House of Lords - Higher Education in Science, Technology, Engineering and Mathematics (STEM) subjects

Higher Education in Science, Technology, Engineering and Mathematics (STEM) subjects - Science and Technology Committee Contents

CHAPTER 6: Policy reforms

200. Two recent policy reforms—on higher education and immigration—are likely to have a significant impact on the HE sector. Although it is too early to assess the effect with any accuracy, the evidence we received indicated significant concern about the outcome of the reforms.

Higher education reforms

201. The Higher Education White Paper, Students at the Heart of the System, was published in June 2011. It was intended to put HE on a sustainable footing by introducing repayable tuition loans, delivering a better student experience (by improving teaching, assessment, feedback and preparation for the world of work), and increasing social mobility. The reforms also sought to increase competition within the market so that, to succeed, HEIs would have to appeal to prospective students and be respected by employers.[273] In addition, the Government made a commitment to improve and expand the information available to prospective students, including more information about individual courses and about graduate employment prospects. The White Paper also called on HEIs to "look again at how they work with business across their teaching and research activities, to promote better teaching, employer sponsorship, innovation and enterprise," and introduced a new risk-based approach to quality assurance (see paragraph 118).[274] Another important aspect of the reforms was a substantial reduction in teaching grants from HEFCE and a sharp rise in the maximum tuition fees.

STUDENT NUMBERS IN STEM

202. One possible effect of the HE reforms is that students may be discouraged from entering HE because of the level of debt they may incur. STEM subjects are generally more expensive to teach than others and, with a system of variable fees, it is possible that STEM courses may end up being more expensive to study. Employers are worried about the effect that the reforms may have on STEM student numbers. Rolls Royce told us: "we are very concerned that the new arrangements could result in a drop in graduate numbers at a time when our requirements are increasing".[275] Many others agreed.[276]

CONTROL OF STUDENT NUMBERS

203. Prior to 2011, each HEI had a limit on the number of students it was able to recruit. The limit was determined according to a formula and based on previous history.[277] As part of the HE reforms, and in order to encourage HEIs to keep tuition fees low, the Government have introduced the core and margin system whereby around 85,000 student places will be contestable between institutions from 2012-13, allowing unconstrained recruitment of students scoring the equivalent of AAB+ or above (65,000), with a flexible margin of about 20,000 places to reward HEIs that combine good quality courses with value for money (having an average tuition fee of below £7,500 a year).

204. The possible consequences of this initiative for STEM provision have caused a great deal of concern.[278] Some anticipated, for example, that uncapping recruitment of AAB+ students would inhibit, rather than expand, provision of STEM because, as Million+ put it: "STEM students are less likely to achieve AAB+ than their non-STEM counterparts; the higher costs associated with STEM and STEM-related provision will make it hard to support STEM subjects below the £7,500 threshold for access to margin places".[279]

205. In October 2011, HEFCE announced that they would "exclude numbers associated with currently identified ... [SIVS] from the calculation to create the margin, on condition that institutions at least maintain their entrant levels to SIVS courses".[280] Further to this, in May 2012, the Government announced that the threshold would be lowered from AAB+ to ABB+ and that, from 2013-14, an additional 5,000 places would be allocated to HEIs with lower fees. This means, in practice, that about one third of student places will be uncapped. It is not clear what effect these developments will have on STEM provision.

206. The recent adjustments to the core and margin system may allay some of the concerns about the effect of the HE reforms on STEM provision. However, we invite the Government to explain in their reply to this report on what evidence this change of policy was based and the timescale in which it was implemented.

