In Defence of Top up fees
Do you want Britain to have top quality Universities? If your answer is ‘yes’ then you must acknowledge that with quality comes cost, and that there is no such thing as a free lunch. If you want the best, you must pay for it. In a globalising world, this means tough decisions.
Top up fees are the fairest and most pragmatic way of paying for those first class Universities we all want to see; they combine progressive redistribution of wealth, financial aid for the poorest students, more cash for Universities and a fair deal for the general taxpayer. They are an imperfect way to satisfy as many people as possible, and isn’t this compromise the meat and potatoes of governing?
A quick look at the alternatives for University funding makes the case for the fees even more convincing. Massive increases in general taxation are politically impossible, as well as being unfair to the taxpayer and harmful to the economy. The system as it was, with student grants and up-front fees, was regressive and elitist; working class taxpayers were essentially subsidizing middle class students. A London School of Economics study revealed that, under the old system, 81% of the children of professionals went to University, compared with only 15% of kids from poor families – this is why the Tories opposed top-up fees, they were simply playing their usual role as defenders of class privilege.
The NUS (an odd Tory bedfellow) is wrong about top-up fees, and has been from the beginning. By acting the populist demagogue and opposing them they are in effect campaigning to entrench middle class perks.
Central to NUS opposition to top up fees is its continued wailing about the large amount of ‘debt’ students will leave university with – as much as £25,000, in some cases. This is not distinguished from other types of debt – credit card dues for example, and as a result potential students might be scared away from the benefits of higher education.
It must be repeated again and again that a student loan is not as unforgiving as any other. Repayments are 9% of earnings above £15,000. Thus someone earning £18,000 repays £270 a year, or £5.19 a week, a deduction on the payslip alongside income tax until the loan has been repaid.
Income-contingent loans are very different from credit card debt, which has a high interest rate, a short repayment period and no forgiveness if earnings are low. Student loans have built-in insurance: low earners make low or no repayments; repayments drop to zero if someone stops earning; people who never earn much do not repay; and any loan that remains after 25 years is forgiven.
It is disgraceful that the NUS does not do more to explain the new system to students, especially to less well off income groups, who proportionately benefit out of the new arrangements. On average, graduates earn 50% more in their lifetime than those without a degree; to be blunt, they can afford to pay. Higher education is free for students; it is graduates who pay for it.
The case can also be made for an increase in top up fees. A recent survey of University Vice Chancellors has shown that a good proportion of them believe that there will have to be further rises in top-up fees when the system comes under review in 2009.
Many VC’s are casting their glances enviously across the Atlantic, at American institutions of Higher education – they are swimming in cash; oodles, mountains, piles of the stuff. Harvard has an endowment of over $25 billion, five times that of its nearest overseas competitor – Cambridge. Nine of the top ten best funded Universities in the world are in the US, and they routinely charge their students much more than we are currently paying. In today’s world wealth equals power and this is true in Academia as well as on Wall Street.
The key to freeing up our higher education system is to lessen its dependence on the miserly government for its funding – top up fees are the first step on a long and difficult path of reform.
When combined with a commitment to get 50% of young people in higher education by the year 2010, top up fees are part of a radical and progressive policy towards higher education, and one of this Labour governments finest (and bravest) domestic policy achievements. Bravo, Messrs. Blair, Clarke and Brown!
-posted by Adam
Very brave of Brown to impose a measure on English students and parents that does not apply to his own constituents. Bravo indeed. Bravo to all Scottish MPs that voted for this, and bravo to the Labour Party for gerrymandering the constitution to allow them to do this. (Comment this)