We won't have to pay a thing!

EU students may find they can get away with paying nothing for their top-up fees. Lucy Hodges reports
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The Independent Online

When the top-up fees Bill was wending its way through Parliament, the Government was asked how it would collect the £9,000 owed by each EU student under the new regime. The question is important because there are so many EU students at universities in Britain. They flock to sign up for British degrees because our higher education system is so good compared to those on the Continent. With the new, enlarged EU, there are expected to be about 50,000 young people a year coming in from countries like France, Germany and Finland (the "old" Europe) and from further afield - Cyprus, Estonia, the Slovak Republic and so on (the "new" Europe).

When the top-up fees Bill was wending its way through Parliament, the Government was asked how it would collect the £9,000 owed by each EU student under the new regime. The question is important because there are so many EU students at universities in Britain. They flock to sign up for British degrees because our higher education system is so good compared to those on the Continent. With the new, enlarged EU, there are expected to be about 50,000 young people a year coming in from countries like France, Germany and Finland (the "old" Europe) and from further afield - Cyprus, Estonia, the Slovak Republic and so on (the "new" Europe).

If the Government is unable to collect the new top-up fee repayments when they graduate, we shall be losing a lot of money - as much as £150m a year, says Bahram Bekhradnia, the director of the Higher Education Policy Institute. More seriously, there could be a big political storm if it turns out that British students are having to pay back their £3,000-a-year top-up fees, but that the Germans, French and Estonians are getting off scot free.

British students will have their repayments deducted at source, once they are earning £15,000 a year. But how can we be sure graduates of British universities from mainland Europe pay up? Simple, said Alan Johnson, the former higher education minister - the Student Loans Company (SLC) would do the job. It was working "in partnership with other EU states so that by 2009-10, when the first graduate contributions from EU students will be collected, there is a robust, watertight system in place."

That was more than a year ago. Johnson has moved on and since then there has been silence. But last month, the Education Select Committee raised the matter with Alan Wilson, the director-general for higher education at the Department for Education and Skills (DfES), who looked bewildered. Last week, Education Secretary Ruth Kelly was given the same treatment. She said she would look into it.

Critics are sceptical that the SLC will be able to track down 50,000 new graduates a year from the 25 countries. "I don't believe the DfES has got it sorted at all," says Barry Sheerman, the select committee chairman. "And if they haven't, it will be hugely expensive, because they won't be able to get a penny back from these students."

Bekhradnia is similarly concerned. "The problem is that the only watertight system will be to collect the money through the tax system," he says. "That is why the Inland Revenue is being used in this country to collect the debt from our graduates. But there is no incentive for other countries to agree to such measures for an overseas government. Some EU students will pay, but many may not. And I am afraid there seems no sign of any watertight mechanism to ensure that they do."

Not everyone is as pessimistic as this. Robert Jackson, a former Conservative higher education minister and now Labour MP for Wantage, says that the EU graduates in question are intelligent people who are going to be relatively high-earners and won't want to have a black mark against them. So, most of them will pay up. "They will want to honour their obligations," he says. "You are talking about a relatively high-class of debtor." But, if it emerged that it was easier for Continental European students to evade payment than British students, then it would be possible for the British students to take a lawsuit to the European Court of Justice in Luxembourg and complain that they were being discriminated against, he added.

Asked about the concern, the SLC sounded remarkably sanguine. "We are considering, with the DfES, how to strengthen these arrangements to ensure the successful repayment of loans from EU students after they have finished their courses," said a spokesman. "Though we understand the concern of the select committee, we are confident that we have the time needed to get robust and effective loan recovery systems in place by the point that the first repayment contributions from EU students are due to be collected."

The DfES made a similar comment. So, everyone is singing from the same hymn sheet. Perhaps only time will tell whether EU students will pay up. But the Government can't say it hasn't been warned.

l.hodges@independent.co.uk

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