The Graduate Tax

Today Vince Cable announced that the government was investigating the way in which University degrees are paid for. Instead of large, subsidised loans (£3000 per year) graduates would instead pay an income assessed tax, presumably for the rest of their lives. I'd heard this idea proposed before and I thought it was an excellent idea, as a graduate I find having a £20 000 debt hanging over my head quite disconcerting. I would personally feel much more comfortable without the debt, instead simply having to pay a small amount extra in tax once I start earning a respectable wage.

However something I overlooked was how this idea of a graduate tax appears to prospective university students. According to the BBC's research almost all college students feel threatened by this tax and find it a disheartening thought. To young people living in financially uncertain times, a time when a undergraduate degree does not guarantee lucrative employment, the idea of a extra burden may be enough to put people off entirely.

As far as I can see the graduate tax won't be much different, save that payments will be income assessed, so it appears that these prospective students' fears are likely unfounded but an unfounded fear can be just as damaging as a legitimate one. If we go through with this policy a great deal of energy needs to be dedicated to ensuring young people that this tax is a substitute for tuition fees and does in fact work in their favour otherwise we may see a severe drop in university applications and the past twenty years of increasing the amount of graduates will have been a complete waste of time.

Another worry I have is that if prospective students believe that doing any degree course will permanently saddle them with an extra tax, young people may stop studying subjects which are not meant to be financially lucrative such as Art, History and English. My greatest fear is that we will be scaring people away from studying for the sake of studying and we will be left Margaret Thatcher's dream, university existing simply as training for future employment.