Evidence and the Government’s Case

The two most common ways of defending the government’s proposals for transforming the way that university teaching is funded, are (1) that the proposals are ‘progressive’, in such a way that they will not deter poorer applicants, and (2) that they are necessary as part of a deficit reduction strategy. Yet while the media has been understandably focused on the issue of student protests, two almost entirely unreported independent reports have thrown doubt on whether either of these arguments are sustainable.

The Million+ Group and London Economics issued a report this week which concludes that in their current form, the Government’s proposals will lead to 60-65% of graduates being worse-off than under the current system with the greatest impact on middle income earners. Far from being progressive as the government claims, these changes seem likely, the report argues, to limit social mobility.

Meanwhile the Higher Education Policy Institute (HEPI) have produced a study which shows that the government could save no money at all from their reforms. The cuts could even lead to a small increase in the public contribution, HEPI argues, because the government has been too optimistic in its assessment of likely graduate incomes. David Willetts has conceded this week that the 80% (£2.9bn) per annum cut in the teaching grant only saves public money in a narrow accounting sense. Since the income from graduate repayments will take so long, the taxpayer will not benefit from the shift in funding from direct grants to loans throughout this parliament and into the next. As a letter in the Telegraph from academics argued this week, this evidence at the very least weakens the case for immediate, rushed, changes.

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One response to “Evidence and the Government’s Case

  1. Many thanks for directing me to David Willett’s admission that this is really an accounting trick rather than a genuine saving – I am informing my own Tory MP about this.
    You might strengthen this bulletin by pointing out that the Million+ report draws on the just-published report of the Office for Budget Responsibility, the government’s own fiscal watchdog.
    http://budgetresponsibility.independent.gov.uk/d/econ_fiscal_outlook_291110.pdf
    See box 4.3 for the statistics: servicing the student fees increase will add 13 billion to the public sector net debt by 2015.

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