House of Commons · Adjournment Debate

Alternative Student Finance

15 July 2021 · 1 other contributor

Opened by Stephen Timms Lab East Ham

Summarised by AI from the official record, so it can contain mistakes.

Read the full transcript on Parliament.uk

At a glance

Stephen Timms raised concerns about alternative student finance in the House of Commons. A government minister responded. Other MPs also contributed.

Key points

Government pledged in 2013 to introduce student finance compatible with Islamic principles.
Progress has been slow despite multiple consultations and the 2017 Higher Education and Research Act.
Constituents and campaigners highlight financial barriers preventing young Muslims from attending university.

How the debate unfolded

MPs spoke in turn to share their views and ask questions. Here's what each person said.

Opened the debate

Stephen Timms Lab East Ham

Eight years ago, the Government pledged to introduce alternative student finance compatible with Islamic principles. This promise has not been fulfilled, leading many British Muslims to feel unable to attend university due to religious prohibitions against interest-bearing loans. The pledge was made by Prime Minister David Cameron in a speech at the World Islamic Economic Forum in 2013, who promised that 'never again should a Muslim in Britain feel unable to go to university because they cannot get a Student Loan—simply because of their religion.' However, despite multiple consultations and promises, progress has been slow. The Higher Education and Research Act received Royal Assent in 2017, which campaigners hoped would allow the implementation of takaful loan models. Since then, there have been various reviews and discussions but no clear timetable for its delivery. Constituents like Fatima Khan and campaigner Asha Hassan highlight that many young Muslims struggle to attend university due to these financial barriers, while others are deterred entirely. The Sutton Trust recommended a 'halal student loan' in 2018, which could increase social mobility for Muslim students. Despite this, the Government remains vague about its commitment and timetable.

Other contributors (1)

Jim Shannon DUP Strangford

The Member acknowledges the importance of ensuring higher education is accessible to all regardless of religion.

Government Response

Michelle Donelan

I assure the House that I understand the issue and concerns regarding sharia-compliant student finance. Islamic finance is well established in the UK, with financial institutions providing services for nearly four decades. The Government aims to promote this sector further. Following David Cameron’s announcement in 2013, a consultation led to confirming a model for sharia-compliant products. New powers were introduced under the Higher Education and Research Act 2017 to enable alternative payments alongside grants and loans. Specialist advisers were appointed to design these products. The Government aims to align ASF with their post-18 review of education and funding, ensuring fair terms for all student support packages. Despite this, participation rates among disadvantaged backgrounds have doubled from 11.3% in 2006 to 24% in 2020, with over 200,000 students identifying as Muslim currently. The Government remains committed to accessibility and equity for all, considering ASF carefully alongside other priorities. An update on sharia-compliant student finance will be provided upon conclusion of the post-18 review.