On Thursday, the Higher Education Policy Institute (HEPI) released a report proposing dramatic changes to the student loan repayment structure. HEPI is a think tank founded to ‘shape the higher education policy debate through evidence’, and Newcastle University is amongst it’s University Partners.
The report, Undergraduate fees revisited, outlines a ten-point plan. The opening proposal is halving the repayment period from 40 years to 20 years. The 40-year repayment period was introduced in 2023. The third proposal then states that “all graduates should have to repay £10 a week, come what may.”
Also suggested is an “additional student loan charge of 3% for earnings between the income tax threshold and the current student loan repayment threshold.”
In its conclusion, the report states that we must accept that the student finance system introduced in 2012 under the Conservative-Liberal Democrat coalition has failed. It claims that neither graduates nor universities like the system.
The report was written by Tim Leunig, an Associate Professor at the London School of Economics. He was formerly Education Advisor to Rishi Sunak during his term as Prime Minister, and Economic Advisor for both Sunak and Sajid Javid while they were both, respectively, Chancellor of the Exchequer.
Newcastle University Vice-Chancellor Christopher Day, who also Chairs the Russell Group, told the BBC earlier this month that ,“The harsh reality is that unless the student and/or the taxpayer pay some more, the sector will shrink or the quality will go down”.
Indeed, the HEPI report outlines the struggles of universities as a reason for altering the system. Highlighting a reliance on the higher fees of international students.
The Newcastle Chronicle reported on Friday that Newcastle University is expecting a £35 million “blackhole” this year due to a significant decrease in international students. The Chronicle explained that an email sent by Christopher Day to University staff stated that recruitment for “core funded” positions would be frozen, and “capital projects” such as buildings and equipment would be subject to review.
The topic of tuition fees has been a common one in the press of late. Labour Peer Peter Mandelson, writing in the Guardian this week, called for an increase in tuition fees. He said, “I believe introducing some form of inflationary link to domestic tuition fees would be a fair approach”.