| Support officers at the city’s main institutions say the “commercial” debt, — overdrafts, bank loans and credit card usage over and above their student loans — has become “a fact of life” for students who are also working long hours to supplement their income.
Last week concern was raised about the continuing problem of student bankruptcy in Scotland, despite a slight fall in figures.
Statistics released by the Student Loans Company showed the number of former students undergoing sequestration had fallen to 677 last year from 811 in the previous year.
The remaining figure has been blamed on the crippling debt faced by graduates. After qualifying, many former students are thought to be left with an estimated £15,000 of debt.
Student money advisers in Dundee fear the high level of debt can be explained by the basic cost of living.
A spokesperson for Dundee University’s money advice centre told the Tele that many undergraduates struggle to make ends meet despite having part-time jobs and full student loans.
The maximum student loan for those living away from home in Scotland is £4300 per year.
According to a student advice website, the average rent for flats in Dundee is £50 over 52 weeks leaving around £30 per week for food, utilities and transport costs. The Child Poverty Action Group estimates £45 a week must be spent on food to provide a healthy diet for the average adult.
The minimum wage for 18-21 year olds is £4.45 an hour. Students face the choice of jeopardising their studies to work 20 or more hours a week at this rate, or supplement their income through credit from banks.
James Nicholson, head of student support for the University of Abertay said, “We try to advise new students to be sensible with their money. The truth is they are not going to be able to support themselves on the student loan.
“We hold workshops to encourage people to plan their finances. It is a simple fact of student life that you are going to have to take on an overdraft to supplement your income.
“Many will choose to part-time work. I have conducted my own research and found 73% of students at Abertay work part-time.
“We do advise people, however, not to take on more than 12 hours a week because research shows any more will interfere with their studies.”
James Alexander, president of NUS Scotland, said, “There are an awful lot of students in Scotland doing part-time work, and it is fair to say this is a result of the cost of living.
“The Executive has admitted that the loans for students do not cover the total costs of living. High street banks now target students quite actively, offering up £2000 in overdrafts. It is an increasing problem.”
A Scottish Executive spokesperson said work was being done to combat student debt problems. “We are doing a great deal to tackle student debt and ensure people have equal access to higher education, regardless of their background,” he said.
“Tuition fee contributions have been abolished in Scotland for eligible full-time Scottish domiciled and EU students, the Young Student Bursaries scheme has been introduced and Hardship funds are available to those in particular financial difficulty.
“Student loans are repayable on affordable terms, with the amounts linked to the borrower's income.
“We are committed to creating an optimal learning environment for all students and this means that effective financial support must be in place.
“A move to grants rather than loans would not make sense — it is more expensive to provide student support in this form.” |
