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Laurie Penny: We need a retroactive graduate tax

Vince Cable’s plans are bold and progressive, but could go further to reduce inequality.

This morning, Vince Cable signposted his plans for a change in university funding, whereby graduates might find themselves repaying the cost of their degrees in the form of a tax based on earnings, as opposed to the current student loans system, which discriminates in favour of those who go on to more profitable careers. Cable said he would ask the former BP boss Lord Browne, who is leading an independent review into university fees and funding, to examine "the feasibility of variable graduate contributions".

This is a bold and progressive idea. But why not be a little more bold and a little more progressive, and apply the graduate tax to all graduates, not just current and prospective students? If tax can be applied retroactively, why not levy a fee from all working-age graduates, including those aged 30 and above who have used the benefits of free higher education to carve out high-paying careers for themselves?

Cable has a track record for sound ideas about higher education, including his observation that too many graduates are now going into jobs that were previously the province of non-graduates. This has implications for his cited figure of £100,000 as the average difference between the earnings of graduates and comparable non-graduates net of tax. The graduate earnings premium peaked in the 1980s; today, a university degree is a mandatory requirement for most lower- and middle-management jobs, rather than an optional educational extra to boost one's earnings.

Cable previously told the BBC that "if you're a schoolteacher or a youth worker you pay the same amount as if you were a surgeon or a highly paid commercial lawyer. I think most people would think that's unfair." Surely it's rather less fair to expect those over 30 to pay nothing at all? Surely it's not beyond the pale to ask those who enjoyed British higher education at its most lucrative and inclusive to give something back?

If Britain is to remain a world leader in research, innovation and education, our higher education system needs more money, and fast. But why should the burden of financing the necessary cash injection be placed solely upon today's young graduates, who have rather less chance of going on to high-paying careers than those who left university in the 1970s and 1980s?

The money that could be raised by taxing graduates across the board might well be enough to reduce the cost of university for young people from disadvantaged backgrounds, as well as solving the problem of higher education funding more fairly. If a variable graduate tax were truly based on earnings, there would be no reason for graduates of any age to pay more than they could reasonably manage. Parents of current students might even find themselves paying less overall, if their graduate tax liability offset the costs of contributing to higher tuition and maintenance fees for their children.

The new president of the National Union of Students, Aaron Porter, has said that while the NUS welcomes the graduate tax proposal, any changes to funding should be genuinely fair and progressive to win students' support. The core injustice of tuition fees has always been that they imposed a burden of debt on the young which rewrote the script for young adulthood in this country. And although there are indeed more young graduates now than there were 20 years ago, most are labouring under a double load of unavoidable personal debt and high unemployment.

Meanwhile, Vince Cable, George Osborne and David Willetts, along with nearly every other policymaker currently responsible for higher education funding, were financed through their degrees by a generous grants system, left university in credit, and entered a booming job market. A universal graduate tax would be a fair way of sharing out some of the proceeds of that extraordinary generational luck.

If the deficit must be paid for, it is not unreasonable to expect it to be paid for on the basis of equal sacrifice. If the principle of retroactive taxing is being considered at the highest levels of government, it is not far-fetched to suggest that the rich be taxed as well as the poor, the old as well as the young, on the basis of the services that they have enjoyed from the state.

I'd stop short at suggesting that Cable backdate the graduate tax to 1970, of course -- that would leave older people with degrees owing, ooh, tens of thousands, almost as much as an average humanities graduate in 2010. And nobody would stand for that.

Laurie Penny is a contributing editor to the New Statesman. She is the author of five books, most recently Unspeakable Things.

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How the Lib Dems learned to love all-women shortlists

Yes, the sitting Lib Dem MPs are mostly white, middle-aged middle class men. But the party's not taking any chances. 

I can’t tell you who’ll be the Lib Dem candidate in Southport on 8 June, but I do know one thing about them. As they’re replacing a sitting Lib Dem (John Pugh is retiring) - they’ll be female.

The same is true in many of our top 20 target seats, including places like Lewes (Kelly-Marie Blundell), Yeovil (Daisy Benson), Thornbury and Yate (Clare Young), and Sutton and Cheam (Amna Ahmad). There was air punching in Lib Dem offices all over the country on Tuesday when it was announced Jo Swinson was standing again in East Dunbartonshire.

And while every current Lib Dem constituency MP will get showered with love and attention in the campaign, one will get rather more attention than most - it’s no coincidence that Tim Farron’s first stop of the campaign was in Richmond Park, standing side by side with Sarah Olney.

How so?

Because the party membership took a long look at itself after the 2015 election - and a rather longer look at the eight white, middle-aged middle class men (sorry chaps) who now formed the Parliamentary party and said - "we’ve really got to sort this out".

And so after decades of prevarication, we put a policy in place to deliberately increase the diversity of candidates.

Quietly, over the last two years, the Liberal Democrats have been putting candidates into place in key target constituencies . There were more than 300 in total before this week’s general election call, and many of them have been there for a year or more. And they’ve been selected under new procedures adopted at Lib Dem Spring Conference in 2016, designed to deliberately promote the diversity of candidates in winnable seats

This includes mandating all-women shortlists when selecting candidates who are replacing sitting MPs, similar rules in our strongest electoral regions. In our top 10 per cent of constituencies, there is a requirement that at least two candidates are shortlisted from underrepresented groups on every list. We became the first party to reserve spaces on the shortlists of winnable seats for underrepresented candidates including women, BAME, LGBT+ and disabled candidates

It’s not going to be perfect - the hugely welcome return of Lib Dem grandees like Vince Cable, Ed Davey and Julian Huppert to their old stomping grounds will strengthen the party but not our gender imbalance. But excluding those former MPs coming back to the fray, every top 20 target constituency bar one has to date selected a female candidate.

Equality (together with liberty and community) is one of the three key values framed in the preamble to the Lib Dem constitution. It’s a relief that after this election, the Liberal Democratic party in the Commons will reflect that aspiration rather better than it has done in the past.

Richard Morris blogs at A View From Ham Common, which was named Best New Blog at the 2011 Lib Dem Conference

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