Research to inform the evaluation of the Diamond Reforms to student finance: summary

OB3 Research, in collaboration with Miller Research, was commissioned by the Welsh Government to undertake research to inform the evaluation of the Diamond Reforms to student finance in Wales.

The Diamond Reforms were intended to widen access to, and participation within higher education (HE), and to strengthen part-time and postgraduate provision across Wales. From the academic year 2018/19 onwards, the Diamond Reforms introduced changes to the package of tuition fee support and maintenance support available for Welsh-domiciled students.

It was expected that the research would provide evidence relating to the first three objectives of the reforms:

• widening access to HE
• strengthening part-time provision
• strengthening postgraduate provision

The work programme for the research involved:

• an inception stage 
• a desk review of student finance Welsh Government policy, and published data for Welsh-domiciled students
• a literature review about the public’s perception of HE and student loan debt aversion
• the development of research instruments, including survey tools and discussion guides 
• fieldwork with Year 12 and 13 learners, parents and guardians of Year 12 and 13 learners, part-time HE students, and postgraduate HE students from Wales 
• fieldwork with stakeholders and representatives from Higher Education Providers (HEPs) in Wales

Findings from the desk review of Welsh-domiciled student numbers in higher education

• According to the Higher Education Statistics Agency (HESA), the number of Welsh-domiciled undergraduate students entering UK HEPs has remained fairly consistent since 2016/17 (HESA). A drop was experienced in 2023/24 when 33,970 Welsh domiciled undergraduate entrants were reported (compared to 35,770 in 202/23). 
• Since 2019/20, Welsh-domiciled part-time undergraduate entrants have accounted for between 36% and 40% of all Welsh-domiciled undergraduate entrants. HESA data shows that Wales has the highest proportion of part-time undergraduate entrants as a percentage of all undergraduate entrants amongst the UK nations. 
• The number of accepted applicants from Wales as reported by the Universities and Colleges Admissions Service (UCAS) peaked in 2016, and was at its lowest in 2024. Although there has been a slight increase in the number of Welsh-domiciled accepted applicants in 2025, recovery has not been as marked as the year-on-year percentage increase for students of English domicile. Wales had 8% fewer accepted applicants in 2025 (19,120) than 2016 (20,715). 
• There is a slightly different pattern when considering Welsh-domiciled accepted applicants specifically from 18-year olds. According to UCAS, applicant numbers peaked in 2021 and were 2% lower in 2025 (10,535) than 2016 (10,700).
• UCAS data shows that entry rates for 18-year olds from Wales as a proportion of the population rose from 29.6% in 2016 to a high of 33.6% in 2021 before falling to 29.2% in 2025/26. Entry rates are lower than those in England and Northern Ireland.
• HESA data shows that the number of Welsh-domiciled postgraduate taught master’s student entrants increased between 2016/17 and 2023/24, peaking in 2020/21 (HESA enrolment data for recent years and HESA enrolment data for previous years).
• Wales is a net importer of full-time students from the rest of the UK. HESA data shows that the proportion of full-time undergraduate entrant students from Wales studying in England increased over time, from 35% (7,815) in 2019/20 to 39% (7,905) in 2023/24.

Findings from the literature review relating to perceptions about the value of HE, student loan debt aversion and awareness of student support

• Students and graduates continue to see HE as valuable, with most graduates believing their degree was worth the investment of time and money. However, the perceived graduate earnings premium has narrowed in recent years, mainly due to rising non-graduate earnings. Perceptions of value are shaped not only by costs, but also by teaching quality, course organisation, and the adequacy of financial support. 
• Concerns about student debt remain a significant factor in decision-making, especially for those from lower-income backgrounds. Although Welsh-domiciled students have experienced the largest proportional increase in average graduate debt in the UK (BBC News) (£14,000 in 5 years from 2018 to 2023 according to Student Finance Wales data), there is limited evidence that this has directly reduced participation. Debt aversion is more pronounced among disadvantaged groups, but most students  see loans as a necessary route into HE.
• Understanding of student finance and repayment terms is often limited, particularly among prospective students from lower-income families. Misunderstandings about how loans work can increase debt aversion and reduce intentions to participate in HE. Access to accurate information and guidance is uneven, with disadvantaged learners less likely to receive consistent advice. 
• Participation in HE remains lower among students from disadvantaged backgrounds, disabled students, and those with care-experience. These groups are more likely to be debt-averse and less confident about the financial return of HE. While targeted financial and pastoral support can help, wider issues of belonging and inclusion also influence perceptions of value and participation.
• The literature review found little direct evidence on the specific impact of the Diamond Reforms on participation or perceptions of HE in Wales, meaning the extent of their influence remains uncertain. This highlights the importance of the evaluation in addressing some of these gaps and understanding how the Welsh student support system influences decision-making.

