Tories will leave students with £1 trillion in debts that can’t be repaid

The Tories will leave students with £1 trillion in debts that can’t be repaid. So much for “conservative fiscal responsibility”!

By Alex Johnson, IMT Edinburgh

Stressed out teachers are leaving the profession in droves, an overhaul of GCSEs has led many students to feel suicidal and declining conditions are hitting university staff. The British education system is in crisis left, right and centre. Young people are bearing the brunt of this crisis with ever-mounting debts from maintenance and tuition fees and a lack of career prospects. The worst outcomes and highest debts are falling on the shoulders of working-class students.

A House of Lords economic affairs committee has produced a damning report exposing the unsustainable and fiscally reckless realities of the student finance system. The committee found evidence that over the next 25 years, the student loan book would grow to over £1 trillion of debts which will never be repaid. It reports that the government has always been aware of the enormous long-term cost of unpaid student debt. But it went ahead with the new system back in 2010, not with the intention of actually reducing government funding for higher education, but as a “fiscal illusion” to make the deficit appear smaller.

Looking back to the 2010 election which preceded the hike in tuition fees – the hallmark of the new system – we will remember the Tories were at pains to present themselves as the party of sensible economic policies. They insisted they would provide a safe pair of hands to reduce the deficit and save future generations from an economy steeped in ever mounting debt. As committee chairman, Lord Forsyth, explained, the reality is that “by moving to a system of funding through loans, because of the accounting methods of the Treasury, it was possible for George Osborne (then Chancellor) to appear to increase funding for higher education by £3bn but at the same time cut his deficit by £3.8bn.” The cost of unpaid loans is not included in the official deficit until it is written off after 30 years.

Much student debt will never be repaid, and extortionate interest rates of 6.3% mean those in low-middle earning professions such as nursing will pay the most overall as they will take the longest to repay their loans. The committee found that the system is also particularly bad for part-time students – most often working-class people who have to work alongside their degree to make ends meet – as it is tailored to full-time students who have just left school. This has contributed to a 60% decrease in part-time students over the last decade. The rhetoric of the Tories providing a sensible and safe pair of hands has been exposed once again as a complete fallacy. They claimed they wanted to “balance the books” to avoid passing on debts to the next generation. In reality, they’ve used smoke and mirrors to bury the debt, pushing it onto the shoulders of individuals until it re-emerges even worse in several decades time as unpaid loans on the government’s books. The short-sightedness of such a policy shows their utter disregard for ordinary people and more of the unprincipled gambling with our futures that we have seen again and again from the Tories.

The Tories’ marketisation and decimation of the higher education system has been enormously damaging across the board. Not only to the futures of young working-class people, but also to the livelihoods of university staff (not including the Vice Chancellors with their six-figure salaries), and to the broad quality of education. However, the global economy has been facing a crisis which is inherent to capitalism for a decade now. It would be naïve to think the problems of the British education system are due only to the Conservative ideological agenda of putting profit first and the reckless gambling of one or two politicians. While Corbyn’s pledge of free tuition is important and must be defended, we need to consider the economic realities of the world we’re living in and ask whether, on its own, free tuition is enough.

We only need to look at Scotland, where education is largely devolved, and a nominally anti-austerity government is in power. Those who have lived in Scotland for 3+ years pay no university tuition fees, but the broader trend of a lack of graduate jobs, the commodification of education and the driving down of working conditions is still prevalent.

Young workers and students are faced with the prospect of being worse off than their parents’ generation. This is practically the definition of a system in decline. It is a condition which must be overthrown, not reformed. Fifty years ago, in 1968, the world was swept by a revolutionary tide of angry youth, demanding a future in a just world. In 2018, we must continue the fight for revolution.

This year campuses were rocked by an unprecedented strike by lecturers and academic staff. Thousands of students stood in solidarity with their teachers, often on freezing picket lines. This surge of support pushed the lecturers on, with many concluding that the strike was not just about pensions and pay, but the future of the higher education sector. Ultimately this movement was quashed from above, by the bureaucratic machinations and conservative nature of the UCU leaders. Many lessons were learned however, showing the need for a broad, revolutionary struggle.

We must demand socialist policies such as a return to a system of maintenance grants for all students, state funded tuition and stable contracts for university staff. Problems of the national debt and decreasing living standards are bigger than the whims and fiscal tricks of the Conservative Party and must be understood in the context of the failure of capitalism.

  • We demand a high quality, fully funded education system in which young people don’t start their adult lives buried in debt.
  • We demand well-paid, stable graduate jobs, which allow us to make the most of the talents and training of young people.
  • We demand that everyone has the same access to a university education.

History has shown us that, under capitalism, even when we win concessions, they can so easily be taken away. An economy that is democratically planned by a politically engaged population, run in the interests of what people need, rather than what will make the most profit is the only way we can win these demands and maintain them. Socialism is the only solution.

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