Staff and agencies Monday April 22, 2002
Students now leave university owing an average £10,000, meaning graduate debt has tripled over the last three years, a survey showed today.
The poll by the NatWest bank showed that while two thirds thought tuition fees were unfair, students were divided on whether grants paid for by a graduate tax or loans were better.
The government's review of student finance is due to be published as part of the July comprehensive spending review, although ministers are reported to have ruled out a graduate tax as too expensive and potentially unpopular.
The NatWest annual Money Matters survey showed that even though graduates may have to foot debt repayments of £200 a month, their salaries could start as high as £25,000 in London and East Anglia. Only 8% of those questioned said they considered dropping out in their final year to get a job to clear their borrowings. However, job and money worries dominated the list of woes of those about to leave university - 55% were anxious about finding work, while debt repayment was a concern for 40%.
By contrast, staying in contact with friends from university was only a worry for 26%.
NatWest said average debt reported in its surveys increased from £3,300 in 1999 to £10,000 in 2002, when the first students to feel the full impact of the abolition of grants and the introduction of fees were graduating.
The survey showed that 45% of people graduating this summer wanted the government to retain student loans, while 44% favoured the return of grants paid for by a graduate tax.
Ann Marie Blake, head of student and graduate banking at the bank, said: "For the majority, university is still seen as a worthwhile investment and nine out of 10 graduates in this year's survey are adamant that debt did not put them off finishing their course."
The survey was based on responses from 2,000 people in England and Wales.
National Union of Students' president, Owain James, said: "Although shocking, these figures do not come as a surprise. The government badly fails students as yet another survey now has proven.
"There are now countless independent reports, including that of UniversitiesUK, that vindicate the NUS's call for a return of maintenance grants. The devolved powers in Scotland and Wales have both taken steps to rectify the problem with the return of grants.
"The ongoing Westminster review of student funding seems to be going off the rails. With proposals such as commercial interest rates on student loans which, far from improving the situation, will make it far worse for students. If the government wants to improve access to university and end elitism, as highlighted by the chancellor in the Laura Spence affair, it needs to give students more money - not more debts," he said.