Tuition fees: How they have become more expensive for university students

Last updated: 4th September, 2013

tuitionfeespigIt’s no secret that a lot of things have become more expensive in recent years. Inflation has risen gradually in the past several months, while the cost of groceries and energy has increased by more than 10% in some instances – but all that pales into comparison as far as university tuition fees are concerned. Until a couple of years ago, they were capped at less than £3,500, but that changed.

Three years ago, tentative steps were made to give universities the power to charge much more for tuition fees. After much wrangling, the government eventually voted in favour of allowing universities to charge anything up to £9,000 a year for tuition fees, a move which proved to be controversial to the extreme with students fearing they would be even more in debt.

Fee-ling the heat

The typical debt levels of an undergraduate student prior to the law change would have been somewhere in between the £15,000-£20,000 bracket. Inevitably, fears about needing to take out more money via a Student Loan were realised for thousands who were left with little choice but to pay far more than they had initially budgeted for.

Students up and down the country began to ponder whether or not they could continue to afford staying in higher education. Many will have used this website to help do the maths, while those considering going to university while still doing their ‘A’ Levels will have suddenly had second thoughts because of the rising cost of trying to gain a degree.

Money markets on alert

Although it took a while, the impact of higher tuition fees had eventually reached the wider economy. In October 2012, the Consumer Price Index (CPI), the main measure of the rate of inflation in the UK, had risen by 0.5% month-on-month, owing partly to the rise in the cost of higher education and the increase in the value of money being loaned to hard-pressed students.

“The CPI jumped from 2.2 per cent in September due to the rising cost of university tuition fees. It now costs students 19.1 per cent more to attend university after the cap on charges was hiked by the government to £9,000 from £3,375″, according to a blog post on the City Index website.

As a result of the rise in inflation, fuelled by the increase in tuition fee price caps, the Pound fell against some of the other major global currencies in the foreign exchange markets. This proved that the impact of higher tuition fees was far-reaching.

Debt levels soar

student_budget_calculatorAs expected, within a year of their introduction, the level of debts accumulated by students had risen sharply. The average debt of a student after graduation one year ago stood at over £25,000, a record high. This, along with higher fees may have given a handful of universities reason to think again about charging anything even close to £9,000 a year.

While there was plenty of talk about some universities refusing to charge the full amount, the reality was that a large proportion of them had chosen to charge as much as possible. Among the universities most likely to charge £9,000 per annum for some of their courses included elite institutions such as Oxford, who attracted a large number of students from privileged backgrounds.

A price worth paying?

Today, the state of many graduates’ finances is typically even worse than it might have been. The average student debt for 2013 now stands at a massive £39,000. For a student to loan that amount of money over the course of three years might seem absurd, but to cover other essentials as well as fees, it’s imperative.

Some are wondering whether the cost of higher education actually outweighs the benefits. When high graduate unemployment levels are thrown into the mix, it makes studying for a degree seem almost pointless, but for the time being, those in higher education will be left with a tough decision to either pay up or end their studies prematurely.

By students

Hello! This website has been written by student money experts Save the Student! to give you an overview of student bank accounts and what they have to offer you.

The studentsWe review the benefits and catches of all student accounts so you can make an informed choice and avoid the traps!

By students 2

Video: How to choose a bank account

Search the site

The Essential Student Guide to Finance

Click to download for free!

Get Our Free Student Money Tips: