David Willetts

David Willetts MP, the Shadow Secretary of State for Innovation, Universities and Skills, has uncovered a serious problem with the legislation on maintenance grants for students. As a result, thousands of students could demand more money from the Government.

David Willetts MP said:‘Ministers claim maintenance grants are gradually withdrawn from families earning more than £27,120. But that is not what the law says.

‘Tens of thousands of students could gain a windfall from this basic error.

‘It is a cock-up that could cost the Government millions of pounds. It is staggering that no one in DIUS has spotted the mistake.’

Notes for Editors

1. Official information says students from families with incomes between £27,120 and £38,330 should have their maintenance grants progressively reduced in value. For example, students from families on £27,120 should receive £1,230 a year, while those from families on £38,330 should receive £50 a year. (http://www.direct.gov.uk/en/EducationAndLearning/UniversityAndHigherEducation/StudentFinance/FinanceForNewStudents/DG_070203)

2. But Clause 57(c) of the Student Support Regulations (2007) erroneously says students from families in this income bracket should all receive a flat-rate maintenance grant of £1,230.

(c) where the household income exceeds £27,120 but does not exceed £38,330, he receives
an amount equal to RM - A where-
RM is £1,230
A is £1 for every complete £9.50 by which the household income exceeds £38,330;

Household income Grant being paid Grant according to law
£27,120 £1,230 £1,230
£30,000 £927 £1,230
£35,000 £401 £1,230
£38,330 £50 £1,230
£38,331 or more No grant No grant

3. In 2006/07, 67,820 English-domiciled students received a partial grant (23 per cent). The error affects a significant proportion of these students and their families (Hansard, 7 January 2008, c.78W-84W). If half of them claim £615 extra (the mid-point), then the cost to Government will total £21 million.