With the 2026 Senedd elections approaching, a new HEPI and London Economics report sets out what different higher education funding reforms in Wales could mean in practice.
Assessing potential manifesto commitments on higher education funding in Wales models the financial and distributional impact of three prominent policy options linked to the parties currently leading the polls, offering rare clarity in a debate where formal manifesto commitments have yet to appear.
The analysis examines the consequences of keeping Plan 2 loans, reducing maintenance grants for Welsh students studying elsewhere in the UK and abolishing loan interest while extending repayment terms to 45 years. The modelling shows starkly different outcomes. Cutting maintenance grants would reduce Exchequer costs but leave affected students worse off upfront, while eliminating interest rates would significantly increase public spending while lowering repayments for many graduates. The report also highlights how fiscal constraints imposed by the UK Treasury may sharply limit what any incoming Welsh Government can realistically deliver.
At a time when Wales’s funding settlement is under mounting pressure, this evidence-based assessment provides essential insight into who would gain, who would lose and how sustainable each option would be. For anyone seeking to understand the real trade-offs facing policymakers – and the likely direction of travel after May’s election – this is essential reading. Click here to read the press release and find a link to the full report.