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  • FIRST POST
    • Former MSE Helen
    • By Former MSE Helen 9th Nov 11, 9:52 AM
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    Former MSE Helen
    MSE News: Confusion reigns as student fees fear takes hold
    • #1
    • 9th Nov 11, 9:52 AM
    MSE News: Confusion reigns as student fees fear takes hold 9th Nov 11 at 9:52 AM
    This is the discussion thread for the following MSE News Story:

    "Poll results reveal lack of understanding over new tuition fees, as many expected to hit the streets today in protest ..."

Page 1
    • michaels
    • By michaels 9th Nov 11, 10:20 AM
    • 22,394 Posts
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    michaels
    • #2
    • 9th Nov 11, 10:20 AM
    • #2
    • 9th Nov 11, 10:20 AM
    I always laugh (what else can you do) - what is being introduced is basically a graduate tax, something the Tories never wanted and the Lib Dems until a few years ago were in favour of.

    And yet politically it has been presented as a fees system which it isn't to satisfy Tory back benchers who haven't got what they want and meanwhile the Libdems are being crucified in the polls even though they have got something they were broadly in favour off.

    The reason the Tories are in favour of fees is that they should encourage students to choose degrees on the basis of their value in employment and colleges to innovate to compete on fees - in fact this won't happen as almost all courses cost the same.

    As I say, you have to laugh because otherwise you would cry.
    Cool heads and compromise
    • callum9999
    • By callum9999 9th Nov 11, 10:39 AM
    • 3,950 Posts
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    callum9999
    • #3
    • 9th Nov 11, 10:39 AM
    • #3
    • 9th Nov 11, 10:39 AM
    I would hardly call that a shambles. I would describe it as the typical mentality people in this country (and probably many others) have of moaning about something while putting absolutely no effort into finding out anything about it.

    The information is out there, and if these (prospective) students are incapable of finding it before travelling across the country to protest against it - are these really the sorts of people we would want to be paying to go to university for anyway? If they can't find information about something they are seemingly so passionate about, how on earth are they going to cope with researching topics they will likely have little interest in once at university?

    It's all well and good moaning about how communication should be clearer, but short of forcing everyone going to the demo to read the website about it beforehand, what else should they do? If they make a speech or release a press release on the matter, the average student will just completely ignore it (probably under some guise of "politicians are always lying anyway").
    • Paulgonnabedebtfree
    • By Paulgonnabedebtfree 9th Nov 11, 10:43 AM
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    Paulgonnabedebtfree
    • #4
    • 9th Nov 11, 10:43 AM
    • #4
    • 9th Nov 11, 10:43 AM
    I imagine that the legislation has covered this possible loophole but have wondered how someone might be affected if they set up a limited company straight after university.
    e.g. drawing a salary of under 21k for the next 30 years but leaving profits in the company, living in the "company owned" house, driving the "company owned" car etc. Indeed, maybe even not drawing the 20.99k as salary at all but taking it in dividends for the tax advantage.
    When/if an extra salary is paid eventually, that could go to spouse or significant other although the former student would obviously benefit from this.
    As I say, if a lowly pleb like me can think of this, I'm sure the powers that be have also taken it into account.
    • Cat2011
    • By Cat2011 9th Nov 11, 11:07 AM
    • 476 Posts
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    Cat2011
    • #5
    • 9th Nov 11, 11:07 AM
    • #5
    • 9th Nov 11, 11:07 AM
    If you don't know the in's and out's of the new system by now then you're probably too daft to go to uni anyway. There are plenty of sources of information.

    I just wish they'd hurry up and decide if you can overpay. As a prospective student next year I want to start sorting out how to finance it.
    Debt-free 27th July 2012!
  • 2sides2everystory
    • #6
    • 9th Nov 11, 11:32 AM
    • #6
    • 9th Nov 11, 11:32 AM
    If you don't know the in's and out's of the new system by now then you're probably too daft to go to uni anyway. There are plenty of sources of information.

    I just wish they'd hurry up and decide if you can overpay. As a prospective student next year I want to start sorting out how to finance it.
    Originally posted by Cat2011
    You might be forgiven Cat2011 as you are starting out (although your declared debts and savings suggest that you might be more mature than average!), but doesn't your post on second reading kind of cause you to be contradicting yourself in your second paragraph?

    Even you don't know all the in's and out's of the new system needed to make your personal plan and you are well into preparing or even finalising perhaps your UCAS applications by now.

    And when you look at the vagaries of the interest rate in this climate, you are never going to be able to come up with a reliable forecast of what actually you will pay if you really do plan to overpay if it is permitted. And how long will the threshold be 21K, the rate 9% and the payback limit 30 years? Do you know those in's and out's Gunga Din ?

