Bid to stem rise in student loans for migrant workers

A sharp increase in the number of European Union citizens coming to Denmark to study has prompted Higher Education and Science Minister Ulla Tørnæs to look into whether the programmes on offer are “too big a draw” for foreign students and whether there are loopholes which need to be closed.

She fears the cost will this year break through a ceiling imposed by a political agreement between parties in 2013.

According to a ministry statement, over the past two years 1,500 more European Union and European Economic Area, or EU/EEA, citizens have come to Denmark to get an education and receive the Danish student loans and grants, or SU, to which they are entitled as ‘migrant workers’, provided they work 10-12 hours a week.

The ministry said English-language academies in particular are attracting foreign higher education students and have a high proportion of students from EU/EEA countries.

Tørnæs will examine the offer of English-language vocational education, and will discuss with the parties behind the SU reform of 2013 whether the rules need tightening.

“I am very concerned about the dramatic increase in the number of EU citizens who come here to get an education and get SU,” she said.

“It has never been intended by the Danish SU system and the EU internal market that they should travel to Denmark to take a free education, getting SU, and then go home again.

“Therefore, we must examine whether the foreign students find a job after graduation, and whether the English-language education quality and relevance to the labour market is high enough,” Tørnæs said.

The influx followed the decision of the Court of Justice of the European Union in February 2013 that citizens from EU/EEA countries have a right to receive Danish student loans and grants or SU – if they have the status of ‘migrant workers’.

In practice this means that students have to work at least 10-12 hours per week at the same time as they are registered as full-time students.

This led to rising numbers of incoming students, notably from Eastern European countries in 2014, the first year after the EU court ruling.

The legal basis for this arrangement was an agreement by political parties with a combined majority in parliament in 2013. But it included a condition that if a ceiling of DKK400 million (US$60 million) was reached in total payments to EU/EEA migrant workers, the political agreement would be revised by parliament.

Minister Tørnæs is now concerned that, during the first half of 2016, this ceiling of payments from Danish taxpayers’ money to other European countries’ citizens will be reached.

The agreed ceiling was 5,500 full-time equivalents of SU support for student migrant workers, with a total cost of DKK400 million.

Steep increase

Since December 2013 there has been a 118% increase in the number of student migrant workers receiving the SU and further increases are expected because there is a delay in the administrative handling of all applications. The total number of student migrant workers who received Danish SU support in 2015 was 7,653, with 4,484 full-time equivalents, and the cost had reached DKK321 million.

But the Social Liberals, who helped craft the agreement on a payment ceiling, said there’s no reason to panic.

Spokesperson Ida Auken said: “There is a threshold built into the deal for when we need to address the problem. That hasn’t been crossed yet, so the government needs to stop panicking.

"The same legislation also helps to attract foreign talent to Denmark."

The increase in student migrant workers was greatest from Romania, followed by Slovenia, Hungary and Germany. The nations which sent the most student migrant workers in 2015 were Romania (1,313), Lithuania (760), Hungary (599), Bulgaria (593) and Slovakia (509).

The migrant worker category is only one of several categories of European students that might qualify for the Danish SU. The total number of students from the EU/EEA receiving the Danish SU in 2015 was 17,975, up from 5,009 in 2008, an increase of 259%. The total SU cost was DKK799 million (US$120 million).