Student loans
- Thread starter JM14
- Start date
Aet290204
Well-known member
Do you know anyone who graduates from University and subsequently never, for the entire duration of their working life, goes into a job that pays more than £23k pa?
No, me neither. And if they don’t then they probably shouldn’t have gone to university in the first place
No, me neither. And if they don’t then they probably shouldn’t have gone to university in the first place
SilentProf
Well-known member
However you try to spin it, it’s a tax on all graduates who wouldn’t be able to pay off their student loans under the current rules and affects the poorest of them more than anyone else.
JM14
Well-known member
No, but quite a few grad schemes will start on less than that.
Another blow for low earners
JM14
Well-known member
The majority won’t ever pay them off, that’s accepted. But this will just make it even more difficult for people from poor backgrounds to attend uni
FatCat
Well-known member
Can you explain that - are you saying because less people will be able to default on a loan and pay it back it’s a tax?
Linny
Well-known member
Bit judgemental but ok.
r00fie1
Well-known member
Paying for education is a tax on skills learning and investment in the future by England.
It relieves employers from paying for trained educated staff - with graduates up to their necks in debt for their benefit.
Scotland can do it.
Do you consider we have a better skills base by getting young people in debt?
I think not.
It relieves employers from paying for trained educated staff - with graduates up to their necks in debt for their benefit.
Scotland can do it.
Do you consider we have a better skills base by getting young people in debt?
I think not.
r00fie1
Well-known member
Rubbish.
SilentProf
Well-known member
Roofie has answered that question perfectly. Forcing loans on people who would otherwise never qualify for credit of that size is both unnecessary and immoral. It only puts barriers in the way of the poorest to prevent them from bridging the class divide. British businesses benefit greatly from the graduates we produce. They should be picking up the tab for educating and training them.
Andy_W
Well-known member
I'm not sure how I stand on this topic, so don't come after me, I just want some things clearing up.....
Why? The debt only gets paid back once they're "no longer poor", in the reality of the world, although in the UK, 23k and 29k is not exactly well off. Since that lower earnings limit came in, inflation and wages have ultimately made that cap lower, so it should have been going higher if anything, this is a massive change.
But, the yearly fee cap is changing from 9k to 7.5k, so a 4-year course is now 30k, rather than 36k, so it's a small change for most, unless they're on a cheap course. "worse" uni's should be banned from charging more for courses, as this does not benefit the student, but funding from "better" uni's should be diverted to help bring up the worse ones, so we get more of an even playing field. People from poor areas can't go and study in London, as it could bankrupt them, so bring up the level of the uni's in the cheaper places etc.
Why? The debt only gets paid back once they're "no longer poor", in the reality of the world, although in the UK, 23k and 29k is not exactly well off. Since that lower earnings limit came in, inflation and wages have ultimately made that cap lower, so it should have been going higher if anything, this is a massive change.
But, the yearly fee cap is changing from 9k to 7.5k, so a 4-year course is now 30k, rather than 36k, so it's a small change for most, unless they're on a cheap course. "worse" uni's should be banned from charging more for courses, as this does not benefit the student, but funding from "better" uni's should be diverted to help bring up the worse ones, so we get more of an even playing field. People from poor areas can't go and study in London, as it could bankrupt them, so bring up the level of the uni's in the cheaper places etc.
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Andy_W
Well-known member
The system needs changing, and what is paid, somehow needs to be current and future means-tested, not just future means-tested, but bright people from poorer backgrounds should still get the opportunities that rich idiots do.
If uni is being funded though, then some more manual trades should be able to get their training or tools paid for, with the same earnings caps, for like plumbing, electrical courses, site passes, HGV's etc. It's unfair that these guys have to pay for their own tools and courses, and fund the education for people who could likely ultimately end up their bosses, on a lot more money, or effectively just ******* it up the wall, although the latter seemingly seems to happen less and less. In our sports clubs, the uni lot are nowhere near as bad on the booze as my age group was!
I think what most have a gripe with is people doing an effectively pointless degree for 4+ years, that has low job prospects and not in an area of growth, so they end up racking up a load of debt and then opting for a simpler or less testing line of work.
For me, we should prioritise funding towards trades in need, or those who would have very little chance of not reaching the earnings caps.
I also don't think we should allow people who clearly are not attending or continually failing to carry on with their courses, especially if they're in areas with low job prospects. If it's being funded by the people, it needs to benefit the people so they get a good ROI.
