To think people are unaware on how much the government has SHAFTED students with loans

[SucksToBeMee]

This brings me so much anger to this day, and I took out my student loans from back in 2012 when 9k tuition fees were introduced.

I did a 3 year undergrad and I left with a 50k debt. I can live with my 50k student loan. Fine, the government wants to pass the cost on to students (not that I agree you they should be doing that) but fine.

But the interest rates are so unbelievably outrageous I have no NO CLUE how they've gotten away with completely shafting the whole (especially poorer) student population.

Do people realise the interest rate on student loans is 3% + RPI? It's currently at 6.6%

6.6% interest this year on a 50k loan. That's at least £3300.

I earn a £45k salary and I still won't cover the interest this year. I have been earning a fairly decent salary since graduating and I have never covered the yearly interest.

My outstanding debt goes up and up each year even though I'm paying them thousands in the year. I now owe them £55k after giving them around £6k since I graduated.

They will carry on taking 9% of my salary over 25k and 9% of all my bonuses for the next 30 years.

Anyone who took out max loan (aka from a poorer background) and ended up breaking the barrier through to a better life is fucked over the most.
The wealthier families get away mostly scott free.

I think it's absolutely outrageous, and I'm not sure people realise how fucked over we're actually getting with interest rates. I have a debt that I can never even start to pay off. I will pay them probably double what I initially owed them over the next 30 years.

Honourable mention: they also charge max interest rates on your outstanding loan for the duration of your study.

In my day, only 10% of kids went to uni. They were covered by free (non repayable) grants.
Other kids got apprenticeships or were recruited by firms straight after A levels. It’s insane to think we need 50% of the population to be graduates, and unkind to give kids unrealistic expectations. I’d rather we cut the number of places and funded them properly.

I really agree with this. There used to be great opportunites for bright kids from poor backgrounds to get professional qualifications without going to uni. I have friends who qualified as solicitors, social workers, accountants and civil engineers by getting paid training posts after A-levels and studying while working. The public sector was great for that.

All those routes to a good career have now been closed (with the possible exception of joining the armed forces) and anyone who wants to progress beyond a certain level has to get a degree and saddle themselves with debt for much of their working lives.

and debt is what we call it even if it is really a graduate tax (which it is not in some ways - see below re implications if you go abroad)

This is pretty much the main reason it isn't called a tax.

The students with the stupid rich parents who pay fees upfront Not stupid, or rich, but we could afford to do it, so we did. No point taking a loan loaded with interest from the get go, if we would have just paid it after graduation, and paid the interest. to boot. If it lessens what is borne by the taxpayer, why is it a problem?

Arts and masters courses are a hefty financial choice for individuals to make, they should go into that with their eyes open and we should not all pay for those students deciding to take the risk of earning less. Precisely why we chose to pay for ds to do his BA in History, followed by an MA.

yes indeed benes!

and insofar as the dparents in that subset influence the dc's choices, the 'anti-debt' culture is relevant as well - I think the 'dont worry about borrowing 50k because you won't have to pay it back' message was slightly... dissonant...to many of us at first! Even though once you understand it may make economic sense.

So, reports indicate that labour manifesto will be to abolish tuition fees - will be interesting to see what the position of the other parties is. (assuming there is an election - many other threads there!)

I think if you went to uni in 2012 and are earning £45K at the age of 24 you are very fortunate indeed.
You don't have to pay more than the minimum. You don't have to cover the interest. If you don't pay it off by the 30 year point it will be wiped out so it's nothing like a real loan.

The students with the stupid rich parents who pay fees upfront

It's not stupid at all - I'm so glad mine was all paid for.

I was on the 3k fees, would have had about a 20k loan like my husband - I earn enough that I would definitely have paid off the loan in the end, but with loads of interest added.

"Parents should just buy their kids a house deposit" - firstly, they might not have all that money available at once, and also, they might not have time to manage a whole property with the faff that comes with rentals and upkeep. I personally am very glad I don't have to pay £200-300 a month and can save it all - I feel for all graduates. My maths degree paid for itself through salary, but if I was more into arts and couldn't pay upfront, I wouldn't go.

There are still opportunities to earn a good salary from school - I know someone who started on 18k in IT age 16. Left the company at 21 for a 50k job offer!

"we should not all pay for those students deciding to take the risk of earning less."

On the other hand we need people to teach English, History, at the salary that voters are prepared to pay - so in a sense we all rely on those students being prepared to earn less! Obviously there are far more Eng and History grads than needed to teach, I realise. It's tricky because some will go on to be very highly paid - lawyers, accountants, many other fields - but we don't know which ones at the outset.

One answer would be a graduate tax - but I think successive political parties decided against that, partly because of the 'brain drain' issue - the loan system does retain the possibility of recovering from those who emigrate and don't repay, eventually. And also because 'graduate tax' was thought to be offputting in a way which a loan was not - not sure if that is correct.

Actually, I don't think he even started on 18k, he started as an apprentice.

