Tuition fees in England should be scrapped after becoming a “Frankenstein’s monster” that loads £50,000 or more in debt on to the backs of graduates, according to the architect of the last Labour government’s education reforms.
Andrew Adonis, the former adviser to Tony Blair who also served as an education minister, has used a column for the Guardian to attack the system of student finances, accusing the government of running a Ponzi scheme that leaves students in England with crippling debts.
“In my view, fees have now become so politically diseased, they should be abolished entirely,” Adonis writes in the Guardian.
Admitting that he was “largely responsible” for the structure of fees and loans, with repayments pegged to graduate incomes, Adonis complains that greedy university leaders have failed to improve teaching quality but still rewarded themselves handsomely.
“[Vice-chancellors] increased their own pay and perks as fast as they increased tuition fees, and are now ‘earning’ salaries of £275,000 on average and in some cases over £400,000.
“Debt levels for new graduates are now so high that the Institute for Fiscal Studies estimates that three-quarters of graduates will never pay it all back. The Treasury will soon realise it is sitting on a Ponzi scheme,” Adonis writes.
Adonis’s views drew a swift response from the universities minister, Jo Johnson, who defended the loans system as more progressive in its repayment terms than the pre-2012 version that Adonis oversaw.
“The government consciously subsidises the studies of those who for a variety of reasons, including family responsibilities, may not repay their loans in full,” Johnson said.
“This is a vital and deliberate investment in the skills base of this country, not a symptom of a broken student finance system. And the evidence bears this out: young people from poorer backgrounds are now going to university at a record rate – up 43% since 2009.”
Adonis’s intervention comes after a damning report on student loans in England was published by the IFS, which revealed that students from the poorest households would accrue debts of £57,000 by graduation, and that 77% of students would fail to pay off their debts even 30 years after leaving university.
The issue of student debt has suddenly become a hot political topic since the general election in May, when Labour appeared to gain strong support from young people over its commitment to scrap the existing loans system.
Since the election a string of government figures have suggested that the system – introduced in 2012, charging £9,000 a year for undergraduate tuition – could be revised.
Pressed over a looming rise in interest rates, Johnson said the issue was “under review”, while Andrea Leadsom, the leader of the house, told complaining Conservative MPs this week: “The mood of many colleagues has been heard and I am quite sure the Department for Education are considering this.”
Adonis’s comments also suggest that the technocratic wing of Labour has reconciled itself to some of Jeremy Corbyn’s more aggressive policies, in the wake of Labour’s buoyant election performance.
“Some Tories publicly branded Corbyn’s move a bribe, but it is only a matter of time before they realise tuition fees at their current level are politically dead,” Adonis said.
Angela Rayner, Labour’s shadow education secretary, said: “The government should listen to Andrew Adonis and take a long, hard look at the reality of higher education since their original tuition fee hike.
“Graduate debt is skyrocketing, with no end in sight, and students are facing a lifetime of debt with the taxpayer still picking up the bill at the end.”
Defenders of the loan scheme say that it remains progressive, with the government picking up the unpaid debts after 30 years and repayments made only on graduate earnings of over £21,000.
Amatey Doku, the National Union of Students’ vice-president for higher education, said supporters of tuition fees failed to understand graduates’ fears that future governments could suddenly rewrite the terms of their loans.
“Who knows where we will be in 30 years’ time? Or how many prime ministers we’ll have had?” Doku said, pointing out that since 2012 the government has already made significant changes, including scrapping maintenance grants and pushing down the income levels that trigger repayment.
Andrew McGettigan, an expert on the operation of the loans system, said: “Until the government removes their right to retrospectively change terms, then you as a borrower appear to be on the hook to future policy changes.
“Nothing has done more to undermine trust in the system than the decision to freeze the repayment threshold.”
Tuition fees are set to rise to £9,250 next year, and are likely to reach £9,500 the following year. That means the £10,000-a-year barrier is likely to be breached before the end of the decade. The government’s own projections anticipate that the total outstanding real value of loans will top £100bn next year and reach £200bn within 10 years.
