Student finance and UC

Wingingit202122 · 2023-03-10T07:14:23+00:00

Need some balanced opinions here! Single parent of 3 and I have just started a undergrad degree course at University. Just had my Universal Credit statement come through and they are deducting all of my student finance from my monthly payment (Gone from £1300 to £600) as they class it as an income Im pretty p’d off to say the least for 2 reasons 1. I was only being deducted £280 a month when I was working and making more money a month than the student finance pays 1. STUDENT FINANCE IS A LOAN! We have to pay the student finance back WITH INTEREST so I am majorly p’d at effectively having to pay it back twice. (Once through UC deduction and again back to SF)

OneRingToRuleThemAll · 10/03/2023 07:28

It's classed as unearned income and all unearned income is taken £ for £.

It puts you in the same position as young students who have to pay back the loan forever and ever.

I don't claim uc, but am currently studying with a tuition loan and will be repaying that until I retire.

Herja · 10/03/2023 07:34

It's hugely unfair in my view. Tax Credits viewed it very differently! Completely agree that a loan shouldn't be considered income.

Vegrocks · 10/03/2023 07:37

You have joined an undergrad programme and you’re a single mum of three… and you didn’t look in to the financial impact? This is news to you? Yes I don’t agree with the policy but it’s pretty baffling you have committed to this and now you’re surprised

MrsRR1 · 10/03/2023 07:42

I assume you checked this before you started? Student finance has always been considered income. When I got tax credits years ago they were reduced too. You only pay back student finance once you earn over a certain amount so you may never pay it back in full, or at all.
Just be mindful when you start work; I have a chunk taken out my wage as repayment so you need to factor this in when you start working full time

Babyroobs · 10/03/2023 07:42

Yes of course it's fair. Why should you effectively get student loan and full UC just because you choose to wait until having 3 kids to become a student. That would be grossly unfair to all those younger single students who will be paying back their student loans forever and the parents who are making sacrifices trying to help them through the student years.
What is grossly unfair is that those still on tax credits seem to get student loan and full tax credits on top and this has been going on for years.
UC is paid to you to live on in return for certain commitments eg looking for work. If you choose to become a student and therefore make yourself unavailable for work, then you need to support yourself via a student loan. If you don't want to have student loan deducted then look at part time degrees or Open university etc. Lots of things like childcare grants and things are not deducted from UC.

megletthesecond · 10/03/2023 07:44

It's really unfair and prevents single parents improving their earning prospects.

Swiftswatch · 10/03/2023 07:45

You aren’t paying it back twice though, that implies you would be unconditionally eligible for UC regardless.
SF is counted as income, if you have other sources of income you don’t need the same support from the state.

Original poster

Wingingit202122 · 10/03/2023 07:47

Vegrocks · 10/03/2023 07:37

You have joined an undergrad programme and you’re a single mum of three… and you didn’t look in to the financial impact? This is news to you? Yes I don’t agree with the policy but it’s pretty baffling you have committed to this and now you’re surprised

Actually no-one, Student finance, UC or any online calculator can tell you what will be deducted from the SF until AFTER you apply. So no, I had no idea this much would be deducted

OP posts:

Original poster

Wingingit202122 · 10/03/2023 07:49

MrsRR1 · 10/03/2023 07:42

I assume you checked this before you started? Student finance has always been considered income. When I got tax credits years ago they were reduced too. You only pay back student finance once you earn over a certain amount so you may never pay it back in full, or at all.
Just be mindful when you start work; I have a chunk taken out my wage as repayment so you need to factor this in when you start working full time

See my previous comment

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Swiftswatch · 10/03/2023 07:49

Wingingit202122 · 10/03/2023 07:47

Actually no-one, Student finance, UC or any online calculator can tell you what will be deducted from the SF until AFTER you apply. So no, I had no idea this much would be deducted

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I imagine it’s also because you’re viewing the SF as the per month equivalent but it’s paid in one chunk for the term which is why the deduction is higher now.

coffeetofunction · 10/03/2023 07:51

I can understand your frustration. I'm hoping to start an undergraduate in September and I'm already worried about how I will manage. My eldest will be doing an additional year at college before uni so I will be supporting him as well. I know I'll have to work in addition to full time uni and placements. Good luck with the degree OP

Babyroobs · 10/03/2023 07:52

megletthesecond · 10/03/2023 07:44

It's really unfair and prevents single parents improving their earning prospects.

Why does it prevent people improving their earning potential ? no-one ends up worse off my claiming student finance instead of UC, you would get roughly the same amount overall, but just paying some of it back later.

Original poster

Wingingit202122 · 10/03/2023 07:52

megletthesecond · 10/03/2023 07:44

It's really unfair and prevents single parents improving their earning prospects.

Exactly! There have been many on my course who have already withdrawn (started in jan) as they can’t afford to actually continue. I know it’s for the best to stay on but in reality it’s going to be a hard 3 yrs

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gogohmm · 10/03/2023 07:53

@Wingingit202122

The fact that uc takes student finance into account is on the student finance and universal credit websites!