As a side point, as I saw a recent study from the US, and once a few variables were catered for, the quality of college/ uni had very little bearing on the expected total earnings over a career, which seemed surprising.
If uni is being funded though, then some more manual trades should be able to get their training or tools paid for, with the same earnings caps, for like plumbing, electrical courses, site passes, HGV's etc. It's unfair that these guys have to pay for their own tools and courses, and fund the education for people who could likely ultimately end up their bosses, on a lot more money, or effectively just ******* it up the wall, although the latter seemingly seems to happen less and less. In our sports clubs, the uni lot are nowhere near as bad on the booze as my age group was!
I think what most have a gripe with is people doing an effectively pointless degree for 4+ years, that has low job prospects and not in an area of growth, so they end up racking up a load of debt and then opting for a simpler or less testing line of work.
For me, we should prioritise funding towards trades in need, or those who would have very little chance of not reaching the earnings caps.
I also don't think we should allow people who clearly are not attending or continually failing to carry on with their courses, especially if they're in areas with low job prospects. If it's being funded by the people, it needs to benefit the people so they get a good ROI.
As a side point, as I saw a recent study from the US, and once a few variables were catered for, the quality of college/ uni had very little bearing on the expected total earnings over a career, which seemed surprising.
JM14
Well-known member
If the threshold for starting to pay the loan back is reduced any further its going to be crippling for some people, I have no problem with paying it back once its affordable (fees shouldnt be anywhere near that high but thats another discussion) but for most you come out of uni for the first few years with no money and a fairly poorly paid grad job (if youre lucky) and likely a min of £800/1k monthly rental costs before anything else.
Those coming into this from rich backgrounds will have parents to bail them out, but its already enough to put poorer students off and thats without then having to start paying back the student loan earlier.
People say this like it's a good thing, or like graduates are getting some sneaky favour. I reckon most actually do repay the original value of their loans. It's that the interest rate keeps the debt topped up and round their neck all their lives.
JM14
Well-known member
Problem is for almost every decent job that isnt manual, you are required to have a degree which is just crazy. Change that to more on the job training and relevant qualifications and it makes things far better.
I did what most would consider a pointless degree, and have moved into a line of work which isnt related to the degree in the slightest, yet it was still required for the job, without it the earning potential and potential to progress would be seriously limited. And that seems fairly representative across the sector. I completely agree with your point and I think its the most pointless system you can have, but thats why you end up with so many doing what seems like pointless degrees
Andy_W
Well-known member
Yeah, I get it, and actually what I wrote missed out is although the actual cost of the course is less, people pay it back earlier, probably at the worst time, which isn't right.
I would say making the loans "interest-free" in general would be good. Also, the rate paid back for the first 5 years of earnings over the cap to be 0%, then 2%, then 5%, then 10% etc. Charging someone 10% on someone earning 25k is terrible, it should be 0% for a few years, then 2%, but then hit them with 5% at 30k, 8% 40k, 15% 50k (if it's not already paid back by then).
One thing we need to consider, which I kind of forgot about, is these young people have to get on the housing ladder too, which is about 3-5x harder than those 20, 40, 60 years older or whatever. I think people saving for a house, in a semi-locked account, should get some sort of payment holiday too. We should let them get on the ladder, before getting hammered with loan payments.
I also wouldn't be against a hyper-tax, for those who use their degrees to earn 100k or whatever, I wouldn't be against them paying more for their course than the course cost, as they got a much better ROI from it anyway. Income tax does sort of do this, but a guy on 100k with no funding, shouldn't be paying the same tax as a guy that got a massively subsidised degree.
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Andy_W
Well-known member
Yeah that is ludicrous mind, I totally agree on that, I'd much prefer competency or trade ability tests over "that guy with the degree is going to be better".
Yeah, I get that some degrees show you can learn to a certain standard, I've done similar to a degree (pardon the pun), but my education was in a much in demand field, but now I just work in another, and I'm certainly better at the one I don't have a degree in!
We could really do with limiting spaces to the degrees which are effectively zero chance of jobs, rather than letting the uni's use them as moneymakers. I most know about 10 people with a criminology degree and zero of them do anything related to it. It's the same as "filler" A-levels,
I think people doing degrees in what they like rather than what they could work in, kind of just shows that some only want to learn what they want, where as with jobs you have to be able to learn what you don't want, or what is boring etc, that's the hard bit.
