'If no-one will fully repay £9,000 student fees, how is the system sustainable?' blog

flimsier

Braveheart100 wrote: »

Currently a graduate pays on average £45,000 in tax between the age of 22 and 50 more than an average non-graduate; due to the extra earning power of having a degree.

This EXTRA £45,000 in tax more than pays for a the cost of obtaining a degree.

By charging fee's for university education; students effectively PAY TWICE for their degree...........There is no economic argument for charging ANY university tuition fee's; even the fee's introduced by Blair.

What we are seeing here is an immoral tax on students who wish to benefit from Higher Education. Immoral, because THESE people were still at school when the Banking Sector brought the country to it's knees. These kids had nothing to do with the World Banking Crisis but they are being hit harder than any banker in terms of bailing the country out.

Even the way the Tories have organised the fee collection is corrupt. It is all about moving liabilities off the Government balance sheet; so we have this terrible new loan system costing far more than the current subsidised system (yes the whole exercise will cost the country MORE money for less education!) designed so that a few Billion in government debt can be hidden from view. No wonder Cameron needed to buy Murdoch off so that newspapers don't dwell on this.

I did not pay a penny for my degree in 1978-81 and sleep easily at night knowing that I have more than paid back my debt to society. Most of the Tory & Liberal MP's who voted these £9000 fee's also had free Higher Education; I hope they DON'T sleep easily at night knowing how much damage they have done to today's students, tomorrows young people and the whole Higher Education system.

Honestly, I have no idea why ML has become the chief cheer leader for this pile of carp.

Just gotta say that I love this post (apart from the pedant in my wanting to focus on the mis-used apostrophes).

Your final paragraph - I have no idea either. It's the opposite of what he used to say as General Secretary of the LSE Students' Union.

flimsier

melancholly wrote: »

i agree in the sense that i think university education should be free..... but once the battle was lost way back in December, what should MSE do? pretend that fees aren't happening and refuse to explain the system? at this point, looking at what the pros and cons of the student loans versus any other form of funding is the only way to play it...... until there's a new government (which may not even be at the next election!) who may change the whole funding structure.

fees are going up. it's a poor solution, but it's happening. we're past the point where complaining about it is going to make any difference so it's time to face the facts of the situation. there is a time for lobbying and a time for clear explanations. sadly, we've been in the latter for many months already.....

Mixed up with his explanation of the new system is a political tone; it reads as an argument for why the new system is better - and it manifestly isn't. Because he writes "I am not saying the new system is better" at the end of his blogs doesn't make the argument any less so.

The students who say him speak are taught in our citizenship classes to analyse the provenance of the message - they looked him up and (correctly in my view) labelled him a "government spokesperson once removed" - a remarkably mature observation and decided they would investigate the fees themselves.

progressive_uk

Actually Martin, I think you're missing a much wider point about the effect of writing off vast swathes of student debt in 30/40 years time on the public finances.

Whilst I'm not an accountant or an economist, my principal fear is that large numbers of loans (probably on the order of tens of thousands each) will be written off each year as they reach the 30 year line. Isn't this a ticking time bomb?

Surely student debt sits on the government's balance sheet, and then when it has to be written off, the money to actually write it off will have to come from somewhere (bit it taxation/spending cuts/public borrowing). We could easily be talking about hundreds of millions a year being written off in this fashion, and it will fall to that generation's tax payers (poetically, the same taxpayers who have just had their debt written off!) who will pick up the tab.

Money_Saving_Dude

Lokolo wrote: »

Not if they aren't living in the UK! I'm not talking of people just moving their money aboard, I'm talking of them actually MOVING abroad. And not just individuals, but businesses.

We've seen it before with manufacturing industry, and most recently with Cadbury's who are moving jobs to Poland to save costs.

Fair point, but what I'm talking about is personal tax, not corporate tax. You would need to totally sell up in the UK, not just move offshore. You would have to sell your house to someone else and lose all control over it to get out of the clutches of LVT. So it is a pretty potent tax (and hence why it is so strongly opposed). There are few that would go so far as to sell their homes. House price inflation is still significant in the more expensive end of the housing market, especially in London. And to sell out completely means you may not be able to get back in in the future.

Someone earlier mentioned the 50% tax range and the fact they paid too much tax already. Well I'm in the 40% bracket and I pay too much tax. Indeed I don't know anyone who doesn't pay too much tax.

The beauty of the Mansion Tax is if you don't like it move into a cheaper house, then you can avoid it completely, and not leave the country. It is basically a tax on lifestyle.