It was obvious that higher education was going to become something one had to pay for so when dc were born we started saving in the schemes Brown had set up. We just haven't stopped saving.
I don't want my to start their working lives with interest accruing debt if it can be avoided.
They may well not be settled enough for years to want a house purchase.
For us it isn't so much about being crazy wealthy as having prepared for Uni or equivalent since they were born.
I want them to have the same freedom to choose a subject they love that I had unhindered either way by debt considerations.
My levels is stupidly are my own concern!

As are my typos!

Mrex Great plan, however who will then teach all our children English, History, Art, Drama, Music, or would you like all of those to disappear from the curriculum too as they are not "useful" to society.

So, reports indicate that labour manifesto will be to abolish tuition fees - will be interesting to see what the position of the other parties is. (assuming there is an election - many other threads there!)

I really can't see how that would work. Where would the money come from? Universities are not in a position to take any more financial hits.

Interesting discussion, especially where people advocate subsidising those whose subject is more 'useful' to society over those whose subject enhances society.

If that principle were to be followed through, then those whose labour is more useful should be paid the most and have the highest status - sewage workers, nurses, policemen...

@Jux

I don't think that's quite accurate. People ration / make a discriminate choice in public spending all the time. I don't think it's so beyond the pale to suggest we might do so a little more effectively in university education.

It is true that I'd favour a more uneven distribution of the current pot of money, because I think that would generate better returns for society as a whole. I favour a nuanced and balanced idea of "worth" that doesn't exclude things that don't have obvious return. But I do think we shouldn't shy away from saying that there's a certain idiocy to refusing to make ANY kind of value judgment about the relative worth of degrees, and putting our money where our mouths are.

To make an analogy, grants for charities and art institutions don't blindly hand out money equally - there's some attempt to evaluate the worthiness of the recipient.

Interesting discussion, especially where people advocate subsidising those whose subject is more 'useful' to society over those whose subject enhances society.

It's not usefulness - it's how well paid those graduates will go on to be, hence how much tax they will contribute.

It makes sense to subsidise STEM degrees because those graduates will go on to have higher salaries and put more back into the system, rather than a lot of arts/humanities grads that never even hit 25k.

I think there is sometimes a very shallow understanding about what is useful in society.
STEM subjects are great and have their place but so do arts subjects.
It was our arts first degrees that made it clear to DH and I from the beginning that the Iraq war would be a disaster, not our later practical MAs.
In addition our arts degrees taught as a host of transferable skills that we still use.
A society needs a balance of all subjects to function well.

It was our arts first degrees that made it clear to DH and I from the beginning that the Iraq war would be a disaster

You don't need a degree to realise that! My mum has a maths degree and and was vehemently opposed, as were the million people that went to protest.....

No you don't, you always have to opportunity to self educate. But our suitably practical MA's added nothing to our understanding of the situation.
The knowledge and expertise we gained in our arts degrees informed our understanding of the complex, historical issues in that area of the world.
They meant we had useful insights into a volatile current situation at our fingertips. The arts subjects aren't just learning for learnings sake, although I also believe that is valuable.

I’m pretty sure a concussed duckling could have said at the start that the Iraq War would be a disaster, absolutely no degree needed...

There was a lot of opposition at the time but also a fair amount of support.
And a lot of the opposition was fairly generic anti war sentiment.

The students with the stupid rich parents who pay fees upfront
Or canny affluent older parents or more commonly grandparents who realise they're going to last longer than 7 years so can gift the funds and it's an excellent way of off-setting against inheritance tax.

There is a lot of zero sum 'reasoning' on this thread.

It's very sad.

There are people paid very high salaries to solve these problems in government and they're not doing a very good job.

Except you have no evidence that they haven't done a good job. You have your own personal feelings on the matter. Given the limitations of any form of taxation system and contribution-based public spending, this one's actually pretty good.

I know the interest is high - but the repayments are fixed at 9%. If the interest was to come down y say 2%, that could well mean the repayment threshold has to drop to the old £21k rate - bringing low earners back into the system - far more inequitable than now, and still means that the rich parents you have a problem with can still choose to have their child avoid repayments.

Going back to the old system of direct funding is inequitable becuae the poor's taxes pay for the rich to go to university (personally I don't think this is an issue for a number of reasons in principle - though its; not great for the universities as it goes...)

Graduate lifetime tax of 6% on salaries above £25k is probably the most equitable but issues around high earners who go abroad / tax havens.

And if anyone thinks that can’t happen
I never thought our nurses would pay to learn how to nurse

I think that's scandalous.

A colleague's daughter is doing a midwifery degree. Because they can afford it (they're comfortably off, though far from wealthy), they're covering her fees and living costs. They worked out that her degree will cost them in excess of £60k!

Nursing and midwifery students are especially hard done by imo. They can't work because they have to cover shifts and do irregular hours while training, plus they don't earn a high wage afterwards, unless they're very likely and progress to management grades.

A recently retired nursing friend also maintains that the training is woefully inadequate compared to the old SRN training. She reckons they qualify with huge gaps in their knowledge.

It's no wonder there's a shortage of nurses and midwives imo.

and still means that the rich parents you have a problem with can still choose to have their child avoid repayments. The payments haven't been avoided though, as the fees and maintenance have been paid up front. All that has been avoided is the interest on the loans. The university hasn't lost out as the fees have been paid, and the taxpayer hasn't had to fund another loan.