Juc I'm afraid to the best of my knowledge that's correct. There are career development loans but as they are only for courses lasting up to two years (or three with a year's work experience included), they don't really work for PhDs. To be really really honest with you, I really wouldn't recommend funding a humanities PhD through credit - it doesn't stack up as a sensible plan financially. I have a few suggestions that may work depending on your situation:
1) ask yourself whether a PhD is REALLY necessary to get you to whatever career you are seeking. If you are thinking of academia, be aware that the job market in the humanities means you are statistically unlikely to get an academic job, and that things are going to get worse not better in the next 5 years regardless of who wins on Thursday. If you are going to do this, whatever you do, go in with your eyes wide open, and don't assume you will beat the odds - plenty of excellent people don't.
2) If you need a PhD or can't imagine doing anything else then I assume you've not been successful in this year's funding battle. If you're eligible for AHRC funding, then study who has block grant funding for next year and apply everywhere that you can make a viable case that you could be supervised there. This might mean applying to places that you wouldn't choose to live in but I'd suggest trying to get past this if at all possible. Also keep an eye on the Tuesday guardian and jobs.ac.uk for any university scholarships or alternatively funded projects. It might also be worth considering the USA and Canada if you have a good academic record, or if you speak other languages and the project would be viable there, other European countries.
3) If you are AHRC eligible and have a first or very high 2:1 in your BA, it might be worth risking a career development loan for an MA but get advice from someone in the know in your subject as to what MAs might help your cause. They are very definitely not all equal. Also be aware that you'll have to start repaying as soon as you finish the MA.
4) If you're not AHRC eligible and/or your results / limited geographical mobility are such that you're unlikely to ever get funding, I'd suggest doing it part-time. It's just about financially manageable particularly if you live somewhere cheap. I have my doubts that London would be viable. Before commiting to this, ask your dept what other part-timers do to self-fund, and make sure you have a viable plan.
Sorry not to be really encouraging but I thought it was fairer to be honest.
Juc,
Did you apply to everywhere in the country with block grant that's ok for your topic or just to your preferred options? If so, I'd definitely consider another go next year with a wider spread of applications. You are right though, your first degree result will not help. Is your MA from somewhere highly rated in your subject? If it is, then it might work out.
Odds on getting a permanent lectureship? Someone has calculated for my hopelessly oversubscribed soc sci subject (politics) that it's about 10% and a friend in genetics reckons it's about the same for them although that's cushioned by numerous postdocs in her subject. Mind you that's including everyone who graduates, and many won't want to go into academia, as a Politics PhD can be helpful in other careers if you've done something appropriate to public policy or NGO work. I'd imagine though that it's probably not much better in most humanities subjects although with variations according to topic area. E.g. I suspect modern history is better than medieval. If you want a lectuership I'm reliably told an accountancy PhD is the way to go. Apparently they have reall difficulty filling accountancy posts...
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