I have, you were ambiguous - but I guess that your idea of a huge salary is somewhere between £21k and what I'd call a huge salary.
I used the term huge salary, because I was vague on the numbers, but IIRC what was needed to clear the loan within the 30 years was £47k. Anyone earning less than that will not pay it off.
And, yes, £47k is a huge salary for most people.
According to a quick search over 40% of the loans will never be paid off - sounds a bit pointless going to Uni if you'll barely earn more than minimum wage.
Assuming your 40% is correct, more then 60% of graduates will earn £47k or more, which is way more than the current median wage.
Minimum wage is currently £6.19 per hour. At 37hpw and assume paid holidays, that's just under £12k per year.
Assuming your 40% is correct, more then 60% of graduates will earn £47k or more, which is way more than the current median wage
...which is taxed accordingly so they would be paying way more in income tax and NI than anyone earning the median salary. Doesn't seem necessary to effectively tax them twice just because they chose to go to university.
For reference I studied an arts degree (Graphic Design) and my first job was £20k salary, I got offered the job the same day I received my results.
I appreciate my situation isn't the norm and I know a lot of graduates from all sorts of degrees (science, arts, engineering, etc) who are working in retail stores or elsewhere.
My Arts degree seems to have paid off, however I wish there were more people with Engineering degrees - that way us with the Arts degrees would be more in demand and thus paid more!
...which is taxed accordingly so they would be paying way more in income tax and NI than anyone earning the median salary. Doesn't seem necessary to effectively tax them twice just because they chose to go to university.
They're being "taxed" the same number of times as any graduate, just at a different rate...
They'll also pay back less overall on their student loan than someone earning less...
Just had a look and see IBM say they pay £30k which is pretty impressive. Logica seem to pay up to £26k, would have thought they were average sort of payers. What are your skills?
I'm a project manager now. No complaints about my earnings these days, took me time to get where I am. A degree definitely wasn't a help in getting there.
Had I been oriented towards programming, coding etc, then I'd be earning much more, but that's not at all my skill set. My younger brother will be sorted, he can go programme for IBM and earn £30k - sure my dad will be more than happy to suggest it and ensure he moves out 😀
Which is why I included the word effectively.
I'm perfectly happy with
...which is taxed accordingly so they would be paying way more in income tax and NI than anyone earning the median salary. Doesn't seem necessary to tax them at an even higher rate just because they chose to go to university.
Interesting stats:
Some background of average salaries: http://career-advice.monster.co.uk/salary-benefits/pay-salary-advice/uk-average-salary-graphs/article.aspx
A degree can add £12k per year to earnings: http://www.bbc.co.uk/news/education-12983928
Doesn't seem necessary to tax them at an even higher rate just because they chose to go to university.
They're not taxed at a higher rate because they're graduates, they're taxed at that rate because they earn a lot.
They're not taxed at a higher rate because they're graduates, they're taxed at that rate because they earn a lot.
they are if in addition to the normal tax rate, they have to pay back a loan to the government that had to be taken out to cover the university fees in the first place.
IBM have an intensive selection procedure, I'd have thought they were paying top whack to be honest.
Depends how popular they are, market forces etc.
they are if in addition to the normal tax rate, they have to pay back a loan to the government that had to be taken out to cover the university fees in the first place.
People earning less and so paying lower rate income tax will also be paying this back...
That graduates will earn more, on average, than non-graduates and so pay more in tax was always an argument against the introduction of tuition fees. I fully agreed with this.
Are you suggesting that there should be tax relief on student loan repayments? Or that there should be a cap on the maximum monthly repayment? Or against progressive taxation altogether?
I've posted enough on this thread for you to realise what I think.
Clearly not, but I'm more than happy to leave it here 🙂
I should add that my position is that Higher education should be taxpayer funded with no repayments. What I do not think is that it should be universal, rather it should only be open to those who have earned it.
Can you figure it out from this?
molgrips - MemberSo, is there an argument for a quota system of grants? So, all engineers, scientists, doctors, nurses, etc get a free ride; then other degrees get a limited number of free grants depending on the value to society of the degree?
There is an element of this up here- our funding model's quite different to England. Some courses get specific additional funding (mostly STEM stuff) so more funded places are available. It's also a consideration when allocating funded places to institutions in the first place (frexample we have some courses we could fill several times over, if more funded places were available, but they're not courses that are as high a priority)
It sorta kinda works, though to be fair the prioritisation isn't always right- no surprise. There's some downsides though (free education for all scottish kids- yay! Less places for scottish kids though. Alternatively, english kids can pay and have no quota cap. A bit weird. Northern Ireland is where it meets in the middle and all goes tits up.
