Chichester MP co-writes forward of a new Onward report, 'A Question of Degree' that looks at student loans, the value of degrees and technical education.
Foreword:
One of us went to university. The other started work as an apprentice in a car factory and took a degree later through her employer. We both ended up as MPs. That’s how it should be. There should be lots of different ways to learn and improve your skills. You should be able to get to the top jobs and top qualifications whether you go to university, or learn on the job, or go to a technical college. But at present we have a dramatically lop-sided system. University education dominates at the top of every profession, and every institution. In contrast, technical education and apprenticeships have been the poor relation for decades, neglected and underfunded. Until recently, these courses have not even provided any route to high level qualifications or top jobs. In recent years that has started to change, with the creation of higher level technical education, degree apprenticeships and the forthcoming Institutes of Technology. But still there’s a long way to go. And a lot to change. Thanks to new government data we now know that there are many people for whom it is not worth incurring over £50,000 of debt to obtain a university degree - either for them, or for the government. This paper concludes it is between a fifth and a quarter of university students. We now know specifically which courses, at which institutions, see their graduates earning too little for their degree to have been worth it financially. That’s not the only way in which the facts have changed in recent years either. New data on the dramatic imbalances of wealth between generations makes it clear that we need to take urgent action to help younger generations enjoy the same opportunities their parents had. This paper proposes that we boost the incomes of younger graduates with a graduate tax cut which will halve the repayments of anyone with a student loan. Unlike cutting tuition fees, which does nothing for those who have left university, it will benefit people whether they are past, present or future students. It proposes that we pay for this tax cut by reducing the cost to the taxpayer of subsidising low value university courses that don’t benefit their students. Roughly half of the student loans issued each year are now not expected to be repaid. 83 per cent of students won’t repay in full. So if we could steer people away from low value courses towards either higher-value university courses, or towards upgraded technical options – like graduate apprenticeships – then we could save enough to pay for a tax cut that will benefit younger graduates, and to invest in further improving technical education. In 1999 Tony Blair set a target for 50 per cent of young people to go to university. A goal to simply expand the numbers at university may have made sense before we had data on which courses were worth it. But we now know that many courses won’t benefit their students financially. So our goal should change – we should aim instead to maximise the number of young people learning in ways that will actually benefit them in the long term. Earning a living is not the only reason people study. Of course, education has a value in its own right. There will always be people studying things that are beautiful or important in ways that don’t add to GDP. But for most people, study is a route to a job, a career, a better income. At the moment too many of those young people are being sold a false promise. Too many are facing hefty repayments for degrees that won’t help them financially, and too few are being offered quality technical and apprenticeship options instead. It’s time to rebalance the system, and create a country in which there are more good options and more ladders to climb up.
Neil O’Brien OBE MP and Gillian Keegan MP
