dr. dieter dohmen thessaloniki, october 4, 2010 loans for vet in germany [email protected]
TRANSCRIPT
Content
1. Loans – the frame
2. VET-Loans – Regulations
3. VET-Loans – Data
4. VET-Loans – Efficiency & Effectiveness
The environment
Two loan schemes:
Federal Law on Student Support and
Federal Law on Support for VET-upgrading programmes (e.g. Master-craftsmen programmes and comparable qualifications)
Full-time school-based (initial) VET – 100% grants
Full-time studying at universities – 50% grant, 50% loan
-> CVET-programmes are covered, if Master programmes are considered CVET (=> if at all, this law is of minor relevance in this context)
Regulations
Federal Law on Student Support (BAfoeG):
Full-time studying at universities – 50% grant, 50% loan
Full-time school-based (initial) VET – 100% grants
-> CVET-programmes are covered only, if Master programmes are CVET (age restriction: 30 years at the start of the programme)
=> if at all, this law is of minor relevance in this context
Regulations
Federal Law on Support for VET-upgrading programmes (AFBG):
i.e. Master-craftsmen programmes and comparable qualifications
Full- or part-time programmes
Programme and examination fees (of up to € 10.226)
Costs for preparation of “master-piece”
Costs of maintenance (in case of full-time programmes) (means-tested)
Regulations
Federal Law on Support for VET-upgrading programmes
Maximum support for full-time programmes:
Maintenance: up to € 675 up to € 155: loan(based on income assessment) rest: 56% loan/44% grant
Plus € 215 for husband/wife (if applicable)50% loan/50% grant
Plus € 210 per child (if applicable)50% loan/50% grant
(plus € 113 per child for lone parents (if applicable): 100% grant)
Loans are interest-bearing: Euribor + 1% (+0.7% risk contribution)
Regulations
Federal Law on Support for VET-upgrading programmes
Maximum duration: full-time - 2 years, part-time - 4 years
Maximum loan (depending on personal situation):e.g. € 16,200 (un-married) or € 21,300 (married, 1 child)
Grace period: time of studying plus 2 years afterwards (can be extended to 6 years)
Repayment period: max. 10 years
Repayment rate: min. € 128 per month, but can be adjusted to the maximum repayment period (e.g. in examples € 135 and € 177)
Special regulations
Loan can be reduced …
• by 25% upon successful examination
• by up to 66% in case of foundation of a company, if one employee or trainee is deployed
• in case of part-time employment due child-rearing and insufficient income repayment can be postponed (and can be granted eventually)
Some data
Number of trainees supported: 157,500 (2009) 136,000 (2006)
Average amount: € 2.892 (for all programmes) (2006: € 2,715)
for public institutions: € 3,837 (25% of participants)for private institutions: € 3,547 (9%)
for courses at public institutions: € 2,802 (34%)for courses at public institutions: € 2,317 (25%)
Distance education courses: € 1,433 (8%)
Average support (per Person and month): € 745
Average share of loan: 69% (2009) (2006: 71%)
Some data
Average support (per Person and month):
Grant for maintenance: € 195 (26%)
Grant for child care: € 115 (15%)
Loan: € 433 (59%)
Total: € 745
Average share of loan: 69% (2009) (2006: 71%)
Some data
Number of trainees supported: 157,500 (2009) 136,000 (2006)
female share: 31% (2009) (2006: 32%)
full-time: 26% - part-time: 34% (2006: 26 and 36%)
83% have no income, 12% less than € 5,000 (no gender differences)
Some data
Age distribution by gender (Total) (2009)
0%
5%
10%
15%
20%
25%
30%
35%
40%
unter 20 20 - 25 25 - 30 30 - 35 35 - 40 40 - 45 45 - 50 50 - 55 55 - 60 60 - 65
Total
Male
Female
Efficiency & effectiveness
No official data on administration cost is available
however administration cost of interest rate is 1%point(in comparison: for BAfoeG costs of loan administration are at 2.7%)
Default rates are not known: however, the 0.7 %points increase of the interest rate suggest that they are not too high
Measures to improve efficiency & effectiveness
Regulations in Germany are based on legal approaches, i.e. efficiency and effectiveness are of minor importance.
However, few changes have been made, e.g.
• Loan was transferred from public budget to KfW, …
• … and introduction of interest-bearing loans (from interest-free) (though interest during training and 2 year grace period is paid by government)
Support for children and partner turned to a 50% loan (from 100%)
25% reduction for successful examination has been introduced last year
