Vince Cable set to propose graduate tax

IveSeenTheLight

from http://www.bbc.co.uk/news/education-10631013

Vince Cable set to propose graduate tax

By Sean Coughlan BBC News education correspondent
Vince Cable is trying to find ways to reduce the cost of higher education
A graduate tax is to be proposed by the Business Secretary Vince Cable, in a keynote speech on the future funding of higher education.
This would mean students in England would repay the costs of going to university through taxation once they began working.
A review of tuition fees and student finance is due to report in the autumn.
Mr Cable, who has pledged to oppose raising fees, will suggest a graduate tax as an alternative system.
This would mean students' fees being paid by the government to universities - and graduates would then pay a higher rate of taxation.
At present, the government lends students money to cover the cost of fees, with this loan paid back when students enter work, until the loan is paid off.
Under a graduate tax, the amount paid would depend upon earnings - compared with the current system in which a fixed amount is paid back.
Such a change could draw the political sting from the tuition fee debate - with Liberal Democrat MPs having personally signed pledges to oppose an increase in fees.
Private universities
Mr Cable, whose department is responsible for universities, is also set to suggest ways of cutting the costs of higher education to both taxpayers and students - such as promoting two-year degrees and more students living at home.
University students are waiting to hear how much courses will cost
Another proposal will be for more university courses to be franchised out - with universities accrediting courses which are taught by other institutions.
There will also be calls for a wider role for private providers in higher education - and there have been suggestions that private providers will want to expand into subjects such as teacher training and healthcare.
The speech from Mr Cable on Thursday will address the deepening pressures on the university system.
An unprecedented number of people are applying to university - and figures due on Friday will show that record numbers of well-qualified youngsters are going to miss out on places this year.
But spending limits from the government mean that universities are restricted in how much they can expand to meet the demand.
The previous government's promise of an extra 20,000 places this year has been cut to 10,000 places.
Fewer students
Mr Cable is also expected to retreat from the previous government's ambition of getting 50% of young people into university.
But this would be against a trend in rising numbers. There are already 51% of young women going to university - and in Mr Cable's Twickenham constituency, 52% of the working-age population have a degree.
There are now parts of the country in which almost two in three young people go to university.
Universities have also been warning of a deepening funding problem - and some university groups have called for an increase in tuition fees above the current level of £3,225.
There is an expectation that the subsidised repayment of loans for students' living costs will also be increased to a more commercial level of interest.
University leaders have warned that they need extra funds to maintain competitive in a global market - and there had been speculation that the limit for fees would be raised to £7,000 per year.
Malcolm Grant, provost of University College London, has suggested that protecting funding for research is a greater priority than recruiting more students.
However any increase in fees would add to the pressure on the taxpayer in the short term - with the government having to cover the up-front cost of any increase in fees.
As such, Mr Cable's speech will look at ways to reduce the cost, in the form of shorter, flexible courses and more studying from home.

FTBFun

So not much difference from how student loans are repaid at the moment, then!

Idiophreak

FTBFun wrote: »

So not much difference from how student loans are repaid at the moment, then!

Except:
"Under a graduate tax, the amount paid would depend upon earnings - compared with the current system in which a fixed amount is paid back."

Meaning you'd be financially penalised for taking a degree that would lead to a full time job...and you'll end up with (sweeping generalisation ahoy) scientist and engineers subsidising the arts even moreso than they do at present.

IveSeenTheLight

FTBFun wrote: »

So not much difference from how student loans are repaid at the moment, then!

My brother completes a mechanical engineering degree this summer.
He also took on a part time job, meaning that he has not taken on student debt.

I also know student that have taken loans and spent it on non educational stuff.

Why should all graduates have to pay differing taxes (depending on pay) for an education that they might not have been in debt to.

Exocet

IveSeenTheLight wrote: »

Why should all graduates have to pay differing taxes (depending on pay) for an education that they might not have been in debt to.

I agree. But it seems clear that they are going to raise the cost of University education significantly. Yet somehow they also need to sell those University places to the next intakes. Otherwise our Universities are only going to be educating foreign nationals and our future, as a country, gets worse.

Poor students already leave with 30k worth of debt (I think). God only knows what their future bills (tax) will be.

StevieJ

IveSeenTheLight wrote: »

My brother completes a mechanical engineering degree this summer.
He also took on a part time job, meaning that he has not taken on student debt.

I also know student that have taken loans and spent it on non educational stuff.

Why should all graduates have to pay differing taxes (depending on pay) for an education that they might not have been in debt to.

And prescribed by someone who probably never paid a penny.

oscar52

Idiophreak wrote: »

Except:
"Under a graduate tax, the amount paid would depend upon earnings - compared with the current system in which a fixed amount is paid back."

But its not actually "fixed". Yes, ok its 9%, but 9% of £5000 (so earning £20K) is more than 9% of £1000 (person earning £16K)

nearlynew

New taxes are inevitable. The government always finds new ways to steal from you.

That's what governments do.


Remember - they are all lying f*cking thieves.

IveSeenTheLight

StevieJ wrote: »

And prescribed by someone who probably never paid a penny.

I guess you mean Vince.

I studied through the Open University

michaels

Seems fair enough to charge back tuition costs as a percent of income with an 'allowance' as well but surely the total payable should reflect the course costs rather than high earners paying more altogether even if they do a 'cheap' degree.

lynzpower

IveSeenTheLight wrote: »

My brother completes a mechanical engineering degree this summer.
He also took on a part time job, meaning that he has not taken on student debt.

I also know student that have taken loans and spent it on non educational stuff.

Why should all graduates have to pay differing taxes (depending on pay) for an education that they might not have been in debt to.

Crazy. I have the money to pay for my masters in fees, Ive saved this myself.

Why should I have a grad tax that will arguably cost me a lot more than 5k over the next 30 years of my working life?