More than two in five potential adult students say they would be unlikely to take up a loan for an FE course, according to the government's survey of attitudes to borrowing.
Researchers commissioned by the Department for Business, Innovation and Skills found that opposition to the FE loans being introduced next year softened when the terms were explained, including the fact that they would not need to make repayments unless they were earning more than pound;21,000.
But even then, 42 per cent said they would probably not be willing to take out a loan, and of those 11 per cent were definite about their opposition, prompting fears that large numbers of adults will turn their backs on education.
More than 300,000 people will be affected when FE loans are introduced in September 2013, as the government withdraws its subsidy for over-24s on courses at A-level equivalent and above in an attempt to reduce spending. Students will be expected to borrow on terms similar to loans for university tuition fees.
The survey said that getting the message right about the affordability and relatively generous terms of the loans would be key. But critics of the plan - which include the Association of Colleges, unions and students, who have issued a joint call for the government to delay its proposals - argue that the timescale is too tight and there is no budget for communicating how loans would work.
"There is clear evidence in this report that, with all the will in the world, many people let down by education first time round will not return because of the new loans system, which removes government subsidy for many students," said Toni Pearce, vice-president for FE at the National Union of Students.
"The report attempts to justify the decision to replace spending with lending by saying that, once explained properly, the impact on take-up will possibly be reduced. But, given the government's performance in trying to communicate the changes to the HE system, there is little hope that prospective students will get the kind of information provided to those taking part in this study."
The introduction of loans for FE had been even more rushed than the rise in university fees, Ms Pearce said, and FE institutions were unprepared.
Researchers held focus groups and surveyed 400 people to test their reaction to the government plans to end subsidies and offer loans instead. Three-quarters of potential students said course fees were the main barrier to embarking on courses.
Those studying to move into a new career were the most concerned with cost, but they also weighed that against the value of the qualification. People who had been out of work for a while were the most likely to believe the value of the course outweighed the cost, but the very long- term unemployed tended to be "fatalistic" about work and education. Before the loan system had been explained, the focus groups tended to feel that the emotional and financial burden of the loan "greatly outweighed" the benefits of education, the report said.
After the terms were explained, including a lower interest rate and protection from repayment for those earning under pound;21,000, 58 per cent said that they might take up a loan. But the explanation only tended to increase confidence in those already willing to consider borrowing: some who initially said they "might" take a loan moved to "probably" or "definitely". The proportion saying they would probably not borrow remained 42 per cent.
The survey found that many people were unaware that the government subsidises level 3 courses for older students. "Given the limited knowledge of current course costs, it may not be helpful to emphasise the change in price at all," the report said. Or, as one current apprentice put it: "Take out that the government is no longer helping you. Because the rest of it is positive."
The Department for Business, Innovation and Skills was not available to comment.
75% of adults surveyed said fees were the key barrier to taking a course
83% had borrowed money in the past, and two in five had difficulty repaying it
58% said they might take out a loan to fund their study
37% of 40- to 49-year-olds said they were likely to take out a loan
63% of 23- to 29-year-olds said they were likely to take out a loan.
Original headline: Survey sparks fears that adults may reject education over loans