FUNDING STEM SUBJECTS

207. Imperial College London explained the different costs associated with STEM courses, compared with a humanities course, as follows:

"in 2009-10, the full cost to the College of educating a HEFCE fundable taught student in some engineering subjects was £15.7K per annum. Hence, despite the rise in undergraduate tuition fees, leading institutions will still face a deficit on much of their taught STEM provision. In contrast, we calculate that the average cost to Russell Group institutions of educating a humanities student is around £7.1K per annum."[281]

208. There is, therefore, a real danger that, with variable fees, STEM courses may end up being more expensive than other courses which could, in turn, impact the number of students wishing to go on to postgraduate study.[282]

209. HEFCE told us that "following these reforms, the Government will maintain some public funding for teaching, around £2 billion, to fund additional costs and public policy priorities that cannot be met by a student-led funding system alone".[283] CaSE, and others, told us that this additional funding for high cost subjects would not be sufficient to cover the additional costs of STEM courses:[284] "£1,500 per student for resource-intensive subjects such as science and engineering ... is the equivalent of a 17% subsidy for HEIs which charge £9,000 per annum, or 20% for those charging £7,500 per annum".[285] Another way to avoid charging more for high cost subjects would be for HEFCE to subsidise some of the costs through their SIVS funding. However, as we have said (paragraph 89), the money available for SIVS funding is significantly limited. The Wellcome Trust suggested that the Government "should seek a commitment from institutions that students choosing to study STEM subjects will not face higher fees than other students at the same institution".[286]

210. Another possible consequence of the new funding model is that cheaper humanities courses may end up cross-subsidising the generally more expensive STEM courses, "thus creating an unhealthy and unwelcome tension between different areas of academia".[287] Humanities students are likely to object strongly to their fees being used to subsidise other courses and STEM students may object to funding allocated to STEM being spent elsewhere. We recommend that HEFCE publish the quantitative evidence on which they base their funding model for public subsidies for STEM subjects with a view of reassuring stakeholders that these subsidies, in conjunction with students' fees, are sufficient to cover the cost of STEM provision.

CAPITAL FUNDING

211. As part of the HE reforms and the efficiency drive across government, capital funding for universities has been reduced significantly: £1,040 million less in non-recurrent and capital funding from the 2009-10 position. These reductions are not offset by any increase in income to universities from regulated fees,[288] and are likely to have a disproportionate effect on STEM subjects because, for example, "the teaching of science and engineering often requires a significant injection of capital funding for equipment".[289] A number of HEIs and professional bodies expressed concern about the implications of reduced capital funding for the provision of STEM courses with a significant practical element.[290] The Open University, for example, said that it had "caused regrettable pressures on the ability of institutions to offer a state of the art laboratory experience".[291] This may, in turn, limit the number of STEM student places that HEIs can offer because "the ability to take additional students in the chemical sciences, and STEM subjects more widely, is restricted by the capacity of laboratory space and facilities that are available to any one institution".[292]

LONGER UNDERGRADUATE COURSES

212. Higher fees may deter some students from taking well-regarded and important courses in STEM, such the MEng, which last four years instead of the more usual three.[293] The MEng "offers a fast track route towards professional qualification as a Chartered Engineer.[294] Rolls Royce told us that they were "concerned that there could be a particular disincentive to participation in four year programmes".[295] (They currently require engineering applicants in the UK to be qualified to MEng or to engineering Masters level.)[296] The Council for the Mathematical Science said: "the quality of UK undergraduate degrees in the mathematical sciences is high. At the 'top' end, quality has been enhanced by the increasing popularity of Integrated Masters degrees. There is a serious risk to the viability of these in the era of high fees",[297] and the Institute of Physics expressed the worry that the HE reforms "may also have an adverse impact on the uptake for the four-year integrated Masters degrees—the MPhys/MSci—which are now the norm for those considering a career in university or industrial R&D".[298]

PLACEMENTS AND SANDWICH COURSES

213. As we have noted (in paragraph 179), the Wilson Review recommended that all undergraduates should have the opportunity to undertake some sort of internship during their period of study as a way to "enhance graduate skills levels and ensure a smooth and effective transition between university and business environments".[299] Under the new fees regime, there is a risk that students may be discouraged from doing placements because of the fees that they would have to pay during the placement and the interest that would be accumulated on the student debt—a point made by GlaxoSmithKline: "students would be deterred from applying to do a sandwich year, as this would be seen as leading to an additional year of debt".[300]

CONCLUSION

214. It is too early to assess the impact of HE reforms on the sector. We recommend that the Government have particular regard to the effect of the reforms on STEM provision. We support the role that the Government have given to HEFCE to monitor unintended consequences and to intervene, as appropriate, to protect strategic or vulnerable provision that will not be supported by the market. However, we have some concern that HEFCE may not have sufficient funds to intervene should it be necessary and recommend that the Government ensures that HEFCE will have the necessary resources should these circumstances arise.

