Agreement on controversial student loan scheme reform

The major political parties in Denmark have signed a 10-point reform agreement aimed at strengthening the economy, job creation and competitiveness. When the reform is fully operational in 2020, student grants and loans spending will be reduced by DK2.2 billion (US$383 million). Students are angry, but rectors support the move.

Public money saved on the student grants and loans system, called the SU, will be invested in other areas of higher education. The agreement (in Danish) is called “On the Reform of the SU-System and the Student Completion Framework”.

Several points in the agreement are technical, such as changing the level of support for students living at home, and reducing the indexing of the yearly increase in student grants and loans so that it is not fixed to general price increases.

There is a new proposal – awarding a bonus for each month of study less than the degree time requirement – as well as an increase in the transport grant, another mechanism for compulsory registration for an exam when registering for a course, an improved system for academic recognition, a more flexible transition from bachelor to masters study, and a requirement for universities to reduce the average time-to-degree by 4.3 months by 2020.

The agreement also has a clause related to a recent ruling by the European Court on SU support for students from other European Union (EU) countries. It states that the Education Ministry must monitor such payments for foreign citizens very closely, and that there is a minimum requirement of 10-12 hours of work per week.

If the total amount of payments to EU citizens of other countries exceeds DKK200 million (US$35 million) a year – as two political parties claim it will – the government will have to find such support but introduce ‘protective measures’ that are not specified in the agreement.

Allan Vesterlund, of the student council of Aarhus University, was convinced that students would take more time to complete degrees under the new reforms – contrary to what was intended.

Vesterlund told Jyllandsposten that the new student grants and loans regulations in reality would mean that students would have to work more to pay rent, because rentals would increase faster than levels of support.

On the other hand, Vesterlund was happy with the agreement, stating there would be less bureaucracy involved in academic recognition at universities.

Professor Jens Oddershede, chair of the Danish Rectors' Conference, was quoted by Universitetsavisen as saying that university leaders were “supporting the reform”, even though they had reservations regarding some of the details.

In particular he mentioned the fribeløb – the size of the salary a student can earn without paying taxes – which has been increased in the agreement. “This in many ways contradicts the intention of the agreement, to reduce the time to completion of the degree,” Oddershede said.

Minister of Education Morten Østergaard said in a statement that it had been important for the ministry to secure more money that could be used for work creation for students. He was satisfied that under the new agreement, “the SU is kept in its present form, where everyone who today is receiving SU also will be able to do that in the future”.