FE loans system ‘not working’ after drop in applications

30th October 2015, 10:31am

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FE loans system ‘not working’ after drop in applications

https://www.tes.com/magazine/archive/fe-loans-system-not-working-after-drop-applications
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Adult learning body Niace has claimed that the system for FE loans is “not working”, after new government figures revealed a drop in applications in 2014-15.

New statistics released by the Department for Business, Innovation and Skills revealed the the number of applications for 24+ advanced learning loans decreased by 5 per cent, from 70,820 in 2013-14 to 67,280 in 2014-15.

Despite this drop, the number of approved applications slightly increased to 56,870, up from 56,220 in 2013-14. However, just £148.8 million (37 per cent) of the £398 million loans budget allocated for the year was used, leaving £250 million left unused.

Fiona Aldridge, Niace’s assistant director for development and research, told TES: “The loans system clearly isn’t working - the drop of 5 per cent on last year’s loan applications is extremely worrying. We need more people to invest in their skills to build their careers and their income, not fewer. A better skilled workforce, in better paid jobs, is good for UK businesses and the wider economy.

“The loan system is working in exactly the opposite way - loan applications are low and going down. We estimate that in 2014-15 alone, £250 million of learning opportunities were lost. Meanwhile, UK skill levels are falling behind our international competitors.”

Niace has called for 24+ loans to be made available for smaller qualifications, modules, units and professional qualifications. The organisation is about to start a trial, funded by JP Morgan, of new approaches to increase loans-funded learning in the retail and health and social care sectors in London.

Adult loans were introduced in 2013 to help learners aged over 24 pay the fees charged by training providers for level 3 and 4 courses.

A spokesman for the Association of Employment and Learning Providers said that one factor behind the decrease was the unsuccessful introduction of loans for apprenticehips.

“We believe that loans offer an opportunity for adults to secure higher skilled and better paid jobs but changes to benefits and tax credits may be making people hesitant about taking out a loan,” he added.

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