Money_Saving_Dude

Lokolo wrote: »

Not all the banks have done damage due to the UK economy.

OK let me counter this with links just from this site:

PPI misselling
when-is-misselling-mis-consuming-can-you-be-missold-every-month-for-10-years
Tories brand bank charges unfair
HBOS to pay £17 million compensation for customers

There are many other stories about how our banks con us out of money. OK you could argue that we should enter into banking (and especially investment, where much of this happens) with our eyes open. But banks just make the simple opaque. So pension charges are excessive. And your high street bank's stocks and shares ISAs -- well just don't touch them with a barge pole.

Seriously. Go to somewhere like Hargreaves Lansdown or the Motley Fool and learn a little about what to do, then invest using index funds.

Banking in the UK leaves a lot to be desired. And the beggar of it is, it is supposed to be our main industry. If we provide such a crap service for what we are supposed to do best, what hope is there for this country? Unless of course fleecing as many people as possible is seen as a laudable objective. :mad:

BACKFRMTHEEDGE

progressive_uk wrote: »

and it will fall to that generation's tax payers (poetically, the same taxpayers who have just had their debt written off!) who will pick up the tab.

The same generation who are going to be raising large amounts of taxes in order to pay for the unfunded public sector pensions of the baby boomers....

BACKFRMTHEEDGE

Money_Saving_Dude wrote: »

OK let me counter this with links just from this site:

PPI misselling
when-is-misselling-mis-consuming-can-you-be-missold-every-month-for-10-years
Tories brand bank charges unfair
HBOS to pay £17 million compensation for customers

Our banks are owned by the tax payer. Much of the money paid out by banks for PPI is just tax payers money. So tax payers are just getting a bit of their taxes back.

Money_Saving_Dude

BACKFRMTHEEDGE wrote: »

Our banks are owned by the tax payer. Much of the money paid out by banks for PPI is just tax payers money. So tax payers are just getting a bit of their taxes back.

OK, what about these:

Barclays profits hit by PPI payout
HSBC given PPI complaints extension

We are talking about inappropriate banking behaviour, so this game is (unfortunately) dead easy.

Lokolo

Money_Saving_Dude wrote: »

OK let me counter this with links just from this site:

PPI misselling
when-is-misselling-mis-consuming-can-you-be-missold-every-month-for-10-years
Tories brand bank charges unfair
HBOS to pay £17 million compensation for customers

There are many other stories about how our banks con us out of money. OK you could argue that we should enter into banking (and especially investment, where much of this happens) with our eyes open. But banks just make the simple opaque. So pension charges are excessive. And your high street bank's stocks and shares ISAs -- well just don't touch them with a barge pole.

Seriously. Go to somewhere like Hargreaves Lansdown or the Motley Fool and learn a little about what to do, then invest using index funds.

Banking in the UK leaves a lot to be desired. And the beggar of it is, it is supposed to be our main industry. If we provide such a crap service for what we are supposed to do best, what hope is there for this country? Unless of course fleecing as many people as possible is seen as a laudable objective. :mad:

Dude, I have my S&S ISA with HL, I know what I am talking about

Pension charges ARE NOT excessive. You recommend me going for a tracker, where the AMC is around 0.5%, this isn't excessive! I am quite happy to pay 1% AMC for my managed fund and if I don't get performance I will move my money to a different fund.

I'm not saying the banking industry is perfect but if you lot keep wanting to tax people and their businesses, they will leave to go elsewhere and I'm not just talking about the banking industry! As I've pointed out already, THEY WILL LEAVE THE COUNTRY. This stupid LVT tax is pathetic, if businesses get charged more tax for having premises they won't have it in this country. The UK's manufacturing industry is already suffering, this tax is going to give more reason to go elsewhere. Unemployment is already high as it is.

The banking industry isn't the only one that's pathetic, the football industry is as well. The UK is nowhere near perfect but given the deficit, introducing more taxation isn't the answer here.

BACKFRMTHEEDGE wrote: »

Our banks are owned by the tax payer. Much of the money paid out by banks for PPI is just tax payers money. So tax payers are just getting a bit of their taxes back.

Only 3 banks were bailed out.

xycom1

The way that the new fees have been explained to me, is that they are repaid by means of a 'graduate tax' at a rate of 9% over £21K/year. This will run for as long as the person earns over £21K to a maximum of 30 years - and does not take into account the amount repaid against the notional borrowings in the form of the original loan. So some high earners will repay well in excess of the amount that they initially borrowed.

Right or wrong?