation, food bills and household goods and course related expenditure all fell in real terms between two surveys. As a result this essential expenditure overall fell for both young and mature full-time students. However, other expenditure, ie expenditure on clothes, entertainment, alcohol, tobacco, holidays and non-course related travel and consumer goods, etc increased on average". Now, if I was Jeremy Paxman or if I was a nasty journalist from a less reputable newspaper I might say, this means that students are working for luxuries rather than necessities. What statistics or comments would either of you be able to produce that would, perhaps, counter that view?
  (Ms Fidler) The NUS accommodation survey, which is done annually, with co-operation with institutions, ie the institutions provides the information, has shown that accommodation costs are rising year-on-year for students. From 1996 to 2000 accommodation rose by 17 per cent, which is higher than the student support rose. This years's accommodation cost survey showed that on average students are spending three quarters of their student loan on their accommodation. In terms of essential costs I know that does not sit with Claire's data, maybe more work needs to be put into that. There is evidence that some of the essential costs have risen, particularly in terms of accommodation.

  382. This is Claire's data, would you say, Claire, that the interpretation that I have, as it were, put into the air of your data is correct or incorrect, if so what is wrong with that interpretation?
  (Professor Callender) I think that MORI are some really interesting data about costs on accommodation, in particular. There is an argument that actually since our study was conducted, accommodation costs have risen considerably. Back to my study, there are some important points to look at. When you compare students with other young people basically the proportion of money spent on these different item is very, very similar. What we are talking about is not necessarily a student life-style but a young person's life-style.

  383. Right.
  (Professor Callender) Students are no different from any other young people in the terms of the proportion of money they spend on entertainment.

  384. It might be that the amount of money young people spend on entertainment and on the other things here has risen over the last ten to 15 years but you are not saying that the students within that framework are particularly consumerist or feckless compared with their counterparts.
  (Professor Callender) I am saying that, and I am saying something else too. When we look at changes in expenditure over time, this is where the DfEE did make a strong point in their press release, the idea that, for example, students are spending in absolute terms more money on entertainment is correct. However, the price of entertainment, which includes alcohol and tobacco, have risen way above inflation rates. Some of the increase in expenditure that we are seeing, that was very prominent in the press release by the Department of Further Education, is as a result of the cost of these items rising way above inflation between 1996 and 1998/1999.

Mr St Aubyn

  385. I am sorry that I was not here for the early part of your evidence; I will read it carefully afterwards. I want to ask you a bit about student debts. There is a lot in your report about that, saying that, even before the new system cut in, the student debt level was rising rapidly. Do you think that raising the threshold before student loans have to be repaid would make this less of a burden on students' shoulders, that they would feel, "At least I will not have to repay this until I am earning a fairly decent wage"?
  (Professor Callender) Yes, I think there is a strong argument for that. The reason why I am particularly in favour of raising the threshold is as follows. I think it is very important that students start repaying their loan, when they can afford to start repaying their loan and when they are benefiting from the higher education system. In this country underpinning the entire loan system is the idea that because students benefit in the long term, in terms of job opportunities and the wages and incomes that they will get as a result of these job opportunities, they can afford to borrow money to pay for that outcome. What I would like to see is a higher threshold because it is at that point that they are indeed benefiting from the advantages of a higher education degree.

  386. Lindsey, would you like to add to that?
  (Ms Fidler) I will add support to what Claire said. I think it is about repayment once they are benefiting from higher education. Ten thousand as a threshold is not that different from a non-graduate.

  387. Do you think that students are dropping out because they worry that they may never make that grade and therefore the debt is forced on them and they think, "I have got this to pay back already and it may be a long time before I am on £20,000 a year", if one decides to put the threshold at that level eventually? Is that going to be the reason for them not being retained on their course?
  (Ms Fidler) I think the debt in itself can be a reason for drop-out in terms of the worry and stress and the financial hardship. I have personally no data to say that it is about projecting in terms of the repayment system, but there is certainly an issue in terms of the worry and stress for those who are debt averse. This is the issue that we have. We do have some students who are not debt averse, for whom debt is going to be less of a problem, but we do have a large amount of students for whom debt is a significant concern. I think that in itself can promote drop-outs.
  (Ms Callahan) There is a recognition that the great majority feel that the money they spend on education is an investment in their future—eight in ten say this. Certainly over half are not worried about their loans at the moment, that they can pay them off when they start working.

