news, politics, university

Budget 2015 and the Self-Righteous Student

The budget cuts may be hard, but not all wrong.

As was always inevitable, there has been a lot of controversy surrounding the recent budget. Despite what appeared to be a great deal for the public at first light, as details were revealed, it became dangerous to those of a certain demographic. However, there are plenty of articles already written on the overall impact of the budget (such as this from the BBC). What I want to focus on in this article is the uproar created by the removal of university grants and why I believe cutting such grants is a perfectly reasonable course of action.

At this point, I feel it is very important to give an insight into my background. I come from a lower-middle class background and have recently graduated from a Russel group university. After 4 years of study I have, of course, left university with a large debt to my name. For every year I attended university, I took the full loan available to me, one to cover the entirety of my course fees and a maintenance loan to help cover living costs. However, for me and a large number of other students, the maintenance loan is not enough to live on for a year, depending on family income, it is approximately £3,500 to £7,000. Fortunately for me, I had a small amount of savings which, combined with working full time over the summer, allowed me to enjoy university life with only minimal ‘topping up’ from my parents.

What if I had not had savings. What if I hadn’t found a job over summer. What if my parents couldn’t help me financially. This element of luck should have no place in whether to enter higher education or not. If the government is serious about encouraging people from low income backgrounds, the loan amount must be increased. A student should be able to progress through university, in its entirety, without the need to borrow from their parents. This is absolutely fundamental. Despite the income or savings of the parents, the student should have the option to borrow enough to provide a reasonable standard of living to cover rent, food, utilities etc.

What many are troubled by is the withdrawal of grants, supplied to low income students to cover living costs, but are not to be repaid. I am a firm believer in seeing higher education as an investment in a person’s future earning potential. Spending circa £50,000 on university should allow someone, over the course of a working life to earn at least £50,000 more than if they had gone straight into work at 18. If it won’t allow someone to do this, then there is not a high enough demand for such a graduate therefore there is no reason the taxpayer should subsidise their learning. If they are doing it purely out of love for the subject, they are entitled to do so, but must pay their own way.

A problem that most definitely does need to be addressed by the government is the educational gap seen between high and low income families regarding the value of university. Everyone needs to be given a basic education on the potential avenues higher education can create as well as the costs and benefits associated with this. This should be done in formal education, in all schools throughout the country. The huge gap that is currently seen between university attendees from high compared to low income families is in no small part due to the education and opinion of the parents. By teaching students that university, although it is a big investment, is exactly that, an investment, not just an unnecessary expense this gap can be reduced.

I believe everyone should be entitled to go to university regardless of their background and should not have to fund either their studies or their living costs while still a student. However, regardless of background, this must be paid back when the graduate has moved into a financially stable position (currently with an income of £21,000 or more) as that individual has made a decision to invest in their future. Paying grants not only runs the risk of devaluing degrees but doesn’t address the root cause of the issue and because of this I believe the chancellor was right to withdraw them.

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One thought on “Budget 2015 and the Self-Righteous Student

  1. For a student from a low income family with no savings and no other monetary aid,
    they would be realistically looking at borrowing

    -£9000 Tuition fee loan per annum
    -£8000 Maintenance loan per annum

    Over a four year masters degree that’s circa £68K, not £50K. Your reasoning that over
    the course of a students working life they are expected to earn at least £50K more is not
    sufficient. These student loans are charged at interest depending on the persons salary
    but at a base rate of 1.5% APR. If we take a student who will encounter £68K of debt and
    has a starting salary of £28K then using [1] we can calculate that it will take on average
    30 years to repay and the student will end up paying circa £168K.

    If we take your scenario of £3.25K maintenance and £3.25K tuition fee per annum for 4 years
    you (and I) have £26K of student debt. Now using [1] with a starting salary of £28K it
    will take you approximately 15 years in which you will end up paying a total of circa £45K.

    Enjoy paying £20K more than me to pay off your student debt because you’re a filthy, disgusting
    peasant (and that’s for high achieving STEM graduates). 😉

    [1] http://www.studentloanrepayment.co.uk/scheme/rep/repayment-calculator/sfe/

    Like

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