Ghastly Tory plans for wealthy students to buy university places

[Hathor]

Unbelievable. Fast-track to a more divided society through our children.
www.bbc.co.uk/news/uk-13343824

www.bbc.co.uk/news/uk-13343824

Mmmmm.

On the one hand this is just opening up the channel by which international students get into UK Universities to residents of the UK. And that's been running for years and allows the Universities to earn income as they charge more for such students and that, in theory, can help keep fees for "normal" UK students down. The current system of foreign students hasn't hurt the "normal" UK students attending as those numbers are at record levels so in theory this shouldn't hurt it either.

On the other hand wasn't part of the justification for the new student loans and fees system that rich students couldn't duck out of the system and would still be paying off their fees for years to come and helping fund those who don't hit the earning limits? So if the rich people just pay lots of cash up front then they'll duck out of what is in effect a graduate tax, meaning less money in the pot, meaning "normal" students getting hit?

Does this mean that students with "wealthy" parents won't be eligible for loans? What if the parents refuse to pay for university? And, how much do one's parents have to earn to be in this category???

Makes sense to me. Why should the privilege only be extended to foreign students? It's not fair that places at a certain price are available only to foreign students and not British.

Badger - that was the justification, untile the Treasury realised how much they'd have to stump up upfront!

It would be much simpler to just limit the quantity of loans available if they want to allow universities to take in as many students as they wanted. The problem is on what basis you offer students loans. To those whose parental or own income is less than a certain amount - you penalise 'middle England' then? To those with certain grades - goes against widening participation and effectively means the Government controls admissions? First come first served - hardly fair?

Loans are also available to students of private universities (which effectively means they won't be privarte any more ).

It'll be interesting to see what this proposal actually is when the white paper is published - if it ever is!

The O'Clock News is saying that this idea has been binned already.

Yes, One O'clock News saying Willetts has already backtracked. But it's revealing that the Tories even considered allowing rich people to buy university places instead of having to apply in the same way as everyone else.

"The O'Clock News is saying that this idea has been binned already."

Now Harvard & co. can breath a sigh of relief. Their steady trickle of rich bright Brits will remain uninterrupted.

I think they should be able to if they've got the grades. There are too many people at university who shouldn't be there anyway. They've only encouraging this widening to get people off the unemployment numbers.

Haven't the rich always bought their childrens further education in the same way they buy a private education? I don't see what the fuss is all about.

Tories acting like tories. And a nice distraction from their plans to rip apart the NHs.

"Haven't the rich always bought their childrens further education in the same way they buy a private education? I don't see what the fuss is all about."

It would have allowed the "rich" to duck out of what is to all intents a graduate tax that the new loans and fees system introduces. The idea of that is that no one would be able to pay up front and that everyone would then pay afterwards if they were earning enough.

If the "rich" could pay up front then the only people who would pay the "graduate tax" would be the "poor", which is hardly fair.

Says it all

Badgers - the avoidance of the "graduate tax" scheme was, to me, the major flaw in the proposal. Although, they might have circumvented it by making the 'wealthy' undergraduates take the loan (with a big top up from their parents / sponsor). Although that would increase government costs.

In practice, the very rich are going to set up 'trust funds' or similar to help their dc's pay the graduate loan anyway.

In an abstract way - I quite like the idea of getting rich people to pay the full 'market rate' for a quasi-public service. But it does seem impractical in this case.

"Although, they might have circumvented it by making the 'wealthy' undergraduates take the loan (with a big top up from their parents / sponsor). Although that would increase government costs."

It would increase the upfront costs but also increase the yearly income into the "loan" scheme as those additional people would be forced into paying back the "loan" and couldn't pay it back early.

"In practice, the very rich are going to set up 'trust funds' or similar to help their dc's pay the graduate loan anyway."

Where the money comes from doesn't matter, what does matter is that they would have been made to pay back into the scheme, couldn't have avoided it and couldn't have exited early by paying a lump sum.

Though that does of course presume that they'll go on and get highly paid jobs.

"In an abstract way - I quite like the idea of getting rich people to pay the full 'market rate' for a quasi-public service."

I agree.

