IN ORDER that the universities can have their budgets slashed and be privatised or closed, students are to be charged up to £9,000 a year in fees. These are all to be paid back at commercial rates of interest, along with the loans that they will have had to take out to finance their living expenses.
In fact, students will not only find themselves paying back these sums for up to 30 years after they leave university, they will be ‘paying back’ up to three times what they borrowed in the first place.
It is to be bumper profits for the banks – while higher education is privatised!
The BBC yesterday revealed that it had calculated that a student borrowing £39,000 (£27,000 in fees and £12,000 in cost of living expenses for a three-year course) will pay back up to £83,000.
Under the new regime, due to begin in 2012, graduates will pay back 9% of earnings above £21,000 for up to 30 years.
Interest on the loan is expected to range from inflation only, to inflation plus 3%, with higher earners paying higher interest.
A student who begins work at average earnings and gets a £1,000 pay increase each year, will, after 30 years, have paid back £78,882, while still owing £14,513 which will be written off – that is until the legislation is changed!
Ex-students are to be in the clutches of the banks for 30 years. The universities are to have their budgets slashed, with many facing closure or mass course closures.
The 130 universities in England are facing cuts of 12%, mainly falling on teaching costs.
The grant for teaching has been cut by more than 8% and that for research by nearly 3% compared with last year. Capital spending is down by 58%.
Taking into account some special funding programmes which are ending, and the end of the one-year University Modernisation Fund, this brings the total to a 12.6% cut.
Only one university, the London School of Hygiene and Tropical Medicine, will see a rise in its grant – 4.6% in cash terms, or 2.2% if an inflationary measure of 2.4% is taken into account.
Universities will experience a cut in their ‘recurrent grant’ (largely teaching and research) of about 4% (cash terms).
Amongst the biggest losers are Bishop Grossesteste University College, Lincoln, which will see its funding cut by 13.4% in cash terms, and 15.8% in real terms.
City University, London will see its funding reduced by 8.4% in cash terms (10.8% in real terms) while funding at the University for the Creative Arts is down 7.8% (10.2%).
Also seeing high real terms cuts are the Royal Academy of Music (7.9% in cash terms, 10.3% in real terms) and Sunderland University (6.4% in cash terms, 8.8% in real terms).
However, Oxford’s funding will be cut in real terms by ‘only’ 1%, while Cambridge University’s will be cut by 3%.
Only 30% of university income comes from the Higher Education Funding Council for England (Hefce), with universities raising other funds through research, student fees and business ventures.
Professor Steve Smith, president of the vice-chancellors’ forum, Universities UK, has commented that: ‘The funding allocations announced today are the result of recent cuts of around £1 billion to universities’ public funding, before the new tuition charges even begin to come into play’.
It is clear that it is to be every university for itself with students paying the bill as courses are slashed and the prestigious universities go for big business funding, leaving the rest to slash and burn or close.
This is not education. This is dog-eat-dog capitalism destroying state education for the majority in order to restore it to being the privilege of the rich.
For students and workers there is no way out of this crisis, except that of taking action to bring down the coalition, to go forward to a workers government and socialism.