Can you figure it out from this?
You assume that I could remember exactly what was said by each person in every post that they made in the thread. Had a quick scan through and spotted that, which made your position clear.
I absolutely agree that the fact an (average) graduate will earn more, and therefore (probably) pay more tax* is a perfectly valid argument for fees never having been charged in the first place.
Unfortunately, this argument was lost and fees are here, as are repayments, and this was the context for my comments. I suspect we're actually on the same "side" on this.
*I was at uni with some people who went on to very high-risk, borderline dodgy, banking practices which probably helped contribute the the current financial situation, but we'll gloss over that 😉
Free education for scottish kids omg how does that work 😉
Sad to see how narrow peoples view of benefit to society is on here. Or how the education of others may benefit them.
Sad to see how narrow peoples view of benefit to society is on here. Or how the education of others may benefit them.
I went to Durham, so most of my peers went into finance/accounting or law. I think that's probably net drain on society 😉
[i]That graduates will earn more, on average, than non-graduates and so pay more in tax was always an argument against the introduction of tuition fees. I fully agreed with this.[/i]
Presumably though this is based on the past, when there were far less graduates and consequently a degree had higher value?
Has anyone else had someone called Andrew Roberts email them to tell them how wrong their point of view is (as posted on this thread)?
If he's emailing everyone on the internet, who disagrees with his point of view, he's going to be a very busy boy and possibly ought to seek some professional help.....
one angle not covered so far is the scope for cutting fees without compromising on the quality of degrees.
Most / all of the "established" universities have made few if any efforts to transform their cost base or their operating model - they are still stuck on fixed 3-4 year degrees with many buildings idle in the evenings and holidays.
A more commercial approach could see them reduce their estate and working the buildings more intensively thus shortening degree lengths (to 18 months or 2 years excluding the lab / medical based degrees).
This would not only enable the fixed costs per degree student to be reduced but would also save students a significant sum on living and accommodation expenses as well.
Unsurprisingly, most of our universities aren't interested in modernising their operating models or responding to the desire from their students / customers for shorter courses so it's actually the newer private universities and likes of BLP who are driving this agenda.
Oh, and the nonsense about the students loan company is just that - it's simply the sale of a loan book whereby the treasury will convert a long term liability (default on loans) into an asset.
Presumably though this is based on the past, when there were far less graduates and consequently a degree had higher value?
Yep, that's one of the counter arguments, and one of the reasons fees were introduced. Though, it could be argued that a more educated workforce will create value.
I went to Durham, so most of my peers went into finance/accounting or law. I think that's probably net drain on society
Net drain? You'd need 4 "normal" people to contribute the same amount of tax as one of those 😉
Yep, that's one of the counter arguments, and one of the reasons fees were introduced. Though, it could be argued that a more educated workforce will create value.
IIRC the drive was based on an 'arbitrary' figure of wanting to have 50% of young people degree educated rather than working out the possible cost / benefit over people's lifetimes etc....
Net drain? You'd need 4 "normal" people to contribute the same amount of tax as one of those
I'm not sure that they pay tax, do they?
Oh, and the nonsense about the students loan company is just that - it's simply the sale of a loan book whereby the treasury will convert a long term liability (default on loans) into an asset.
It's not simple enough for me. Can you expand on this please? Why would anyone buy what for the government is considered a long term liability? Where does the liability turn into a potential profit worthy of investing in? How does a liability turn into an asset?
The student loans book isn't a liability (how would they sell it if it was?) It's an asset- despite the rise in expected defaults it's still a long term cashflow.
There's only 2 reasons to privatise it... 1) Sell it to your mates. Or 2) Fiddle the books- sell a long term asset to give a smaller, temporary boost today and make the budget figures look better this year, in return for a longer term loss that future governments can worry about.
Northwind - with your background I thought you would appreciate there are some organisations that are better set up to administer a loan book than the government
Nah, tbh I don't agree. The SLC's a big enough institution to justify maintaining its own standalone infrastructure (particularily as the methodology and terms are so nonstandard). And it's a long-term return, which frankly the financial sector has grown bad at, meanwhile nobody is better placed to borrow or lend over a half-century basis than a country.
If the government were going to cut a really good deal, and sustain the rate cap, then it could be a good option. But it's going to be either subsidies via the synthetic hedge, (making it a long-term cost instead of a long-term gain) or it's going to be at the expense of student borrowers. And in either scenario it's almost certainly going to be sold for less than it's worth.
