Students in England are likely to be hit even harder by cost-of-living pressures than first thought, with the poorest now predicted to be up to £1,000 worse off.
Analysis by the Institute for Fiscal Studies (IFS) estimates that there will be an extra cut of £250 beyond previous predictions because of inflation rising at a higher rate than economists’ initial forecasts.
In its latest economic and fiscal outlook, the UK’s Office for Budget Responsibility predicted that RPIX inflation – which is used to adjust the value of student maintenance loans – would peak at 11 per cent in the last quarter of 2022, but the value of the loan was increased in line with the predicted level of inflation of 2.3 per cent that was forecast in November 2020.
