In a speech today Business secretary Vince Cable proposed a new graduate tax to replace the existing tuition fee structure.
During his speech Mr Cable claims that some Universities are “at risk” from high levels of debt, and they would be left to go bankrupt under the new system. This may well alarm many University of York students, as it is commonly known that the University has borrowed extensively to fund the Heslington East project. York Council recently revealed that the University has had to “draw more heavily on capital borrowing than had been expected.”
Although the University are awaiting the upcoming Browne Report into University funding before commenting further they have moved to reassure students of the financial stability of the University. In an official statement from Jane Grenville, the Pro-vice-chancellor for students, the University admit they are now using up previous surplus to ‘buffer the cuts’ they also claim that the University has a ‘very diversified income stream’, gaining finance from research grants, innovations and commercial operations, and so are ‘not as badly affected as some other institutions.’
Under the proposed new system, the government will pay the cost of tuition fees directly to the universities, rather than granting loans to students to cover their own expenses. Graduates will then have to repay the money through a tax imposed once they start earning more than £15,000. Higher earners will be expected to pay more.
“We want to investigate an option which is clearly fairer and related to people’s ability to pay,” Cable told the BBC.
The plans were welcomed by NUS, with president Aaron Porter commenting that “he (Cable) is right to ask why, under the current unpopular and regressive top-up fee system, a care worker or teacher is expected to pay as much as a corporate lawyer or banker.”
However, he also called for further details into the workings of the new scheme to ensure that it is truly a reform and “not simply tuition fees by another name”.
“Students will not be conned by rebranding exercises or marketing drives”.
His sentiments were echoed by University and College Union general secretary, Sally Hunt, who said “If the government thinks it can get the public to swallow higher fees as some sort of graduate tax it is living in a dream world. We need a proper debate on how to fund our universities, not an exercise in re-branding.”
“We will judge the plans on what they actually do and whether or not students will be forced to pay more, not how the government markets them,” Hunt concluded.
The possibility of a graduate tax system will be included in Lord Browne’s review of student finance, which will be published this autumn.
Where exactly does it say in this article WHO/WHAT exactly someone from the University said to “reassure students of the financial stability of the University”?
Poor.
Well I think it seems pretty clear it was a statement releases by the uni.
I welcome the idea of a graduate tax but threats of bankrupcy and increased commercial competition between unis is worrying