Labour’s tuition fees policy was one of the most talked about of the 2017 manifesto, and one of many pledges to successfully rally voters around Corbyn’s campaign. Students, prospective students, and concerned parents alike found solace in the pledge to lift the financial burden they expected to shoulder for years to come, bringing Labour one step closer to government.
This policy was vital in shining light on the cartel-like behavior from vice-chancellors, the struggles of the UK’s younger generations under unprecedented amounts of debt, and ultimately upon a loan system not fit for purpose. By burdening young people with an average debt of £44,000, the Conservatives’ higher education policy is simply not appropriate, justified, or fair.
I remain committed to extending education to all – for as long as we have the means to subsidise learning, we are obliged to do so, if not for the social worth of allowing an education for all who require it, then for the pragmatic reasoning that a more highly-educated workforce are more able to provide for the country as a whole. The many graduates who do not become part of the top income percentiles of society ought not to be required to suffer the large burden of debt they currently do, particularly as we move towards a society in which a degree is seen in many sectors as a prerequisite rather than a choice.
The solution to unaffordable education, however, is more complicated than the effective but simplistic pledge to scrap tuition fees may have you think. Tinkering with one component of this broken system is not enough; a total overhaul is necessary.
Reinventing the higher education payment system requires looking beyond the £9000 headline figure to tackle the problems of maintenance loans, grants, executive pay and repayment terms. By considering all of these contributing factors, we may find the most effective way to reduce the burden of debt on students is not primarily through scrapping tuition fees, but a collection of other means.
According to the IFS, 73% of current university students will not pay off their loans entirely, meaning most people’s tuition fees are subsidised by the state – as they should be. Those who do repay the loan in its entirety are those earning the largest sums of money across their 30 year repayment period, acting as an effective graduate tax.
As a graduate tax (or proxy income tax, considering graduates expect to earn around 35% more than non-graduates), fees should be made more progressive by adding bands of repayment rates rather than a flat 9% rate. A progressive banding of fee repayments may then justify the reduction in tuition fees as a whole.
By taxing the wealthiest graduates more, this policy could raise a similar amount of money as the current system, even if the headline tuition figure were to be reduced, especially considering that taxpayers currently subsidise 44.2% of tuition anyway. Here, tuition is paid for overwhelmingly by wealthy graduates and supported by the state at large, meaning that education is available to all and, like in all progressive taxation, those with the means to pay more support those who don’t.
Tiered repayments are a pragmatic way to reduce the burden on low and average earners – often forgotten by the left is that some of the estimated £11.2 billion that could go into scrapping fees entirely may be best placed in other areas of financial support for students.
For example, one of the most atrocious moves of Cameron’s premiership was not his introduction of higher tuition fees, but the abolition of maintenance grants for the poorest students. The tuition fee system clearly has major flaws, but it has overseen an increase in poorer students making it to university due to the admittance cap now having been lifted. No such thing, however, can be said for scrapping maintenance grants, robbing over £3000 from the poorest students every year.
Labour’s manifesto is right in pledging to bring grants back, and should do so in an even more robust fashion than before, prioritising maintenance over tuition at all times. A more immediate worry in any student’s mind than the future cost of tuition is how they’ll afford their rent, food, or transport. This will reduce most graduates’ bills significantly and lower the barriers to university life significantly for working class students – students will not need to rely on savings in order to have somewhere to live, nor will they have to suffer higher debts for not having the financial backing of their parents.
Of course, the more comprehensive grants should once again be given to nursing students to encourage medical staff to train for, work in, and stay in our chronically understaffed health services. This method may – in future – be considered in future for other areas of the public sector in which there is a staffing deficit, such as education.
Even aside from grants, the maintenance system is broken. Although superficially progressive, providing an adjusted loan based on parental income is so flimsy and susceptible to abuse that it breaks down, letting down low and middle income families the most. Loans focus on income rather than wealth, so children of wealthy parents who may be retired or do little work at the time of application can benefit from a much larger loan than the child of average or below average earners.
Just as unfair, parents who can redirect their income through a business, for example, may be able to make use of accounting techniques so that their child may benefit from seeming to be much less wealthy than they already are. In reality, many victims of the current loan system are students whose parents who are employed at a low or average wage with little to no savings. To solve this, loans should either be considered as a one-size-fits-all policy, which may admittedly be inefficient in its allocation, or – my preferred option – place a weight on wealth rather than income.
Wider concerns over this level of debt do not only include its magnitude, but it is what is done with it, both during education and afterwards; the former referring to its wide misuse in institutions of higher education, and the latter referring to the retroactive adjustment of loan conditions.
Looking at the misuse of tuition fees, Andrew Adonis, former education secretary, expressed a desire to reform the tuition fee system he helped to create. Universities have acted en masse to push up fees, whilst university directors and vice-chancellors are one of the few to reap their benefits. The former director of The LSE, for example, earned a pretty substantial £466,000 in 2014 – conveniently enough to pay the entire tuition fees for 17 of The LSE’s students every year. Labour must pledge to ensure that tuition fee money goes exactly where it ought to: tuition. This means placing a cap or required ration on executive earnings should public universities still wish to receive taxpayers’ money.
The fear of unexpected alterations to the loan system is also a major concern; there is a need for the government to enshrine in law terms for which legislation is expected to cover. There is no justice in a student going to university on one deal, leaving on another, and having changed once again halfway through repayment. Some of the changes graduates fear have already happened, with many graduates experiencing an interest rate hike, which should – in reality – not be being raised much above inflation at all, if we look to not benefit wealthy students who can pay their tuition off immediately.
We must commit to students to have the same deal they signed up to, and for new students to know in advance if there will be any significant changes to their loans; part of this settlement must be to halt any private involvement into the Student Loans Company, which may put pressure on future governments to charge students more. Students require the guarantee that in 30 years or under, their debts will be wiped free, and that the interest rates won’t increase their debt out of control.
Perhaps this last point has shown the government’s attitude towards higher education: as ever-changing as the system over which it wishes to preside. Damian Green doesn’t think the fees are fair (or at least doesn’t think the Tories can be re-elected on it), Jo Johnson likens them to the most progressive policies of the age; there is simply no consensus.
The Tories cannot figure out a way to fix a system fit to collapse. We, therefore, must not settle for an intellectual sticking plaster of just scrapping tuition fees. Grants, maintenance loans, the misuse of fees, changing terms, and increasing interest rates are all as important as tuition fees, if not more important.
The manifesto pledges were undeniably an improvement over our current broken system, but we cannot be content with simple, populist policies if they do not do good by ‘the many’ for whom we profess to work. The money we have must be used to broaden access to the poorest, not subsidise the highest graduate earners – Labour must be smart with higher education policy.