Original poster

Wingingit202122 · 10/03/2023 07:54

Swiftswatch · 10/03/2023 07:49

I imagine it’s also because you’re viewing the SF as the per month equivalent but it’s paid in one chunk for the term which is why the deduction is higher now.

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It’s UC who have divided it into monthly amounts so therefore i will be having the same deduction every month for the next 3 yrs. They will even deduct it over summer when i’m not actually studying

OP posts:

Original poster

Wingingit202122 · 10/03/2023 07:55

coffeetofunction · 10/03/2023 07:51

I can understand your frustration. I'm hoping to start an undergraduate in September and I'm already worried about how I will manage. My eldest will be doing an additional year at college before uni so I will be supporting him as well. I know I'll have to work in addition to full time uni and placements. Good luck with the degree OP

All i can advise is to start putting some savings away now! Good luck with it all x

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Original poster

Wingingit202122 · 10/03/2023 07:58

gogohmm · 10/03/2023 07:53

@Wingingit202122

The fact that uc takes student finance into account is on the student finance and universal credit websites!

Where does it say on their website that they deduct the whole amount every month? When I was working it was 55p deducted for every £ earned so why would anyone think it was now £ for £?

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Babyroobs · 10/03/2023 08:00

Wingingit202122 · 10/03/2023 07:58

Where does it say on their website that they deduct the whole amount every month? When I was working it was 55p deducted for every £ earned so why would anyone think it was now £ for £?

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UC is designed to encourage people to work, that is why earnings are deducted at a taper rate of 55p in the pound. Student loan is not earned income so is deducted pound for pound as are private pensions, state pensions etc.

IhearyouClemFandango · 10/03/2023 08:01

But you're not paying it back twice. UC isn't yours in the first place, so they're not taking it from you, just not giving it to you as you have another income source.

Original poster

Wingingit202122 · 10/03/2023 08:03

Swiftswatch · 10/03/2023 07:45

You aren’t paying it back twice though, that implies you would be unconditionally eligible for UC regardless.
SF is counted as income, if you have other sources of income you don’t need the same support from the state.

Of course it is paying it back twice. For the next 3 yrs my student finance is deducted from my UC on a monthly basis of over £700 so that’s over £25000 from my SF entitlement
Once I graduate SF will want me to start repaying my loan and being 29 I am pretty sure I will have repaid most, if not all, of it

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Babyroobs · 10/03/2023 08:05

Wingingit202122 · 10/03/2023 08:03

Of course it is paying it back twice. For the next 3 yrs my student finance is deducted from my UC on a monthly basis of over £700 so that’s over £25000 from my SF entitlement
Once I graduate SF will want me to start repaying my loan and being 29 I am pretty sure I will have repaid most, if not all, of it

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How are you paying it back twice ? UD is free money in the first place ! Student loan is being taken off that and then you repay the student loan later ( maybe ).

Vegrocks · 10/03/2023 08:05

Wingingit202122 · 10/03/2023 07:47

Actually no-one, Student finance, UC or any online calculator can tell you what will be deducted from the SF until AFTER you apply. So no, I had no idea this much would be deducted

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Of course you could

it is very straightforward the deductions

Ylvamoon · 10/03/2023 08:08

Your Student Maintenance Loan is paid to you for living expenses.

So yes, why do you think it shouldn't be deducted from your UC?

Otherwise every student over 18 would be entitled to a full amount of UC ....

Ponoka7 · 10/03/2023 08:10

It isn't fair. If you were getting a loan for any other purpose, it wouldn't be counted for income, so why a loan for education?
Up until the late 2000's there were lots of free courses for mature students to do, up to degree level, now they have to be paid for and these rules effect all 19+ year olds.

@Babyroobs , there are lots of careers which benefit from mature students, groups such as LP, the disabled, care leavers etc, such as Nursing and SW. Education choices shouldn't just be for those who can afford them. You've got to look at the overall benefit to society of people being able to increase their earnings and further their education, as well as the experience they bring to the organisations they go into.

Babyroobs · 10/03/2023 08:13

Ponoka7 · 10/03/2023 08:10

It isn't fair. If you were getting a loan for any other purpose, it wouldn't be counted for income, so why a loan for education?
Up until the late 2000's there were lots of free courses for mature students to do, up to degree level, now they have to be paid for and these rules effect all 19+ year olds.

@Babyroobs , there are lots of careers which benefit from mature students, groups such as LP, the disabled, care leavers etc, such as Nursing and SW. Education choices shouldn't just be for those who can afford them. You've got to look at the overall benefit to society of people being able to increase their earnings and further their education, as well as the experience they bring to the organisations they go into.

That is my point - people can still afford them as they are no worse off by claiming student loan than claiming UC. It's not like they are facing a sudden drop in income that makes them at a disadvantage ?