It was a big day for me yesterday. My bank account finally reached £0. That’s no overdraft, no VISA bill and no student loan. Next month the bank will have to use black ink to print my balance.
This is an achievement given I self-funded an MPhil and a PhD after my BA. If I’d paid what the government said I should pay on my student loan then I’d still have most of it to pay off. Fortunately I’ve found the Student Loan Company extraordinarily hard to talk to, hence the VISA and overdraft. It’s a worse rate of interest and it meant the bank phoning up every so often asking “Where’s our money?”, but at least I felt they were taking an interest. It’s been a big incentive to get it paid off.
In future years this will seem quaint. The UK government is set to impose fees of up to £9000 per year on students. To put this in context, around a decade ago there were no fees, and the people imposing these fees had their university education paid for them by the state, along with a generous grant for attending university as well as various benefits. There’s simply no way the average parent of a child at school can prepare for these fees. If you can’t pay the fees up front you can pay them after. You’ll be charged above inflation for the loan, and if you pay off the loan early you’ll be hit with penalty charges, because the government is using these extra payments over the cost of the course to fund Higher Education. Vince Cable hasn’t dwelled much on the importance of penalising people who pay off their debts, other than to say on BBC News, “It’s like a tax”. Actually, with these penalty clauses, it’s government redistribution of wealth. It is a tax, at least for those who can’t afford to pay the huge fees.
It’ll also be a massive burden. Paying these fees off will be the equivalent of making the final payment on your mortgage.
There’s lot to dislike about the cuts, but the common factor that really gets me down is that they’re presented as morally justified, as though these are exactly the sort of thing we should be doing anyway. The justification for the cuts isn’t “Baby Boomers don’t want to pay tax at the same rate as their parents did”. It’s “The person who benefits should pay”. It’s hugely depressing that politicians on all sides of the house don’t believe that an educated and informed electorate is an asset to the nation.