Findings from the primary research relating to widening access to HE

• Most young people who contributed to the research were planning to go to university. They were motivated by an interest in a particular subject, career ambitions and an expectation that university would offer personal growth, independence and broader opportunities. 
• Female learners were more likely than male learners to plan to go to university and to value HE, while male learners were more likely to be undecided or discouraged by financial pressures. College-based learners were also more likely than their school-based counterparts to plan to go to university and to value HE.
• Those who were unsure or had decided against university were concerned about the cost of HE and had doubts about whether a degree was a worthwhile investment. Undecided learners were reluctant to go to university unless they could be convinced of the tangible benefits of doing so and reassured of a guaranteed job or career at the end.
• Parents and guardians with higher incomes were generally supportive of university, while those from lower-income households tended to focus more on the financial implications and encouraged employment or apprenticeships as more practical routes. Learners whose parents or guardians had not been to university were more likely to be undecided or to consider alternative options such as work or vocational training.
• Cost of study was a key concern and was found to have a bearing upon decision making, including where and what learners choose to study. However as has been found in other research for most, whilst student debt was a source of worry, it did not deter participation in HE. 
• Young people as well as parents and guardians, particularly those from lower-income households, found student finance complicated and difficult to understand and would benefit from clearer, more user-friendly information. 
• Learners from higher-income families or those confident about future employment prospects were more likely to see student loans as manageable whilst those from lower-income households or with less financial support tended to view debt more negatively, seeing it as a burden rather than a tool for opportunity.
• Stakeholders and HEPs highlighted the impact of systemic and structural barriers to HE enrolment, including lower school attendance which negatively impacts academic achievement and students’ ability to meet university entry requirements; an increase in the number of AS Level learners not progressing to study A Levels, a rise in behavioural and wellbeing issues amongst young people, and an increase in elective home education.

Findings from the primary research relating to strengthening part-time provision

• Part-time undergraduate study is often pursued by students out of necessity due to work and personal circumstances. As such, the flexibility of part-time provision is paramount and allows students to work around personal responsibilities. 
• The quality of part-time provision accessed was deemed by students to be positive, with experiences often described as rewarding but demanding. Isolation was a recurring theme, particularly for distance learners who have limited contact with peers.
• Financial pressures were a challenge for part-time students, with rising household expenses and the wider cost-of living crisis increasing financial strain even for those in employment.
• Part-time students raised issues relating to the inequity of support compared to full-time students and thought that the system unintentionally discourages faster study progression. 
• Debt aversion itself did not generally deter participation in part-time study, but it was found to influence how and where students choose to study.
• HEPs reported that the Diamond Reforms supported growth in part-time study amongst mature and in-work students, largely delivered by the Open University, as well as increasing demand for flexible, industry-aligned provision. 
• The expansion of part-time provision across HEPs remains constrained by financial and operational pressures, with a complex funding model that is perceived by HEPs to fail to cover higher delivery costs.
• HEPs reported that lower maximum tuition fee loans for part-time Welsh-domiciled students studying in Wales limit fee-setting and revenue generation, despite additional Medr grant funding.