    People who are questioning the scheme are not daft, they are concerned. They may have more concerns than you who now merely wants to find out definitely whether overpayment will be permitted.

    To even be considering overpayment suggests that you have done some forecasts already about the interest rates and don't like them, and that you don't like a 9% additional higher rate tax. It implies you have the independent means to buy your way out of the "wage slave" set up that most students are being shoo-ed into signing as they only have one choice - sign or don't go. Yet with 4 credit cards on the go, unless you have stumbled on some secret special retro Balance Transfer deals of the type I was using 10 years ago to buy property at a true 0% (no fees) then surely you must be counting on either a very highly paid job between now and when you go to university or an inheritance of some kind? What is your rationale for overpaying out of interest?

    Sincere best wishes for getting on to your preferred course next year and making it all work for you.
    Last edited by 2sides2everystory; 09-11-2011 at 11:50 AM.
  • alexlyne
    • #7
    • 9th Nov 11, 11:33 AM
    • #7
    • 9th Nov 11, 11:33 AM
    i'm with those who blame the prospective students for not getting off their bums and actually finding out this information. I haven't been a student for years yet I know more than they do - how is that possible, it doesn't even interest me that much. 'Wow' is all I can say. It's certainly a scandal all right!

    If the news in question was 'students don't know how much their university will charge for their education as many want to change the amount they said they would charge', then that would be a valid argument in my opinion.
  • 2sides2everystory
    • #8
    • 9th Nov 11, 11:48 AM
    • #8
    • 9th Nov 11, 11:48 AM
    What do you think you know alex?

    Do you think you know that save for the richest students for whom 50K is a mere bagatelle, that the scheme is a tax?

    If yes, do you think you know how that tax might be changed if the UK economic outlook becomes dire?

    Do you think the UK economic outlook will become dire?

    Do you think you are a fatalist?
  • alexlyne
    • #9
    • 9th Nov 11, 12:13 PM
    • #9
    • 9th Nov 11, 12:13 PM
    I think I know that I don't know everything - else that's what I would have written?
    I'm vaguely aware that the majority of students can be safe in the knowledge that they'll never pay back all of the debt they accrue, so not much point planning to try to overpay it, or determine the financial implications between an 8k uni and a 9k one. And because of that, it does amount to a 30 year tax on those earning over 21K at a rate of 9%... blah blah it's all written down pretty much everywhere. And the system will fall down as universities get their 9k a year from the government and students will pay only a fraction of that back, so where does the shortfall come from - but that isn't a question that really applies to a would-be uni student deciding their career options.
    • anselld
    • By anselld 9th Nov 11, 12:52 PM
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    anselld
    It is not communication which is a National Scandal, it is the huge increase in fees and the level of debt students are expected to carry for a decent education.

    They are not protesting for better communication; You don't need to have two brains to work out it is much more expensive in the new system to go to University. That is why they are protesting.
  • 2sides2everystory
    ... And because of that, it does amount to a 30 year tax on those earning over 21K at a rate of 9%... blah blah it's all written down pretty much everywhere.
    by alexlyne
    So alex, essentially you are content to just buy the sales pitch as it stands (or at least to recommend that our young people do so)? If they did so, should they be focussed on buying a certain university education or should they focus on a personal plan to deal with how the financial commitment might work? Or if you like - how much emphasis should they put on each?

    Is it actually just a simple measure of one versus the other? I mean for every 10 hours they spend choosing the right course, should they spend one hour perhaps on tuning a cashflow forecast for their first 30 years after graduating? Or less perhaps, because it has already been worked out as "less to worry about than last year" and "you pay back just 9% of earnings over 21K" and "most people will never have to pay it all back before the 30 years are up ?

    If like you, they are minded to buy into something like that as pitched, need they even look at the price of their chosen course be it 7,500pa for 3 years or 9,000 for 4 years? Need they be concerned about future increases in RPI?

    Perhaps you would say no, those too are irrelevant because the fact still is that there's "less to worry about than last year" and "you pay back just 9% of earnings over 21K" and "most people will never have to pay it all back before the 30 years are up ?

    OK then, so about the 9% and the 21K and the 30 years. How do we know those will survive as real limits that our young people can trust if there is no track record of such payments, no history, no pathfinding until someone starts paying and not until 2015 at the earliest?

    How sure can we be that UK will not by then be facing austerity measures as bad if not worse than those affecting Greece today? Greece has frequently fired tear gas at its students this year. What might we fire at ours by 2015? 19% / 11K / 50 year paper perhaps so as not to hurt them too much?
    • Taiko
    • By Taiko 9th Nov 11, 1:12 PM
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    Taiko
    It is not communication which is a National Scandal, it is the huge increase in fees and the level of debt students are expected to carry for a decent education.