Immigration reforms

215. International students contribute significantly to the UK economy. Between 2010 and April 2012, the Government made a number of changes to their immigration policies as part of their commitment to reduce net migration "from the hundreds of thousands to the tens of thousands".[301] They included, for example, the introduction of a new category under Tier 1, capped at 1,000 visas, for persons of exceptional talent and achievement in science or the arts (with applications subject to endorsement by the Royal Society, the Royal Academy of Engineering, the British Academy or the Arts Council). The immigration reforms likely to be of most concern to students are:

Tier 2 (skilled workers): the introduction of a cap on the number of visas available to skilled workers of 20,700 (down from 28,000 in 2009) although "high-quality graduates—including those in STEM subjects ... will not count against the numerical limit"[302];
Tier 4 (student visas): the introduction of accreditation requirements for colleges, changes to the standards of English required, working rights, dependants' sponsorship and restrictions on working hours (but no overall restriction on the number of visas available); and
Tier 1 (post-study work route): closure of the route from April 2012 and replacement with more selective arrangements under Tier 2.

216. These changes are intended principally to tackle "bogus colleges"[303] and students who use the student visa system simply to gain access to the UK. To this extent, we support the Government in their efforts to address a problem that gives a bad name to our HE system and to bona fide overseas HE students who intend to return to their countries of origin after their studies.[304]

217. As with the HE reforms, it is too early to assess the full effects that the immigration reforms will have on HE. However, substantial anecdotal evidence from HEIs, professional bodies, employers and others suggests that they are already having a significant impact on STEM provision in some areas. In May 2012, 68 Vice-Chancellors, governors and university presidents wrote a letter to the Prime Minister warning that the immigration reforms could lead to foreign students going elsewhere, costing the economy billions.

NUMBER OF STEM OVERSEAS STUDENTS

218. In 2010, the Home Office carried out a study in which they estimated that around half of overseas students in the UK were studying at HEIs, of which around half were studying postgraduate courses and the rest a mixture of undergraduate or pre-university courses.[305] Data from HESA shows that, between 2009-10 and 2010-11, there was an 8% rise in non-EU undergraduates and a 5% rise in non-EU postgraduates.[306] Within STEM subjects, in 2009-10, 13% of first degree qualifiers, 55% of Masters degree qualifiers and 42% of PhD qualifiers were from overseas.[307]

219. The Wellcome Trust, the AMS, and the University of Southampton each argued that restrictions on skilled immigration from outside the EEA presented a significant threat to the sector. In evidence to a House of Commons Home Affairs Committee inquiry into student visas, Professor David Wark from Imperial College London said that 29% of the student body at Imperial College London were non-EEA, and they accounted for 62% of their fee income. Therefore, he said, "from a purely financial point of view, it would be devastating to Imperial to have any significant cut in the number of students".[308]

220. At a recent Universities UK event, Professor Julia King, Vice-Chancellor for Aston University, said that the university had experienced:

"a dramatic reduction in overseas student applications and admissions, leading to a significant reduction in income to the university. Comparing 2011/12 with 2010/11, the biggest impact on applications was on India, with a 39% decline, followed by Nigeria at 27%, resulting in a 30% drop in admissions from India [equal to 200 less overseas students than planned]. In the current academic year about £3million less income—on a university turnover of £120 million, and it looks as if it is happening again for the coming year."[309]

221. The University of Salford also told us that most of their Masters courses depend on overseas students and that, without them, many would be closed on economic grounds.[310]

