Future development of loans in Further Education

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 your views matter

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.