How higher tuition fees will cost the government more

[the_gabih]

The hike in tuition fees is set to create a huge financial black hole because the government underestimated how many universities would charge the maximum £9,000 fees, according to a powerful committee of MPs.

A report by the Public Accounts committee suggests that the funding gap could cost the taxpayer an extra £95m a year and lead to a reduction

Comments

[red_pill]

prahapse im missing something, but...

loans are being incressed whilst grants to the univserty from the public purse are decressed. the net is roughly simmler, but the loans will, theorticly, get paid back.

therefor, whils thtere is in incress in borrowing from the studnet loans componey, there is a decress in giving from the grants or whatever, and it all stays about even keel, but with more paying back

or am i missing a step?

[the_gabih]

Theoretically. However, that won't even out until the majority of graduates find jobs that pay them at least £21,000, and in the current economic climate, that might not happen for a while. In the meantime, the government's budgeted for a situation where most universities charged £7,500 a year, and suddenly they've got to find extra money where they'd planned to save.

[red_pill]

ummm...

still, theorticly, they should get back more money then they would with say, the grant. prima facie anyway.

[the_gabih]

But we don't do grants. We haven't since 1997 (except for a miniscule maintenance grant for the poorest students, which I think is being kept). Nobody's arguing for grants, we're just saying that massive cuts are both not helping the budget, and hurting social mobility within the UK.

[red_pill]

sorry, what i ment was

there is money, given directly to universtys, i belive. the goverment wants to cut this, if i recall correctly. as the alterntive, its alowing universty to do whatever they like with tusion fees, with a cap

when i say grants, i mean the money the universtys resive direct from goverment. i am almost certenly using the word wrong.

and i never said that i agreed with the policy. i dont. i just tend to look at things and poke at them, like this interptration of the lack of goverment forsight. if, for example, the amount charged is more then the amount cut from direct universty funding, thats a goverment fuck up in the pocket department (as opposed to the asshole department, where there doing amazingly well at being assholes, i agree)

[witherwings]

You're thinking of teaching and research grants. The former is administered by HEFCE who also tell unis how many UK/EU students they can recruit. They get fined if they're under or over.

[polietics]

The step you're missing is those loans which don't have to be paid off - either because the graduate never reaches the cap on paying back or they just skip the country, explained in the article as:

This means that the current balance of outstanding loans -- £24bn -- is expected to rise to £70bn by 2015-16, the report says.

[red_pill]

yea, but there will still be a bigger recoupment on whats been paid then with a grant, as there is the requierment to pay it back once yatta yatta yatta

im not saying i agree with the polcy, but rather, from a purely fincal perspective, they should still, despite the cluster fuck, get back more money this way then with grants. i think.

[polietics]

Yes but in the end which is a far off place well away from now, where the recession is. They'll get more money back in 50 years, sure! But now? When they actually need the money?

[frelling_tralk]

It depends on how many get paid back though. With today's job market, and a degree no longer being a guarantee of a good job, a whole load of those student "loans" are going to be defaulted.

[red_pill]

you never defult on a student loan in the uk, i dont think. it just sits around doing nothing until you hit the 21k mark.

that said, they should, in theory, still get more back as this is replacing grants and so if any gets paid back it will be more then with grants.

[frelling_tralk]

that said, they should, in theory, still get more back as this is replacing grants

Student grants ended in 1997? We've had loans for a while now

[red_pill]

i used the word grant poorly. i ment direct goverment funding to the universty.