222. Within the discipline of engineering, where the UK is particularly reliant on overseas students, Professor Wark said that 40% of their students were non-EEA students and that if they were to lose them "it would have a severe impact on our ability to perform research that keeps Imperial College as a world-leading institution".[311] In 2009-10, 34% of engineering first degree qualifiers and 64% of engineering postgraduate qualifiers were from overseas (including other EU countries)[312]. The Engineering Professors' Council told us that "almost all engineering departments in the UK would be running at a loss if it were not for overseas students' fees",[313] and that, in a poll they had conducted, 16 out of 27 HEIs reported a reduction in overseas applications to Masters courses.[314] Professor King, speaking at the UK Universities event with reference to Aston University, said that "48% of engineering PhDs were obtained by non-EU students, up from 43% in 2004, compared to an average across all courses of 29%". She went on to say: "We are highly dependent on overseas students to keep our engineering courses running and solvent!".[315]

223. In addition to the fee income provided by overseas students, they also have a positive effect in the classroom. Professor Cantor told us: "I believe fiercely that having international students and home students at the same time, not only in my institution but also in others, enriches the educational experience."[316]

224. We should congratulate ourselves that our HEIs are able to attract substantial numbers of overseas students in such a competitive international market. We are concerned, however, that some HEIs rely too heavily on the income derived from international students. We question the long-term viability of such an approach. HEIs must ensure that their business model is truly sustainable.

225. We are concerned that changes to the immigration rules may reduce the number of overseas students coming to study to the UK and, therefore, the income that HEIs derive from these students to support other activities. This may result in a general reduction of provision of STEM courses that rely on this income to make them viable.

POST STUDY WORK ROUTE

226. Another area of concern raised by witnesses related to the closure of the post study work (PSW) route.[317] The PSW visa enabled foreign graduates to work in the UK, for up to two years, after obtaining a UK degree.[318] This visa had been highly valued by overseas students as a way of gaining work experience before returning to their countries of origin, and to help to fund their study. According to a National Union of Students survey, 94% of overseas students said that availability of the PSW route was a very important factor in deciding to study in the UK and nearly three-quarters of those surveyed said they would not have come to the UK without the option for PSW.[319] Professor King made a similar point;[320] and Jo Doyle, Director of the International Office at the University of Southampton, said:

"When the changes to the post-study work regulations were announced this time last year, we were running at a 23% increase in applications. By the end of the recruitment cycle, that had reduced to 11%, and I think that that is probably a direct result of the post-study work change. This year, our applications are up only 3%, so that is quite a big shift. In the three years that I have been talking about, the biggest growth has been in postgraduate applications, with 47%, 44% and 32% respectively. Again, it was running at 32% at the time of the post-study work announcement last year, and it then reduced to 13% by the end of the year. This year, our growth in postgraduate taught applications at this stage is only 4%. So I am looking at the same period over four years."[321]

227. The Government have replaced the PSW route with more selective arrangements under Tier 2,[322] notably making a job offer paying more than £20,000 a year a requirement for a visa. Several witnesses suggested that this could make it much more difficult for talented international graduates of UK universities to enter the UK workforce.[323] The UK Border Agency (UKBA) told us that the limit was set following guidance from the Migration Advisory Committee.[324] It is not, however, clear if this guidance was intended specifically for graduates. We would ask the Migration Advisory Committee to reconsider its advice. We would further ask the Committee to monitor the impact of the changes on both the number of graduates who stay on to work in the UK and on the number who decide not to study here, due to the real or perceived barriers created by the closure of the PSW route.

PERCEPTION

228. Perhaps the most worrying aspect of the immigration reforms is the message it conveys to overseas students that the UK does not welcome them.[325] Professor George told us that "especially in India ... there is a perception that we are closed for business and that it is difficult to get in".[326] Professor King said: "the UK is seen as no longer welcoming overseas students ... whereas other English-speaking countries are trying hard to be welcoming".[327]

229. In 2011, the UK Council for International Student Affairs (UKCISA) recommended in their student survey that "given all the recent negative publicity surrounding student visas, UK Border Agency (UKBA) needs to work with the Foreign and Commonwealth Office and British Council to develop a positive communications strategy clarifying areas of concern and uncertainty and emphasising that the UK, after a period of visa reform, continues to encourage, value and positively welcome well-qualified students".[328]

