Future development of loans in Further Education

Closed 21 Aug 2014

Opened 19 Jun 2014

Feedback Updated 31 Mar 2015

We Asked

For your views on our proposals: to expand the Advanced Learning Loans system to include 19-23 year olds and those studying at level 2; to simplify the current system; to follow the approach in Higher Education consultation last year to introduce a Sharia compliant mechanism; and to transfer Higher National qualifications to within scope of Advanced Learning Loans.

You Said

There was no clear concensus on the expansion of Advanced Learning Loans, particularly given the uncertainties around the future funding of the Further Education sector and the overall impact this has. There was support for the removal of the concurrent and repeat study rules; and for a Sharia compliant product in Further Education if one is introduced in Higher Education. Two thirds of respondents saw negative consequences of bringing Higher Nationals into Advanced Learning Loans.

We Did

Proposals to expand Advanced Learning Loans will be taken forward in the next Spending Review informed by comments from respondents. We will simplify the current system by removing the repeat and concurrent study rules in 2016/17. Primary legislation is needed to introduce an alternative finance product; we will contine to develop this with experts in Islamic finance. We will give further thought to the issues raised about the transfer of Higher Nationals, but will not go ahead at this time.

Results Updated 25 Mar 2015

The outcome of the consultation is that the scope of Advanced Learning Loans will not be expanded.  This is because respondents recognised it would be better for an expansion of loans to be considered alongside a broader review of adult skills funding in the forthcoming Spending Review.  However, from 2016/17, we're relaxing the rules for accessing loans.  We want to support those seeking multiple qualifications at the same time or same level, to help their career progression.

We will not be going ahead with changes proposed for Higher National Diplomas and Higher National Certifications in the consulation at this time.  We want to give further thought to the issues highlighted by stakeholders before going ahead with these changes.

 

Links:

Overview

If you are a learner, potential learner or involved in the provision of further or higher education, this consultation seeks your views on our proposals for an expansion of loans in the Further Education (FE) sector. 

We want to:

  • give access to learning to the widest possible number of people;
  • simplify the funding system that we already have, and give learners more control over their learning experience;
  • provide stronger incentives for learners who want to undertake training or develop their skills;
  • link to the Higher Education (HE) funding system

 

We would like to hear your feedback on how the current Advanced Learning Loans system (lauched in April 2013) is working. 

 

 

Why We Are Consulting

It is essential to our economy that people have the skills that employers need to help us compete in a world that is changing fast.  We need to ensure that further education provides the skilled workforce employers need and helps individuals reach their full potential.

 

In line with the principles of fairness and shared responsibility, public funding is prioritised for younger learners and those with lower skills.  Advanced Learning Loans were introduced in April 2013 to enable individuals to make positive decisions about how to invest in intermediate and higher skills.  They are available to people aged 24 and over studying at level 3 and level 4, and originally included Advanced and Higher apprenticeships. 

With the exception of apprenticeships, which were removed from the loans system in March 2014 and are not covered by this consultation document, the introduction of Advanced Learning Loans has been a success.  By the end of March 2014 there had been 64,700 applications, which represents 81% of the 80,000 loans that we had hoped would be received this financial year and is more than the forecast take-up for non-apprenticeship courses.

We would like to gather views on proposals for a further expansion of loans in the Further Education sector.  The central proposal in this consultation is to expand the scope of loans in the Further Education sector to cover 19-23 year olds and to make loans available for level 2 qualifications where learners are not entitled to full grant funding.  In doing this, we need to ensure that we have a fair and easily understood funding structure, with simple rules that put the power in the hands of the learner. 

This consultation also explores certain ideas which may help to simplify the loans funding framework, and to create greater coherence between Further Education and Higher Education loans systems.  These broader issues include:

•           Considering whether the administrative rules of the Advanced Learning Loans system could be simplified (e.g. removing concurrent study rules).

•           Highlighting a consultation published on 3 April 2014 by BIS, on Sharia-compliant student finance. 

•           Consulting on the idea of moving certain qualifications, for example Higher National Diplomas (HNDs) and Higher National Certificates (HNCs) from Higher Education funding to Advanced Learning Loans.

•           Seeking feedback on the effectiveness of the Advanced Learning Loans system, and on the appropriateness of the information, advice and guidance about these loans.

Why are we proposing this expansion?

There are numerous reasons why we believe now is an appropriate time to propose an expansion of Advanced Learning Loans.  These are set out inf the full consultation document.

We want to use this consultation to gain a fuller understanding of the impact on learners, providers and the government.  This will help us to better understand the value for money of any expansion.

Audiences

  • SMEs (small and medium businesses)
  • Large businesses (over 250 staff)
  • Further Education Colleges
  • Further Education students
  • FE press
  • FE policy organisations
  • Training Organisation
  • Further Education sector representative body
  • Universities
  • Students
  • University associations
  • Universities
  • Students
  • Individual

Interests

  • Student Loans
  • Further Education loans
  • Further Education