Review set to propose cuts to tuition fees and interest rates on student loans

By Blundell

The Augur review of post-18 education and funding is expected to advise the government that tuition fees and interest rates on student loans ought to be reduced.

The report is expected to call for annual tuition fees to be cut from £9,250 to £7,500, whilst advising that interest rates on student loans be reduced from 6.3% to as low as 1.5%.

The review, chaired by the banker Philip Augur, aims to relieve financial pressures on young people and present them with vocational alternatives to pursuing a university degree.

Other possible recommendations, according to the Times, include a lengthening of the payback time on loans to beyond 30 years, more loans to cover student living costs, more support for part-time degrees and a possible return to the means-tested grant.

Damian Hinds, Education Secretary, said that “poor value” degrees are “letting down thousands of students and costing the taxpayer millions.”

Hinds released an analysis of tax data, which demonstrates that, on one in ten university courses, three out of four students were earning less than £25,000 five years after graduating.

Some academic areas are suffering considerably worse than others in this respect, with the creative arts student receiving an average salary of £20,000 five years after graduating. Agriculture, psychology, communications and English are also comparatively under salaried.

Hinds suggested that he is willing to tackle university vice-chancellors, as he dismissed the claim that universities would go bust as a result of such an action was “scaremongering”.

Alistair Jarvis, Chief Executive of Universities UK, reacted with scepticism. He commented that cuts to tuition fees “could lead to bigger class sizes, poorer facilities, labs and libraries, a worsening student experience and job cuts.”

“Students are right to expect value for money and universities are striving to deliver this and address any concerns. However, salary outcomes shouldn’t be the only measure of value.”

In February 2018, commented that universities were better funded now “than they have been for a generation.” With May set to leave Downing Street on the 7th of June, this report is likely to be the last significant one she will face as Prime Minister.

Photograph by Maddie Flishler

One thought on “Review set to propose cuts to tuition fees and interest rates on student loans

  • The earnings data is frankly a bit idiotic. In around 1 generation (30 years), University attendance among 18-25 years old has risen form around 15% of the group to somewhere around 44%. The number of graduates level jobs paying salaries that may have been expected in the 1980s can’t keep up with that kind of growth. So what has happened in stead is that jobs that were previously open to those who had a couple of A Levels, like entry into the civil service or the junior end of banking (or their equivalents), now effectively demand a degree. But the pay for those jobs isn’t increased I line with that. Is it any wonder that early career graduate salaries are so low, or that so many students struggle financially?

    The current funding model is an example of just how badly the market model works. and it’s pretty much held together with sealing wax and string, as the black hole of student debt grows ever bigger. The one thing Augur doesn’t seem to talk about in great detail is whether the University sector needs to be this big at all, or whether the innate British snobbery of degrees v other kinds of qualification. Qualifications like skilled apprenticeships. This may be playing a role in a mad scramble, pushing institutions to offer qualifications that those in government don’t recognise as “valid” because of the intellectual and social monoculture many of them came from.

    Part of Augur looks to rebalance the mix between HE and FE, which is why do of the tuition fee cut is proposed, but its smoke and mirrors, because the government don’t want to spend money on education. It’s not sexy, and there little money to be made for the private sector without causing significant upheaveal, and possibly open revolt.

    It’s just another car crash waiting to happen, and another generation of students will get a shittier deal than their antecedents, only to be told to like it or get lost.

    Reply

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