230. Other barriers identified during the inquiry include: the lengthy and cumbersome bureaucracy associated with gaining a visa and the high cost; and the challenges of dealing with changes to visa policies throughout the duration of a student's course. Also of concern is the UKBA website which is perceived as unwelcoming. The Home Office conceded that more could be done: "on the website, I take your point that we could probably make that a friendlier, more welcoming place to be".[329]

231. HE is a global market and the UK has to compete with other countries that are positioning themselves to attract international students. The perception that the UK does not welcome students may be having a detrimental effect on recruitment from some countries such as India. The UK must be seen to welcome the brightest and the best and the Government must increase their efforts to dispel perceptions that the UK does not welcome students. We recommend that the Government develop a strategy to send out a more positive message through the UKBA website, immigration agencies and the British Council.

DATA

232. Several witnesses were critical of the available data on migration and suggested that better co-ordination of data between UKBA and HEIs was needed to enable them to track students. The Home Office conceded that it was "not possible to routinely disaggregate visa statistics by institution-type, educational establishment or subject".[330]

233. A House of Commons Home Affairs Committee report into student visas noted that the Office for National Statistics used data from a variety of sources to compile net migration figures. This was because the Government did not have a simple method of counting people in and out of the country.[331] A 2011 briefing note by the UK Statistics Authority on immigration statistics stated that: "the currently available statistics on immigration and emigration fall some distance short of painting the comprehensive picture that Parliament would want to be available to inform the public policy debate".[332]

234. The UKBA is currently implementing an e-borders scheme, an electronic system to carry out checks on travellers before they begin their journey, which is anticipated will improve data collection. However, it will still not enable linkage of entry and exit information. It will also not be possible to produce direct migration counts because the information collected from carriers will not routinely include country of residence of the traveller.[333]

235. The lack of reliable statistical data is a concern because the Government are not able to identify problems with their visa system soon enough to put in place a mitigation plan. Data from HESA is more accurate but by the time it is published it is 18 months out of date (see paragraph 70). This problem is particularly acute for the HEIs that we spoke to who are reporting that the HE reforms are having a significant impact upon their recruitment of overseas students already.

236. We recommend that the Government, working with HEIs, as a matter of urgency, make further efforts to co-ordinate data collection and ensure that data is shared between UKBA and HEIs. In addition, the Government should collect real time data on the effects of changes to immigration policies in HEIs with a view to setting up a mitigation plan, if necessary, and to enable policy decisions to be based on the latest information. This should be achieved by September 2014.

CLASSIFICATION OF OVERSEAS STUDENTS AS MIGRANTS

237. The Government define migrant, using a United Nations definition, as someone who comes to the UK for a period longer than 12 months. As a result, most overseas students who come to the UK to study undergraduate courses will be classified as migrants. This classification is particularly significant because of the Government's commitment to reduce net migration. Since "students now represent the largest proportion of non-EU net migration" (around three quarters),[334] a reduction in net migration means, in effect, a reduction in the number of overseas students. The classification fails, however, to acknowledge that most overseas students return to their countries of origin soon after finishing their studies.[335] Oxford Brookes University warned of the consequences of this approach as follows: "by including students in the definition of 'immigrants' the UK is threatening approximately £20bn worth of exports. International students are a free good. They are educated at somebody else's expense and pay us large sums of money to be educated here. The vast majority return home at the end of their course. The current policies are a calamity that will cost UK Plc billions of pounds and severely damage UK HEIs."[336]

238. This policy is also contrary to the BIS policy of expansion of the HE sector to promote economic growth. Damian Green MP told us that the Rt Hon David Willetts MP was leading a task force to maximise opportunities for HE.[337] Lord Clement-Jones, on 30 April 2012, told the House of Lords that: "the Home Office is targeting net migration figures that include overseas students, which is directly contrary to the policy of the Department for Business, Innovation and Skills".[338] Professor Edward Acton of the University of East Anglia, commented: "it is vital that the tension between the Government's net migration target and its support for university-level recruitment is addressed."[339]

