May launches review of high UK university fees, promising fairer deal

19 Feb, 2018 10:14 am

LONDON (Reuters) – Britain could reduce the burden of university fees on students and bring back grants for their living expenses, Prime Minister Theresa May will say on Monday, under pressure to lure younger voters a year after they cost her parliamentary majority.

May’s predecessor David Cameron, a fellow Conservative, tripled the cost of tuition for students from England and Wales to 9,000 pounds a year, many times higher than the fees other EU countries charge their citizens. In 2016, the government also phased out all grants to help poorer students with living costs, replacing them with loans.

The opposition Labour Party says it wants to eliminate student fees and restore grants.

May’s Conservatives, or Tories, have long defended their approach, arguing that requiring students to pay helps fund more places so more people can study, and puts more of the burden of the cost of higher education on those who benefit most from it.

Students do not have to make payments on their loans unless they earn above a minimum threshold, although they continue to accrue interest. Unpaid balances are wiped out after 30 years.

But the system is extremely unpopular with younger voters, angry about being the first British generation to start their careers carrying tens of thousands of pounds of debt. Young people voted heavily against the Conservatives in an election last year that surprisingly erased May’s majority, forcing her to form a minority government.

May will acknowledge that Britain now has “one of the most expensive systems of university tuition in the world”, and pledge to make it fairer, according to excerpts from her speech released in advance by her office.

“All but a handful of universities charge the maximum possible fees for undergraduate courses. Three-year courses remain the norm. And the level of fees charged do not relate to the cost or quality of the course,” she will say.

The review “will examine how we can give people from disadvantaged backgrounds an equal chance to succeed”, including looking at grants for poor students, her office said.

Education Secretary Damian Hinds said on Sunday that students could be charged variable tuition rates depending on the economic value of degrees in the subjects they study.


“What we need to look at is the different aspects of pricing, so the cost to put on the course, the value it is to the student and also the value to our society as a whole and to our economy for the future,” he told BBC’s Andrew Marr show.

The opposition said such a system would only serve to lock poor students out of the best-paid professions.

“Charging more for the courses that help graduates earn the most would put off students from the most disadvantaged backgrounds from getting those same qualifications,” Labour education spokeswoman Angela Rayner said on Twitter.

“So much for the PM’s talk about social mobility. The Tories really haven’t grasped the reality of social mobility.”

Earlier on Sunday, a parliamentary committee said the government should cut the interest rate it charges on student loans, which are pegged at 3 percentage points above retail price inflation. The current rate of 6.1 percent is higher than most banks charge for mortgages or unsecured personal loans.

The British parliament’s Treasury Committee said the use of RPI as a benchmark was unfair, and the 3 percentage point premium introduced in 2012 was hard to justify.

“The government must reconsider the use of high interest rates on student loans,” said Nicky Morgan, Conservative chair of the cross-party committee.




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