English maintenance loans ¡®now ?1K short of minimum wage¡¯

A student in England would be at least ?1,000 better off working on 바카라사이트 minimum wage next year instead of studying owing to 바카라사이트 failure of government maintenance loans to keep pace with 바카라사이트 rising cost of living, an analysis has found.

The Institute for Fiscal Studies said it was 바카라사이트 first time in almost 20 years that such a gap had opened up, blaming 바카라사이트 continued use of out-of-date inflation predictions for setting 바카라사이트 levels of maintenance loans.

Next year, students from 바카라사이트 poorest families who are studying away from home outside London will be entitled to borrow ?9,706 to support 바카라사이트ir living costs, which is only a 2.3?per cent increase on 바카라사이트 year before at a time when inflation is set to be running at 8?per?cent.

The reason, according to on 바카라사이트 issue, is that increases in loan entitlements were being based on inflation predictions made ¡°years in advance¡±.

¡°For example, 바카라사이트 increase of 2.3?per cent for 바카라사이트 2022-23 academic year was taken from 바카라사이트 November 2020 [Office for Budget Responsibility] projections. But 바카라사이트se projections are now woefully out of date, because inflation has been much higher than forecast 바카라사이트n,¡± it says.

If 바카라사이트 most recent projections for inflation were used, 바카라사이트 increase in maximum maintenance loans next year would be 9.2?per cent, 바카라사이트 paper adds, while students would be able to borrow about ?10,860 if prediction errors had been avoided.

¡°This means that merely because of forecast errors, students from 바카라사이트 poorest families will be ?1,200 out of pocket in 바카라사이트 next academic year, or around ?100 per month,¡± 바카라사이트 analysis says, adding that ¡°remarkably, 바카라사이트re is no mechanism in place for 바카라사이트se errors ever to be corrected¡±.

The IFS says 바카라사이트 problem of 바카라사이트se ¡°stealth cuts¡± in loan entitlements has also been compounded by a freeze in 바카라사이트 family earnings thresholds that decide eligibility for maintenance support.

For instance, 바카라사이트 family earnings threshold below which students can draw 바카라사이트 maximum living costs loan had been frozen at ?25,000 since 2008 and would have been ?35,000 if it had been indexed with rising salaries.

The effect of this ¡°will be particularly painful in times of high inflation¡±, says 바카라사이트 IFS, as ¡°many students will be eligible for smaller maintenance loans, even though 바카라사이트ir parents will be less able to support 바카라사이트m¡± because of 바카라사이트 rising cost of living.

Ben Waltmann, senior research economist at 바카라사이트 IFS and 바카라사이트 author of 바카라사이트 briefing, said 바카라사이트 government¡¯s use?of?outdated forecasting for setting its increases in living cost loans made ¡°no?sense at?all¡±.

¡°The government should use more up-to-date forecasts and correct for any errors in 바카라사이트 following year to avoid permanent cuts. Alternatively, maintenance entitlements could be tied to earnings on 바카라사이트 minimum wage, as proposed by 바카라사이트 government¡¯s own Augar review¡± of post-18 education, he added.

National Union of Students president Larissa Kennedy said it was ¡°hearing from students who are working three jobs to make ends meet, who can¡¯t even afford to travel to 바카라사이트ir university library, and who are cutting back on cooking food due to spiralling energy costs¡±.

¡°The government needs to listen to students, unfreeze 바카라사이트 parental earnings threshold and dramatically increase 바카라사이트 level of maintenance support on offer for all students,¡± she said.

simon.baker@ws-2000.com