Monday, 2 October 2017

Conservative hypocrisy on student loans

Although the coalition government did not get rid of the student loans system, Vince Cable as Secretary of State for Business, Innovation and Skills managed to extract some concessions from chancellor of the exchequer George Osborne. One of them was clearly the guarantee to index the repayment threshold, because it was something that Osborne lost no time in withdrawing when the Conservatives gained an absolute majority in 2015. Now Mrs May's PR people are hailing as a great new offer to students what looks like merely returning to a coalition policy.

This "U-turn" would still leave the repayment threshold below the average household disposable income of £27,200. If England is to retain the student loans system, it should surely reflect the uplift that a university degree is supposed to confer. Residents of non-EU origin are liable to be deported if they earn less than £35,000 p.a. This looks like an arbitrary figure, rather than a reflection of an above-average contribution to UK society - why not bring the two figures into line at, say, £28,000 (index-linked)? If the chancellor is not willing to do that, then he should cut the punitive interest rate on student loans - and stop the periodic sellings-off of loan books to commercial interests.

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