A leaked document has alleged that Whitehall has been recommended to hike up the the repayment rate of student loans. In this document Rothschild Investment bank advised the government to increase the percent that old student loans were paid off.
This advice, from a report in 2011 still rumoured to be under review, has warned that the money is required to put back into higher education. All this speculation comes ahead of George Osbourne's spending review later this month. This plan, if it were to go ahead, could be seen as extremely unfair to those who signed up to receive a student loan when the rates were set at 1% above the Bank of England base rate. Students who have paid the lower fees of a few years ago, roughly £3500 pa, were to be told by then ministers "You have a deal which is so much better than your younger siblings". The most worrying thing about Project Hero, as the report was named, is that government continues to throw higher educations to the wolves. After the trebling of tuition fees and shakeup of university funding, higher education is a step away from propping the government up, rather than the other way around. The introduction of tuition fees was the government trading in the family silver. Now they are starting to panic. The investment in youth that the government anticipated has not quite paid back as quickly as it thought. So, this knee-jerk reaction to lack of funds heading the Department for Business, Skills and Innovation, requires a further reach into the pockets of battered higher education. Seeing that the system is struggling to cope with students only having to pay an average of around £25,000 to the Student Loans Company, how will it cope when students are owing much, much more than that? The idea that the government should demand its money back from graduates quicker because they're short is one that's not worth entertaining. With graduate unemployment being so high and opportunities short and massively fought over its no surprise that people are struggling to break the £15,000 salary to begin paying off their loan. How is it ever going to cope when people have to be earning £21,000? Do you think its fair that the money that has been invested in youth education should be demanded back by the state? Is education a commodity to loaned out by the government? Are degrees worth the massive debt? What do you think?