[2024] UKUT 305 (AAC)

Identifying the statutory basis for the various elements of the Appellant’s student finance for academic year 2021/22 is complicated by Student Finance Wales’ use of the non-statutory term ‘Welsh Government Learning Grant’ to describe part of that finance. Despite that, it is possible to ascertain with confidence the statutory basis for the various elements of the Appellant’s student finance for 2021/22.

The Appellant was informed that she would receive a Welsh Government Learning Grant of £2,939 and a Special Support Grant of £5,161.

The Special Support Grant is clearly the same thing as the special support payment provided for by regulation 50 of the 2018 Regulations. I say that because the maximum special support payment is £5,161, which is the sum identified for this Appellant (£1,000 base grant and the first £4,161 of her maintenance grant).

What then was the statutory basis for the Appellant’s Welsh Government Learning Grant of £2,939? This must really have been the remainder of the Appellant’s maintenance grant (the portion not treated as Special Support Payment). I say that because the maximum maintenance grant for a full-time student not living at home, and studying outside London, is £7,100. And £4,161 (the portion of the Appellant’s maintenance grant treated as special support payment) plus £2,939 equals £7,100.

So, using the terminology of the 2018 Regulations, the Appellant must have been awarded a maintenance grant of £7,100 and a base grant of £1,000. £4,161 of the maintenance grant, and the entire base grant, was treated as Special Support Payment. The remainder of the maintenance grant - £2,939 – was styled a Welsh Government Learning Grant by Student Finance Wales but that had no effect on its legal status as maintenance grant.

The student loan available to the Appellant was reduced by an amount equal to the remainder of the Appellant’s maintenance grant (the part not treated as special support payment). That follows from Steps 5 and 6 of the student loan calculation provided for by regulation 56 of the 2018 Regulations.

The Appellant also received a Parent’s Learning Allowance of £1,821 but I need not dwell on this because it was not any type of re-labelled maintenance grant. Since it was not, in law, a maintenance grant it could not have operated to reduce the student loan available to the Appellant under regulation 56 of the 2018 Regulations.

In the words of regulation 69(2) of the 2013 Regulations, the Appellant’s maximum student loan was reduced ‘on account of’ a grant made to her. As explained above, the Appellant’s maintenance grant reduced the amount of student loan available to her by £2,939. The maintenance grant was not, in whole or in part, an excepted type of grant under regulation 69(2)(b). It was not, as the Appellant argues, an amount intended for the maintenance of another person. That is because, under the 2018 Regulations, the maximum maintenance grant provisions do not take account of any person other than the student (a separate part of the 2018 Regulations – Part 11 – deals with grants for dependants).

This Appellant’s student income was to be based on the amount of her student loan (regulation 68(2) of the 2013 Regulations). That meant the amount to be taken into account was the maximum student loan that the Appellant would have been able to acquire by taking reasonable steps to do so. In identifying this maximum loan, the Regulations required it to be assumed that no reduction had been made on account of any grant. It is clear therefore that this Appellant’s maximum student loan was to be treated as £5,350 (actual student loan) plus £2,939 (amount by which maximum loan reduced on account of maintenance grant).

The more difficult question is whether, for a claimant in the Appellant’s circumstances, a finding that reasonable steps were not taken is required in order for unearned income to include a student loan amount that exceeds the actual student loan received.

In this respect, the different formulations used (the role played by ‘reasonableness’) by regulations 68(5) and 69(1) are instructive. The former refers to a person who “could acquire” a student loan by taking reasonable steps to do so. The latter refers to the maximum student loan that a person “would be able to acquire” by taking reasonable steps to do so. Why, then, does regulation 68(5) refer to a person who ‘could acquire’ a student loan by taking reasonable steps to do so but regulation 69(1) refers to the amount that a student ‘would be able to acquire’ by taking reasonable steps? This must have been deliberate. There must have been a reason for the different language used in these two deeming provisions both of which are contained in the same part of the 2013 Regulations (indeed in successive regulations) and are concerned with the same general issue.

In my judgment, the formulation used by regulation 68(5) directs attention squarely to the reasonableness of the actions taken by a particular student (see Upper Tribunal Judge Poynter’s decision in IB v Gravesham BC and Secretary of State for Work & Pensions (HB) [2023] UKUT 193 (AAC)). By departing from the language of regulation 68(5) in the next provision to deal with reasonableness in the context of student loans, the legislator must have intended a different approach. In my judgment, in these legislative circumstances the term ‘would be able’ was chosen because the identification of the maximum amount under regulation 69(1) was intended to be done on a notional basis. That explains why the legislator, in regulation 69(1), did not replicate the language of regulation 68(5) and refer to the amount that a student ‘could acquire’ by taking reasonable steps. Under regulation 69(1), the question is the amount that a notional student, whose material circumstances match those of the claimant, would, by taking reasonable steps, be able to acquire. Regulation 69(1) does not require an analysis of the reasonableness of the steps in fact taken by a particular student. And, in identifying the regulation 69(1) amount, regulation 69(2) requires any grant-related reduction in the actual amount of student loan to be ignored.

Applying the above construction to the Appellant’s circumstances, it is clear that the notional maximum student loan that she would have been able to acquire by taking reasonable steps to do so was £5,350 (actual loan) plus £2,939 (amount by which available loan reduced on account of a grant, that reduction being ignored by virtue of regulation 69(2)). By a very roundabout and opaque route, this was the amount included by the First-tier Tribunal as part of the Appellant’s unearned income. The Tribunal arrived at the correct result. Its errors were immaterial, and its ultimate decision did not involve an error on a point of law. I must therefore dismiss this appeal.

Finally, I apologise for the delay in giving this decision. Shortly after the hearing, I suffered serious injuries in an accident which kept me away from my duties.