Callender, C.

MacKinnon, K.

Vegeris, S.

Wilkinson, D.

WestminsterResearch

    WestminsterResearch http://www.wmin.ac.uk/westminsterresearch   Higher and further education students' income, expenditure and debt in Scotland.  Claire Callender1 David Wilkinson2 Karen MacKinnon2 Sandra Vegeris2  1 London South Bank University 2 Policy Studies Institute   This is a reproduction of Scottish Executive Social Research Findings No. 33/2005, ISBN 0755927818.  Commissioned and published on behalf of the Scottish Executive.  © Crown Copyright 2005.   The report is available online:  http://www.scotland.gov.uk/Resource/Doc/76169/0019034.pdf   The WestminsterResearch online digital archive at the University of Westminster aims to make the research output of the University available to a wider audience.  Copyright and Moral Rights remain with the authors and/or copyright owners. Users are permitted to download and/or print one copy for non-commercial private study or research.  Further distribution and any use of material from within this archive for profit-making enterprises or for commercial gain is strictly forbidden.      Whilst further distribution of specific materials from within this archive is forbidden, you may freely distribute the URL of WestminsterResearch. (http://www.wmin.ac.uk/westminsterresearch).  In case of abuse or copyright appearing without permission e-mail wattsn@wmin.ac.uk. This report is about the income, expenditure and debt of full time students in higher education (HE) and further education(FE) in Scotland in 2004/05. It is based on research, commissioned by the Scottish Executive, conducted by ProfessorClaire Callender of London South Bank University, the Policy Studies Institute, and NOP Research Ltd. While studies in thepast have examined the finances of undergraduates attending Higher Educational Institutions in Scotland, this is the firststudy also to explore in-depth the finances of FE college students taking undergraduate and non-advanced courses.The main aims of the study were to collect comprehensive data on full time students’ income, expenditure and debt, and toidentify any differences by students’ socio-economic and institutional characteristics. The interviews with students wereconducted between January and May 2005.Main findingsn Over half HE students and FE students had not thought about the costs of going to university or college before they startedtheir course, nor sought information or guidance about these costs. By contrast, the vast majority had obtained informationabout financial help with the costs of studying.n The total average income over the 2004/05 academic year (i.e. excluding the summer vacation) of HE students was £5,795and among FE students it was £4,377.n The total average expenditure over the 2004/05 academic year of HE students was £6,604 while for FE students it amountedto £5,320.n By the end of the 2004/05 academic year, 79 per cent of HE students and 18 per cent of FE students anticipated being indebt. The average expected debt of HE students was £4,653 while for FE students it was £109. Within HE, this figure roseto £5,580 for those studying at HEIs and fell to £2,125 for those at FECs.n 86 per cent of students graduating in 2005 from an HEI anticipated leaving university with debts, the vast majority of whichconsisted of student loan debt. Their average debt on graduation amounted to £7,561, but a quarter owed over £12,000. n The average income, expenditure, and debt of students studying at HEIs in Scotland in 2004/05 were lower than that of theircounterparts in England and Wales in 2002/03. Despite longer courses in Scotland, Scottish students graduating in 2005 had£2,740 less debt than English and Welsh students graduating in 2003, after controlling for inflation. This was mostly becauseof the different student funding systems and students’ different patterns of living arrangements.n The vast majority of students were convinced of the economic and social returns of HE. Roughly 80 per cent of HE and FEstudents thought that in the longer term they would benefit socially from their education while three-quarters thought theywould benefit financially.Higher and Further Education Students’ Income,Expenditure and Debt in Scotland Professor Claire Callender: London South Bank UniversityDavid Wilkinson, Karen MacKinnon, Sandra Vegeris: The Policy Studies InstituteEnterprise and Lifelong Learning Research ProgrammeResearch FindingsNo.33/2005Student incomes in 2004/05Forty per cent of HE students’ total income was derived fromthe student support system, 29 per cent from paid work, 23per cent from students’ family, and five per cent from socialsecurity benefits. For FE students, a similar proportion oftheir income came from student support, but 22 per centcame from paid work, 18 per from their family, and 17 percent from social security benefits.The family and student support were the two most commonsources of income with nearly four out of five of HE studentsand roughly seven out of ten non-advanced FE studentsreceiving money from these sources.There were considerable variations in students’ total averageincome depending on their characteristics. The greatestincome disparities among