University tuition fees review

[truman 10]

Which is what I've been saying of course.

 

I would like to see more support for fees from the Govt though, the living cost component is entirely at the cost of the students, after all we dont pay living costs of schoolchildren even if the tuition is free.

 

You can mitigate that by studying near home...

[I1L2T3 10]

As some of us have pointed out a tax would penalise people who went to University who don't end up benefitting from higher wages. The risk of this could be minimised by reducing the number of people going to University and reducing the degrees that Universities offer, but I'm not sure that would be welcomed.

 

The current system ensures that only people who go on to earn a decent wage will pay back the cost of their education.

 

The problem with the current system is that very little Is likely to get paid back.

 

If you are concerned about threshold income levels it would be just as easy to trigger payment of additional tax through the taxation system, and you could also use a sliding scale of repayment based on income.

 

That way there is no pretence of loans, no opportunity for ideologues to monetise the loan system by involving private companies, no need for the government to backstop private companies, and no vehicle for the charging of punative interest rates.

 

The argument that the interest rates don’t matter because people never pay the interest is a bit daft. I work with people who owe money on student loans (one lass with over £40k), and there is a significant psychological impact of seeing the debt reducing very slowly despite quite high payments.

[Bob Arctor 11]

If the interest rate is irrelevant just make it a tax. It would be far more efficient, and provide the government with a guaranteed rolling source of predictable revenue that could be reinvested into eduction and training for generations.

 

That makes sense to me. I wonder if everyone who supports the idea of a sliding scale of loan repayments based on income level realises how similar that is to income tax. It's a short hop from there to just funding it through income tax. Do we really think it's only graduates who benefit from their education? I think we all benefit from people in our society being better educated, so why not just fund it through income tax and remove the incentive to pile 'em high and churn them through (I'm looking at you, Hallam) and incentivise the provision of high quality learning instead.

[hackey lad 3,991]

Ive kept out of this thread , but I will now tell you a true story . My niece is the first in our family to go to university . After three years of hard work she passed out last year . She is now employed in her chosen field . During a discussion between her and her granddad ( my dad) , Granddad asked her if she was worried about her owing the money and paying back her student loans . She said " don't worry about it granddad , most people don't pay them back" .

[I1L2T3 10]

That makes sense to me. I wonder if everyone who supports the idea of a sliding scale of loan repayments based on income level realises how similar that is to income tax. It's a short hop from there to just funding it through income tax. Do we really think it's only graduates who benefit from their education? I think we all benefit from people in our society being better educated, so why not just fund it through income tax and remove the incentive to pile 'em high and churn them through (I'm looking at you, Hallam) and incentivise the provision of high quality learning instead.

 

Indeed. The argument that the current system is better because people don’t pay back until a certain income level is a complete dead duck.

 

Like you say the existing taxation system can be tweaked to build in triggers based on income levels.

 

Personally I would support an automatic increase on income tax for all degree study. 1% on the tax rate perhaps. As suggested earlier the max could be 1% per year up to 5% for the 5 year courses like medicine. A three year course would result in 3% tax. If you drop out after two years you pay 2%. If you wanted to incentivise participation in certain courses then discount the tax. For poorer students discount the tax.

 

It goes a little against my leftie credentials but in pragmatic terms I do think all undergraduates/graduates should pay something back. Moving forward through the decades I’d like to see that revenue ringfenced for investment back into not just higher education but for other forms of post-18 training as well.

 

The graduate tax is actually a decent opportunity.

[ez8004 10]

Ive kept out of this thread , but I will now tell you a true story . My niece is the first in our family to go to university . After three years of hard work she passed out last year . She is now employed in her chosen field . During a discussion between her and her granddad ( my dad) , Granddad asked her if she was worried about her owing the money and paying back her student loans . She said " don't worry about it granddad , most people don't pay them back" .

 

So your niece is happy to be part of an incredible piece of social engineering genius.

 

Have you ever wondered why the repayment threshold is kept so low? It is to prevent the less affluent from ever earning a significant amount even with a degree. I have colleagues who have £30k of debt paying hundreds in repayments every month because they have an annual income of £45k. It isn’t actually a lot, as it is only just inside the 40% income tax bracket, but it will take him years to pay it back. It is like having a mortgage before you even actually get a mortgage.

 

This whole setup handicaps you from earning and getting on the property ladder. Obviously for people who don’t deserve it according to the government.

[I1L2T3 10]

Ive kept out of this thread , but I will now tell you a true story . My niece is the first in our family to go to university . After three years of hard work she passed out last year . She is now employed in her chosen field . During a discussion between her and her granddad ( my dad) , Granddad asked her if she was worried about her owing the money and paying back her student loans . She said " don't worry about it granddad , most people don't pay them back" .

