England's university students will soon face increased costs as tuition fees are set to rise to £9,535 per year in 2025 – a £285 increase from the current £9,250 cap, which has been in place since 2017. Alongside this change, maintenance loans will also see adjustments to help students with cost-of-living challenges.

For low-income students especially, these increases bring both relief and further concern, with broader implications for students' financial futures and the accessibility of higher education.

Tuition increase and debt implications

The fee increase aligns with inflation, yet it can be perceived as a "sticking plaster" that doesn't address the deeper affordability issues students face. Education Secretary Bridget Phillipson noted that this decision aims to place universities on a "firmer financial footing", with plans for more comprehensive reforms in the coming months.

However, long-term impacts are unclear, especially with new student loan repayment terms extending up to 40 years, meaning many graduates may now be repaying their loans for the majority of their careers. For many, this system could create ongoing financial stress and limit economic mobility.

Maintenance loan adjustments

To address the rising costs of living, maintenance loans will be linked to the Retail Price Index, excluding mortgage interest (RPIX) inflation measure, currently set at 3.1%. This means that students outside London living away from their parents will receive up to £10,544 annually, while London-based students may access £13,762.

However, the Institute for Fiscal Studies (IFS) highlights that despite the increases, students will still be borrowing around 9% less in real terms than they would have been in 2020-2021. Although the National Union of Students (NUS) supports the loan increase, it has also advocated for the return of non-repayable maintenance grants, which were scrapped in 2016.

University financial struggles and cost-cutting

Many universities have been operating at a deficit as inflation and stagnant funding continue to stress budgets. The slight tuition increase serves as a cash injection to help cover operational costs, but many institutions still struggle to make ends meet.

The Office for Students (OfS) reported that nearly 40% of universities predict a deficit this academic year. These financial strains may result in reduced course options and resources for students, with institutions potentially trimming budgets, laying off staff, or cutting programs to remain solvent.

What's next?

The upcoming changes to tuition fees and maintenance loans signal that the cost of higher education in England is likely to continue climbing, posing challenges for both students and universities.

As living costs rise and fees inch upward, the government is expected to introduce additional long-term reforms to support universities and improve educational value, including potentially evaluating university spending and executive salaries to ensure better outcomes for students and taxpayers.

Until then, students from low-income backgrounds may face tough choices, balancing loan repayments with the rising costs of their education and everyday expenses.