This week, the Higher Education Policy Institute (Hepi) announced it is lobbying for tougher sanctions on those who refuse to pay back their student loan, namely those who move abroad before doing so, and suggests graduates should be treated like tax evaders, benefits fraudsters, or even arrested if they re-enter the UK. Inspired by New Zealand, the think-tank wants to see student loan payment evasion eradicated.
On the surface, this seems fair enough. When you attend university, you enter into an agreement with the Government. They provide you with the funding to complete your desired course and, in return, you pay them back when you have graduated and are earning above a certain amount. Compared to the situation in America, it almost seems reasonable. Breaking the rules of said agreement should be met with some sort of sanction, as there would be if you were to move abroad to escape a bank loan.
That being said, what Hepi fails to recognise is that, in the UK, you have to go to university in order to guarantee you’ll have a high earning job. Unlike in the days of our parents, or our politicians, hard graft simply isn’t enough. You need a piece of paper to back it up. It’s hard to respect politicians who keep increasing the price of university while they brandish their degrees paid for by the taxpayer.
Nick Hillman, director of Hepi, said: “If the Government is serious about wanting to sell off the student loan book to the private sector, tougher penalties for non-repayment would also increase its value. Ministers, MPs, and peers should consider amending the Higher Education and Research Bill currently before Parliament to ensure higher repayment rates.”
The fact the Government treats student debt as a way to make money is the key problem. University has stopped being a way to educate future generations and has become a business. Forget increasing taxes on those earning £150,000; let’s have a higher repayment rate for the graduate earning £25,000 and living in London. Whitehall’s logic here is not fully sound, nor is it fully informed.
While I don’t advocate the decision to move abroad to escape your student loan, it should be a warning sign to the Government not to arrest graduates but to examine the reasons why they may resort to such desperate measures. The Hepi report comes after the Sutton Trust found England to have the highest level of debt per graduate than any other country in the English-speaking world. England’s grads are now leaving with almost £45,000 of student debt. By comparison, New Zealand’s graduates leave with just £23,000, the lowest of any other anglophone nation. So is it fair to compare England to New Zealand, when actually their graduates get a much fairer deal in the first place?
Everyone always throws around the figure of £9,000, a yearly amount that isn’t even the final price of a year at university. You still have to add in a maintenance loan, which often does not cover the cost of rent, so students have the added pressure of working a part-time job. NUS Insight found 64 per cent of students worry about money either all the time, or very often. Speak to any university undergraduate, and you’ll often find their biggest source of concern is their finances – not their course load.
Students should not be allowed to run away and escape their student loan. The responsibility of repaying a loan is part of being an adult. However, before Hepi makes sweeping statements about arresting students at Heathrow, it should consider the root cause of such an action. Maybe if the UK’s student loans were as low as they are in New Zealand, the same course of action would be appropriate.