I see with interest that in today’s Independent on Sunday, you’ve challenged me to “come clean” about “just what my proposals are” for a graduate tax; asking for an “open contest” comparison. You will remember I wrote to you earlier in the week suggesting both a meeting and an open debate. Although I’ve had no reply other than reading your comments in a Sunday newspaper, I’m delighted to respond. Here’s ten reasons why I think our proposals are fairer and more progressive than yours.
Firstly, our proposal for a progressive graduate contribution scheme would have retained the idea that the state, as well as the individual, should contribute to the cost of Higher Education. Your Government’s decision to transfer the whole cost on to the individual through a loans system is the ideological choice of group who believe that Higher Education should only be available to the richest. I'm sure they are amazed at your willingness to go along with it and they’re not the only ones.
Secondly, under our proposals, earners in the lowest quintile would have paid less than £500 for university; those in the next quintile about half what they do now and those in the middle quintile roughly the same as now. It would only have been those who really benefit that would have paid more. Under your Government’s proposed scheme only the bottom 25% of earners would pay less overall- meaning 75% pay more. Our version of a graduate tax would have been more progressive.
Third, you’ve argued that your proposals are fairer because graduates would only start paying back when they earn £21,000 as opposed to £15,000 in our proposals drafted in 2008. You omit to mention that this is £21,000 in 2016 money, and that the threshold won't increase until 2021 (not even Vince Cable had worked this out when he spoke about it on the radio earlier this week). Under our proposals the repayment threshold would have moved every year in line with inflation.
Fourth, you say that your proposals are fairer because so many students never pay back their debt under your scheme. Being in debt for the next 30 years of our lives is not something we want to celebrate as progressive- and never paying off a debt is something I was raised to believe is a source of shame, not progressive pride.
Fifth, your proposed system introduces course price as a factor in student choice. Even if the system of loans and repayment makes it easier for a student to get into and then pay off debt (and I dispute your assertion that it does), there are still significant problems with a system that includes fees and course prices. It is ridiculous to assume that students won’t take the price of a course into account when choosing it, regardless of the repayment mechanism. A truly progressive system is one where students are able to make decisions according to their ambitions and aspirations without concern at all to price or potential returns (as remains the case in the proposed system), or viability in relation to the support they could obtain. A modified graduate tax would have removed price as a determinant in student choice.
Sixth, your system means that higher contributions go to rich institutions and lower ones to poor institutions. By operating a “fees and loans” scheme instead of graduate tax, it means that the higher payments from richer graduates end up flowing into the universities that are already richest, with the fewest poor students to support, the most endowment funds and the best asset bases. This means that, apart from the few on “golden ticket” scholarships, the poorest students go to the poorest institutions and the richest students end up topping up the richest institutions. There’s no sense in a progressive payment system if the outcome effects are regressive. Our modified graduate tax would have meant a fair distribution of the extra contributions that the richest graduates make to all universities.
Seventh, you have said you will look at “early repayment penalties” on loans (although we’ve had no detail yet). But this misses the point. By operating a fees and loans scheme, it is possible for the richest families to avoid taking out loans altogether- meaning that the children of (in your words) “Goldman Sachs Bankers” can avoid having to pay more at all. A modified graduate tax would have meant that those who financially benefit the most from their education pay their fair share in later life.
Eighth, your proposed system supposedly offers students more “consumer power”, helps drive university efficiency and improves quality. In truth your proposals offer virtually no enhanced rights or power to students over their provision. And there is no evidence from any other country that a market in Higher Education would work to improve efficiency- in fact most other countries’ evidence points to the opposite. There is also no evidence at all that the “market” improves quality or that there is any link between the quality of teaching and the price paid. The supposed “link” between a student paying an institution and it responding to student need is faulty, and a cover for an ideological attempt to marketise HE. Our modified graduate tax would not have pretended that students paying more automatically means they get more.
Ninth, the key determinant of university access is achievements at level 3. We wouldn’t have swapped £450m in maintenance support for the poorest at school and college doing A levels for a third of that in golden ticket partial scholarships to universities. What's the point in free first years for the poorest if they drop out of college before they get there?
But finally and tenth, your manifesto said you’d scrap fees. Your signed pledge said you’d vote against an increase. Your video address to my conference said you’d “vote against, campaign against any increase in that cap”. Your proposal takes student fees and debt and triples them. Ours would have taken fees and debt and abolished them.
Students are angry about your proposals because they are unfair, ideological and represent a massive betrayal of the students who voted for you. That is why they want your party to vote against them and not because “It’s great going on demos and really having a crack at the government of the day”.
NUS National President
PS- The vote on Thursday is a vote on the cap. It's not a vote on making fees progressive, or your scholarship fund, or reforms to deliver better value for students. Tripling fees before Christmas with a vague promise to make them more progressive after Christmas, on the thin excuse of prospectus deadlines, is nothing short of a disgrace.