The debate on variable tuition fees should be reframed as a discussion about the parameters of a graduate-contribution scheme, the vice-chancellor of Sheffield Hallam University has said.
Philip Jones told a Universities UK debate on options for the future of higher education funding that the language of fees was “toxic” because it focused attention on student debt.
“We need to reframe the debate and focus on the way graduates contribute to the cost of education,” he told delegates at the debate in London on 11 December.
Nick Barr, professor of public economics at the London School of Economics, agreed that people were enduring “sleepless nights” over student loans because they thought about them in the same way as credit-card debt.
He said it “might be a good idea to call the current system a graduate tax”, as people did not tend to stay awake worrying about their children’s future tax bills.
However, Professor Barr criticised the National Union of Students’ call for a true graduate tax to replace the current system of fees and loans.
Loans allow the Government to collect repayments from students in other European Union countries, he said, which could not be done through taxation.
He suggested that a “redistributive element” should be built into the loan system so that graduates in more highly remunerated jobs paid a higher rate of interest than their less wealthy peers. How much they paid should be a policy decision, but it should not be “infinitely more”, he added.
Professor Barr also called for truly variable fees.
“Why should a student in a small local institution pay the same as someone at a world-class university?” he asked.
He added that the interest on loans should be charged at the Government’s rate of borrowing to prevent wealthier students taking the cash purely for investment purposes.
Anna Fazackerley, head of education at the think-tank Policy Exchange, who is preparing a report on fees for publication in January, said she had noticed “a real swing of opinion” towards removing the interest-rate subsidy.
But she warned: “We’re going to have to think beyond that – it wouldn’t raise enough money.”