NASMA response to Announcement of integration of ALF and the SOF

Posted: 07-05-2014

Tim Melville-Ross CBE

Chair

HEFCE

 

t.melville-ross@hefce.ac.uk

Dear Tim

Re: Access to Learning Fund and implications of the HEFCE Grant letter

The National Association of Student Money Advisers (NASMA) wishes to express its concern over the content of the recently published HEFCE Grant Letter from the Secretary of State, which announces an integration of the Access to Learning Fund (ALF), and the Student Opportunity Fund (SOF), into a single budget for student retention and success. We understand the headline implications of this announcement to be a reduction of £125m in the SOF, combined with a further reduction of £37m due to the abolition of the ALF budget – a total cut of £162m.

 

We anticipate the reduced budget will be the subject of fierce competition from within the sector, but our primary concern is the absence of an on-going ring-fenced budget that will protect the interests of students facing hardship during their studies.

 

The ALF has been an immensely effective tool in aiding the retention of students in the most vulnerable circumstances, as well as compensating for imperfections within the student finance system (which, more often than not, have the most severe impact on the same vulnerable groups):

 

  1. Students with dependants

 

The current dependants grants package was introduced following the introduction of the tax credits system, in order to make a complementary package of financial support. With the imminent introduction of Universal Credit, which will by its nature abolish tax credits, students with children are set to lose a substantial amount of financial support – BIS have already confirmed no additional funding will be available to compensate for the abolition of tax credits.

 

Dependants Grants are currently the most complex area of the student financial support package, and take longest to process as a result. This year saw many instances of students not receiving their full entitlement until well into the autumn term with most resources aimed at core processing of maintenance loans and grants (available to all students). The situation was compounded for student parents by the decision to move the processing of their maintenance loans/grants/ to the team dealing with dependants grants – slowing down the processing of even these core components of the funding package. Students in this group invariably face the longest delays to their funding being processed, and are therefore placed in precarious situations each year of their studies.

 

The ALF has acted as a flexible and fast response to the issues students face both in the transition to Higher Education (students in this group are often caught in an income gap when leaving employment, or the benefits system, when starting their studies), and to the inherent delays within the student finance system. The ALF has also long been used to address childcare costs not met by the statutory funding system (which meets only 85% of costs).

 

  1. Disabled students

 

The ALF has been an established funding source for meeting the cost of diagnostic tests for many years. These costs fall outside those met by the Disabled Students Allowance (DSA). The instances of students requiring diagnostic documentation specifically in order to access their entitlement to the DSA are well documented, and a significant proportion of the ALF budget helps to meet these costs. The removal of the ALF threatens to undermine students’ access to diagnostic testing (in many cases on a non income-assessed basis) and at best places this responsibility upon HEIs. We are concerned that the lack of reference to a national scheme of published guidance could have an adverse impact on the experience of disabled students nationally.

 

  1. Students in the ‘squeezed middle’

 

Students whose household income is above £42,620 receive no grant support alongside their loan. Whilst there is a notional expectation an household contribution will be made available to supplement the student finance they receive, this is no longer publicised by government agencies, and nor is it always possible. The student finance system takes no account of household expenditure against essential items, so it is extremely common to see students from higher income backgrounds struggling to get by on  reduced student financial support. These students are another group who have come to rely on discretionary sources of financial support such as the ALF.

 

The removal of the ALF budget, without adequate safeguards put in place to ensure HEIs continue to make arrangements to continue to operate a discretionary fund in the same manner, will be significantly detrimental to the above groups, but will also have an impact on the wider student population. We hope it will be possible for HEFCE to provide more information to HEIs regarding the policy intention behind the recent grant letter, or to seek this from the Secretary of State if necessary.

 

We would be grateful for any communication instructing HEIs as to the importance of ensuring ALF funds continue to be made available, that there will be a commitment to the on-going publication of national guidance to support the ALF (which has been a vital tool in underpinning the provision of discretionary funds in HEIs), and to clarify what requirements will be made of HEIs in terms of future monitoring arrangements of ALF funds.

 

Thank you for your consideration of the above, and I look forward to hearing from you.

 

Yours sincerely

 

 Phil Davis

NASMA Chairperson

c/o Bishop Grosseteste University

Lincoln

LN1 3DY

T: 01522 583602

E: phil.davis@bishopg.ac.uk