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Student Loans : That's Another Fine Mess you've Gotten us into
Comments
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the change from repayments starting at 15k to 21k obviously increases trhe goverenment need to borrow
the changes to the parents salary cutoffs for loans and grants has further increased costs
If we accept the cost of a degree is £9Kpa (not saying it is) then the governments need to borrow is no different whether it is through a £3.5k loan or a £9K loan the only on difference is where it sits for nominal bookkeeping purposes at given point in time.
The loans for our two, one on either scheme are virtually identical so not sure how the cut offs have changed?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Devon_Sailor wrote: »I agree with other posters - the problem was the 50% target for degrees.
I dont see any evidence that it is "another fine mess". What is the Left's answer then? Make universal education free up until the end of a first degree? Where is the cash coming from for that little nugget of economic cyanide?!
Regards,
D_S
A problem with reducing the number of students studying degrees is that many towns and cities are heavily reliant on the student associated spend. It has become an industry in it's own right and economies would be severely hit if student numbers were wound down. The students of today are getting into long term debt to keep the economy of today going.
If degrees were confined to the 5 -10% levels of the 70/80s , with worthwhile added value employment being widely achievable, then the value of degrees would rise and perhaps the cost become more affordable, wholly or in part, by the state through enhanced tax revenue. It seems that 5-10% are simply moving on to further qualification via a Masters all we have done is push the bar further out.
If 40/60% of the debt is not going to be repaid in full then the few are still subsidising the majority. For those that will never enter high paid employment it is akin to a "buy to let" qualification, paying the interest at best.."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
grizzly1911 wrote: »If we accept the cost of a degree is £9Kpa (not saying it is) then the governments need to borrow is no different whether it is through a £3.5k loan or a £9K loan the only on difference is where it sits for nominal bookkeeping purposes at given point in time.
The loans for our two, one on either scheme are virtually identical so not sure how the cut offs have changed?
taking your figure of 9k then
the cost to the government depends the
-whether the government funds all 9k directly
-or funds some of the 9k and the parent pays some or all of the balance
- the new system has more generous grants
-I don't have ready access to the loan parental cutoffs but maybe you do?
the cash flow is obviously affected by the change from 15k to 21k repayment salary
so all in all I would very much like to see the overall cashflow effects and total overall costs0 -
grizzly1911 wrote: »If we accept the cost of a degree is £9Kpa (not saying it is) then the governments need to borrow is no different whether it is through a £3.5k loan or a £9K loan the only on difference is where it sits for nominal bookkeeping purposes at given point in time.
The loans for our two, one on either scheme are virtually identical so not sure how the cut offs have changed?
Some students will opt to pay the fees upfront, or even partially so there will be a slight reduction in government outgoing. Not only that but many students will reconsider university and instead opt to get a job if the degree isn't worth it.
But over the longer term this will increase revenues but could take a long time to see the effectsFaith, hope, charity, these three; but the greatest of these is charity.0 -
taking your figure of 9k then
the cost to the government depends the
-whether the government funds all 9k directly
-or funds some of the 9k and the parent pays some or all of the balance
- the new system has more generous grants
-I don't have ready access to the loan parental cutoffs but maybe you do?
the cash flow is obviously affected by the change from 15k to 21k repayment salary
so all in all I would very much like to see the overall cashflow effects and total overall costs
The 9K only refers to the tuition fee element of the newer scheme which is available to all and isn't income related AFAIK. It is the tuition element that has markedly changed between the two schemes.
On the old scheme if the student only paid £3.5k then the remainder of the cost was being born centrally. AIUI central funding to Universities has been substantially reduced with the introduction of the increased fees.
Some parents may choose to fund this upfront I would expect the numbers to be relatively low.
The main difference in cash flow is a reduction of £540 pa in the repayment rate if the income threshold is attained but with a 5 year extension to period."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Some students will opt to pay the fees upfront, or even partially so there will be a slight reduction in government outgoing.
I wonder what proportion will pay up front in reality?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
grizzly1911 wrote: »The 9K only refers to the tuition fee element of the newer scheme which is available to all and isn't income related AFAIK. It is the tuition element that has markedly changed between the two schemes.
On the old scheme if the student only paid £3.5k then the remainder of the cost was being born centrally. AIUI central funding to Universities has been substantially reduced with the introduction of the increased fees.
Some parents may choose to fund this upfront I would expect the numbers to be relatively low.
The main difference in cash flow is a reduction of £540 pa in the repayment rate if the income threshold is attained but with a 5 year extension to period.
presumably we are comparing the 6k max scheme with the 9k max scheme introduced last year
are you saying there has been no change in level of grants?
are you saying that the parental earning cut offs for grants and loans are unchanged?0 -
Grizzly,
I agree fully with your assessment of the situation; it is complete madness. The economy cannot continue to be a "self licking lollipop". Look what happened when the same thing happened by ballooning the public sector payroll (not knocking PS workers - im one myself! - just disagree with it's size...)
I think there is a middle ground somewhere - certainly scope to push the boundry out from the 5-10% "elite" of the 60s/70s. A reduction in numbers could, as your rightly say, allow for more state assistance for those talented youngsters who need a bit more help to get to University, and stop "qualification creep" - soon the Masters degree will become as widespread and blase as the generic 2:1.
Then there will be calls to make those free/funded too..! :eek:
I think the 40/60% will always be contentious until the Govnt bites the bullet and introduces some sort of official Graduate tax - but I cant see that happening. Personally, I would prefer a loan type arrangement, as you know that the darned thing will end one way or another, eventually, rather than pay an extra x% of tax for the rest of my life.
At the end of the day, I think the current version is pretty good (despite how it was whipped up to students who couldnt be bothered to read:money:s explanatory piece, etc). As you say, it is just numbers that are the 'problem'.....
D_S0 -
To compete with other countries people in this country need to be more qualified.
As the government cannot control universities directly, and believe in the free market then they cannot dictate (apart from in certain fields) the number of UK students a university can take on to a particular course.I'm not cynical I'm realistic
(If a link I give opens pop ups I won't know I don't use windows)0 -
There is an astonishing lack of understanding of the current student loan systems out there...
a student will apply for a loan to cover tuition fees (circa £9k). They will also qualify for a loan & grant of £5-9k per annum for living costs.
Loan repayments are calculated at 9% of any income above £21k per annum.
So, if we assume that a student has "borrowed" £50k in total over a 3 year course (fee loans, & also maintenance loans). They graduate, & have a fixed 30 year repayment timescale.
Let us assume they earn around the national average wage each year - currently just over £25k.
Repayments therefore work out at approx £360 a year (9% of £4000). Multiply that by the 30 years a person pays = repaying £10,800. The other £40k (plus any "interest") is wiped off the record!It's getting harder & harder to keep the government in the manner to which they have become accustomed.0
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