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r00fie1
Well-known member
Just to add some meat to the bones and a few facts to the debate.
Here are the Governments Official Figures - direct from Hansard about the total owed.
It is laughable unless you are the one in debt.
Its an admission by Government that the system is unworkable, unrealistic and totally unsuitable for the 21st Century.
Student loans are the main method of direct government support for higher education students. Money is loaned to students at a subsidised rate to help towards their maintenance costs and to cover the cost of tuition fees.
Currently more than £17 billion is loaned to around 1.3 million students in England each year. The value of outstanding loans at the end of March 2021 reached £141 billion. The Government forecasts the value of outstanding loans to be around £560 billion (2019‑20 prices) by the middle of this century. The average debt among the cohort of borrowers who finished their courses in 2020 was £45,000.
The Government expects that 25% of current full-time undergraduates who take out loans will repay them in full.
?
Here are the Governments Official Figures - direct from Hansard about the total owed.
It is laughable unless you are the one in debt.
Its an admission by Government that the system is unworkable, unrealistic and totally unsuitable for the 21st Century.
---------------------------------------------------------------------------------------------------------------
commonslibrary.parliament.uk
Student loan statistics - House of Commons Library
Student loans are the main method of direct government support for higher education students. More than £17 billion is loaned to students each year. The value of outstanding loans at the end of March 2021 reached £160 billion. The Government forecasts the value of outstanding loans to be around...
commonslibrary.parliament.uk
Student loans are the main method of direct government support for higher education students. Money is loaned to students at a subsidised rate to help towards their maintenance costs and to cover the cost of tuition fees.
Currently more than £17 billion is loaned to around 1.3 million students in England each year. The value of outstanding loans at the end of March 2021 reached £141 billion. The Government forecasts the value of outstanding loans to be around £560 billion (2019‑20 prices) by the middle of this century. The average debt among the cohort of borrowers who finished their courses in 2020 was £45,000.
The Government expects that 25% of current full-time undergraduates who take out loans will repay them in full.
?
Andy_W
Well-known member
Maybe they're just looking at it like it's a fair investment, and that getting something back is better than nothing? Basically, an accepted money pit, as they get the cash back from other areas like tax or whatever?Just to add some meat to the bones and a few facts to the debate.
Here are the Governments Official Figures - direct from Hansard about the total owed.
It is laughable unless you are the one in debt.
Its an admission by Government that the system is unworkable, unrealistic and totally unsuitable for the 21st Century.
---------------------------------------------------------------------------------------------------------------
Student loan statistics - House of Commons Library
Student loans are the main method of direct government support for higher education students. More than £17 billion is loaned to students each year. The value of outstanding loans at the end of March 2021 reached £160 billion. The Government forecasts the value of outstanding loans to be around...
Student loans are the main method of direct government support for higher education students. Money is loaned to students at a subsidised rate to help towards their maintenance costs and to cover the cost of tuition fees.
Currently more than £17 billion is loaned to around 1.3 million students in England each year. The value of outstanding loans at the end of March 2021 reached £141 billion. The Government forecasts the value of outstanding loans to be around £560 billion (2019‑20 prices) by the middle of this century. The average debt among the cohort of borrowers who finished their courses in 2020 was £45,000.
The Government expects that 25% of current full-time undergraduates who take out loans will repay them in full.
?
The only way to get more of that back is to hammer the students, but doing it to the ones earning 24k seems a bit harsh, especially nowadays when they're being screwed by the property ladder.
You could have examples where someone earning 24k has had their fee capped at 9k from Teesside uni, yet someone could be doing economics from one of the big three and likely to clear >50k for the majority of their career, and they also get their fee capped at 9k. That doesn't seem fair, they're both paying the same, but not getting the same back, nowhere near.
It's even less fair on some trady, who never used the system though, but who now earns good money and shells out loads of tax, but they had to lump out 30k on tools and work their nuts off for apprentice wages though, who took 10 years to get 30k, and likely who physically won't be able to work past 60.
The student system should largely fund itself I think, it's a bit unfair that those who never used it, to have to cop out for it, but they probably get it back elsewhere on average as the students may drive the economy and be the customers for the tradies.
I wonder how much of that 160bn went on failed multiple-year courses, or courses that had next to zero job prospects? I suppose that's where they could do a lot of the trimming, as in stop the problem before it becomes a problem.