Revolutionising Student Finance: Our Lifelong Loan Entitlement

As Apprenticeships and Skills Minister, one of my biggest challenges – and personal passions in life – is thinking about how we can change the status quo when it comes to education. For example, a three-year university degree is a great option but it’s not for everyone, nor is it always feasible. 

For someone with caring responsibilities, say, or financial commitments, taking time out to study could seem to be off the cards. 

Higher education graduates on average benefit from a degree by over £100,000 over their lifetime. Now that’s a massive advantage. I want to make sure we give everyone a chance to climb the ladder of opportunity by gaining the skills they need at any stage of their life to get those better paid jobs. 

Our Lifelong Loan Entitlement will radically transform the way student finance is provided, opening up opportunities for more people to access higher education flexibly over their working lives – as and when they need it.  

The current student finance system

Our student finance system has many benefits and has enabled millions of people from all walks of life to access HE who may not otherwise have been able to. In fact, 238,000 18-year-old students in England have been accepted onto HE courses so far this year alone – the largest number ever on record.  

This system works well, but we want to make it better still. Currently, people apply for a student loan based on the cost of an individual course they want to take. Under our new LLE system – we will shake that all up.  

How will the Lifelong Loan Entitlement work?

From 2025, people will have access to a loan entitlement of four years’ worth of student finance (£37,000 in today’s fees). People will be able to see how much funding they have left in a personal account – a bit like a bank account – that can be drawn down and used as and when someone wants to study at college or university.  

The LLE can be used to fund a much wider range of higher education courses, whether full or part time, for modules of courses or for full qualifications in one go. We are also enabling fee limits to be set from any of 12 possible start dates each year, so that fee limits for short courses and modules can be set with greater accuracy than under the current system.

The good news is we are also making maintenance loans available for many part-time students for the first time, and allowing students to use their entitlement for many more technical courses too. 

Benefits of the Lifelong Loan Entitlement

LLE will support everyone who wants to extend their skills. This includes those who may never have previously considered doing a degree. It will also mean people can study again at an equivalent or lower level than they have already achieved. 

Take someone who has spent time bringing up a family and who has never considered HE. They can now use their loan to study for a Higher Technical Qualification in engineering, say, and take out a maintenance loan to study part-time. Or someone who has already completed a degree could use the funding to study a module in coding to upskill in their current job. 

The LLE will create a fundamental shift in the way people study after 18. It means more opportunities and more flexibility for everyone. Like travelling on a train, people will be able to hop on and off their studies at different stations throughout their career journey.

Why is the Lifelong Loan Entitlement essential?

This reset is essential as the world of work is changing so fast. We no longer have just one career. Many of us will end up having two or three over the course of our working lives. Technology can change entire industries overnight, with some jobs disappearing. People will need to constantly upskill to keep ahead of the game. 

The LLE is going to help them do it and it’s going to make sure our economy will be able to withstand the winds of change. The LLE is going to upskill the nation and help more people climb the ladder of opportunity.