The Guardian’s view on new student loan reforms: under pressure | Editorial
SPhilip Augar’s review of post-18 education in England was commissioned by Theresa May in 2018, after the then Prime Minister was spooked by the popularity of Jeremy Corbyn’s campaign promise to abolish the student tuition fees. Four years later, the government’s response has finally come. But the reforms he unveiled last week are primarily aimed at saving Treasury money, rather than students. They are also shameless and deliberately regressive.
Although he talks a good game about adult education and further training, the government’s policy priority has always been to reduce the amount of university graduate debt that is never repaid – and for which the Treasury is responsible. It thus extended from 30 to 40 years the period during which loan repayments must be made and substantially lowered the salary threshold at which the money begins to be repaid. The number of graduates required to repay their loan in full is expected to rise from less than a quarter to more than half.
In partial compensation, the high interest rates charged on loans will be reduced. But this decision will massively benefit the highest-earning graduates. The Institute for Fiscal Studies has estimated that overall the changes will save the Treasury £2.3 billion for each university cohort. It’s money that will come from graduates on extremely low salaries who already have to worry about house prices and meager pensions.
The regressive approach is compounded by the Government’s apparent drive to reintroduce minimum GCSE and A-Level entry requirements for university – a move that would further reinforce social inequalities in educational achievement. A worrying consultation has also been launched on how to deal with ‘poor quality’ courses that do not provide well-paying jobs for graduates. It looks like a back door to reintroduce caps on the number of students in certain fields, as well as a license for philistine judgments about what constitutes the “value” of university learning. Freezing tuition fees until 2025 will lead to a sharp reduction in real terms in university income and teaching resources. It will further depress staff morale on campuses, where many professors have just completed another round of strikes over pensions and working conditions.
All of this amounts to stealth and painful pressure from Whitehall on the higher education sector: the net effect of financial reforms will be to make the prospect of a university education noticeably less attractive for some, and more of a perceived gamble .
This is the intention. The government wants fewer young people to graduate and more young people to consider higher education colleges, apprenticeships and vocational training as viable alternatives. The Augar review itself called for such a rebalancing. But despite the welcome proposal of a lifetime loan entitlement for non-graduates from 2025, nothing like enough money is being spent to reverse the impact of a decade of brutal cuts to the healthcare sector. Higher Education. Instead, the government is taking the lamentable but cheaper option of increasing disincentives to taking the academic route. As the financial war of attrition of our universities continues, the only real winner from the government’s response to Augar’s review is the Treasury.