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Who should pay for my education?

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The Browne review has been drawing a lot of attention in the UK recently, with a lot of students protesting against fees that will burden them with debt. Having read the student funding section of the report, I disagree with the whole student-burdened-with-debt idea here is why.

As consumers, everyone would like a free education. Not to mention free health care. And while we are on the topic, maybe a free cleaner and cook as well.

There is only one problem with free stuff. In most cases, it does not exist. If not the consumer, then someone else, somewhere is paying for the free stuff. In turn this means that this particular consumer is paying for others consumption. The options are to fund services from taxes or prices. In my economically untrained opinion, prices are better, but that discussion is for some other time.

What should a good funding scheme for education encompass? There is quite a lot, but primarily it should allow any student, irrespective of circumstances, to study any course he like. Secondly, it should safeguard universities, preferably from the vagaries of government policies. Thirdly, the financial cost should have a low impact on the students’ career choice. Finally, if for some reason the student has had a limited income for most of his life, he should not have to scramble in his last few working years trying to earn enough to pay back any loans.

The recent Browne review, which put forth a new funding scheme for UK universities achieves all these objectives. The student chooses the course they would like to follow and the government pays their course fees upfront to the university. Once they graduate and get an income above £21000, they pay a fixed percentage (9%) of the income above £21000 every year towards repaying the government. If their income falls below the threshold, they stop paying and the remainder of the loan is written off after 30 years.

This system gives the universities the money they need. The student does not have to commit massive amounts of money upfront and does not really have to tailor their careers around the obligation of repaying their loans. If, due to circumstance or career choice, they cannot repay their debt, it is simply written off.

I cannot think how this system is different from the purportedly “free” education. In addition, it has the advantage of most people paying only for what they consume themselves without having to shoulder someone else’s bills. This scheme is a good idea, as long as the government keeps income taxes low. They should not accept this system and raise income taxes. That is plain sneaky.

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Written by clueso

November 30, 2010 at 12:11 am

Posted in Uncategorized

Tagged with ,

One Response

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  1. If at all possible, in my opinion, a person should pay for their own education.

    Michael G.

    November 30, 2010 at 3:56 am


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