Poorest graduates will owe over £50,000 after grants cut

Students from the poorest backgrounds in England will graduate owing over £50,000 after maintenance grants are replaced by loans, says the Institute for Fiscal Studies (IFS).

More than half a million students from poorer backgrounds currently receive a maintenance grant.

From 2016, these will be replaced with loans, which they will be expected to repay in addition to loans for their tuition fees.

The IFS says the new loans will mean up to £550 more "cash in pocket" per year for those students, but they will graduate owing up to £53,000 in total, compared with £40,500 before maintenance grants were scrapped.

Chancellor George Osborne is consulting on how much a graduate must earn before paying back their loans.

If repayments were fixed at the present level of £21,000 for five years, not rising with inflation, the IFS estimates overall graduate loan repayments would increase on average by a further £3,800 per student.

Middle income students are forecast to be hit the hardest, costing them an extra £6,000 over the repayment of their loan.