This is perhaps somewhere where it would have been easier just to do a proper graduate tax rather than introduce something that is one in all but name and then allow the rich to dodge out of it.

why shouldn't parents minimise their children's debt? we are not super rich, and we are forgoing luxuries so we can help fund their uni costs.

seems unfair to me that where uni's charge the full 9k tuition fee part of that money is paid to students of poorer parents - this should come out of a central pot, not be paid by a student themselves. Especially since that student may actually go on to earn considerable less than the student they are subsidising.

this system does nothing to encourage degrees that are useful for the country. In fact people who do degrees for their own interest (rather than a useful job) are likely to earn less and therefore pay back less/no money. Our relative is planning a dance degree, my son accountancy - guess who's likely to pay less towards the costs.

I agree.

Anyhow, foreign students can pay. Double standard there.

It's not like they're opting out of paying. They would still pay, and they would still have to get the grades. They wouldn't have to pay interest and be lumbered with debt.

It's in no way a loan, it's just a tax, and that's it.

I don't know. Some people use "rich" as a synonym for thrifty, well prepared, organised, aspirational, sacrifice-making, you name it.

Oh no, we're just all "rich". Sure we are.

Actually it doesn't even include me. Some people might be able to pay up front, we won't, but I don't care if others do. Won't bag them a place any quicker.

I have no problem with businesses and charities funding additional places at universities as long as the students have obtained the required entry requirements and the funding is long term (approx 10 years) so universities can invest in the resources needed to teach additional students. My cousin was sponsored by rolls royces for the whole of his enginneering degree and came out with no debt and a very good job. However I do have a problem with parents being able to buy a place for their dc at university as there is a basic principle of fairness at stake here. I think if we were to go down this line universities desperate for money will prefer rich candidates with lower grades to poorer candidates with higher grades. As for the government being able to reign in the universities thats laughable as they have not being able to stop the majority of them charging £9,000 when they stated they would only beable to do so under exceptional circumstances. As regards foreign students yes this needs addressing as well especially when universities go out of their way to engage with someone from overseas in the hope they'll go to them and ignore the poor but clever UK student because they don't pay as much in fees.

Badgers - I think a straight graduate tax has it's own implementation issues (I doubt the Inland Revenue is up to it). And it provides a big incentive for high earners to move abroad. Also, the mindset of 'paying back' is somehow more palatable than 'paying a penalty for' a degree. Although, in practice it has the same financial effect (more or less).

"this should come out of a central pot, not be paid by a student themselves."

The central pot isn't big enough given the vast increase in the numbers of students at University. So the Government is faced with two choices.

1. Increase general taxation to pay for the extra students.
2. Get students to somehow pay for their education

And the problem with 1 is....

"Especially since that student may actually go on to earn considerable less than the student they are subsidising."

The general tax payer will probably be earning less than the student they are subsidising, so hiking up tax to pay for those students has been seen as unpopular.

And then we come back to...

"why shouldn't parents minimise their children's debt?"

Because having gone with option 2 if you allow rich students to now take out the "loan" and repay the "debt" (as others have said it's not really a loan, it is a tax in all but name) then they duck out of funding the system. So the rich don't really pay for it but the "normal" will.

So the only way to allow paying up front would be to charge those who pay up front a massively higher cost than just the tuition fees and for the "loan" system to get a fair slice of that cash so that it can use it to fund other students who won't pay as much back into the system.

Sorry, that should have been:

Because having gone with option 2 if you allow rich students to not take out the "loan" and repay the "debt" (as others have said it's not really a loan, it is a tax in all but name) then they duck out of funding the system. So the rich don't really pay for it but the "normal" will.

"It's not like they're opting out of paying. They would still pay, and they would still have to get the grades. They wouldn't have to pay interest and be lumbered with debt."

They would be opting out of paying the Government and funding the system that funds students, and that is the problem.

Under the current system you are made to borrow up to £9k a year to fund your University education. So the Government gives the University £9k and then a few years later you start to pay the Government back for the loan, so the Government gets an income, and if you earn a lot that income will outstrip the £9k they gave you and they can use the extra to fund other students.

If you just pay the Uni £9k then the Government doesn't get any money out of you, so you're not funding other students and you've ducked out of the system.

The current system was "sold" to us with the claim that richer students couldn't avoid it and would end up paying more over time in interest than the "poor" and thus helping fund the system.

Turing off the flow of money to the Government breaks that completely.