Labour plans long-term move to graduate tax, says Byrne

Shadow universities minister also vows to tackle overseas recruitment barrier

December 5, 2013

Source: Alamy

Look to the future now: ‘universities will be an election issue,’ says Liam Byrne

Labour’s election manifesto could set out a “long-term shift to a graduate tax” as well as a funding policy for the next Parliament, according to the shadow universities, science and skills minister.

Liam Byrne also said that his party would help universities to recruit overseas students by freeing them from the coalition’s net migration target.

And in his first interview since starting the job in October, Mr Byrne set out a wider policy vision: suggesting that universities and science would be central to solving the “cost of living crisis”, identified by Labour leader Ed Miliband, through the creation of more high-wage jobs in the future.

If you like higher education trivia, here is a little known fact about Mr Byrne: what links him, University of Bedfordshire vice-chancellor and former Labour minister Bill Rammell, and new University College London provost Michael Arthur? They all went to the same comprehensive school: Burnt Mill, in Harlow, Essex.

After that, Mr Byrne’s path took in politics and modern history at the University of Manchester (where he led the students’ union), an MBA at Harvard University, work for consulting firm Accenture and bankers N M Rothschild & Sons, founding his own software company, and posts in the Labour government including chief secretary to the Treasury.

So, on the question of funding, is Labour persisting with its policy – announced with great fanfare in 2011 but rarely mentioned now – to lower tuition fees to £6,000?

“The policy we’ve set out is what we would do if we were in government today,” said Mr Byrne. “Ed Miliband also said in his leadership campaign, our long-term goal must be to move towards a graduate tax.”

He added: “What we’ll have to do in our manifesto is take our starting point of £6K fees, explain how we see the situation for 2015 to 2020, and how we’ll see a long-term shift to a graduate tax,” noting that at Manchester, he had been “the first student leader…to set out an argument for a graduate tax”.

Turning to the policy of his main rivals, he suggested that the Treasury’s worries about the loans system “will not allow” the Tories simply to opt for the status quo in their manifesto. “I don’t think the Conservatives will be able to go into the 2015 campaign saying it’s £9K flat for the next Parliament,” he said.

Impact of immigration policy

Then there is the impact of immigration policy on universities’ ability to recruit overseas students. Asked if Labour would support institutions’ demands that higher education students be withdrawn from the net migrant count, Mr Byrne said: “We’ll certainly seek to do that, but strategically we’ll do something more important.

“The government has a target of reducing net migration to the tens of thousands…as long as that target remains in place, I’m afraid there remains the risk that there will be action taken to reduce foreign student numbers in the future.”

He added: “We just don’t think the ultimate target is the right policy.”

What about taking on a job that was widely perceived as a demotion from that of shadow work and pensions secretary?

“Ed Miliband knew that I would give my eye teeth for a job like this,” Mr Byrne said. “Because it is the mission that I have probably thought most about for most of my time in business and in politics. This brief is at the heart of what Ed Miliband wants to achieve in British politics.”

In a speech at the Institute for Public Policy Research thinktank on 9 December, Mr Byrne will flesh out his policy vision for how science can drive a new UK economy. In the interview with Times Higher Education, he highlighted “how universities help us…build a different type of economy, where there’s a bigger supply of better paid jobs in high-growth, high value-added sectors”.

In a comment on the cost of living, he added: “Universities should pay a living wage – there aren’t any two ways about it.”

Mr Byrne said that five years’ work on his book, Turning to Face the East: How Britain Can Prosper in the Asian Century, published this year, convinced him that the UK’s universities “will be amongst the most important bridgeheads to new markets like China”.

Shortly after landing his new job, Mr Byrne reread Harold Wilson’s “White Heat of Technology” speech, which marked its 50th anniversary in October.

“Back then, Labour saw universities as a critical way in which Britain prospered in a different kind of world,” Mr Byrne said. “We are the party of the scientific revolution…There’s a wider game here, and that’s why I think universities will be an election issue.”

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