WIREDGOV

The Graduate Endowment Bill was published today outlining the Scottish Government's plans to scrap the fee for around 50,000 students including those who have just graduated and those who have just started new courses.

Graduate Endowment Fee was introduced for Scottish domiciled students and EU students entering a Scottish university from 2001-02 and is a one off payment on successful completion of a higher education course of three years or more.

Education and Lifelong Learning Secretary Fiona Hyslop said that removing the fee would also benefit prospective employers and the Scottish economy.

She said:

"Delivering on this key manifesto pledge shows that we are serious about reducing the burden of graduate debt which can hold back new graduates or even deter potential university students.

"Abolishing the fee is not just good news for current students but is also in the best interest of the public purse. It is an inefficient way of raising income with taxpayers losing around a third of all fee income collected.

"Our vision of a Smarter Scotland is one where the benefits of education are spread widely and equitably and access to higher education is driven by ability alone. The graduate endowment fee is a barrier that we cannot let stand in any young Scot's way and I look forward to support from across the Parliament as the Bill progresses."

The first students became liable to pay the Graduate Endowment Fee - currently £2,289 - on April 1, 2005.

Students with a disability and lone parents are among those who are exempt from the graduate endowment fee. Around half of graduates are currently liable to pay the fee.

Students can pay the fee in cash, by adding it to their student loan, or a mixture of both. Around 70 per cent of graduates have been adding fees to loans each year.

Approximately £17m is generated in income from the Graduate Endowment Fee annually and reinvested into the student support system. The abolition of the GE fee will not affect the fees, grants and bursaries currently payable by the Student Awards Agency for Scotland. That support system will remain.

There will be no implications for university funding, which will continue to be funded from existing budgets.

It is estimated that around £12.7m has been paid back in cash from the three cohorts of graduates liable to pay the fee with £26.3 million being added to loans. Of this £26.3m only £57,000 has been returned to the taxpayer.

Related Information

http://www.scotland.gov.uk/Publications/2007/10/consultationreport

http://www.scotland.gov.uk/Topics/Education/UniversitiesColleges/16640/financial-help

http://www.saas.gov.uk/