Sunday, March 30, 2014

Tuition Fees versus a Graduate Tax - A False Choice

So the student loans system, of which I was one of the first members, begins to unravel. Who would have thought that the government lending money, with no guarantee of payback, at low rates of interest, and increasing the threshold for repayment, would result in the government losing out? Perhaps somebody with a GCSE in maths? I’m pleased Labour has started to address the problem with today’s announcement that we’re pledging to cut tuition fees to £6,000.

But this isn’t a long term solution to the crisis in funding, and Labour knows it. Now the idea of a ‘graduate tax’ is gaining traction as a way of paying for our world-beating education system, and a real alternative to loaning money on economically obtuse terms. I must confess a layer of bemusement covering my steadfast opposition to this idea – as somebody who is fortunate enough to pay back a significant sum out of his pay packet every month, the current system already feels like a graduate tax to me. Despite the macro-jiggery-pokery of changing a loan to a tax, there does feel to be something deeply unjust about me paying the same amount for a university education I’ve barely finished as O do to a pension that I will likely barely claim, while property-owning baby-boomer colleagues prepare for a well-earned retirement, founded on modest incomes built by university education they’ve never directly paid for. A graduate tax couldn’t practically find every graduate working today, and so its arbitrary start point will simply perpetuate this frustrating and unjust system of taxing those graduates who can afford it least.

For society, there’s a more worrying element to a graduate tax: it’s inherently anti-intellectual. In simple terms it means we’re prepared to tax a successful scientist curing cancer more than a ‘self-made’ businessman or premiership footballer whose skills do not necessarily depend on university education. Surely, we should live in a society where the rate of tax paid by individuals is based on their ability to pay, not linked to their education.

If ever there was an idea that keeps people in their place, a graduate tax is it. Those from backgrounds where university education is a given will see no alternative, of course, but that’s not true for those who don’t take getting a degree as a given. With well-paid graduate jobs increasingly rare, and governed with plenty of prejudice themselves, for students from communities where jobs and career paths without a degree are more familiar, the idea of staying away from university becomes all the more appealing.

If we abandon a graduate tax as an idea that is arbitrary, anti-intellectual and exclusive, how do we pay for our universities? The radical answer is: through general taxation. Simply put, we need to raise tax on the wealthy, permanently, as they are able to pay for the maintenance of a world-class higher education system that’s to the benefit of the whole of society, not just its students. In effect, of course, many of society’s wealthiest are university educated, and so it is, in part a de facto ‘graduate tax’. However, it will also mean that those who earn little as a result of their education, including those who sacrifice high pay to do the most demanding and socially worthwhile jobs (like doctors, social workers, academics) are not arbitrarily lumbered with a burden not paid by a footballer. A footballer who may not be university educated, but needs those skills in a society as much as anyone, and is more able to afford to pay for them than the direct recipients.

Funding through general taxation is the only way in which we can ensure higher education is paid for by all, and is accessible to all. Moreover, we should also end the outdated and elitist notion that only higher degrees should be paid for in this way. We need to make room for such funding for other skills and qualifications – it’s mad that Further Education, particularly in practical skills from plumbing to IT is still often funded by up-front fees paid by students least able to afford it.

One of the arguments often touted by tuition fee proponents was that is unfair for the dustman to pay for the doctor. Despite the obvious answer that it’s in the dustman's interests to maintain a quality health service, one might very reasonably agree that if the doctor is not prepared to pay for the dustman’s skills and lifelong learning, then perhaps the dustman should keep his cash. We need to fix that – through a system where bankers and CEOs bear the biggest financial burden of paying for skills, not working and middle class people.

So yes, let’s reduce tuition fees now. Yes, let’s have a big conversation about how we fund skills for everybody, at every stage in their life, whether practical or academic. But let’s fund it from the pockets of those who are our wealthiest, irrespective of where that wealth comes from. And as for the middle-aged politicians who say it is unfair and impractical? Perhaps they’d like to cough up the fees they’ve never paid, as they can more than afford it. Up front, with interest, please – it’s only fair.