Give “tuition fees” their proper name! The “aspiration tax”!

Posted: June 12, 2014 in Uncategorized
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Give “tuition fees” their proper name! The “aspiration tax”!

reblogged from AAV:

The Liberal Democrats began writing their own political obituary when they decided to go back on their pre-election promises to vote against any increase in tuition fees in order to allow the Tories to triple university fees to £9,000 per year, making study at English public universities the most expensive in the world.

This betrayal was particularly stupid given that the student lobby were one of the core Lib-Dem demographics. This U-turn was so bad that huge numbers of people who voted Lib-Dem in 2010 because they likes their stance against the commodification of the education system have sworn to themselves that they will never ever vote Lib-Dem again. People aren’t just temporarily angry about this, they are enraged because as far as they are concerned, the Liberal Democrats stole their votes.

The fees that the Liberal Democrats helped the Tories to introduce are not just three times as high as the New Labourfees, they also come at a much higher rate of interest. Instead of being index linked directly to the rate of inflation like the old loans were, the new loans accrue interest at the rate of inflation plus 3%. 

Even with interest rates being held at all time historic low of 0.5% for the last five years the government now admits that they got their sums badly wrong and that 45% of graduates will never earn enough to pay off their loans, rather than the 28% they originally predicted.

There are two main consequences of this huge miscalculation. The first is that the government now admits that their massive hike in student fees is already perilously close to failing to break even, meaning that not only will it cost millions of students extra, it also looks extremely likely that this new system will actually end up costing the taxpayer extra too.

The second consequence is that millions of graduates look set to spend their entire working lives making payments towards the cost of their higher education. These repayments kick in at £21,000 per year and are administered through a 9% direct taxation (taken directly from the salary like income tax and National Insurance). Around half of students will spend their entire working lives paying this 9% Aspiration Tax without ever actually paying the loan off.

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