both HE and FE students wereassociated with their living arrangements, the presence ofdependent children in the household, and their age, all ofwhich were inter-related. These three factors were the mostimportant in explaining the differences in students’ totalincomeStudents with the highest incomes:n had dependent children;n lived with a partner and/or children; andn were aged 25 and over at the start of their course.Students with the lowest incomes:n were younger – HE students were aged under 25 and non-advanced FE students were aged 16 or 17;n lived at home with their parents;n did not have term-time jobs; andn among HE students only, had not taken out a student loan.Student support71 per cent of HE students had taken out a student loan in2004/05, and 79 per cent had taken one out at some pointwhile at university/college. Students in their final year atuniversity along with parent students and those living with apartner/children were most likely to have taken out a studentloan – between 88 and 86 per cent had done so. The loweststudent loan take up rates were amongst undergraduates atFECs and students living at home with their parents wherebetween 63 and 68 per cent had taken one out.The average value of the student loan was £2,267, but themeans-tested nature of loans and the different ratesdepending on where students live and study, affected thesize of a student’s loan. Low-income students with dependentchildren were eligible for and received the largest studentloans and the most from other state-funded sources ofstudent support. Those living at home received the smalleststudent loans because of both the lower loan rates for suchstudents, and their lower student loan take-up rates.Two-thirds of FE students received student support, worth anaverage of £2,013. Students living independently of theirfamily received the highest levels of support, and those livingwith their parents the lowest.FamilyHE students received an average of £1,348 from their familyover the academic year. Their family’s generosity variedconsiderably with contributions ranging from an average of£630 for students living with their parents, to £2,704 forstudents living with a partner/and or children. Aside fromthose students who could call upon a share of their partner’sincome, the greatest disparities were linked to students’family background. Students from the highest social classesobtained £1,804 over the year, while students from thelowest social classes received £797.FE students received an average of £803 from their familyover the academic year. Like HE students, their familycontributions varied ranging from £448 for students aged16-17 to £2,343 for those living with a partner/child.Paid workHE students earned an average of £1,693 from paid workover the academic year. Students living with their parentshad the highest earnings at £2,066 because they were themost likely to work during term-time while those withdependent children were the least likely to work (80%compared with 43%), and consequently had the lowestearnings at £1,064.Two-thirds of HE students had term-time jobs working anaverage of 15.7 hours a week in the weeks they worked, andearning a net average of £5.77 an hour. However, 45 percent worked over 16 hours a week.FE students earned an average of £948 during 2004/05with their earnings ranging from £125 for students withchildren to £1,621 for students aged 18-24. A third of FE students were employed during term-time butthis figure rose to 47 per cent for students from the highestsocial classes and dropped to five per cent for students withchildren. Employed FE students worked an average of 16.7hours a week in the weeks they worked, and earned a netaverage of £5.45 an hour.2Social security benefitsSocial security benefits were particularly important for FEstudents. Although only 17 per cent obtained them, theaverage amount of £4,285 received by each claimant wasconsiderable compared with other income sources. Students’ expenditure in 2004/05Sixty-eight per cent of HE students’ total expenditure wasspent on living costs, 18 per cent on housing, and 13 percent on the costs of participating in their course. FE students’living costs absorbed a slightly higher proportion of theirexpenditure at 72 per cent while they spent 15 per cent onhousing, and 12 per cent on participation costs.Students’ expenditure also differed depending on theircharacteristics. These variations were most often linked tostudents’ living arrangements, the presence of children in thehousehold, and their age. Students with the highest expenditure:n had dependent children;n were aged 25 and over;n lived with a partner and/or child; andn lived independently of their parents.Students with the lowest expenditure:n lived at home with their parents;n were younger – HE students were aged under 25 and non-advanced FE students were aged 16 or 17;n among FE students only, they came from the highest socialclass; and n among HE students only, they were in their 2nd year ofstudy.Living costsHE students spent an average of £4,515 on living costs overthe academic year while FE students spent £3,836. Overthree-quarters of this was absorbed by three areas ofexpenditure: entertainment (37%), food (22-23%) andpersonal expenses (28-29%). Entertainment, which includedsports, hobbies, cultural activities and spending on alcohol,was the most costly element of students’ living costs andaverage expenditure on it was £1,662 over the academicyear for HE students and £1,419 for FE students.HE students studying at a FEC in their 2nd year and above hadthe highest living costs at £5,300 while among FE studentsthose with term-time jobs had the highest.Housing costsHE students’ housing costs amounted to an average of£1,197 over the academic year and FE students’ to £785.However, only 71 per cent of HE students and 51 per centof FE students incurred any housing costs because most ofthose living at home with their parents paid nothing. So, theaverage housing costs of HE students living at home werejust £275, and for FE students they were £243. By contrast,students living independently spent £1,821 and £1,935respectively on their housing.HE students living independently had the highest housingcosts of £1,821 while among FE students, those withdependent children had the highest at £1,971.Participation costsHE students spent an average of £824 on participation costsover the academic year while FE students spent £639. Themost expensive item was students’ travel costs to and fromtheir place of study. This absorbed 57 per cent of HEstudents’ total participation costs and 70 per cent of FEstudents’. Among HE students, it was differences in these travel coststhat accounted for the greatest variations in their totalparticipation costs. In turn, their travel costs were related to:their living arrangements; the distances they had to travel;and their mode of transport. HE students living with theirparents or a partner/child travelled much further to theirplace of study than students living independently andconsequently used more expensive modes of transport.Student debtBy the end of the 2004/05 academic year, 79 per cent ofHE students anticipated being in debt compared with 18 percent of students. Within HE, 83 per cent of studentsattending an HEI expected to be in debt as did 69 per centattending a FEC. HE students expected to owe an average of£4,653 and FE students £485 but within HE, students atHEIs anticipated owing £5,580 and those at FECs £2,213.On average, 84 per cent of HE students’ borrowings wasmoney owed to the Student Loans Company, so debt levelswere closely associated with the student loan rates andlevels of take-up. Consequently, those with the highest debtsof £9,192 were students attending HEIs aged 25 and overbecause they were eligible for highest student loan rates,followed by students in their 4th year attending an HEI whoowed an average of £8,084 because they had accumulatedseveral years worth of student loans. 3If you wish further copies of this Research Findings orhave any enquiries about social research, pleasecontact us at:Scottish Executive Social ResearchEnterprise, Transport and Lifelong Learning Department3rd FloorMeridian Court3 Cadogan StreetGLASGOW G2 6ATTel: 0141 242 0262Fax: 0141 242 5455Email: socialresearch@scotland.gsi.gov.ukWebsite: www.scotland.gov.uk/socialresearchThe full report can be viewed on the internet atwww.scotland.gov.uk/llstatistics9 780755 927814ISBN 0-7559-2781-8Astron  B43638 10/05This document (and other Research Findings and Reports) and information about social research in the ScottishExecutive may be viewed on the Internet at: http://www.scotland.gov.uk/socialresearchThe site carries up-to-date information about social and policy research commissioned and published on behalf ofthe Scottish Executive. Subjects covered include transport, housing, social inclusion, rural affairs, children andyoung people, education, social work, community care, local government, civil justice, crime and criminal justice,regeneration, planning and womens issues. The site also allows access to information about the Scottish HouseholdSurvey.Inevitably, HE students who had not taken out a loan were theleast likely of all students to have debts - only 27% did - andthey owed the smallest sums, just £69 on average. Theywere followed by HE students attending an FEC not in theirfinal year who had the second lowest take-up rate of 61 percent and owed £1,620 on average. Among FE students, most of their borrowing was fromcommercial sources of credit. Those living independentlyand with children were most likely to be in debt and had thehighest debts.4About the Student Income andExpenditure Survey in ScotlandThe study was based on a survey of nationally representativesamples of Scottish domiciled full time HE and FE studentsdrawn from 15 Higher Education Institutions (HEIs) and20 Further Education Colleges (FECs) across Scotland. Faceto face interviews were conducted between January and May2005 with a total 1,317 students, consisting of832 undergraduates studying at both HEIs and FECs, and485 students studying at FECs taking a variety of non-advanced courses. 

Higher and further education students' income, expenditure and debt in Scotland

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Higher and further education students' income, expenditure and debt in Scotland

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