Lifelong Loan Entitlement: Big bang or phased implementation?

By Julian Gravatt

The Lifelong Learning Entitlement (LLE) to cover tuition costs for upskilling and reskilling is unquestionably a big idea. Due to be rolled-out from August 2025, a degree of political consensus will be needed bearing in mind the last date for the next general election is January 2025.   


Thinking through the details 

Another key ingredient for the successful roll-out of the LLE by any government – even where the entitlement is limited to funding tuition rather than maintenance – is thinking through the details well in advance of implementation.     
The two consultations on Higher Education Reform and the Lifelong Loan Entitlement have started the debate regarding how the LLE might operate in general terms.  

But there is a lot of work still to do to clarify key rules, to set up systems to administer it, to confirm which institutions will offer it and perhaps most importantly, who in the post-18 population in England will quality for the LLE and when. 


Three elements of the entitlement 

The one sentence summary of the entitlement is that individuals will, in future, be able to take out loans equivalent to four years of post-18 education over their lifetime.  
The idea is that this will enable learners to retrain and upskill throughout their lives in response to changing skills needs and employment patterns. The Post 18 Education and Funding Review recommended the government should take forward the entitlement because too many people concentrate their higher education as young adults and on a full-time basis.  

Essentially, there are three elements to the entitlement: firstly, the creation of a unified student finance system for higher education and further education at Levels 4–6; secondly, bringing in student loans for separate modules (i.e., for parts of courses), and thirdly, a reform of the rules governing student loan eligibility for learners who already hold a qualification at the same or a higher level (ELQ rules). 


The debate today 

Much of the commentary on the entitlement has, understandably, focused on key principles of the Lifelong Loan Entitlement. For example, which courses will the LLE cover?  Will the LLE be equivalent to four years of full-time fees for a Level 6 degree (which in current prices costs £37,000)? And if so, will it be uprated by inflation? And also, will the LLE enable students to take subsequent qualifications or modules at a level they have already achieved?  


Two implementation questions 

Yet, there are two more questions of critical importance to the implementation of the LLE from 2025 which really need addressing. The first is, which organisations can offer courses that attract tuition funding from the LLE? And the second is, who in the post-18 population will be able to use the LLE from August 2025? 


Which organisations can offer LLE funded courses? 

The Department for Education talks about the entitlement as bringing together two systems and lists of providers: the higher education Level 4-6 student finance system and the Level 4-6 element of the advanced learner loan system.  
These are two very different systems despite a degree of overlap.  

There are approximately 1.11 million active Level 4-6 HE fee-loan borrowers. By comparison, only 0.01m (i.e., 10,000) students take out Advanced Learner Loans to fund Level 4-6 qualifications.  

The 10,000 students on Advanced Learner Loan funded Level 4-6 courses are borrowing about 0.1% of the amount borrowed in HE loans - £18 million versus £18 billion.   

A major issue in setting up the Lifelong Loan Entitlement will be working out if the Office for Students should add a few hundred extra providers to an expanded register or whether OFS and the Education and Skills Funding Agency work alongside each other in some way.  

This is not a minor administrative detail.  

Few things will harm a new programme more than uncertainty among those charged with delivering it – the institutions and their staff – about whether they have a clear licence to offer it.  


Who can use the LLE? 

The second question concerns who should be able to access the Lifelong Loan Entitlement from August 2025.  

There are perhaps, three broad options.   

The first is universal access for anyone over the age of 18, including retirees and people who already have degree-level education.  

The second is offering an account to anyone over the age of 18 but excluding those who have already taken out a student loan for higher education and perhaps with a restriction for those over the age of 50 who reached the age of 18 at a time before student loans were used in higher education funding. 

And the third, is an account just for those who reach the age of 18 by August 2025.  

Option 1 

The first option is the most attractive and expansionary, particularly given the big changes in our economy, society and labour market due in the remainder of the 2020s and beyond.  

But the drawbacks are obvious. It would imply as many as 40 million Lifelong Learning Accounts managing the LLE being available from year one. And even if access to LLE was restricted to adults with a Level 3 qualification, the Treasury would be concerned from a public spending perspective if every eligible 18-60 year-old decided to pull-down their entitlement in the year the LLE was launched. 

Option 2 

The second option would cut the number of Lifelong Learning Accounts being available from August 2025 by half. Even so, the entitlement could be open to 20m citizens aged 18 and over who could demand access to income contingent loans especially if the LLE funds part-time and modular provision more suitable to older adults. 

Option 3 

The third option of offering all 18 year-olds the Lifelong Loan Entitlement from August 2025 would limit the number of Lifelong Loan Accounts to around 600,000 who were born around 2007 and are currently in Year 10.  


Phased implementation from August 2025 

We need a system that is clear about which organisations can provide courses funded through the LLE. We need an administrative system that can manage a large number of lifelong learning accounts. And we need a system that ensures budgetary control from the perspective of the Treasury if the LLE is a runaway success. It is for these reasons, the way ahead to implementing the Lifelong Loan Entitlement is a phased rather than a big-bang approach. 
We need No.10, the Treasury and the Department for Education to start a dialogue about implementation as well as broad principles very soon indeed.


Julian Gravatt is Deputy Chief Executive, Association of Colleges