Report

Undergraduate fees revisited

This report from UK think tank HEPI considers the recent history of student finance in England before proposing a 10-point plan for fixing some current weaknesses.

Tim Leunig lays out the shortcomings of the current higher education funding model in England and proposes a 10-point action plan to fix the system for the benefit of students, institutions and the nation.

• A 20-year, rather than 40-year, repayment term on student loans.
• No increase, even in nominal terms, of the amount owed.
• A minimum student loan repayment of £10 a week after graduation.
• An additional repayment of 3% of income between the income tax and student loan repayment thresholds.
• Letting graduates reduce their pension contributions in order to make higher student loan repayments more affordable.
• Reintroduction of an interest rate supplement for graduates earning over £40,000 a year, set at a maximum of 4% for those on over £60,000.
• A new 1% National Insurance surcharge for employers with graduates.
• New maintenance grants for students with parental incomes up to £65,000, with full grants of around £11,000 for those with household incomes below £25,000.
• Provision of maintenance loans for all students not receiving a full grant, provided their parents’ income is below £100,000 a year.
• Additional teaching grants averaging £2,000 per student.