Findings from the primary research relating to strengthening postgraduate provision

• Postgraduate study is mostly motivated by career advancement, career change, personal development, and aspirations for an academic career. 
• Most students had positive experiences of HE and regarded their courses as engaging, stimulating and well-taught. Challenges included heavy workloads and fast-paced courses. Students would welcome more interactive teaching and practical experience.
• Financial considerations were a major factor shaping the experience of postgraduate students and views about student debt influenced students’ decisions about course duration, subject and location. Whilst tuition fees and living costs were cited as barriers to study, student debt was not a hindering factor.
• Financial pressures were the most frequently cited challenge facing postgraduate students, with postgraduate loans often insufficient to cover tuition and living costs. Some reported experiencing financial hardship that affected their basic needs, such as food and housing.
• HEPs reported that the Diamond Reforms had a broadly positive, if uneven, impact on postgraduate taught master’s provision. They found it difficult to isolate the impact of the reforms from wider external factors such as pre-reform growth and pandemic-related trends.
• HEPs felt that the removal of postgraduate grants from 2024/25 had produced mixed effects. Some saw no noticeable fall in demand, while others reported a decline in demand. 
• HEPs reported that postgraduate provision remains dominated by full-time domestic and international students. The financial model for postgraduate teaching remains pressured, relying heavily on tuition fees, including international income, and supplemented by relatively modest targeted funding from Medr.
• Key barriers to growing postgraduate provision according to HEPs included volatility in international recruitment, the high cost of running specialist or intensive programmes, and a funding system that is not well-suited to support accelerated or flexible modes of study.

The following recommendations are for the Welsh Government to consider.

Recommendation 1

In partnership with SFW, Medr, UCAS, Colegau Cymru, Universities Wales and the HE sector, consider how awareness and understanding of the student finance support available to Welsh-domiciled students could be improved. 

Recommendation 2

In partnership with the HE sector and key stakeholders, consider how information and communication to prospective students can better demonstrate the value of HE and the positive employment outcomes achieved by Welsh-domiciled graduates. This should include not only evidence about employment and earnings, but also the wider personal, social and wellbeing benefits associated with participation in higher education. There is a case for extending and strengthening engagement activities, so they reach a wider range of prospective learners, not only those currently targeted through widening-access initiatives. 

Recommendation 3

In partnership with others, continue to address the fundamental systemic and structural factors which account for low HE participation among 18-year-olds. There is a strong case for sustained intervention to tackle issues such as low school attendance, rising rates of elective home education, increasing behavioural and wellbeing challenges, weak academic performance, and decreasing transitions from AS to A level study.

Recommendation 4

Review the household income thresholds and maintenance grant levels for student finance, as these have remained unchanged since the Diamond Reforms.

Recommendation 5

In relation to postgraduate study, explore the feasibility of mirroring the postgraduate master's existing support package with the undergraduate system, with separate funding contributions available for tuition fees and living costs, including tuition fees being paid in part directly from Student Finance Wales to universities.

Recommendation 6

Explore ways to simplify and make student finance support for HE students more flexible, to better accommodate the increasing trend to engage in HE in a more fluid way over a person’s life. This could include improving flexibility for part-time, modular, distance learning and accelerated study routes, ensuring the funding system adequately supports more varied patterns of participation.

Recommendation 7

Given that HEPs thought that the impact of the Diamond Reforms on wider HE funding structures has been limited, we recommend that the Welsh Government explore how the proposals in the Diamond Reforms for reshaping HE funding could be fully implemented to achieve a more sustainable funding model for HE in Wales. 

Recommendation 8

That the scope of the research to inform a review of the Diamond Reforms is broadened beyond the three elements currently under consideration. There is a need to revisit HE funding arrangements and tackle the widening participation gap between Wales and the rest of the UK through a broader systems level approach.

Report authors: Nia Bryer, Heledd Bebb, Tanwen Grover, Kerry KilBride, Sophie Wheeler and Mariana Fikry

Views expressed in this report are those of the researchers and not necessarily those of the Welsh Government.

For further information please contact:
Education and Skills Research
Social Research and Information Division
Welsh Government
Cathays Park
Cardiff
CF10 3NQ

Email: KASEmployabilityandSkillsResearch@gov.wales

Social research number: 12/2026
Digital ISBN: 978-1-83745-122-7