Student Finance and Wellbeing Study Scotland 2023/24: literature review

6. Student expenditure

The last Student Income and Expenditure Survey (2007/08) carried out in Scotland found that the average total expenditure for HE students was £6,339 for full-time students, and £10,453 for part-time students, versus an income (including money earned from part-time work) of £5,166 for full-time students, and £12,057 for part-time students (Scottish Government, 2009). In contrast, for example, information for students from Glasgow Caledonian University (available on its website) suggests that single students will need around £15,000 to £17,000 to cover living expenses for a full year (Glasgow Caledonian University, 2023).

The most recent Student Income and Expenditure Survey (2021/22) carried out in England and Wales found that the average total expenditure for English-domiciled HE students (excluding tuition fee costs) was £11,509 for full-time students and £14,282 for part-time students, versus an income (excluding tuition fee loans) of £11,500 for full-time students and £16,460 for part-time students (DfE, 2018). These figures represent a decrease in income for both full and part-time students of 4-10% in real terms since the Student Income and Expenditure Survey 2014/15.

This demonstrates the gap between the available student funding and the cost of living, a gap which has increased in recent years. The Student Money Survey (2023) found that throughout the UK, the average gap between the average level of student support and the average expenditure per month was £582, with student support covering an average of 46% of monthly expenses.

6.1. Cost of living

Since 2021, the cost of living has increased dramatically as inflation outstrips income, and students are among the hardest hit by this crisis: the Institute for Fiscal Studies (Waltmann, 2022) has proposed that the current levels of inflation mean that student funding (loans, bursaries) for the most disadvantaged students is at its lowest level in ‘real terms’ since 2016/17, being over £1,000 worse off than in 2020/21. This is highlighted in the most recent set of results from the English Student Income and Expenditure Survey. Data from 2021-22 found students in England to have both lower incomes and expenditures than they did in 2014-15, with the authors suggesting that students have been seeking to reduce their costs (NatCen, 2023). The Royal Bank of Scotland’s Student Living Index (RBS, 2023) also found that students’ average monthly expenditure has fallen by 9% since the previous year.

In line with this, the Office for National Statistics (ONS, 2022) found that 58% of students reported that their student loan did not cover their living costs, and 92% of HE students reported an increase in their cost of living, with 91% being worried about the rising cost of living. Almost half of students had either major or minor financial difficulties, and 30% of students had taken on new debt in response to the cost of living crisis, a significant increase from the previous report.

6.2. Accommodation costs

Recent years have also seen rising rental costs, particularly in some of the Scottish student cities (RBS, 2023). Purpose Built Student Accommodation (PBSA) rent prices, for example, increased by 34% between 2018 and 2023 (NUS Scotland, 2023), an increase far greater than inflation during this period. NUS and Unipol’s accommodation costs survey (2021) found that student rent in Scotland increased at a faster rate in Scotland between 2018 and 2021 than any other part of the UK. Meanwhile, the Royal Bank of Scotland’s Student Living Index (RBS, 2023) found that Edinburgh and Glasgow have some of the highest costs of living in the UK. One Scottish university saw a 157% increase in the number of students staying in PBSA in 2022, highlighting the widespread nature of the impact these rent increases have. The Scottish Government’s research on PBSA and student housing (2022b) also highlighted the growing demand for student housing, the poor quality of housing in the private rented sector and challenges around affordability. Accommodation issues are closely linked to finances, particularly within the context of rising rents and a lack of availability in the student accommodation sector. Without access to family support, the cost of paying for accommodation is a particular struggle for estranged students (Bland, 2018; Costa, 2019; Key, 2019; Minty et al., 2022). More than a tenth (12%) of FE and HE students who responded to NUS Scotland’s survey (2022) were currently homeless or had previously experienced homelessness (this compares with 33% of those who were estranged and 29% of care-experienced students).

6.3. Expenditure of students who are parents

There is also a marked difference for those with children, with the last Scottish Student Income and Expenditure Survey (2007/08) finding that expenditure was much greater for both full-time and part-time students with children. Full-time students with children had an average expenditure of £14,144, with an estimated 27% of this being reported as child-specific costs, whereas those without children had an average expenditure of £5,913 (Scottish Government, 2009). It is notable that the data available on this is very dated.

6.4. Summer funding

At the time of this review, the available research illustrated how students’ financial experiences are compounded by the lack of financial support available during the summer, with SAAS and college financial support ordinarily spread over 10 monthly payments. This meant students must budget their loan and/or bursary to cover the summer months, or take on additional work during the break.

Research has highlighted the challenges students face to ensure they have enough money to get by during the holidays. In 2017, the Independent Inquiry into Student Finance (Scottish Government, 2017) called for more flexibility in terms of when students receive their funding instalments to help them manage their money over the summer months. In 2023, 37% of more than 5000 students and apprentices responding to NUS Scotland’s Cost of Living Survey (2023) said it was harder coping financially in the summer holidays than during term time. This was especially the case for those from widening access groups, FE students, non-binary students and those living in rented accommodation. A non-representative survey of FE and HE students undertaken as part of a review of summer support for the Scottish Government (2023) found that 57% of respondents struggled with financial support/income over the summer more than they did during term time, and that 63% of respondents experienced financial hardship over the summer of 2021. Higher proportions of HE college respondents experienced financial hardship (77% vs 67% of degree university respondents, 55% of FE college respondents, and 54% of postgraduate university respondents). Since 2022, students in receipt of the Care Experienced Student Bursary have had the option to receive their Bursary spread over 12 monthly instalments, rather than 10.

Since undertaking this review and the fieldwork for the Student Finance and Wellbeing Study, the Scottish Government has announced that all students will have the option of receiving their bursaries and loans in 12 instalments rather than 10 so they can receive payments over the summer months.