WHY DO STUDENTS FROM THE REST OF THE UK PAY TUITION FEES IN SCOTLAND?
25 March 2018
Students from the EU get free tuition at Scottish universities, but students from the rest of the UK have to pay. Why is this?
Who pays tuition fees at Scottish universities? It’s a vexed question with a complicated history. To understand where we are now, it’s useful to trace the history of tuition fees in Scotland.
Two of the more eye catching legislative moves delivered by the Labour government elected in 1997 were devolution for Scotland, Wales and Northern Ireland, and the introduction of means-tested tuition fees up to a maximum of £1,000 per year across UK universities. Under the latter, around one-third of students paid the new fee in full, one-third in part and one-third of students remained fully funded by the government.
The 1999 election of the first Holyrood parliament resulted in a coalition government in Scotland comprised of Labour and the Liberal Democrats, parties with very different views on tuition fees. This tension led the Scottish Government to appoint lawyer Andrew Cubie to chair a comprehensive review of student funding in Scotland.
The publication, in December 1999, of the Cubie Report set Scotland on a different course to the rest of the UK. The decisive break occurred in 2000, when any contribution to tuition fees by Scottish students studying in Scotland was abolished. Technically, a fee remained but the government now paid it for everyone, not only those at lower incomes. The following year new Scottish students became liable for a £2,000 “graduate endowment”, paid by graduates to the government after completing their studies (most chose to do so by adding the amount to their student loan, which became repayable once earnings reached £10,000). Only full-time students were liable for the graduate endowment: with exemptions, including for mature students and those studying for qualifications below degree level, it was charged to only around 50% of graduates. Income from the endowment was ring-fenced within the government accounts for use on student support, in a limited reflection of Cubie’s recommendation for a fully free-standing fund.
Importantly, Scottish students who chose to study in the rest of the UK did not benefit from the abolition of tuition fees in Scotland nor were they liable for the endowment: they continued to have to pay exactly the same fees as students from anywhere else in the EU. That principle has continued to hold ever since.
Within Scotland, the Scottish Government interpreted EU law as requiring that nationals from other EU member states should be treated identically to Scottish students, under the new charging regime. It therefore paid their fee in full, and they were also liable for the endowment.
The EU did not, however, require the Scottish Government to fund the fees of UK nationals from elsewhere in the UK who came to study in Scotland. EU law strictly prohibits discriminating between nationals of different member states, but is not concerned with differential treatment within a member state. Students from the rest of the UK studying in Scotland therefore continued to pay the same fees and receive the same means-tested subsidy towards them from their home administration, as they did in the rest of the UK, and were not liable for the graduate endowment.
In 2006, fees in England and Northern Ireland were increased to a maximum of £3,000 per year, for which students could for the first time obtain a dedicated “fee loan” to defer the cost. Wales followed suit in 2007, although for several years thereafter it also provided a cash fee subsidy for Welsh students in Wales to limit the impact of the change.
The Scottish government responded to this change by raising the flat-rate university fee to £1,700 in Scotland (£2,700 for medicine), having ensured that the UK government would provide its students with fee loans to cover this. Scottish and non-UK EU students studying in Scotland continued to have their upfront fees paid by the Scottish Government, so only rUK students were affected by the change.
The aim was to prevent Scotland being seen as the cheap option for students from England and Wales – the first instance of fears over what later became known as “fee refugees”. The higher fee deliberately left the total cost over four years no higher than what was initially expected to be typical over three year degrees elsewhere in the UK.
In 2007 the new SNP minority government in Scotland, with the support of the Liberal Democrats and Greens, abolished the graduate endowment (which by then had risen to £2,289, with student loans repayable once earnings reached £15,000). This meant that it was only ever paid by degree students graduating between 2004 and 2006, who had entered university in 2001 or later.
