Das „zum Scheitern verurteilte“ Studiendarlehenssystem könnte durch eine Graduiertensteuer ersetzt werden, sagt ein ehemaliger Wachhund
https://www.independent.co.uk/news/uk/home-news/student-loan-replaced-graduate-tax-office-for-students-b2914025.html
Von tylerthe-theatre
41 Kommentare
Im not sure, it depends on the details but I had loans and have paid them off so I wouldn’t be happy at all at having to pay twice and I think many would agree. Unfortunately universities are incentivised to charge the maximum fees and to stack their halls to the rafters with students regardless of how good or viable the degree is. If this goes ahead we need a new system one where it’s likely less people go to university but that we have other good training on offer and universities go back to how they were 30 years ago.
It’s already a graduate tax.
Also, sounds like they want high earning PAYE piggies to continue to pay after clearing the loans.
Changing the deal after the fact is **not** OK.
This isn’t difficult lmao just have a fixed interest rate. How is this even a debate?
They should just cap the interest to half your repayments. That way you can at least make progress on paying off your loan, even if you will never repay it.
I could probably afford to pay my son’s off upfront, which when it’s RPI+3% seemed sensible.
My fear is I could end up adding £50k to my mortgage and then they change the system and he pays a graduate tax instead
It wouldn’t really be a graduate tax though. It would only be on those who applied for a student loan so not boomers or those rich enough to of had their fees paid for conveniently enough.
For all the people who think we should just have graduates repay less in various ways, where do you think the money comes from to offset the reduced payments from graduates?
If graduates pay less, the cost comes from the general taxation pot.
Not saying that’s necessarily bad, but it isn’t just free money, someone is still paying.
As it stands the overall receipts (and timing of receipts) doesn’t cover the cost of university, so we are already subsidising the fees, even with 9k fees. Any changes to reduce payments will increase the level of subsidy from general taxation.
Whether or not the system is fair, the money has to come from somewhere, and any change to just interest or repayments (e.g. without a „graduate tax“) will increase the need for higher general taxation to offset the reduced income
Just change the interest rate so it’s linked to the interest rate on government debt. If the government can borrow money at X% there’s no reason to charge graduates more than that.
As the government likes to point out when it suits them, graduates on average earn more money. If they’re earning more then the government already receives a benefit in the form of more tax revenue.
Just increase the repayment threshold to where it should be post inflation. Thanks
I still pay off a bit of loan every week. Its been 19 years this summer since I graduated. I dont even know if im close to paying it off yet
Why did they ever change it from base rate + 1%? Better than most normal loans, easier to track and admin, gives a chance for people to pay it off and it doesn’t grow exponentially vs a normal loan of the same amount surely?
This article seems to just be a simplified version of the [Times article](https://archive.ph/5OwAR) it cities as it’s source.
Key part from the headline doesn’t really go into any detail on the proposed graduate tax:
> Blake, who is now the director of the Post-18 Project, a new higher education think-tank, said: “I think we may need to move to a formal graduate tax. There are no popular options here, it’s not just people saying I’m in debt and it’s going up every year. Even if the system computes, it has a sense of being ridiculous when you’re in it. This system has run out of road.”
Blake said the system “did not deserve to survive”, particularly the Plan 2 version. However, he added that any reform would have to treat all graduates the same to feel fair.
Of those whose families considered paying fees in advance, he said: “They were told this is the cheapest money you’ll ever borrow, don’t do it. Now many will be paying back from year one of their professional job, all the way through. If you had the money to pay fees up front, why wouldn’t you?”
A flat graduate tax seems good, as it would mean that the wealthy, who would otherwise just pay for university upfront would also pay this tax, therefore leveling the playing field.
A flat rate would also make ambition rewarding, rather than costly as the current system disincentivises earning more.
It would be beneficial if they ring fence at least part of the income for university funding
Not sure how you have a graduate tax for different level of loans? You could easily have someone who just put tuition on the loans repaying the same as someone with 3-4 times a much debt!
Or have degrees that benefit society (eg teachers, doctors, etc) just be free for uni students and paid by regular taxes like it used to be since those jobs benifit everyone in society. Why pay by only taxing the people studying and give a free ride to those who use doctors/teachers/etc services?
Anything of no immediate societal benifit can stay americanised and profiteered if the scope of courses exceedes the governments budget.
Gaming the system will be passing all but one module and showing an employer that I don’t have the degree for tax reasons.
Did the time, passed everything here is my transcript but I chose not to graduate to avoid the tax liability
Graduates paying extortionate amounts to just cover interest on absolutely extortionate tuition fees which fund the obscene salaries that some people earn at those universities.
The uni I went to was an ex polytechnic yet the „chancellor“ thought he deserved 500k a year in salary.
Another transfer of public money to the pockets of the rich, whilst working people are shafted over it.
Simple, fix the interest rate from now on and write off the over inflated interest accrued for those with an existing plan.
Isn’t it basically just a graduate tax already? If you’re earning anything more than like, minimum wage you’re getting docked.
What about a fixed interest rate that varies based on the type of course? If there are skill gaps and industries we want to fill up with graduates, introduce a lower rate and for those degrees that don’t add much value to the individual, a higher rate.
If the intention is to fund through taxes, then it should be across the broadest base possible – not just service users. We don’t hammer those with long-term medical problems for extra NHS usage, we shouldn’t add extra costs to people pursuing more education if the state is funding it. (I take the same view with road taxes too, even as a non-driver).
If the intention is that students are customers and Universities are businesses, then just privatise the whole thing – including the loan element. There are enough institutions, programmes and lenders that a market with good competition can form, this isn’t like the water or rail companies. These halfway measures are the worst of both worlds and create more „losers“ than beneficiaries.
