What type of financial support is offered to tertiary students – whether in the form of loans, grants or scholarships – is a key question faced by countries. Governments must consider how the different types of support can impact students’ ability to enter and complete tertiary education successfully, and to transition smoothly into the job market. The Netherlands has experimented with different funding models, and currently has a multi-pronged funding approach to help students cover their living and education costs. The variety of funding instruments on offer allows the government to cater to the needs of different student groups.
Financial support for tertiary students – Netherlands
Abstract
In 1986, the Netherlands introduced a basic grant as well as a means-tested grant for students in tertiary education programmes, including students in universities of applied sciences and universities. From 1996, the basic grant was made dependent on a student’s performance: students who graduated within ten years had their grants converted into a gift. Those who did not, were expected to pay back the grant. In 2015, the country replaced the performance‑based grant with a public loan system requiring students to pay back the government starting two years after graduating. This change reflected the belief that individuals should bear more responsibility for funding their tertiary education considering how much it benefits them later in life. However, due to public concerns about the fairness of the loan system, the Dutch Government brought back the basic grant in 2023. Moreover, the government promised to compensate students who took out loans under the previous system. Under the current system, students can access a performance‑based grant that offers students living at home EUR 120/month, and EUR 302/month to those who do not live with their parents. Grants are converted into gifts if students graduate in ten years. If not, students will need to reimburse the government. In addition, a means-tested supplementary grant is accessible to students whose parents earn up to EUR 70k/year. Students can obtain up to EUR 458/month, and the grant is also converted into a gift if students graduate within ten years. Finally, students can also obtain loans to help cover living and tuition costs, but which they must pay back with interest after graduating.
There is no evidence on the effectiveness of the current approach because it was only implemented in 2023. The previous system, on the other hand, was thoroughly evaluated, and studies showed that the loan system did not impact the flow of students into tertiary education, nor did it increase disparities in participation across socio‑economic groups. Still, the loan system was considered unfair: lower-income students were more likely to take on loans during this period and, as a result, become indebted. In addition, because of inadequate information, one‑fourth of students who were entitled to means-tested grants did not apply for this additional help. This highlights the challenges of developing a fair and effective funding loan system. The Dutch example also shows the value of combining different funding tools.
Further reading
[1] Bolhaar, J., S. Kuijpers and M. Zumbuehl (2020), Effect Wet studievoorschot optoegankelijkheid en leengedrag, CPB Policy Brief, https://www.cpb.nl/sites/default/files/omnidownload/CPB-Policy-Brief-Effect-Wet-studievoorschot-op-toegankelijkheid-en-leengedrag.pdf.
[2] DUO (n.d.), Student finance, https://duo.nl/particulier/student-finance/.
[3] NOS (2022), Basisbeurs voor hoger onderwijs opnieuw ingevoerd, studenten vinden bedrag te laag, https://nos.nl/artikel/2422616-basisbeurs-voor-hoger-onderwijs-opnieuw-ingevoerd-studenten-vinden-bedrag-te-laag.
[4] Rijksoverheid (n.d.), Veranderingen studiefinanciering 2023, https://www.rijksoverheid.nl/onderwerpen/hoger-onderwijs/veranderingen-studiefinanciering-2023.
[5] Visser, D., M. Zumbuehl and S. Konijn (2020), Niet-gebruik van de aanvullende beurs, https://www.cpb.nl/sites/default/files/omnidownload/CPB-Notitie-Niet-gebruik-van-de-aanvullende-beurs.pdf.
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