A Labour government would cut fees by £3,000, Ed Miliband has announced. (Photo: Getty)
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Labour's tuition fee policy: not awful, but still pretty bad

Labour's tuition fee policy isn't as bad as I feared. It's still pretty dire.

Labour has finally revealed its manifesto position on higher education funding: the much trailed drop in the tuition fee ceiling from £9,000 per year to £6,000; and a lesser noticed increase in the maintenance grant for students from families with an income of up to £42,000 per year. I’ve written against the tuition fee change previously and, just to put this upfront, I was the most senior civil servant to work on the Browne Review of Higher Education which, in popular perception, ‘paved the way’ to the introduction of £9,000 fees – even though that isn’t what we recommended.

Today’s Labour announcements are, I have to admit, better than I expected for two reasons. But they still represent terrible policy.

Let me cover the positives before I do the rest. The first one is that reducing tuition fees on the face of it reduces the resources that universities have to put on courses. Labour has said definitively though that the drop in fee income will be made up through an increase in direct public funding. No funding gap; no imminent decline in quality. This is good news.

The second positive is that Labour’s changes, in a major departure from previous higher education reforms, will apply to all undergraduates not just new entrants. This means that students who are already in higher education or who may be entering this year – prior to the introduction of the new fee ceiling in 2016 – will incur higher fees until 2016 and then will incur the same lower rate as the new entrants. This is important because it diminishes the risk that lots of people thinking about going to university this year will put off their entry for a year, delaying their careers and emptying out classrooms. If Labour had introduced the lower fee only for new entrants, then there would have been a minimum £9,000 advantage to putting off study for a year (the £3,000 reduction in the fee multiplied by the three years of the typical degree); now the advantage of putting off study is only £3,000, because 2015 entrants will receive the benefit of the future fee decrease in subsequent years.

Okay, enough about the positives. The problems with the policy are legion. The first is that the change is simply unnecessary. University applications are rising, despite the higher fee levels, and the gap between the participation rate of young people from disadvantaged backgrounds and others has continued to reduce. Labour has said the policy will cost £2.7bn a year. It will fund that cost through changes to pension tax relief. But the money could have been used for something else. To put the sum in perspective, it is about twenty times what it costs to avoid dropping the benefits cap to £23,000 per year. Perhaps that example is slightly too remote from higher education, in which case let’s think about the ‘forgotten 50%’ that Labour used to talk about. These are the young people who don’t go to university. £2.7bn per year would be transformative for that group. Merely a sixth of that sum would pay for 200,000 higher level apprenticeships. However, Labour isn’t helping them, instead it’s helping those already fortunate enough to go to university.

In fact the bias of their policy is even more unfortunate than this. Despite Ed Miliband’s rhetoric today about a promise for young people, it isn’t young people that pay tuition fees. Fees are paid back through what looks a lot like a tax on graduates. Reducing the fee level reduces the level of taxation on graduates. And because the ‘tax system’ is progressive in its design, the poorest graduates don’t pay back anything like the full amount of the fees. Labour’s policy in effect is a tax cut for graduates on above-average incomes. Forget about the 50 per cent of young people who don’t go to university, this policy won’t even help the poorest 50 per cent of those who do.

One last dig. Labour has suggested concern over the past few years about postgraduate study. The numbers of UK students going on to postgraduate study looks pretty flat, despite the higher demand for postgraduate skills in an increasingly knowledge-intensive economy. This may in part be because there is far less student finance available for postgraduate study. In order to remedy this, the Chancellor announced an extension of student loans to postgraduate students at the Autumn Statement last year. But that new funding builds on a financing system that Labour has decided is unsustainable. Part of their argument today is that fees have to come down because so many graduates don’t pay them back anyway. It’s difficult to see how Labour could wind back from that position to accept postgraduate student loans, which would take the loan amounts – and hence the non-repayment rate – in the opposite direction to what the party has said it wants. Yet it will already be spending an extra £2.7bn a year in direct public funding on undergraduate higher education. So it’s unlikely that it would be able to find even more direct public funding for postgraduate study.

There is a real risk in other words that a Labour government will spend a lot of money fixing a problem that doesn’t exist in undergraduate education and have nothing left to fix a problem that seems real and pressing to many people in postgraduate education.

Emran Mian is director of the Social Market Foundation

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The polls are bad, but Jeremy Corbyn’s office has a secret weapon

How a shake-up of the leadership team has steadied nerves at the top of Labour. 

If polling had existed back in 1906, Jeremy Corbyn quipped at one recent strategy meeting, the Labour Party would never have got started.

