Leading Article: A graduate tax would not serve universities well

Sunday 23 October 2011 00:34

The news that two contenders for the Labour leadership, Ed Miliband and Ed Balls, are talking about a graduate tax to replace tuition fees shows just how political the whole issue of student funding is becoming again, and how fragile the consensus on fees is.

Or does it? These two men are fighting to become leader of their party. In fact, four out of the five candidates in the Labour leadership election have said they would support a switch from tuition fees to a graduate tax. It is the NUS position and it helps to distinguish them from the responsible candidate, David Miliband, who favours a retention of fees.

We would argue that a graduate tax is a bad idea for a number of reasons. First, it is too soon to change the system again. The current top-up fee regime was introduced in 2006 and appears to be working. Contrary to what Ed Miliband has said, these fees are not paid up-front. Students pay them back after they graduate, in relation to their earnings, and graduates pay nothing back until they are earning more than £15,000 a year.

A new graduate tax would cost money to introduce, it would be complicated and the money would go to the Treasury, not to the universities. The Labour leadership contenders should do more research before committing themselves to a seemingly populist policy that would not serve the universities well.

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