Reinstate maintenance grants

Policy baseline

The costings allocate GBP 1.5bn to higher education and lifelong learning by 2028-29.

• Targets students and adult learners.
• Loan-book effects are excluded from headline.
• Participation response changes long-run cost.

Core trade-offs

The direct beneficiaries are students and adult learners. The costs fall mainly on taxpayers and future student-loan balances. The main economic question is access gains depend on course quality.

• Students and adult learners gain most directly.
• Costs fall mainly on taxpayers and future student-loan balances.
• Key risk: access gains depend on course quality.

Fiscal impact by 2028-29

+GBP 1.0bn to +GBP 3.5bn. Central estimate: +GBP 1.5bn.

• Positive numbers mean net fiscal cost; negative numbers mean Exchequer savings.
• Main channel is the scored tax, spending or delivery change.
• Offsets depend on tax receipts, behaviour and pass-through.
• Range reflects uncertain implementation and economic response.
• This is not an official costing.

Economic impact by 2028-29

• Jobs: Education hiring rises; shortages and retention problems may cap delivery.
• Wages: Teachers, childcare staff or students gain; taxpayers fund the cost.
• Prices: Childcare prices may fall if supply expands; wage pressure can offset subsidies.
• GDP / productivity: Long-run gains possible; short-run GDP effects depend on staffing and quality.

Assessment

This is a real trade-off, not a free gain. Students and adult learners benefit, while taxpayers and future student-loan balances bear most costs. Overall output depends on behaviour, capacity and pass-through.

Confidence: Medium-low. Higher on the policy target and fiscal channel; lower on behaviour, pass-through and economy-wide effects.

Main risks

• Staffing shortage: Recruitment and retention can limit delivery.
• Quality variation: Extra places or grants do not guarantee high-quality provision.
• Long payback: Economic returns take years and are hard to score fiscally.

Safeguards

• Target shortages and disadvantaged pupils.
• Audit quality and staff retention.
• Evaluate outcomes before expansion.

Academic evidence

UK government evidence

Sources

• PolicyLens illustrative scenario methodology for reinstate maintenance grants Internal - PolicyLens, 2026
• Does Aid Matter? Measuring the Effect of Student Aid Academic article - Dynarski, American Economic Review, 2003
• Funding a Fair Deal: Liberal Democrat Manifesto Costings Party costing - Liberal Democrats, 2024
• The End of Free College in England Academic article - Murphy, Scott-Clayton and Wyness, Journal of Economic Perspectives, 2019
• For a Fair Deal: Liberal Democrat Manifesto 2024 Party policy source - Liberal Democrats, 2024

Other Liberal Democrats policies

• Introduce free personal care
• Raise Carer’s Allowance by GBP 20
• Create a Carer’s Minimum Wage
• Scrap two-child and benefit caps
• Recruit 8,000 more GPs
• Guarantee urgent NHS dentist access
• Put counsellors in schools
• Extend free school meals