Maintenance loan covers only half of students’ living costs, leaving about £61,000 short over a three‑year degree

A new Minimum Income Standard for Students analysis finds first‑year students in England need about £418 a week (roughly £21,100 a year) but the 2025/26 full‑rate maintenance loan outside London is capped at £10,544, covering only around half of costs. Researchers warn the gap — which can total about £61,000 over a three‑year degree (£77,000 in London) — forces excessive paid work, increases reliance on high‑cost borrowing and risks worsening access and student wellbeing, and call for redesign of maintenance support including London weighting and clearer rules on imputed parental contributions.

A new analysis of student living costs has laid bare the widening gap between state support and the money required for a minimum, socially acceptable standard of living while studying. The report finds that first‑year students in England need on average £418 a week when rent is included — equivalent to roughly £21,100 a year outside London — yet the full‑rate maintenance loan for 2025/26 for those living away from home and studying outside London is capped at £10,544. According to the researchers, that loan therefore covers only about half of a fresher’s living costs; over the course of a typical three‑year degree the shortfall means a student outside London will need roughly £61,000 to meet this baseline standard, and around £77,000 if studying in London.

Those headline figures are grounded in the Minimum Income Standard for Students methodology, which uses focus groups of students in university cities to define a basket of goods and services deemed necessary for basic participation in university life. The approach — developed by the Centre for Research in Social Policy at Loughborough University and previously applied in a 2024 study — prices up essentials from food and utilities to clothing, travel and modest social participation, then adds a distinct “first‑year premium” for one‑off setting‑up costs (for example a laptop and bedding) and settling‑in expenses such as freshers’ activities. The research team stresses that these are minimum costs for full participation, not aspirational budgets.

Regional variation is material. Excluding rent, the study estimates first‑year students need about £260 a week; with rent included the average rises to the £418 figure. Annual living costs for first‑year students are estimated at about £21,126 in England generally, £20,208 in Wales, £19,836 in Scotland, £18,244 in Northern Ireland and £24,900 in London — where rent accounts for nearly half of total costs. The report highlights that students who rent privately after their first year face particularly high cumulative costs over a degree.

The mismatch between costs and maintenance support is uneven across the UK. For students domiciled and studying in England the maximum maintenance loan covers roughly half of first‑year costs; in Scotland and Wales the equivalent maximum support covers a somewhat larger share but still leaves substantial gaps. The analysis also flags a striking anomaly for students from Scotland who study in London: they receive no London weighting and therefore may see only around 46% of their costs covered, leaving an estimated annual shortfall of about £13,500.

When tuition is folded into the calculation the totals increase sharply. The research excludes tuition from its minimum living‑cost baskets but notes that the government raised the cap on standard undergraduate fees by 3.1% for 2025/26, bringing the maximum fee for a typical full‑time course to £9,535 where providers meet the relevant conditions. When fees are added, the report calculates the total cost of a standard three‑year degree in England can approach £90,000 — and exceed £100,000 for courses in London — although tuition fee loans are generally available to cover the fee element.

The study also considers the behavioural consequences of the shortfall. Even at maximum maintenance support, students in England would need to work more than 20 hours a week in term time and during vacations at National Minimum Wage rates to reach the minimum standard the report describes. The authors warn that such levels of paid employment risk undermining academic engagement and wellbeing, and that some students turn to high‑cost commercial borrowing to plug gaps.

The report’s authors and HEPI commentators draw a bleak conclusion about the wider implications. “These findings demonstrate three serious risks to UK higher education: access to higher education becomes more unequal, the quality of the student experience suffers and the sustainability of the sector is put at risk,” Josh Freeman writes in the concluding section of the report. Nick Hillman OBE, director of the Higher Education Policy Institute, said in the HEPI briefing that the numbers should prompt a “much‑needed conversation” about imputed parental contributions, the level of maintenance support and whether it is reasonable to expect most full‑time students to carry substantial paid work alongside their studies.

One of the private sector partners, TechnologyOne, framed the findings as a call for better institutional tools to support at‑risk students. Cheryl Watson, Education UK Vice‑President at TechnologyOne, said the research “reveals a widening gap between the expectations students bring to university and the reality they encounter” and argued that modern, connected technology could help universities intervene earlier. The company’s intervention should be treated as a sectoral perspective: TechnologyOne claims that better data and systems can improve engagement and wellbeing, but the report’s authors also emphasise that structural change to maintenance support — rather than technology alone — is required to close the affordability gap.

The research team recommends a redesign of student maintenance support built on five principles: simplicity, transparency, independence, sufficiency and fiscal neutrality. The authors urge policymakers to rethink how imputed parental contributions are calculated, to consider regional cost differences such as London weighting, and to design maintenance packages that do not force students into excessive work or high‑interest borrowing. The report frames these as practical steps to protect access, participation and student wellbeing.

HEPI, TechnologyOne and Loughborough’s Centre for Research in Social Policy will present the findings in a public webinar in September; the report’s proponents say their aim is to inform policymakers, university leaders and parents about the scale of the challenge and to stimulate evidence‑based reform. Whether political will materialises to translate the report’s recommendations into policy remains the central question for the sector.

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Source: Noah Wire Services

Noah Fact Check Pro

The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.

Freshness check

Score:
10

Notes:
The narrative is recent, published on 12 August 2025, and presents new findings from a collaborative report by HEPI, TechnologyOne, and the Centre for Research in Social Policy at Loughborough University. No evidence suggests this content has been previously published or recycled. The report is based on recent research, ensuring high freshness.

Quotes check

Score:
10

Notes:
The direct quotes from Josh Freeman and Nick Hillman OBE are unique to this report, with no prior online matches found. This suggests the content is original or exclusive.

Source reliability

Score:
10

Notes:
The narrative originates from HEPI, a reputable UK-based think tank dedicated to higher education policy. The involvement of TechnologyOne and Loughborough University’s Centre for Research in Social Policy further enhances the credibility of the report.

Plausability check

Score:
10

Notes:
The claims regarding the shortfall between maintenance loans and living costs align with previous studies and reports, such as those by the Higher Education Policy Institute and the National Union of Students. The data presented is consistent with known trends in student living costs and financial support.

Overall assessment

Verdict (FAIL, OPEN, PASS): PASS

Confidence (LOW, MEDIUM, HIGH): HIGH

Summary:
The narrative is recent, original, and originates from a reputable source. The claims made are plausible and consistent with existing data on student living costs and maintenance support. No significant credibility risks were identified.