Skip to content
The UK's only independent think tank devoted to higher education.

Croeso i Gymru: Is the Welsh student funding system the best in the UK – or is it far from perfect? Discuss

  • 19 February 2024
  • By Nick Hillman

There’s one certainty about higher education funding in Wales: whatever you say about it, someone will shoot you down in flames. (And there will be more heat than light.)

Five years ago, we published a paper, Is ‘progressive universalism’ the answer? The new student funding arrangements in Wales, which pointed out that – despite enjoying broad support – the new student funding package in Wales was flawed. Specifically, we showed how the poorest students were left worse off in terms of cash-in-hand than their older siblings had been under the previous system.

We also showed the new system was regressive and wasteful, with many resources going to the richest students. This was because there was no longer any expectation that even the very richest parents would contribute towards their student offspring’s living costs. Students from the richest households could even get a grant as well as the maximum maintenance loan.

Our work received lots of media coverage and appeared as front-page news in in the Western Mail under the headline ‘New debt warning for Wales’ students’. This level of impact is the holy grail for think tanks.

But our euphoria didn’t last long. The profile we achieved for our critique was not welcomed everywhere.

In response to what we’d said, the leaders of Universities Wales and NUS Wales sent HEPI a joint formal complaint. They couldn’t claim we had our facts wrong so instead – oddly – attacked us for not criticising England in a report that was focused on Wales. They wrote, ‘as your report is comparing current Welsh students to previous Welsh students, not current Welsh students to English students, we believe it is misleading.’

I’ve no idea if members of the Welsh Government put them up to writing the letter, but it seems certain they would have readily agreed with it.

the first rule of policy is: be suspicious of any consensus that is so broad it risks stifling debate

It was an unedifying episode because the first rule of policy is: be suspicious of any consensus that is so broad it risks stifling debate. Indeed, I am tempted to argue that this principle is absolutely core to HEPI’s role. It might sound overblown but the importance of testing consensus through discussion and debate is why democracy is always better than the alternatives.

Any consensus that includes the representative body for university leaders and the representative body for students as well as the politicians in charge (from more than one political party) needs rigorous testing, even if only to ensure the right questions have been asked in advance about whatever policy is being implemented. If the policy is flawed, such questioning could lead to improvements; if the policy is already as good as can be, then that will become clearer too.

There have been many changes to the Welsh model since it was first implemented just a few years ago, generally aimed at saving money. Most recently, the replacement of grants by loans for postgraduate students has been announced (as has a modest increase in the tuition fee cap to the English level of £9,250). The money-saving changes confirm more questions should have been asked – and answered – about the generous package of support at the time it was introduced. Today, there is a notable reticence about the Welsh reforms, for the initial pride in them seems to have ebbed away.

In the cold light of day, Welsh policymakers and Welsh voters have simply not wanted to devote as much resource to higher education as the original plans entailed. (There was a similar story in England under Gordon Brown, when the improvements to maintenance grants made on his ascent to the premiership turned out to look too costly, leading to various cuts.)

Yet back when I queried the generosity of the Welsh system with those close to power at the time of implementation, I was told that the legacy of the inter-war means test ran so deep in Wales that universalism held a special place in people’s hearts. So the idea of grants for all – even students with multi-millionaire parents – was deemed non-negotiable. No hard evidence for this historical legacy was provided, but I didn’t question it and it striked me as an interesting argument for letting different parts of the UK do their own thing when it comes to higher education and student funding.

Moreover, despite some of what we at HEPI said at the time of the initial implementation of the Welsh student funding system, there are some really positive features of the Welsh funding model. So we’ve been just as keen to highlight these too. To take one example, cash-in-hand maintenance support for full-time undergraduate students is notably more generous than elsewhere in the UK, which is of particular benefit to those from tougher backgrounds. While an undergraduate student from a poor household in England living away from home (and not studying in London) gets £9,978 to spend on their living costs each year, their counterpart from Wales has £11,720.

cash-in-hand maintenance support for full-time undergraduate students is notably more generous for Welsh students

So we have also pointed out that any new Labour Government at Westminster might look closely at Wales when deciding what to do in England. Specifically, I wrote a piece for Labour List last spring that argued: ‘the best way for Starmer to tackle his higher education funding problem is to pick up the phone to Mark Drakeford.’

I also recently argued at the HESPA Annual Conference that, after years of divergence, we could conceivably see more policy convergence – for example, if we end up with Labour administrations in Wales and in Westminster and (after the 2026 Holyrood election) in Scotland. If that were to happen, it would mean three of the four parts of the UK were led by the same political party. (Moreover, as our former colleague Diana Beech – now leading London Higher – and others pointed out at the same HESPA event, most of the metro mayors also come from the Labour Party.)

Yet when we were making the constructive argument that Wales could have lessons for other parts of the UK, this point of view was also immediately shot down. In June 2023, Colin Riordan, outgoing Vice-Chancellor of Cardiff University, wrote a piece headlined ‘England shouldn’t look to Wales for higher education funding solutions’. In it, he argued: ‘The lessons from Wales for England’s new path are certainly not clear.’

What is clear, however, is that institutional leaders in Wales have a less positive perspective on the 2016 changes than they did five years ago.

Where does this leave us and what does it teach us? Surely it reveals that we need to talk more, about student funding in Wales in particular but also about how the four parts of the UK have all adopted different student funding policies, each with their own strengths – and flaws.

That’s why, in conjunction with the Nuffield Foundation and London Economics, we will be touring the whole UK in late February and early March. At our sessions in England, Scotland, Wales and Northern Ireland, we will be doing a deep dive of how the system in each area works and what tweaks might be made, following up with the views of a panel of experts and ending with contributions from the audience.

In London, the event has proved so popular we’ve had to shift to a much bigger venue (from memory, a first for HEPI) and there has also been a fast take-up of seats in Edinburgh and Belfast – though we can still squeeze in more people in all three of these places, if you haven’t signed up yet.

But in Wales, there’s – so far – been less interest in attending. So if you have an interest in student or university financing and are anywhere near Cardiff on the afternoon of Wednesday, 6 March 2024, please do consider coming along. Our panel will include: Professor Maria Hinfelaar (Vice-Chancellor, Wrexham University and Vice-Chair of Universities Wales); Dewi Knight (Director, PolicyWISE and former Specialist Adviser for Education Reform in the Welsh Government); and Orla Tarn (President of NUS Wales).

More details are available here:

Conversation and debate are undoubtedly the best way to construct sensible policy.

Perhaps the Welsh funding system is the best one in the UK, or perhaps it’s far from perfect. Or perhaps both these things are true simultaneously. Either way, we won’t know if we don’t discuss the details.

Perhaps the Welsh funding system is the best one in the UK, or perhaps it’s far from perfect. Or perhaps both these things are true simultaneously.

1 comment

  1. Alun says:

    It seems reasonable to argue it is both the best system and yet far from perfect. It enables the expansion of HE in a way that the Scottish system doesn’t, it includes (only for FTUG and PTUG from next year) maintenance grants, and an overall maintenance level higher than rUK. Welsh-domicile responses to HEPI’s student academic survey over the years seems to support the positives of the system.

    Looking at Diamond more broadly, it saw an increase to HEFCW funding from a low of £104m to a baseline peak of over £200m (now under pressure and declining in cash terms). Unfortunately, these increases were evidently not enough to make institution leaders feel much benefit given the cost pressures that the sector faces more widely.

    We now have a situation where WG puts considerably more (proportionally) into student support than UKG, and UKG puts slightly more (again, proportionally) into teaching and research funding for institutions.

Leave a Reply

Your email address will not be published. Required fields are marked *