Showing posts with label Graduate Tax. Show all posts
Showing posts with label Graduate Tax. Show all posts

Thursday, 2 December 2010

More wriggling from the Lib Dems

I heard a Lib Dem MP verbally wriggling yesterday as he tried to explain why the proposed changes on tuition fees are not in breach of the pledge which his party made at the election in May.  His argument was that there were actually two elements to the pledge; the first was no increase in fees, and the second was to make the system fairer.  And they had succeeded, he said, in the second.
He actually went further and described the changes to the repayment rules as turning the fees from a debt into a graduate tax, because the amount owed was no longer a total which had to be repaid, but a maximum which people would repay according to ability to pay.  It was a valiant effort.
It does, though, highlight a point that I’ve made before; the difference between student debt and a graduate tax is more in the eye of the beholder than a difference of substance.  Simply calling it something different and changing the rules for repayment are not enough to alter the underlying fact that students are incurring a significant future liability in order to pay for their university education.
Changing the nomenclature and a bit of clever presentation are not the same thing as abolishing student debt, and making the system ‘fairer’ is not the same as overturning it.  But I guess that some politicians will continue trying to persuade us that they are.

Wednesday, 13 October 2010

Are fees the only option?

Watching Lib Dems wriggling over the proposed increase in tuition fees ought to provoke at least a degree of schadenfreude, but the issue is really too serious to take any pleasure from.

The outraged noises from the Labour Party are scarcely credible either. They not only introduced tuition fees in the first place, they also appointed Lord Browne to conduct the ‘independent’ review, and we all know that when governments appoint someone to such a role, they invariably choose someone ‘independent’ enough to give them the answer that they want to hear.

The Tories, like Labour, have see-sawed on the issue; what they say seems to depend on when – and where – they are in government, and when in opposition.

And it’s scarcely a secret that I’ve been less than wholly impressed with the stance of some of my own party’s elected members on the issue either – the attempt by the Assembly Group at the annual conference last month to end the party’s outright opposition to charging students for higher education was far from being their finest hour.

There is a problem, though. Far too many politicians are simply presenting the problem as a ‘funding gap’ or claiming that free higher education is ‘unaffordable’ without really spelling out the options. The problem has arisen as a direct result of governments trying to make the opportunity of a higher education available to a larger number of our young people, whilst not providing sufficient additional resources to universities to pay for the increase in student numbers.

There are, in fact, three ways of closing the gap therefore – reducing student numbers, increasing the contribution from general taxation, and charging students ever higher fees (and whether they’re recovered through repayment of loans or some sort of graduate tax supplement is more about presentation than principle). There’s nothing necessary or inevitable about the third choice – unless and until politicians choose to rule out the other options. And that’s the nub of the problem.

Personally, I’m clear that I would not choose to reduce student numbers. Indeed, I’d choose to try and provide a higher education for all those young people who a) meet the entry criteria, and b) choose such a route (although I’d also like to see more ‘parity of esteem’ between what we currently divide into the higher and further education sectors, which might actually serve to reduce the demand). Increasing the overall level of educational attainment of our young people, and helping them to realise their full learning potential, is something which I see as being in the long term interests of society as a whole.

It means, though, that it has to be paid for. The reason we’re being told that tuition fees - and increasing ones at that – are inevitable is because so few politicians are prepared to talk openly about the choices we face in terms of taxation policy. There is an assumption that proposing higher taxes to pay for higher education is a vote-loser – based on the other assumption that we all vote in an essentially self-interested way.

There is, of course, good evidence to suggest that those assumptions are entirely valid. The great victory of modern free market thinking has been to demolish the more collectivist approach which led to the birth of the Labour Party, and it is pretty depressing that the Labour Party itself has done so much of the demolition work.

The alternative to fees is to put the argument for collective purchase and provision of higher education through a progressive system of taxation. The question is whether we want to make that argument or simply accept the current political paradigm. Short term self-interest or long term collective interest? On education, as on so much else, I opt for the latter.