As far as Labour’s direction is concerned, it is that meeting at four o’clock every Monday afternoon that matters. The people who attend it regularly are the Labour leader, his aides, the shadow home secretary, Diane Abbott, and the shadow chancellor, John McDonnell, as well as the party’s election co-ordinator, and their respective aides.

In recent weeks, the meetings have been stormy affairs, and not only because the numbers from the party’s own pollsters, BMG Research, mirror the uniformly bleak picture from the public polls. There is also concern over Karie Murphy, Corbyn’s office manager. Murphy is highly rated by Corbyn for having brought increased intensity and efficiency to the leader’s office. Corbyn often struggles to deliver bad news in person and appreciates that Murphy will intervene on his behalf.

Her intensity is not uniformly welcomed. “She could start a fight with her own reflection,” in the wry words of one friend. An argument with Jon Trickett – the Hemsworth MP whose unusual career trajectory took him from being a parliamentary aide to Peter Mandelson to the inner sanctum of Ed Miliband’s leadership and finally to the role of election co-ordinator for Corbyn – led to Trickett going on a two-week strike, recusing himself from vital meetings and avoiding any contact with Murphy.

That row eventually led to Trickett being stripped of his role and banished from the Monday meeting. Murphy had a similar turf war with the campaigns director, Simon Fletcher, which culminated in Fletcher resigning on 17 February. In a letter to staffers, he called on the party to “keep the promise” of Corbyn’s first leadership bid, a period when Fletcher was central and Murphy had yet to start working for the Labour leader.

All of which, in better political weather, would simply be part of the back-and-forth of office politics. However, set against the backdrop of unease about by-elections in Stoke-on-Trent Central and Copeland, and a series of unhelpful leaks, it adds to a sense of vulnerability around the leadership. One loyalist shadow cabinet minister calls it “the most dangerous time” for Corbyn since he was first elected leader.

Why the danger? Contrary to popular myth, the backbone of Jeremy Corbyn’s successive landslide victories was not a hard-pressed twentysomething, struggling to find a fixed job or to get a foot on the housing ladder. The shock troops of Corbynism, at least as far as the internal battle in the Labour Party went, were baby boomers. Many of them were either working in, or on early retirement from, a charity or the public sector, deeply concerned about the rightward drift of British politics and worried about the next generation.

Corbyn’s decision to whip Labour MPs in support of triggering Article 50 – the process whereby Britain will begin its exit from the European Union – was, in their eyes, a double heresy. The vote signalled acceptance that the forces of the Eurosceptic right had won on 23 June, and it conceded that visa-free travel, membership of the single market and freedom of movement are over.

None of this is automatically great news for Corbyn’s internal critics – not least because the vote on Article 50 is rare in being an issue that unites Corbyn with most Labour MPs. Yet it adds to the sense that his leadership has passed its best-before date.

Adding to the general malaise is a series of unhelpful leaks. There was a story in the Sunday Times on 12 February claiming that the leadership was road-testing possible replacements for Corbyn, and on 20 February the Mirror claimed that the Labour leadership had commissioned a poll to find out whether or not the leader should quit his post. These stories are hotly denied by the leader’s office. Some in Corbyn’s inner circle believe they are the work of Trickett, embittered at his demotion.

It is true that Corbyn is not enjoying the job as much as he once did. However, if the conversation shifts from the minutiae of Brexit to his natural terrain of the NHS and the continuing consequences of government cuts on education and the prisons service, he could quickly find himself relishing the role once more.

Corbyn retains two powerful cards. His newly energised office, under Karie Murphy, is one. Although her brisk approach has generated some public rows, the feeling in the leader’s office is that a chief of staff was needed, and Murphy has assumed that role. The media team has also grown sharper with the addition of David Prescott (son of John), Matt Zarb-Cousin and the former Momentum spokesman James Schneider.

Corbyn’s second asset is more unexpected. His rivals inside the party now fear rather than relish an immediate end to his leadership. A former shadow cabinet member splits his supporters into two groups: “idealists and ideologues – the first we can inspire and win over, the second have to be got rid of”. In their view, the idealists have not yet moved away from Corbyn enough to guarantee victory; the ideologues, for their part, will slink off as Corbyn puts the demands of his office above their interests, as he did over Article 50.

Although self-defeating panic has never been a rare commodity in the Labour Party, the settled view of Labour MPs is that their leader must be given time and space rather than hustled out of the door. There is an awareness, too, that MPs who are united in opposition to Corbyn are divided over many other issues.

So, while the inner circle’s Monday meetings might be fraught, and Labour’s current polling would have given Keir Hardie pause, Jeremy Corbyn is safe. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.

This article first appeared in the 24 February 2017 issue of the New Statesman, The world after Brexit