MSE News: Autumn Statement 2015: Hidden hike in student loan repayment a 'disgrace'

magpiecottage

If this was a commercial loan, a complaint to the Financial Ombudsman Service where it was shown that it led its customers to believe one thing and then did another to the customer's detriment would almost certainly be upheld.

I think this move will be seen as putting the "Con" back into Conservative and reminding us that they are really the Nasty party.

Paul_Herring

dizzie wrote: »

That's interesting Paul, although I guess the key word is "NET".

It's unclear why you seem to pick up on that nor why you chose to use scare quotes. After all costs to the taxpayer have been taken into account (including the actions of everyone who drinks), they (as a group) are still contributing that net figure.

and the person I refer to has definitely had more financial input in terms of disability payments, healthcare costs and eventually nursing home costs than he has ever earned, let alone paid tax for.

I'm sure the argument could be made in the opposite direction for someone who's never had to go to hospital, be dealt with by the police etc, but still pays their excise duty on their sin-taxable habits.

Nevertheless, after lumping both groups together to get a total figure, smokers and drinkers are net-contributors, and if everyone were to stop smoking and drinking tomorrow, where do you think the shortfall in excise duty on those products are going to come from? The tee-totallers and anti-smokers of course.

silvercar

photome wrote: »

thats irelevant

would you expect your bank/builiding society to make retrospective changes to your loan conditions or because you needed the loan that it is ok

Some did change the T&Cs. Base rate trackers a couple of lenders used the argument that they couldn't have been expected to foresee that interest rates would stay for such a long time at such a low level so they backtracked.

dizzie

silvercar wrote: »

Some did change the T&Cs. Base rate trackers a couple of lenders used the argument that they couldn't have been expected to foresee that interest rates would stay for such a long time at such a low level so they backtracked.

Really? Which ones? And was there a legal challenge (because they wouldn't have got away with it). In Europe at the moment some mortgage lenders are having to charge negative interest rates on loans! I'm sure if there was a legal "get out" clause then they'd all do it. So I'd be interested to examine your claim in more detail if you could let me have more info.

As for you Paul...maybe I'm touching a raw nerve with you, but my statement was broader anyway and you've chosen to focus on one study which talks about alcohol. I specifically talked about those who ABUSE their bodies - which could be by EXCESS alcohol, or smoking, or by being a couch potato, eating junk food and getting obesity associated diseases!

You see, I'm not tee-total, but neither do I get rat-ars*d on a regular basis. So those stats you quoted show the irresponsible drinkers being propped up overall as a NET effect by the responsible ones! The evidence for smoking is less clear what from I can see, and since there is no couch potato tax - and a myriad of other ways by which a person can abuse their body, I think your argument is rather weak.

So I'll still stand by the fact that people DO want the services of educated people and that we'd all be vastly worse off if no-one went to university and gained those skills. These skills DO NOT come with a guarantee of a fantastically high wage. (The rubbish the government quotes is from stats a decade old when fewer people went! ). And saddling people with such large sums of debt whereupon Her Majesty's Government can opt to chop and change the rules as they chose - AND backdate them, is not on!

£9000 per year - particularly for courses which are only a few hours a week is a rip off. It is not value for money! In fact your apprentice Electrician on day release to college probably gets almost as many hours of educational input in college per year as some undergraduates...and they certainly don't get charged £9k per year for the pleasure! Maybe you want to think about what we are doing wrong here in the UK. I mean, none of our European neighbours are doing this to their young people. Indeed although we quote America as having fantastically high tuition fees, that is really only for the minority of unis....and US citizens if they wish can still go to university for less money than English students studying in the UK. So why are we being the trailblazers in this awful social and financial experiment?

JimmyTheWig

Paul_Herring wrote: »

No. It's not a tax rate, effective or not.

It's a loan repayment. Most of which won't be happening anyway.

Presumably those figures were based on the £21,000 going up with inflation.
If it is to be frozen, a lot more will be repaid.

dizzie

JimmyTheWig wrote: »

Presumably those figures were based on the £21,000 going up with inflation.
If it is to be frozen, a lot more will be repaid.

They have not even guaranteed to raise this threshold in 2021 so the effects of inflation could be far worse.

If I could just point out another couple of inconsistencies in the conmen goverment's reasoning:

1. They say a loan is worth it because graduates earn on average, over £100,000 more than non-graduates (using an extrapolation of data which was retrieved more than 10 years ago though, when fewer people went to uni)

2. They say that they are having to freeze the threshold because graduate earnings are lower than they expected them to be.

Furthermore, you may recall that the rate of interest charged depends on your income, with 0.15% added for every £1000 more you earn above £21,000 until you reach £40k when the interest rate rises to the full RPI PLUS 3% again. That's also frozen, so due to the effects of inflation, you'll be accruing more interest on your debt than you might expect.

For anyone with a Facebook account, I'd really like as many people to post their objections to the FB page for 10 Downing Street. And don't do it once, do it at least once a week! We might not have the power to overturn this immoral retrospective decision, but we can make our views heard loud and clear by posting our objections on a regular basis on the Government's social media and make them aware that we have long memories and we're not just going to "go away".