This will be an unpopular opinion, but university is mostly an investment in one’s own future, not necessarily the country’s future – especially seen as of recent when many university graduates are also out of work and net beneficiaries.
Of course, training for public service is different, but let’s ignore that bit for now as it should be addressed differently.
I think the most taxpayers should contribute is providing a facility for capped fixed interest rates.
Tax the intelligent, exactly how Darwinian economics ought to work. Perhaps we could also tax the good looking, the sporty or anybody else who has any form of gift or talent.
I have three degrees, one undergrad which I got a loan for and two masters which I did not and I paid for myself.
Am I meant to pay for three degrees even after paying off my original loan? If I am I’m leaving the UK and they wont be able to tax me at all.
A tax would be a great way to push young people abroad after their studies. If the goal is to lose as much talent from the country as possible this would be an good solution.
This would be worse than what we currently have.
The ONS already splits the student loan repayments into two categories:
– A lending amount which is paid off as you work.
– A grant amount which isn’t expected to be paid back and written off.
The concept is you never pay it back. They already take that into account for the budget.
My nephew just looked at his statement , he’s been paying off his student loan for three years and he now owes £4000 more than when he started .
If he carried on for the 30 years , he’d have paid back £75,000 on an £18, 000 loan .
There are 5 categories of people regarding student loans:
1) The ultra rich who never needed one in the first place
2) Highly successful individuals who were able to pay it off quickly post graduation, thereby minimally impacted by the interest rates
3) Successful but not enough to avoid paying huge amounts of interest
4) Those where the interest rates are irrelevant, will never earn enough to pay it back anyway
5) Do not earn enough to pay back any
So essentially groups 1, 2 and 5 get the best deal under the current system. The problem I have with the current narrative is that although capping the interest rates would of course be fair, it does absolutely nothing for group 4, who are by far the largest group. The reality would not change for most people
For context, I am in group 3 and would benefit hugely by the interest rates being lowered. I do actually think a blanket graduate tax would be more transparent and fair but can’t really be brought in retrospectively
Just rethink all of university. When I was on my course I remember the tutor saying “Every year when I deliver this lecture….” And I remember thinking “Just record it then” and that was 2003! It’s all a scam. There is no reason for tuition fees to be as high as they are.
Student loans. Biggest scam any country has done to their own people.
I think this would have to be a replacement system for the next generation of students
Or at least an optional change for those still with outstanding loans
It already is a graduate tax, but in a way that is unsustainable.
Interest is disproportionate to the actual interest rate, and that interest gain outstrips any repayment I make
Interest this year is almost twice (£2061) what came out of my salary (£1147).
Don’t get me wrong, I was under no illusions when I went into this anyway, and I know it defacto is written off after 35 years. Admittedly when I first hit the repayment threshold at a £30k salary, I adjusted my pension sacrifice to take me back out of it. Figured an extra £100 a month for future me was better than pissing it into the void. I can’t really do that now I’m up to £51k.
I don’t expect to come close to hitting initial balance in repayments given I attended as a mature student, so that’s technically £11k that gets written off.
But it’s still wild to see my balance go from £53000 to £72000 over the course of something I finished in 2020, and it’s still unsustainable how this is set up. I think it is also wrong that they can just arbitrarily change some terms of your loan after the fact.
If you’re fortunate enough to have been able to pay your loan off (because your salary outstripped interest, or you could pay it off in full, because you were in that valley where normal payments would cost more than the loan), you should be exempt from any graduate tax. Your account is closed.
This is a great way to further disincentivise your workforce. Love it.
How about we just forgo the theatre, give the boomers a lubed up broom handle and just tell the millennials to bend over and receive? Oh, also give each boomer £1m for ol‘ times sake.
Yours truly,
One of the first millennials getting fucked by this system who accidentally snuck into the 40% tax bracket and now has a 58% marginal rate because of student loans. I’ll eventually pay off my PG but not a cats chance in ever paying off my UG.
What they should do is make the universities liable for paying back loans that the students fail to. That will suddenly give them an incentive to be more discerning in who they accept as students and help them get jobs afterwards.
I’m pissed off with the loan situation but is anyone actually surprised or just jumping on the bandwagon to apply pressure?
I’m on Plan 2, 86K left to pay despite borrowing only ~40K and… I knew this is how it would be. I knew that even if I earned around 80K per year I’d still be paying it off for many years to come (I’m nowhere close to that)
Are people really only just learning that on average salaries they’ll be paying it until it’s automatically cleared? When I read up on it that was *expected* when I signed up.
The messed up part is freezing the repayment threshold while pensions are triple locked. What’s fit for the goose is fit for the gander!!
My students loans were tiny and the deal was good –
You only started paying once were earning over 85% of the average wage,
Interest was set at the rate of inflation,
If you hadn’t paid it off within 25 years it was cancelled. If you were under 40 when you took out the loan, it was cancelled when you reached 50.
There should never have been a student loan *company*, complete madness.
The unfairness of the current system was pointed out when it was being put in place. None of this is new. There were commenters that pointed out that the system was going to fail.
The problem with student loans is HIGH INTEREST. Drop it to zero and absorb the difference between BOE rate or make it BOE rate and keep inflation low or Cap it to the lowest BOE rate during the years of education.
The student loan system isn’t doomed. Its just plan 2.
Make all plan 2 users the Scottish plan 4 system and back date it to loan lifetime removing the egregious interest and if anyone has overpaid refund it.
Just do that. Keep repayment thresholds inflation tied and it’s fine.
You should be allowed to pay a lump sum to pay it off. I will pay off my student loan and can pay it tomorrow if I wanted. I seriously consider doing it because it will be cheaper long term. If they introduce this it needs to be an option.