Dr Harris

  388. In relation to debt aversion the Cubie Committee said, and the Scottish Executive I think backed this, that, given the high level of debt aversion among low income groups they also favour a move towards larger support for higher education students, also on a means tested and non-repayable bursary or grant basis. Do you think that conclusion of theirs on the basis of your work was evidence based, that there is more debt aversion amongst poorer people and that may have bad effects on participation through access and retention and that therefore a decision to give more money to those groups by the re-introduction of some form of grant is evidence based? I am not asking you to comment on its affordability or anything like that, but whether it does at least set out to meet the aims of improving participation?
  (Professor Callender) Certainly there is evidence of debt aversion in the study I did this time and previously, and certainly that debt aversion is highest amongst the lower socio-economic groups and definitely data from the States supports that.


  389. We have to wind up the session. With three excellent witnesses this morning the time really does not allow us to use you as well as we should. Can I ask you all finally, if there were three things which you think should be included in a report that tries to tackle retention, coming out with the different kinds of experience you have all had, what are those three things that you think we should be aware of and highlight in a report on student retention? Shall I start with you, Caroline, as I feel we have neglected you today?
  (Ms Callahan) Certainly the issue of financing. That obviously is a key concern to the students and, although they see it as an investment, certainly it is something that does need to be addressed. Even the qualitative work we carried out, the money there, the borrowing and debt, is a key issue. Also, whilst we looked at all the different up to date courses there are certain issues in terms of the facilities at universities which need to be addressed. For example, a quarter felt that there were not sufficient course books in the library, certainly with the funding and the money they are spending. Perhaps there could be a better availability of course books. That is the second issue, and certainly the facilities within the course. Thirdly, there seems to be with accommodation a proportion of students who have certain issues and problems with various aspects of accommodation, whether it be repairs, maintenance or whatever, so that is another area.
  (Professor Callender) I am going to wear my academic hat. I would say that one of the things that we need is to be able to do rigorous research on this subject area, and we can only do that if we have the data. The sort of data that is required is longitudinal data and that demands an investment to make sure that we have the correct data so that we can properly answer these questions that the Committee is addressing. At the moment, hand on heart, we cannot. We cannot have the evidence based policy that I as a social policy analyst would like to see. That is issue number one, and that applies also to the role of finance in access to higher education. Needless to say, a very close watch needs to be kept on the impact of the changes on overall access and drop-out. Finally, one last issue which we have not discussed at all, but I think is an important issue, is part-time students. The study also looked at part-time students and I am very aware that we have focused exclusively on full-time students.
  (Ms Fidler) Firstly, the role of funding, not just in terms of debt and hardship but in an area again that we have not covered today, which is present funding gaps for students, for example, tutor inter-collating. A hard look at finance and the impact on retention is important. Secondly, there is a need for support for the transition into higher education for those for whom it is a first time experience or for those who are struggling, so the mentoring, the buddying, the money management counselling, the pastoral care, the role that they perform in terms of retention, which again we did not touch much on. Thirdly, to echo Claire's point, there is a need for a better understanding of what retention is and how we define it. Do we talk about it in terms of you have one shot and if you drop out that is a drop-out, or are you talking about those who come back into the system and how long that takes? With regard to the probability of drop-out and the monitoring of students in the system we need better monitoring and we need better performance indicators, as they have in America and in Australia. As Claire says, we need a better research base to understand the experiences that lead to drop-out.

  Chairman: Lindsey, Claire, Caroline, can I thank you. It has been a fascinating session. As far as I am concerned we could have gone for a lot longer. I hope, as you go on your way, if you do think, "Why did I not say this to the Committee?", you will drop us a line. Thank you very much for being with us.

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