Barclays bank warns of growing student debt

A-Level students, who are looking forward to University today after receiving their grades, may be in for a shock when they learn that student debts may average more than £30,000 when degree courses are completed in 2010.

A new report by Barclays Bank suggests that the rising cost of living, and possible increases in fees will push student debt levels up, although it also warns that student loans debt may not be sufficient to pay for three years at university.

The £33,708 figure is based on expected annual outgoings of £11,236, although average outgoings of £7,859 in 2003 have not resulted in average debt levels of three times this amount. Natwest reported earlier this week that students are accumulating an average of around £8,000 per year.

Barclays further suggests that paying such costs will not be possible out of the student loan alone, and has indicated that students may need to seek other sources of debt, although the system presently expects parents to contribute to student living costs.

By 2010 at least some students are likely to be paying £3,000 a year as part of Government plans for top up fees, though it has committed not to push this higher. It has also reintroduced grants for poorer students in an attempt to prevent people from poorer backgrounds being priced out of higher education.

The concerns raised in the report, mirror those expressed today by the university and college lecturers union NATFHE.

NAFTHE has called on the parents of A-level students, and other parents, to oppose plans for tuition fees of £3000 per year, so as to secure the right to higher education for future A-level students.

NATFHE General Secretary, Paul Mackney, commented: ‘Parents – of all children – should speak out now against a differential fee system which will either deter poorer students altogether – or channel them into cheaper, poorly resourced universities. The next generation deserves the same opportunities. Families should let their MPs know their views.’