 

Blimey, what an attitude. It’s a rational attitude of course based on the realities of the situation.

 

Read up on the economic concept of moral hazard.

 

Now, if this pattern of thinking is repeated across millions of students then you have millions and in time maybe tens of millions who don’t ever intend to pay a penny back.

 

That is not a sustainable system.

 

That is why a tax is better. Everybody understands that by going to uni there will be an inescapable financial consequence. One that is not overly onerous as now, but it is there all the same. And the system gets the vast majority paying back and not the few.

[hackey lad 3,991]

So your niece is happy to be part of an incredible piece of social engineering genius.

 

Have you ever wondered why the repayment threshold is kept so low? It is to prevent the less affluent from ever earning a significant amount even with a degree. I have colleagues who have £30k of debt paying hundreds in repayments every month because they have an annual income of £45k. It isn’t actually a lot, as it is only just inside the 40% income tax bracket, but it will take him years to pay it back. It is like having a mortgage before you even actually get a mortgage.

 

This whole setup handicaps you from earning and getting on the property ladder. Obviously for people who don’t deserve it according to the government.

 

I don't think she is paranoid enough to think about social engineering . The fact is she worked hard ,got the results she needed for her chosen career path and is now gainfully employed on that path , doing a good job for society and earning a very good wage for someone of a similar age .

 

---------- Post added 20-02-2018 at 23:00 ----------

 

Blimey, what an attitude. It’s a rational attitude of course based on the realities of the situation.

 

Read up on the economic concept of moral hazard.

 

Now, if this pattern of thinking is repeated across millions of students then you have millions and in time maybe tens of millions who don’t ever intend to pay a penny back.

 

That is not a sustainable system.

 

That is why a tax is better. Everybody understands that by going to uni there will be an inescapable financial consequence. One that is not overly onerous as now, but it is there all the same. And the system gets the vast majority paying back and not the few.

 

Wheres the attitude ? If there comes a time when she has to pay back her loans , she will , willingly . No need to be rude

[I1L2T3 10]

I don't think she is paranoid enough to think about social engineering . The fact is she worked hard ,got the results she needed for her chosen career path and is now gainfully employed on that path , doing a good job for society and earning a very good wage for someone of a similar age .

 

---------- Post added 20-02-2018 at 23:00 ----------

 

 

Wheres the attitude ? If there comes a time when she has to pay back her loans , she will , willingly . No need to be rude

 

The attitude is taking a loan that you know you might never pay back. If you get a degree and you don’t have to pay for it you get to keep the degree. If you buy a house or a car and don’t pay for them you lose the house or the car.

 

If you embark on a path where you know that there Is a high risk you won’t pay for something that is bad IMO. Tell me what does that teach kids exactly? What is good about it?

 

Actions have consequences and people need to learn that. Best way is to tax them.

[truman 10]

So your niece is happy to be part of an incredible piece of social engineering genius.

 

Have you ever wondered why the repayment threshold is kept so low? It is to prevent the less affluent from ever earning a significant amount even with a degree. I have colleagues who have £30k of debt paying hundreds in repayments every month because they have an annual income of £45k. It isn’t actually a lot, as it is only just inside the 40% income tax bracket, but it will take him years to pay it back. It is like having a mortgage before you even actually get a mortgage.

 

This whole setup handicaps you from earning and getting on the property ladder. Obviously for people who don’t deserve it according to the government.

Your colleague will be paying about £180 a month..

Edited February 20, 2018 by truman

[Bob Arctor 11]

Indeed. The argument that the current system is better because people don’t pay back until a certain income level is a complete dead duck.

 

Like you say the existing taxation system can be tweaked to build in triggers based on income levels.

 

Personally I would support an automatic increase on income tax for all degree study. 1% on the tax rate perhaps. As suggested earlier the max could be 1% per year up to 5% for the 5 year courses like medicine. A three year course would result in 3% tax. If you drop out after two years you pay 2%. If you wanted to incentivise participation in certain courses then discount the tax. For poorer students discount the tax.

 

It goes a little against my leftie credentials but in pragmatic terms I do think all undergraduates/graduates should pay something back. Moving forward through the decades I’d like to see that revenue ringfenced for investment back into not just higher education but for other forms of post-18 training as well.

 

The graduate tax is actually a decent opportunity.

 

Even this assumes that the primary beneficiary of a university degree is the graduate themselves. Do we know that for a fact, or is it an assumption?

[I1L2T3 10]

Even this assumes that the primary beneficiary of a university degree is the graduate themselves. Do we know that for a fact, or is it an assumption?

 

That’s why I pitched the max rate at 5%, way below the max repayment percentage we have now