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Owe, Owe, Owe Your Boat Gently Down Your Dreams

by • November 1, 2013 • Economics, PoliticsComments (0) • Views 2032

You probably think the tuition fees story has been done to death. The rise of the maximum price a university in the UK can charge British students to £9,000 a year (from around £3,500) seems shocking enough; even more so when you realise that for a typical student studying on a 3 year course, the shot at an undergraduate education is likely to cost £27,000 in fees alone. Depending on where you live at university, the cost rises even more when living fees are included – ruling out well-connected London universities for huge numbers of people. It’s even more heart wrenching when you realise people wanting to study on longer term course, like medicine, could leave university with £45,000 of debt as they enter the big bad world. But the cost of tuition fees isn’t as simple as that, it runs much deeper.

It seems somewhat odd that eighteen-year-olds up and down the country are being asked to prove themselves worthy of paying £9,000 a year. In the years before 1998 (when UK tuition fees were first introduced), or even before 2012 (when they were considerably lower) it seemed sensible for most students in school to aspire to a university education: an opportunity to gain expertise in a field you love, a platform from which to find a job, and an experience you won’t forget, all were (and still are) brilliant reasons to want to go to university. It was even plausible for people to get there, provided they were academically able. While university was always a costly expense, leaving after three years with a good degree and only owing only the price of a new Toyota Aygo seemed pretty sensible; especially since, if anything, it was the living costs at university that applicants had to fret over. This changed for a lot of people when tuition fees tripled; already the numbers of university applicants has dropped. The 2012 cycle UCAS report showed that 43,000 fewer people applied for university in 2012 than in 2011.

When you leave university owing as much as a Jaguar XF, the benefits seem slightly less valuable, especially when coupled with spiralling unemployment and the reality that you probably won’t get the job you want (or even one remotely to do with what you spent tens of thousands of pounds studying). That’s from a typically middle class perspective; for a number of individuals who aren’t as privileged as me, or the rest of the comfortable classes, university simply isn’t an option. That may seem fine to some that criticised the rising levels of university courses and places and credited widespread education with the devaluation of degrees, but doesn’t it seem slightly archaic to have a system that excludes people so blatantly so early on in life? In years to come, how will conservatives and neoliberals argue that “wealth is earned”, when those born into more financially-testing circumstances than them never had anywhere near the amount of opportunities us lucky ones did? More importantly, people that could’ve done incredible things might not get the chance; it’s true that university isn’t the only option, and for many people it might not be the right one, but that’s a choice we should all get to make, not just those of us living in the suburbs with well-off parents.

There’s another issue with ball-strangling tuition fees. When we’re still going through one of the worst debt crises in history, does it not seem like we’re shooting ourselves in the foot by sending people off into the world owing so much? Yes, it’s true the terms of student loans aren’t that harsh, but that’s theoretical money we could all use more wisely. If borrowing led to the bust, having £30,000+ less in your pocket probably isn’t going to help that vicious cycle. Money that could be invested, saved, used as a down payment on a home, used as a rainy day fund, or anything else stable will in part at least go towards paying back debts you could carry for up to 30 years. Now we don’t have that money I guess it’s another credit card, car payment plan, long-term mortgage, QuickQuid loan, and before you know it you’ve arrived at your mid-life crisis realising you still don’t really own anything substantial. It’s true that it’s better to owe a student loan than any other type, but there’s one thing better than that, and that’s ‘not owing anything at all’. If the previous generation got into a debt crisis and a ‘buy now, pay later’ culture, what chance do we have if that’s what they require us to do before we even get to a career?

Given that Danny Alexander, Chief Secretary to the Treasury, has already announced that by 2015 the government plans to privatise most, if not all, of the student loan book, things are only set to get exponentially worse. Given that we’re already in a mess if we have to take out a student loan, making the conditions on that loan worse than they are, which privatisation would, would be nothing short of catastrophic. Better still, the Treasury announced even more pioneering ways to royally fuck the younger generation – raising interest rates on student loans, retroactively. What this means is that student who took out loans between 1998 and 2012 will have the cap on interest rates on their loans lifted, allowing the new private owners to charge whatever they want in interest payments. The implications of this don’t ever bear thinking about, but suffice it to say that, particularly when the country is still trying to find its way out of a national and individual debt crisis, this is a terrible idea. No-one benefits from this except the private firms which acquire the loans; the economy is held back by an entire generation of soon-to-be graduates crippled by debt repayments for the rest of their lives, only the richest students will escape by paying off debt quickly, and as a result social mobility takes yet another punch to its already-battered face. Before anyone starts being optimistic about the interest rates not being as bad as I’m making them sound, the government report that this was announced in actually states that, “one indicative calculation suggests that an employee on £25,000 a year, with £25,000 of undergraduate loans taken out before 2012, could work until retirement without ever paying off their debt if the interest rate cap were removed”. It says that. In the report. The one they’re following. That’s apparently a good idea. It says it. Right there.

That the government is prepared to allow this to happen, worse, to make it happen, is mind-boggling unfair – people who, had there been no cap on interest, would most likely have never taken out the student loans they now have, would be charged for being part of a deal that they did not agree to, a deal that barely even resembles the deal they agreed to. New Statesman’s Alex Hern sums up the government position on this quite nicely: “young people are easier to screw over than old people”.

Whilst pensions are ‘triple-locked’ under this government, welfare is slashed and capped and brought to its knees like there’s no tomorrow (because, obviously, pensions are completely different from welfare [despite being conditional on National Insurance contributions in exactly the same way that JSA is], how dare you suggest such a thing). If things are allowed to go ahead as planned, there certainly won’t be for us. The report also states that “the [financial] risk is best taken by government…; second best is it being taken by graduates…; and lastly by investors who want inflation protection”. I may be mistaken, but I was always under the impression that investors were in the business of taking on risk; and yet, the government believes that having the slightest element of risk in an investment is unthinkable.

Something tells me that this particular Chancellor isn’t that big on allowing the government to take on financial risk (at least, not risks that can’t be taken on the understanding that it’s only a future government that would suffer the consequences), so let’s all take bets on where this risk on this investment is actually going to fall. On the off-chance that anyone was still deluded that the Conservative party does not exist for the twin goals of unbalancing the generations, and sycophantically and unashamedly pandering to big business, now we can be absolutely sure of it.

There are a million and one reasons why our generation is up shit creek without a paddle and tuition fees are another one of them. This isn’t about being given handouts or something for nothing; it’s about us all being given chances and opportunities; something this government doesn’t feel the need to do. After all, young adults might have the vote, but we have the lowest turnout of any eligible age group; and even if we do vote, is anyone really going to do anything differently?

Mo Choonara is an upper-sixth student at Altrincham Grammar School for Boys and regular contributor to Lucid Politics.

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