Scottish students should get minimum income of £8,100 a year, government finance report recommends

Scottish students should have the legal right to a basic income of £8,100 a year, a major review has found.

Students north of the border already enjoy a huge advantage over those in the rest of the UK as they are not required to pay tuition fees – but the radical report goes much further in its proposals.

Increased support should be given through a mixture of loans and means-tested bursaries, according to researchers – who also called for financial support to be extended to those at further education colleges as well as universities.

The report recommends that college students, who are currently ineligible for student support, should be allowed to access a bursary of up to £4,050 or a £4,050 loan – which should be written off for those who then go on to graduate from university.

The proposal – which would cost £16m a year in bursaries alone - is part of a series of recommendations following a year-long independent review into student support, commissioned by Scotland's SNP Government.

Under the proposals, university students under 25 would retain current bursary levels with loans increasing by around £500 a year.

The report finds that such a “major change in approach” would give students the equivalent of the Scottish Government's living wage.

The option was one of three considered - keeping the status quo for bursaries and increasing loans at no immediate extra cost or having a 50/50 bursary and loan split for both college and university students – which would cost up to £123m a year extra in bursaries.

The report endorses SNP manifesto pledges to cut the loan write-off period by five years to 30, keep interest rates low and raise the student loan repayment threshold to £22,000 - urging Ministers to consider raising it to £25,000.

Further recommendations include creating a new payment for students so they do not lose out on benefit entitlement due to loans or bursaries, retaining discretionary funding and giving more flexibility on when money is received.

Review group chairwoman Jayne-Anne Gadhia, Virgin Money's chief executive officer, said: “Our recommendations are based on a New Social Contract for Students in Scotland.

"They would ensure that further and higher education are valued equally - with entitlement to support for students across both sectors. And in return, more students from diverse backgrounds will have the chance to become successful graduates, for the social and economic good of Scotland.

"The establishment of a minimum student income is an essential step forward in delivering fairness, and helping to ensure that money is no longer a reason for dropping out of courses.

"Non-repayable bursaries will continue to be focused on those from the lowest income backgrounds. And students can, if they so wish, access high quality student loans - on the best terms in the UK."

Minister for Further Education, Higher Education and Science, Shirley-Anne Somerville, added: ”The report sets out a number of recommendations that would fundamentally change the way students in Scotland are supported financially.

“It is only right that we now take the time to consider these recommendations in detail - and as part of current and future Budget processes. We will set out our next steps in due course.”

She said the Government wants to ensure “all students, especially those in our most deprived communities, are provided with the financial support they need to succeed” and is investing a “record amount” in student support.

Student union NUS Scotland President Luke Humberstone said: “The current student support system is broken. The poorest students in higher education are forced to take the greatest debt, while further education students have no guarantees that they'll be entitled to any support.

"We welcome the proposals to give the same level of support to Scotland's further and higher education students. Whether you're studying at college or university, the cost of living doesn't change and neither should the level of student support available."

PA contributed to this report