239. A possible solution, suggested by several witnesses, would be to follow the example of other countries in classifying migrants as either "temporary" or "permanent". The efforts of the Home Office, in tackling net migration, would then be concentrated on permanent migrants. According to a recent report by the Institute of Public Policy Research (IPPR), the UK's three most obvious competitors in the global market for overseas students—the United States, Australia and Canada—"measure student flows in a way that does not contribute to permanent net migration figures, even though they show up in net migration statistics".[340] Lord Henley, Minister of State for the Home Office, told the House of Lords, however, that it was "not appropriate to discount [overseas students] from net migration statistics" because they are consumers of public services". Furthermore, he warned, the Government would be accused of "fiddling the figures" if they were to follow this suggestion.[341] We strongly disagree with this assessment. Making a distinction between temporary migration (which would include study at a sponsoring HEI) and other forms of migration would reconcile the contradictory policies emanating from BIS and the Home Office, and also send the right signal to the world that the UK welcomes the brightest and the best to the UK. Given the significant contribution that overseas students make to the economy and that the majority leave the UK following their studies and do not therefore contribute significantly to net migration, we recommend that the Government make a distinction in the immigration statistics between HE students and other immigrants and uses only the latter category to calculate net migration for policy-making purposes.

Policy reforms and their compound effect on taught Masters provision

240. In addition to the consequences of the HE and immigration reforms which we have already described, the evidence we received suggests that there is a danger that they could have a compound impact on stand-alone Masters provision producing a "triple whammy" effect due to higher fees, a lack of student finance and a decline in overseas students choosing to study in the UK.

HIGHER FEES AND LESS PUBLIC FUNDING

241. The Browne Review suggested that funding from HEFCE for stand-alone Masters should be reduced on a similar basis to undergraduate support. In January 2012, however, HEFCE agreed to provide an additional £39 million to maintain funding for these courses at levels prior to the HE reforms. For STEM subjects, other than medicine, this translated to around £1,500 got each student.[342] However, this is a "transitional"[343] arrangement and it is unclear what the funding arrangements for stand-alone Masters courses are going to be post 2013-14. Many Research Councils are also reducing or removing their provision for taught Masters provision.[344]

242. Several witnesses noted that neither the HE reforms nor the Browne Review had paid much attention to postgraduate provision, in particular to the funding of taught Masters.[345] Since fees for stand-alone Masters courses are unregulated,[346] there is a real danger that, if funding from HEFCE and others dries up, fees for STEM courses will be increased in line with undergraduate degrees. This could act as a deterrent for students already burdened with large undergraduate debt. Million+ told us that, as a result of funding cuts, "universities will have no option but to increase postgraduate fees with effect from 2012".[347] The Physiological Society warned:

"if the costs are excessive then fewer students are likely to apply. The resulting reduced intake is quite likely to render the course uneconomic to run, leading either to its withdrawal or to an increase in the, at present, unregulated fees charged. Consequently there may be a serious loss of stand-alone Masters training provision."[348]

243. Professor Michael Farthing, Vice-Chancellor of the University of Sussex, said: "it could take years to re-establish Masters courses if they are wiped out by falling demand ... [because] the development time to re-establish those programme is years, not weeks or months".[349] This is of particular concern with regard to provision in those areas where skills are required to support economic growth in the UK and where the UK is lacking such skills (for example, in the geological sciences, environmental sciences, and toxicology) and many witnesses suggested that public funding should be provided in strategic areas.[350]

244. Oxford Brookes University said that, as a result of public funding cuts, "the UK tends only to run stand-alone Masters courses that are clearly instantly profitable".[351] A similar warning comes from IET which warned that "the new fees regime will discourage students from doing a Masters as to not to incur greater debt. Fees are putting off UK students now and the supply of researchers is already drying up".[352] Reduced provision in stand-alone Masters could have significant impact on employability skills and, in turn, on economic growth. The Institute of Physics, therefore, called for public funding to support Masters courses "in areas that are of national importance".[353]

