University promises £5,000 cost-of-living grant to new students

A UK university has promised to give all new domestic students a £5,000 “cost-of-living” allowance from the start of the next academic year.

University College Birmingham announced details of the non-means-tested grant, which does not need to be repaid, after a planned rise in English tuition fees was confirmed earlier this month.

Any first-year, full-time student who enrols for entry in September 2025 will be eligible, as long as they qualify for funding from Student Finance England and pay the full £9,535 tuition fee using a student loan.

The university – which has 5,300 undergraduates, according to the latest Higher Education Statistics Agency figures – will pay the allowance over eight £250 monthly instalments in the first two years of the course, with a further two £500 instalments in the final year.

“Clearly, strong attendance, engagement, progression and successful completion of studies are at the heart of the grant and underpinning eligibility criteria”, it said.

UCB has declined to offer the same incentive to its continuing students, but said a new student hardship fund of up to £1 million will be made available “for those who are facing genuine, significant cost pressures which could otherwise impact on their ability to complete their studies successfully”.

Universities – particularly teaching-focused institutions – have had to come up with ever more creative ways to attract students amid fierce competition for domestic undergraduates after across-the-board declines in international student numbers.

Prize draws, offers of subsidised housing and free equipment are commonplace, but the UCB offer appears to represent a step up in the race to attract applicants, who seem to be growing ever more sceptical about the value of university study.

Students will pay £285 more per year for their degrees from September after the Labour government ended an eight-year tuition fee freeze. Maintenance grants have also been increased by 3.1 per cent but still lag way behind the full costs associated with study.

UCB said the allowance was launched in recognition of the growing financial pressures students face, highlighting that many of its intake come from socio-economic groups that experience the highest rates of deprivation and are often under-represented in the broader higher education sector. It said the increased costs of higher education “risk deterring applicants from key target demographics”.

Campus Spotlight: Helping students through the cost-of-living crisis

“By easing the financial strain for our students, we’re ensuring they can focus on what matters most – their education and their future careers,” said vice-chancellor Michael Harkin.

“We recognise that there has been some press speculation that the new government will, at a later date, consider the reintroduction of the student maintenance grant for students from low-income backgrounds, and the university strongly encourages the government to implement such a move across the sector.

“In the interim period, the university feels it must act, while it is in a position to do so, to ensure our students do not feel discouraged by the cost of everyday life. We continue to hear that message from our student community and from applicants, and that is what has prompted our intervention now.”

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