And its not just students they are after: a director of a Conservative created think tank said when targeting cuts at the elderly, the government might as well go for it now rather than wait because in five years time, many of those elderly voters may not be around, and if they are then they'll have forgotten who did what to them! Utterly despicable for someone to be promoting that death or dementia can be taken advantage of when it comes to securing votes next time round. I'll never again vote for this lot! :mad:

phillw

dizzie wrote: »

Really? Which ones? And was there a legal challenge (because they wouldn't have got away with it).

There was and they did.

http://www.property118.com/westbromtracker-today-judgement-day/71935/

It all comes down to legal interpretation of the T&C though. Most banks would rather not have the bad press and legal costs.

The government is bound by the same laws, so you could complain to the relevant ombudsman.

I'm not sure how "I never intended to pay off this loan I entered into and now looks like I might be forced to" will play out and you might have to make an expensive legal challenge.

Maybe the government are hoping that nobody will bother, maybe they think they have a water tight case or maybe they think they can get away with it.

I suspect Labour or Lib Dems would be making exactly the same changes or worse if they were in power. After the last Labour government, we're lucky we didn't end up like Greece.

With negative ECB rates the banks in Europe offering negative interest rate loans are probably not that unhappy, they are charging customers for depositing money too. It is the difference between the rate they lend and borrow at that is important.

The government however doesn't have any money, it's our money that is being lent out. So if students don't pay it back then you and I do. Maybe I'm just jealous as I didn't get the opportunity, but don't expect sympathy from everyone.

Paul_Herring

phillw wrote: »

The government however doesn't have any money, it's our money that is being lent out. So if students don't pay it back then you and I do. Maybe I'm just jealous as I didn't get the opportunity, but don't expect sympathy from everyone.

Now, I'm not a home owner, and don't plan to be - how do I get that £3,000 back that they're giving away to first time buyers?

And about that child benefit for the 5 kids I don't (and won't) have - how do I claim that back?

Oh - and my full time private sector job precludes me claiming quite a few other benefits - I'd like that money back too...


Yeah - no real sympathy here either.

callumst

Most degrees in university are redundant, I would urge those (and parents) considering uni to seriously consider what they study and if there are any job prospects at the end of it. I know people who have studied subjects where they are told by the university lecturers there is almost no hope of getting a job with this. If these courses didn't exist, or full payment had to be made upfront then the successful courses wouldn't subsidize them. People are studying archaeology because they enjoy it, which is all well and nice but there are hardly any jobs in it. Look at it from an investment perspective, do you want to waste 3 years enjoying something but paying £40k+ and getting no job at the end of it? Good courses at good universities are relevant. Take my course, its roughly 95%+ employed within 3 months after graduating (how many are over £21k and in the same field I don't know), but I know that without a degree in my industry it would be very difficult to find a good job.

All universities should publish their employability stats for the course (% employed after graduating, on salary above, and in the same industry), and students should be warned the government WILL change the repayment to screw you over. Our University was saying "don't worry about the student loans in 2012, it's only the cost of a few pizza's a month".

Look at student loans in the US, its the next housing bubble. Students graduate owing hundreds of thousands in loans which can't be written off even if you declare bankruptcy, and you have to pay them back whether you are earning or not.

My course earns millions a year from 300 students and only a handful of staff, where does all that money go? If I was asked to pay £3k a year in fees upfront, or within one year of studying. Otherwise it will be £9k with interest from the government, I would have chosen the £3k in fees which you could earn working summer and part-time jobs. Our university justifies the high fees as being "competitive with other universities". Hang on, it's competitive meant to be lower? And just a year earlier they were saying no way will we charge £9k, now look at them - they all are. The Vice Chancellor got found out for tax avoidance too, employing himself through a limited company.

People say the student loans won't ever be repaid for most people. If the threshold is frozen forever or long enough, every single person will repay who is in work. Even if you are on minimum wage working part-time, the wage could still be over £21k many years from now.

phillw

callumst wrote: »

Most degrees in university are redundant, I would urge those (and parents) considering uni to seriously consider what they study and if there are any job prospects at the end of it.

Due to popular crime drama tv programs there was a huge demand for some forensic course a few years ago. There was only one position in the uk that it would qualify you for and it was already filled. Most people going to university have no clue about life in the adult world and don't know how to work out the right qualifications to get, their parents are either clueless, don't care as long as it gets their kids out of their hair or have tried explaining but their kids refuse to listen to them.

The people who know what to do are already getting good jobs at the end of it. The rest are pretty much going for a three year (or longer) university experience.

Paul_Herring wrote: »

Now, I'm not a home owner, and don't plan to be - how do I get that £3,000 back that they're giving away to first time buyers?

At least you still qualify for it, if you ever change your mind. All the people who have already scrimped and saved to buy a house don't. OT but some people were complaining on the radio that all the help the government was offering was not enough because they would have to give up going out to buy a one bedroom flat and they shouldn't have to sacrifice their quality of life.

I don't care what these hedonistic loafers do, but I'm not subsidising it.