Maintenance grants could be reintroduced in England at little cost to taxpayers if the student finance system were redrawn along more progressive lines, according to new research.

published by the National Union of Students (NUS) urges the reintroduction of means-tested grants ¨C scrapped in 2016 ¨C worth up to ?4,224 on top of existing maintenance loans, benefiting nearly four in 10 full-time undergraduates.

This is designed to tackle a mounting cost-of-living crisis among students,?which is increasingly perceived to hurt university finances also, if it puts people off enrolling in higher education.

The grants would be funded by a rebalancing of student loan repayments to make the highest-earning graduates subsidise those who earn least after leaving university and those who are from the poorest backgrounds. Under the current system, the highest-earning graduates typically pay less for their education because they pay back their loans sooner.

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The NUS¡¯ alternative, based on modelling produced by London Economics and funded by the University of the Arts London (UAL), relies on bringing in stepped repayment rates, so more graduates pay back some of their loan, and reintroducing real interest rates of up to 2 per cent for higher earners, to keep them in the system for longer. It would also reduce the repayment period by five years, to 35 years.

The NUS said that this would allow for maintenance grants to be reintroduced at a net cost to the Treasury of ?86 million, against a total current outlay of ?3.5 billion.

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¡°We know from anecdotal and statistical data that students from the poorest backgrounds can be put off attending university due to the cost of supporting themselves there, or are forced to take on work to the detriment of their studies if they do attend,¡± said Alex Stanley, the union¡¯s vice-president for higher education.

¡°The proposals we¡¯re putting forward today are a no-brainer to help fix this: they model a way for the government to begin to right that wrong and help support social mobility, in line with its mission to break down barriers to opportunity, at minimal cost to the Treasury.¡±

The modelling has similarities to previous work conducted by London Economics for UAL and for the Sutton Trust. The NUS version envisages stepped repayments of 2 per cent on earnings between ?12,570 and ?27,570, 4 per cent between ?27,571 and ?42,570, 6 per cent between ?42,571 and ?57,570, and 8 per cent on earnings above ?57,571. Real interest rates would be levied on those earning between ?27,571 and ?57,570.

The intervention comes ahead of the conclusion of the Westminster government¡¯s multi-year spending review, due in June. Universities have been warned not to expect a significant injection of cash despite a funding crisis gripping the higher education sector.

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Alex Sobel, chair of the All-Party Parliamentary Group for Students, said that ministers should pay close attention to the NUS research.

¡°Time and again we¡¯ve heard from researchers, students and official reviews that the current system requires a significant overhaul. This research is a welcome contribution to that conversation,¡± said Sobel, the Labour MP for Leeds Central and Headingley. ?

¡°It presents an opportunity to improve outcomes for all students, particularly those from the poorest backgrounds, and get them the skills they need to help grow our economy, all without significantly increasing costs to the taxpayer, and we would call on the government to give it serious consideration.¡±

chris.havergal@timeshighereducation.com