Student finance to be radically transformed from 2025

People across the country are set to benefit from a complete overhaul of student finance, helping them get flexible loan funding to train, retrain and upskill throughout their working lives. 

The Lifelong Loan Entitlement (LLE) will empower more people to study in a way that works for them, opening up opportunities for those that might have never considered higher education.

This could help them balance training or studies alongside other commitments such as childcare or financial commitments, which will revolutionise social mobility and plug skills gaps. 

Under the plans, the government has confirmed that from 2025, people will be able to access loans worth the equivalent of four years of post-18 education (£37,000 in today’s tuition fees) under the LLE and use them flexibly over their working lives to suit their circumstances – transforming the student finance system.

The loan can be used to pay for full or part time study, for a variety of courses – from degrees to Higher Technical Qualifications, and including modules. Like a flexi-travel card, it allows people to jump on and off their learning, as opposed to having a ticket with a single destination. 

Students will be able to keep track of their studies and see how much funding they have left in a personal account, and access information about the courses and modules they can spend it on. This will be available online, and operate much like a bank account. 

Maintenance loans will also be available for students studying many more technical and part-time courses, including modules of courses for the first time. This will set the system on a par with traditional full-time study and open up new study and training opportunities for people from all backgrounds.  

People up to the age of 60, who have previously studied, will also be able to access this student finance, based on student loans they’ve already taken out.

And under the new system, returning students will be able to study at an equivalent or lower level than they previously studied – something that the current system does not allow.

For example, thanks to the new rules, from 2025, someone who previously had taken out a student loan to study a history degree will now be entitled to finance for a Higher Technical Qualification in Software Development. 

The overhaul will not only empower people to learn throughout their lives and offer greater opportunities for learning, but enable workers to retrain and upskill to meet the needs of the cutting-edge industries and high-paid jobs of the future.

Education secretary, Gillian Keegan said: “I know first-hand the benefits of lifelong learning, having retrained and upskilled numerous times in my journey from apprentice to education secretary.

“Lifelong learning is critical to career progression, helping to fill skills gaps and boost the economy, which is why this overhaul to our student finance system is so important.

“The Lifelong Loan Entitlement will give people flexibility to study, train and upskill throughout their working life, in recognition that careers aren’t linear. In doing so, it will facilitate a complete culture shift in the way further and higher education is viewed and who it is available to.” 

Jane Hickie, chief executive officer, Association of Employment and Learning Providers (AELP), said: “AELP warmly welcomes the Department for Education’s response to the Lifelong Loan Entitlement consultation. The measures set out in the response really do have the potential to revolutionise the way in which adults access skills provision throughout their lives.

“In particular, the development of lifelong learning accounts will help empower much greater choice for adults deciding how and where to undertake their future training needs.

“We are also pleased to see the introduction of maintenance support covering provision at Level 4 for the first time – as this will help more adults with the costs of living while retraining. Furthermore, the relaxation of the equivalent or lower qualification rules also represents an important step forward.

“This will provide learners with extra flexibility that has already been successfully used in apprenticeships to enable adults to develop additional skills in a rapidly evolving, fast-paced economy.”

“We look forward to supporting these vital changes as the Lifelong Learning (Higher Education Fee Limits) Bill makes its way through parliament.”

The LLE will replace the previous student finance system from the start of academic year 2025/26.