Student loans good. Graduate tax not so good

Good piece by Nicholas Barr in the Guardian on the reasons the current loan system is better than the NUS-preferred Graduate Tax:

The bottom line is that we have the best of both worlds. Graduates face what looks like a graduate tax, but one that does not go on for ever. And universities face a system that encourages competition and strengthens university autonomy.

Also includes a helpful reminder of the difference between a system which makes the education free for the student and a credit card debt:

Many people conflate student loans with credit card debt. This is plain wrong. A credit card debt of £20,000 rightly causes parents sleepless nights. Student Loans Company debt is very different – low interest rate, long repayment period, and no repayments when income is low. What parent has sleepless nights over their child’s future tax bills – even though a typical graduate over a full career will pay around £1m in income tax and national insurance contributions? Thus university is free to the student, and graduates face an income-related payroll deduction when they start earning. The government should be loudly cheered for bringing in this system and noisily excoriated for its complete failure to get across to the public that this is how it works.

And he is quite right about the under-promotion of the realities of the system.

Advertisements

More on Departmental Headship (as or versus Stalinism)

Following up an earlier post on this topic (with thanks to John Dale and the author for the prompt):

Nice post in which Mark Harrison draws on substantial knowledge and experience to compare and contrast Stalin’s Soviet Union with his reign as Head of Department:

The big difference was this: I had no barbed wire. With a few coils around the campus, I could have blocked off the exits. I’d have had to give guns and spotlights to the security staff. If I could have stopped my professors from leaving, I would have been able to do things to them that would lower their welfare, and they would have had to accept it. They would have grumbled, and then conspired against me, and I would have needed a political police within the department to listen, detect, and report it to me. I’d soon put a stop to that. Forced labour would be next. But I had no barbed wire. If they didn’t like the pay or conditions on offer, and could do better elsewhere, my colleagues would leave. Other universities that could use their talents more productively would make them a better offer, and I would have to match it or lose them. Without barbed wire, I could not accumulate personal power by treating others badly; I could get my way only through reliance on positive motivations.

But there are also some very strong positives here too. Well worth a look and I will get round to reading the article by Radice which prompted this.