LACK OF STUDENT FINANCE FOR MASTERS COURSES

245. The Browne Review stated that student finance provision for Masters courses "was not necessary as the private benefits to individuals would be sufficient to generate investment".[354] It is too early to say whether this will be the case following the HE reforms. However, some witnesses were concerned that the lack of student loans to finance Masters courses would further erode student numbers in Masters courses. This situation is in stark contrast to the availability of student loans for undergraduate courses that include an integrated Masters course. The Wilson Review recommended that "HEFCE should monitor 'postgraduate taught' enrolments and identify any barriers to enrolment that have been created by the new student loan system and advise the government of its conclusions".[355]

246. Fees for Masters courses will have to be paid in advance. Students will, therefore, have to rely on commercial loans or private wealth to finance their studies, which will restrict access to this type of postgraduate provision.[356] CaSE warned that, since undergraduate fees are rising to £9,000 a year, they "expect postgraduate fees to rise above that, given they are for higher qualifications. This will exacerbate the access problem if financial support is not introduced".[357]

247. The lack of finance available to students, and the higher fees payable from September 2012, will act as a further disincentive for UK domiciled students to study STEM Masters degrees. This will have a marked impact across the STEM industry but particularly to those employers which have to recruit UK—rather than foreign—nationals (such as defence and within Government more widely).[358]

248. At present, students can apply for professional career development loans. But, although subsidised by Government, their terms and repayment conditions are considered to be fairly onerous. Fewer than 2% of current Masters students fund their studies in this way.[359] As an alternative, it has been suggested that private finance schemes could be developed in a more targeted way to support some form of student loan to postgraduate students.[360] Other proposals include some form of government-backed income contingent loan scheme to some groups of postgraduate study;[361] making available postgraduate loans, to be repaid by the student once salaries exceeded £15,000;[362] and qualifying postgraduate level STEM as SIVS.[363]

249. We recommend that the Government extend the student loan scheme currently available to undergraduates to cover STEM Masters degrees and that payment starts when the graduate earns over £15,000 with a view to recovering the debt fully.

CONCLUSION

250. There is a potential compound effect of policy reforms on stand-alone Masters provision. The new higher fees regime combined with the lack of student finance is a threat to the number of UK domiciled students who decide to pursue postgraduate education. Added to which, immigration reforms are already having an impact on certain HEIs who may in turn reduce Masters provision significantly. Little is known of the effect that this "triple whammy" will have on postgraduate provision. By the time the effect is quantified and analysed, it may be too late to put remedial action in place. This reinforces the importance of our recommendation (in paragraph 107) to set up an expert group to consider the supply and demand for postgraduate provision.

251. The risks associated with the HE and immigration reforms are high and potentially costly. The anxieties expressed to us by employers, HEIs and professional bodies are real and we urge the Government to heed them.

273 BIS, Higher education-Students at the heart of the system, June 2011. Back

274 Ibid. Back

275 Rolls Royce. Back

276 1994 Group, UK Deans of Science, Institute of Physics, Medical Schools Council, CaSE, Royal Academy of Engineering, Education for Engineering, Physiological Society, Institute for Engineering and technology, Society of Biology, Million+, National Higher Education STEM Programme. Back

277 HEFCE, Guide to funding: How HEFCE allocates its funding, September 2010. Back

278 Million+, National Higher Education STEM Programme, ABPI, Institute of Physics, Council for the Mathematical Sciences, UCAS. Back

279 Million+. Back

280 HEFCE, Student number controls for 2012-13-invitation to bid for student places, October 2011. Back

281 Imperial College London. Back

282 The Wellcome Trust, Royal Astronomical Society, Institute of Physics, Russell Group, Academy of Medical Sciences, CaSE, Society of Biology, Syngenta, University of Manchester. Back

283 HEFCE. Back

284 Royal Astronomical Society, Institute of Physics, Russell Group, Royal Academy of Engineering, CaSE, Society of Biology, Universities UK, Million+, the Physiological Society. Back