Student loans double to £500m in 10 years

The amount given in loans to Scottish students has more than doubled in 10 years, according to new figures.

Audit Scotland said students borrowed more than £500m from the Student Loan company in 2018-19, compared with £187m a decade earlier.

Students from the most deprived areas typically borrowed more than those who were from the least deprived areas.

Scottish students receive free university tuition but can borrow money towards their living expenses.

According to Audit Scotland, in 2008-9 the average loan to each Scottish student was £2,420, but by 2018-19 it had reached £5,300.

The biggest rise took place between 2012-13 and 2013-14, when the average loan went up from £3,110 to £5,020.

Students from the poorest backgrounds are not 100% dependent on student loans - they are also entitled to bursaries.

Someone from a household with an income of under £20,000 would be entitled to a bursary of £2,000 and a loan of £5,750. If the household income exceeds £34,000 they could borrow £4,750 but would not get a bursary.

These facts alone help explain why the poorest students borrow the most - the best off are allowed to borrow less.

Supporters of the current system argue it is, essentially, the fairest possible, all things considered.

The amount students repay in any one month depends on their earnings - in effect, the repayments work as though they were a graduate tax.

Some would argue even more support - preferably money that does not need to be repaid - is needed for students from poorer backgrounds. Even headlines about "debt" may create a belief that university is beyond someone's financial reach.

And although the SNP abolished fees for university tuition, political critics will seize upon the headline increase in debt built up in student loan debts since the party came to power.

The report said the increase in the average loan over the past three years had been "negligible".

It also noted that students from the most deprived areas tended to borrow more than those from less deprived areas.

Audit Scotland said the average amount being borrowed from those from the most deprived areas was £5,800 - compared with £4,960 for the least deprived.

Although students can borrow money towards the cost of living, the terms of the repayment are different to commercial loans.

Students normally repay the loans by paying 9% of their annual income above £18,935. The more someone earns, the more they pay.

The Scottish government has committed to raising the repayment threshold to £25,000 by April 2021.