It’s noteworthy that at this stage students from anywhere in the EU at Scottish universities were technically all still charged the same fees (which by 2011 had risen to £1,820). The only difference was that fees for Scottish and non-UK EU students were paid on their behalf by the Scottish Government, specifically the Student Awards Agency Scotland (SAAS). The fees, whether they came from SAAS or from rUK students, covered around a quarter of the total cost of tuition. The balance was paid by another branch of the Scottish Government: the Scottish Funding Council (SFC).
The Scottish Government, via the SFC, was therefore still subsidising students from rUK who chose to study in Scotland. The converse was also true of Scottish students studying in rUK, whose £3,000 fee only partially covered the cost of teaching.
In 2012, the Conservative/Liberal Democrat UK coalition government introduced variable university tuition fees up to a maximum of £9,000 per year in England. As before, loans covering the full cost of tuition were made available to all students, repayable on an income-contingent basis.
As in 2006, the Scottish Government argued that it needed to increase fees for rUK students in Scotland to avoid a flood of “fee refugees”.
For the first time, the Scottish Government permitted universities in Scotland to charge new students from other parts of the UK a different upfront fee. This move required new legislation, permissible under EU law because it only concerned differential treatment within the UK. No formal fee cap was set, but the Scottish Government took reserve powers to impose one should it be deemed necessary. In practice Scottish universities self-imposed a £9,000 limit (now £9,250).
The Scottish Government has emphasised that the difference in treatment rests on residence within the UK rather than any concept of nationality. In practice, a combination of residence and nationality applies (thus some non-UK EU nationals resident in other parts of the UK appear to remain entitled to free tuition in Scotland).1 This conclusion comes (a) from looking at how the Northern Irish dual-nationality "loophole" was fixed a few years ago, and (b) from an FoI from 2014, in which the Student Awards Agency Scotland identified that there were each year between 100 and 200 EU nationals resident in other parts of the UK who received support from SAAS in the period from 2006-07 to 2011-12. Despite being resident in other parts of the UK, these were students for which the SG was evidently accepting responsibility. They were getting average support at levels more than enough to cover their fees. The number shot up in 2012-13, due to a sudden jump in NI dual nationality applicants, who it was known at the time were all declaring their EU citizenship to obtain free tuition.
From 2013, the reporting suggested that only dual nationality cases had a new residence criterion imposed. Nothing appears to have been done to change the position of sole nationals of another EU nation but resident in the UK (not Scotland).
Belfast Telegraph news story, 17th September 2012
The current guidance
In parallel, all of the remaining public subsidy for rUK students in Scotland through the SFC was withdrawn, other than a small allowance for those on the highest-cost courses, mirroring what was happening for students at universities in England.
Scottish universities now receive almost all funding for rUK students through their individual fees, and the number of such students no longer counts towards the cap on government funded student places in Scotland. They therefore no longer compete with Scottish and EU students for Scottish Government “funded places”.
This brings us up to the present day situation with tuition fees: students from the rest of the UK who come to study in Scotland pay fees of up to £9,250 per year, while Scots and non-UK EU nationals continue to receive “free tuition”.
A forthcoming briefing will consider how policies on maintenance (ie living expense) support have diverged as a result of devolution, across all four nations of the United Kingdom.
NOTES
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This conclusion comes (a) from looking at how the Northern Irish dual-nationality "loophole" was fixed a few years ago, and (b) from an FoI from 2014, in which the Student Awards Agency Scotland identified that there were each year between 100 and 200 EU nationals resident in other parts of the UK who received support from SAAS in the period from 2006-07 to 2011-12. Despite being resident in other parts of the UK, these were students for which the SG was evidently accepting responsibility. They were getting average support at levels more than enough to cover their fees. The number shot up in 2012-13, due to a sudden jump in NI dual nationality applicants, who it was known at the time were all declaring their EU citizenship to obtain free tuition.
From 2013, the reporting suggested that only dual nationality cases had a new residence criterion imposed. Nothing appears to have been done to change the position of sole nationals of another EU nation but resident in the UK (not Scotland).
Belfast Telegraph news story, 17th September 2012
The current guidance
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