On the eve of the Labour Party conference, Ed Milliband announced in an interview with The Observer, that he plans ‘to slash university tuition fees by a third’, by reducing the cap on tuition fees to £6,000. It’s a headline that appears to have been mistaken for a policy.
These past 15 months Labour has being decidedly light on policy. This surprised no-one. It was said of the previous Brown Government that Labour had run out of ideas; no-one seriously expected the ‘backroom boys’ who picked up Gordon Brown’s mantel to come up with new thoughts any time soon.
However, what has surprised me is how gullible (or biased) sections of the media have been in greeting this particular announcement. Perhaps starved of a decent sound-bites from the Labour leader since the time he decided to give the same answer half a dozen times to ITN’s Damon Green back in June, they are now chomping at the bit for anything printable.
But this doesn’t excuse confusing this particular utterance for a policy, or at least not one that puts Labour on the side of poorer students.
When it comes to repaying student loans, the amount you pay depends on what you earn, NOT what you owe! So reducing the cap on tuition fees doesn’t change how much graduates will pay back month in month out.
It doesn’t matter whether you borrowed £6k a year or £9k a year for your tuition fees you will still only pay back 9% of earnings over £21k. And let’s not forget loans are written off after 30 years.
So let’s say you graduate and get a job paying £25K, you will pay back 9% of £4,000, or £30 a month. On this basis you will pay back just £10,600 of your loan before it is written off, irrespective of whether you borrowed £18k or £27k to go to University. Altering the cap does not change the amount you have to pay back.
There is a point where it does change and, according to calculations by Stephen Tall here on Lib Dem Voice, only graduates who land a starting salary of £38,300 or higher will be better off if tuition fees are capped at £6k. This hardly smacks of helping poorer families.
It also ignores the fact that all universities who wish to charge fees of £9k have to make bursaries available to improve access to students from poorer families. Do we assume this will get thrown out along with the £9k cap?
If this wasn’t enough, the following morning Labour party officials went on to refuse to guarantee this pledge will feature in their manifesto for the 2015 General Election.
So we are left with a non-policy, a headline that is talking about slashing fees from £9k to £6k that may well never make it into a manifesto — and even if it did wouldn’t make the blindest bit of difference to student or graduate finances for low-to-middle earners.
But this interpretation ignores another headline. Labour for all their protests about increased fees have just shown their support for the Browne Review and their backing for higher tuition fees.
The last Labour Government’s introduced top up fees of £3,000, now Ed Milliband wants to set the cap at £6,000. So here’s the headline I would have written:
- “Labour Vows To Double Tuition Fees”
And why not? Liberal Democrats took enough flack for going back on a pledge to oppose a rise in tuition fees. Why not hold Labour to account and judge them against their own policy positions too?
* David Parkes is the treasurer of the Spanish Branch of Liberal Democrats Abroad.
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8 Comments
Labour introduced tuition fees while the Tories raised them,
but Lib Dems ensured HE stayed free at the point of access.
Did we? Were the Tories were planning to introduce upfront payments?
(I think their manifesto merely committed them to the Browne Review)
Andrew, lets not beat around the bush, Labour introduced tuition fees, promised not to raise them and then proceeded to triple them. The Lib Dems promised to oppose any further rise in tuition fees, yet half our parliamentary party voted with the Conservatives to triple them once again. Now Labour are showing support for a £6k cap, double their previous position. The simple fact is no party has much credibility when it comes to making (and keeping) promises to students.
However, the Lib Dems at least have done a lot to improve access and ensure a proper funding solution for universities during the economic crisis. The other two parties only made efforts at opposite halves of this problem independently. During their tenure Labour improved access, and the Tories improved funding. We can stand proud that we took the 3rd way and managed to do both. But this latest effort from Ed Miliband is a joke, for reasons explained above.
I do have to be thankful to Ed for destroying the image of Labours credibility on this issue just as university terms start across the country. Very bad timing. I’d say it shows how his leadership isn’t great, but where was his shadow cabinet when this was being discussed?
@Andrew Duffield
“Labour introduced tuition fees while the Tories raised them,
but Lib Dems ensured HE stayed free at the point of access.”
Except for all the people who the Lib Dems, Labour and Tories do not think should be studying, who plain aren’t eligible for your loans, and for the part-timers who will find themselves beginning to repay long before they finish their courses. Who y’all just won’t admit exist, either because they inconveniently fail to support this absolutist ‘free at the point of access’ prevarication, or because you never noticed them – in which case you aren’t really knowledgable enough about the sector to comment…
If chemo cost £60,000 on the NHS for patients who’d previously enjoyed NHS treatment for appendicitis, would that be classifiable at ‘free at the point of access’?
In the US they say that reality has a well-known liberal bias. In the UK, it doesn’t seem that reality is especially supportive of any of our political ideologies, but if it’s supporting anybody on tuition fees, it sure ain’t the Lib Dems. One marvels at the Lib Dem party faithful’s effort to prove that 9k is fairer than 6k and much, much cheaper than 3k – marvels, and promises oneself to find a better, or failing that, a more credible, or failing that, a funnier way to waste one’s vote.
I must have hallucinated the motion at lib dem conference where we openly debated the problem of part time students having to start repaying before they finish. Seems we are discussing it.
As to who’s eligible for the loans, that would be every british citizen. That doesn’t seem like it’s being limited to a narrow group.
As to 9k v 6k, under the system as it operates, and under what Ed proposed, 6k fees mean higher earning graduates finish repaying earlier than under 9k fees, while the average earners end with the debt wiped out while repaying exactly the same. The argument over the level of a graduate contribution is different than that of a graduate contribution versus free education. You have to argue within the context of the actual argument after all.
@Rich
“As to who’s eligible for the loans, that would be every british citizen. ”
So the government silently withdrew the ELQ legislation then? Congratulations! I am ecstatic, and will withdraw that part of my comment at once! But on the off-chance that this hasn’t actually occurred…
As for “arguing within the context of the actual argument”, go search for the term “ELQ”. You’ll find no shortage of people being held back by ineligibility for the loans that you say every British citizen is able to access. Broadly speaking, they have the misfortune to be English and/or living in England, and have previously achieved a qualification that is considered to be equivalent to or higher than the one that they’re planning on studying. It doesn’t matter whether the qualification was entirely dissimilar, or self-funded, or was completed in Bulgaria or Timbuktu, or happened thirty years ago, or whether the individual has excellent reasons for retraining, or whether their first qualification was a useless degree from a failed institution. If your current aim fits in the same place on the great QCF index, then you’re paying your fees upfront, and what’s more, you’ll typically pay an ELQ supplement.
As for who finishes paying when? The rich don’t care for a second; whether it’s £6k, £9k or £18k it is chicken feed to them. I don’t agree with the idea of giving the rich a free ride at the expense of the bunch in the middle, but I don’t delude myself that charging £3k/year more than Labour will somehow magically make it all okay, especially when in so doing I am playing with the lives of people who actually do end up paying these fees upfront. Either keep them managably low or just make it a 30-year tax, make it applicable to every graduate, and be done with it.
see Centre Forum website http://www.centreforum.org for a fuller treatment of this issue,highlighting that it only makes any significant difference to really high earners !