Hang on. Student loan interest is at or below inflation, isn't it? And with the defaults, how could it ever be an asset? And who the hell would buy it? Unless... Jackthedog is right...
There's a load of different rates... Had to google this, old mortgage style ones are set at RPI, more recent ones are either RPI or 1% above an average of bank base rates (whichever is lower), but the new IC loans are 3% above RPI.
o'course, that's just the current terms- it's pretty much a given that this would change in one of two ways if it was sold (either the hedge or removing the cap, for new and/or for existing students)
I for one look forward to a future of retrospective interest changes, with a subsequent wave of non-payment, leading to the SLC repossessing people's degrees from inside their brains with a chisel.
Re: selling the student loan book, of course there will be a price but with low Interest rates that price will be less tha face value, so for arguments sake of you have £100m of loans the sale price might be £90m taking into account loan terms (eg rate, length of loan) and default rate assumptions.
Also just because a loan interst rate is set at "inflation minus" doesn't mean it's a bad rate as such "inflation minus" might turn out to be better than "base rate plus" or long term fixed rates
The hedge is a red herring as that is on the government books already by selling without the risk they will get a commensurately better price, the government borrowing rate is likewise largely irrelevant as they are looking to sell to their lenders the pension funds.
mefty - MemberThe hedge is a red herring as that is on the government books already by selling without the risk they will get a commensurately better price
Nah, the hedge is again a way of fiddling the books- make the sale today look better than it is, at the expense of a long term cost which future governments can deal with. It's a subsidy hidden behind a name. Classic privatisation really, privatising the asset and the profit but not the cost.
The hedge isn't already on the books, not really sure what you mean by that tbh... Unless you're looking at it from a lost opportunity point of view (ie, the cap prevents us from taking more profit from interest).
But, the falsehood there is that if we sell the SLC, we still lose that opportunity, there's no gain there. But we end up also paying out the hedge. So it is a net loss.
And yet it's happening. Some of the things that are going on seem so unlikely that people just aren't looking for it, so they don't see it.If the plans for the legal system come to fruition, it could soon be perfectly plausible that you could be arrested by G4S officer, held in a G4S cell before being transported in a G4S van to be tried in a G4S court by G4S prosecutors using forensic evidence gathered in a G4S lab, while you're defended by a G4S lawyer, before being transported in another G4S van to a G4S prison, where you will have no choice but to to provide unpaid labour for a G4S company before eventually facing a G4S parole board and, if you're lucky, being released into the care of a G4S halfway house wearing a G4S ankle bracelet, reporting to a G4S parole officer.
This is the same G4S responsible for countless newsworthy failures prior to its rebrand and continues to be responsible for failures under its new flag today, the same company that reneged on its contract to provide security at the 2012 Olympics, leaving the tax payer to come to the rescue.
Scary, no? At what point are we as a society incentivised to tackle the causes of crime when there is so much money to be made profiting from cheaply and badly managing the symptoms? And what incentive is there for a company to provide a solid defence in court when doing so would reduce the future income of its other branches?
Unlikely? Seems it doesn't it. That's why we're moving towards it. Nobody is paying attention. Just like the NHS being carved up and privatised as we type. Nobody believes it, because we choose not to look.
Those who do choose to look are being left increasingly with no option but to take to the streets with regularity, trying whatever they can to spread the word, gain support and grow some kind of resistance to it. And what happens? They get heckled, laughed at, dismissed and derided by the very public they're trying to help. I've watched it happen. I've been on the receiving end. It's just astonishing.
Where a government has come into power through some form of popular vote, fraudulent or not, and maintains at least an appearance of constitutional legality, the guerrilla outbreak cannot be promoted, since the possibilities of peaceful struggle have not yet been exhausted. - Che Guevara
Unfortunately life is still to good for most people to care, the collective memories of how the serfs were treated prior to the two great wars are all but gone hence the apathy. Also most people are cowards, the psychology of the herd has a lot to do with it.
IBM have an intensive selection procedure, I'd have thought they were paying top whack to be honest.
Oh I started off with them, must be more fussy now?!
I'm a project manager now. No complaints about my earnings these days, took me time to get where I am. A degree definitely wasn't a help in getting there.Had I been oriented towards programming, coding etc, then I'd be earning much more
Hmmm, our project managers earn pretty well - in fact us Technical Consultants are at the bottom of the earnings, partly because much of our work can be done off shore. I'm the only tech guy on my project based at the client site, I'm leading a team in India which will soon be 10 people. They're charged out at 20% what I am, hard to justify my time really though definitely needed and so far the client agrees.