    They are not protesting for better communication; You don't need to have two brains to work out it is much more expensive in the new system to go to University. That is why they are protesting.
    Originally posted by anselld
    Have you actually read the article?
    • gadgetmind
    • By gadgetmind 9th Nov 11, 1:17 PM
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    gadgetmind
    Even you don't know all the in's and out's of the new system needed to make your personal plan and you are well into preparing or even finalising perhaps your UCAS applications by now.
    Originally posted by 2sides2everystory
    The reason that cat2011 doesn't know about how overpayments work is because HMG haven't decided yet, or if they have, they haven't told anyone yet.

    I am also holding off until this is decided. If they won't allow overpayments without penalties, then they can stuff their loan.
    • jrawle
    • By jrawle 9th Nov 11, 1:23 PM
    • 235 Posts
    • 137 Thanks
    jrawle
    It is not communication which is a National Scandal, it is the huge increase in fees and the level of debt students are expected to carry for a decent education.

    They are not protesting for better communication; You don't need to have two brains to work out it is much more expensive in the new system to go to University. That is why they are protesting.
    Originally posted by anselld
    I think you have just proved the point of the article!
    • jrawle
    • By jrawle 9th Nov 11, 1:29 PM
    • 235 Posts
    • 137 Thanks
    jrawle
    As other people have commented, if someone is incapable of understanding the new student finance scheme, are they really bright enough to go to university?

    If anyone is guilty of poor communication, it's not the government, but the media and most of all the NUS. The latter have done a huge disservice to many students - particularly those from poorer backgrounds - by leading them to believe they won't be able to afford university now, rather than pointing out that it makes it more affordable and that they may never even have to pay back what they've borrowed. (Plus the often-forgotten fact that a student "debt" isn't considered a debt when taking out a mortgage etc.)

    The media want to make a political point out of it, an excuse to bash the government. And the NUS want an excuse to protest. Both could have played a valuable role by educating the public about the new system rather than scaring them.
    • gadgetmind
    • By gadgetmind 9th Nov 11, 1:32 PM
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    gadgetmind
    I think you have just proved the point of the article!
    Originally posted by jrawle
    Not if it's your intention to pay off the loan early. Under the new system, the loan is larger, the interest rate higher, and repayment penalties still undecided.
  • alexlyne
    I didn't starting paying back my loan until 5 years after I graduated. At that point I owed around 8K. I am still less than halfway through paying it under the current system after nearly 4 years (with above median salary). If the kids are going to graduate with over 30K of debt, and paying a lower amount while interest rates will be higher, then unless your career plan is 'earn 50K', then even people with above average salaries will not pay it all back in 30 years, so it seems pointless to try to pay it back early (unless you're guaranteed that super-high income of course). Whichever way you look at it, students are still so much worse off come next year.
    For me, it was repay a loan, or get a house to provide security for myself and my family. Other peoples priorities are different and I respect that. Let's hope that there are plenty of jobs in 2015 though
    • gadgetmind
    • By gadgetmind 9th Nov 11, 2:25 PM
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    gadgetmind
    unless your career plan is 'earn 50K'
    Originally posted by alexlyne
    Starting on 50k is perhaps unrealistic, but it's a reasonable number to shoot for later as your career progresses.

    even people with above average salaries will not pay it all back in 30 years
    They will pay the principle many times over, and a shed-load of interest on top.

    unless you're guaranteed that super-high income of course).
    Whether this is a high income from someone with a good degree is perhaps left to a different thread.
    • jrawle
    • By jrawle 9th Nov 11, 2:38 PM
    • 235 Posts
    • 137 Thanks
    jrawle
    Not if it's your intention to pay off the loan early. Under the new system, the loan is larger, the interest rate higher, and repayment penalties still undecided.
    Originally posted by gadgetmind
    None of that is relevant when considering whether the new system has been communicated well, which was the point of the article. anselld either hadn't read the article, doesn't understand the system, or both.

    As Martin often points out, many people would be very ill-advised to overpay as they are likely to pay more overall than than if they didn't.
    • gadgetmind
    • By gadgetmind 9th Nov 11, 2:45 PM
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    gadgetmind
    As Martin often points out, many people would be very ill-advised to overpay as they are likely to pay more overall than than if they didn't.
    Originally posted by jrawle
    That depends on what assumptions you make in your mathematical model. Based on the most likely scenario, my daughter will be better off clearing the debt as early as possible BUT that depends on repayment penalties, which haven't yet been announced.

    Not bothering with the loan is an option for her/us but taking one out derisks the scenario where she fails to complete the course.

    I've got everything in spreadsheets but, 1) she needs to get the offers and medicine is "somewhat competitive" and 2) HMG need to decide regards penalties.
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