Labour proposes £6k fee cap, but Conservatives smell a U-turn

The Labour Party would reduce the annual tuition fee cap to £6,000 if it were in power, Ed Miliband has said, in an apparent move away from favouring a graduate tax.

September 26, 2011

The Labour leader, who made the announcement in a newspaper interview on the first day of the Labour Party conference in Liverpool yesterday, claimed the reduction in the cap, which is £3,000 lower than that due to come into force in 2012, was “fully costed”.

He told The Observer that the policy would be financed by reversing a cut in corporation tax for the banks and implementing higher interest rates on tuition fee loans for graduates who went on to earn more than £65,000 a year.

In its response to the idea, Universities UK, said it “welcomed the recognition that higher education must be adequately funded from a number of sources, and that that should include a system of graduate contributions”.

However, others, including the Conservative led coalition government and the National Union of Students, were quick to criticise.

David Willetts, the universities minister, is quoted in the Guardian as saying: “Ed Miliband has now accepted that tuition fees should be doubled to £6,000 a year.

“He has consistently supported a graduate tax and Labour MPs were whipped to vote against higher fees at the end of last year. This monumental U-turn is evidence of weak leadership.”

And Liam Burns, president of the National Union of Students, told Sky News that the changes would not help poorer students, partly because many lower-earning graduates will not pay-off their debt in full within the 30 year time limit.

“You have to think who this benefits,” Mr Burns said. “Because of the 30-year cut-off – in which your debt would be written off under the system being proposed – actually taking the cap down to £6,000 would benefit the richest the most.”

Mr Miliband is reported to have launched the £6,000 plan as one that would form a major plank of the Labour manifesto were there to be an early election.

However, it was not clear whether the plan would survive in its current form if the coalition was to serve a full term.

The Labour leader told the BBC that “if we can do more by the time of the election [in 2015], we will”.

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