The Guardian this week published statistics showing Universities to be in a state of serious debt crisis. Some, such as Manchester University, owe as much as £12.4million.
Despite this, Phil Harding, chairman of the British Universities Finance Directors Group, doesn't seem at all worried. He said, in the Guardian:
"I think we are borrowing with a degree of confidence and a reasonable expectation the cap on tuition fees will either come off or be lifted so that universities will be able to charge higher fees."
So, the plan is seemingly to spend now in anticipation of increased income from students in the future. The wisdom of this is questionable. With fees already in excess of £3,000 per year, is it fair to expect students to pay so much? An Equifax study last week estimated the average student starting university this year will graduate with £30,000 of debt. Yet the strategy still appears to be to solve institutional debt crisis by causing individual debt crises. We are educating our students into debt and that cannot be good. With consumer indebtedness at record levels, the culture of borrowing is one that should be counteracted, not encouraged.
The Liberal Democrats have a different theory about funding of higher education, which often makes them popular amongst students. Speaking in The Guardian, their higher education and skills spokesman Stephen Williams said:
"Universities should be making a plea for extra central government funds rather than anticipating passing the bill on to future students."
This standpoint makes more sense to me, as individuals shouldering such massive burdens of debt before even considering a mortgage, is surely undesirable. Donald MacLeod in the Guardian makes the point that "on the average graduate salary of £18,000, repayments are £5.19 a week. In that sense, it's more like a tax." If that is the case, then why not just rebrand it as a graduate tax? The Sutton Trust report claims that it is the perception rather than reality of debt that is deterring poorer students from University. As someone who has spent periods as a full-time taxpayer as well as a student, I would have no problems with paying extra tax to support future students through Higher Education.
Thames Valley University, where I am a student, was noted in the Guardian piece as one of the worst indebted. The Guardian reported the debt at £5.8million, whereas the Times Higher Education Supplement quotes a deficit last year of £6.5million.
Yet today, it was revealed the institution is undertaking a restructuring programme that will include a £60million spend on estates. Questions of priorities arise when, from a student's perspective, it appears money is being spent on repainting corridors when people struggle to find a functioning computer in certain faculty buildings. Within this development budget, is included a £6.7million grant from the government. It will be interesting to see if the results provide the 'value for money' the government demands from its public services.
3 comments:
As a ex-TVU student who decided to study in the UK, it is the cost of fees that played a massive part in why I could no longer continue the course. With the cost of one year translating to €5000 (without accomdation and living expenses - totalling approx €20,000) - the quality of education was not worth the huge cost and the lack of help and treatment by the UK government to international students was very off putting. Such things as getting a bank account was an ordeal.
I understand that even though students are leaving university with over £30,000 in debt, the fact that students CAN get a loan is commendable. Here in Ireland, we dont have that option. I had to take a loan of €1000 this year to complete my degree - which is paid back weekly. And with future cost of €8000 in a postgraduate course ahead of me, a loan that did not have to be paid until I was earning the required salary would be a massive weight lifted off my back.
But one thing must be considered by the British government - students should be receiving the best education for the money they'll have to pay back. For International students, we dont get student loans, and to be honest, this was something I considered very discrimitory.
I agree wholeheartedly with Claire's comments about dis-couraging rather than en-couraging 'debt culture'. There is a big problem in theis country with so many people finding themselves in a spiral of debt that can cripple them. Saying to our youngest adults that 'debt is fine - debt is necessary' is the wrong message. Rebranding the system so that rather than 'taking out a loan' a student is taking advantage of a student grant, which is only repayable by themselves at a time when they are earning enough for the repayments to be a very managable amount; taken from their wages as 'student tax' - and used to fund the next generation of repayable grants is an excellent idea. If a student leaves university with debts of £30,000 or more then it is obviously very tempting to add to that 'student loan' with other loans - what's an extra £2,000 or £5,000 or even £10,000 if you're already £30,000 in debt? Student finance needs to be seen as something entirely different to bank loans and overdrafts and credit card loans.
I am also totally against the un-capping of tuition fees. Higher education should be something that is accesible to all, not just those who can afford it. 'Selling' education to the highest bidder will simply mean that the more prestigious universities will be able to charge the higher tuition fees and therefore seem unaccesible to lower income families. A student should be able to choose their university course, providing they get the appropriate grades, according to which course is the most appropriate for them, rather than how much debt they are willing to fall into in order to benefit from it.As somebody who has worked extremely hard and scrimped and saved in order to build up her savings it is a very scary thought that, even now, my daughter's student loan, by the time she leaves university, will amount to more than double the amount that it has taken me twenty five years to save!
What I find infuriating is that the people in power that years ago retracted grants for university and relaced them with loans, themselves came out of university with no debt due to the grants they recieved out of the tax payers pocket. My parents themselves had their grants for university and therefore came out with next to no debt ready to start their working career. If the people in power in this same age group with similar circumstances had loans instead would they be where they are today? I doubt it.
In an age where the echoes of 'education, education, education' are still heard it seems a shame that now those that were empowered with opportunities as never had before have had these snatched away. Some people again, as in days of old are too poor to go to university. Shame on our establishment!!
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