Parents expected to pay up to £5372 a year towards university costs

first_img Want the best of The Telegraph direct to your email and WhatsApp? Sign up to our free twice-daily  Front Page newsletter and new  audio briefings. As students across the country prepare to start university for the first time, analysis of student loan data has revealed that many parents may be feeling the pinch.According to figures obtained from the Student Loans Company (SLC), there has been a “hidden” rise in the amount that parents are expected to contribute towards their child’s education.  In some cases, parents are facing a 27 per cent increase on last year, meaning many families could be expected to pay hundreds more a year, following changes to the way student loans are allocated.The research, by consumer help website MoneySavingExpert.com, also revealed that the highest earning parents – those earning upwards of £69,803 a year – are now expected to pay over £5,300 a year towards university costs.The increase follows recent changes in the way in which student loans are allocated.Previously, students from lower income families were eligible for a non-repayable maintenance grant to help with the cost of living. This grant was scrapped by George Osborne, the former Chancellor, to be replaced by an increased maintenance loan, which is means-tested based on parental income.The reduction in this loan starts for families with incomes of £25,000 a year and it can be halved for those whose family income progresses towards £60,000.For new 2016 university starters, this increase in loan size, coupled with a large increase in the portion of the loan that is means-tested, means some parents are expected to pay up to 27 per cent more than parents on the same income last year.  According to MoneySavingExpert.com, parental contribution is calculated by taking the maximum maintenance loan available and subtracting the actual amount received after means-testing. For 2015, this was calculated by taking the maximum total award – maintenance loan plus grant – and subtracting the actual amount of loan and grant received after means-testing.Martin Lewis, founder of MoneySavingExpert.com, criticised “the lack of transparency and clear guidance” on parental contributions, saying it could  lead to “unmanageable levels of debt” for students whose families can’t afford to pay.In response, the former head of the Independent Taskforce on Student Finance Information, has written an open letter to Jo Johnson, the universities minister, calling for the Government to make parental contributions explicit in information supplied by the SLC.”Almost every 18-year-old school leaver – while able to vote, join the army, marry and apply for a credit card (all the freedoms of adulthood) – still sees their university maintenance loan dictated by a means test of their parents’ residual income,” he said.”The reduction in this living loan starts for those from families with incomes as little as £25,000 a year and loans can be halved for those whose parents earn £60,000.”The implicit premise is that parents will fill the gap, but implicit isn’t good enough – this must be made explicit. The only thing I can find from the Student Loans Company is within its guide to how you’re assessed and paid; it says ‘depending on their income, parents may have to contribute towards the living costs of their student children’.He continued: “The bare minimum requirement must be that parents should be loudly told about it, including exactly how much they are expected to give.”A Department for Education spokesperson said: “There should be no barrier to any child’s ambitions and we are already seeing record numbers of disadvantaged young people going to university. We want to go further and ensure we are building a society that works for everyone.“We have increased maintenance support for students from the lowest income backgrounds by 10 per cent.“As the OECD has recognised, this Government’s approach to student finance is sustainable. Maintenance support is provided as a contribution to students’ costs.‎ Financial assistance is also available through universities.”last_img read more