Dear Ms Hay,
Thank you for contacting me about Higher Education funding. I am sorry you have not received an earlier reply.
With both Bournemouth & Poole College and Bournemouth University sitting within my constituency, I am only too aware of the importance of supporting higher education and ensuring those from poorer backgrounds are given equal opportunity to go to university.
Universities play a huge role in both our local and national economies, and it is in all of our interest to ensure places of Higher Education and their students flourish. In order to achieve this, we need to make sure sufficient funding is made available.
The last Labour Government recognised that the funding structure needed to be reassessed, and so it established a Review of Higher Education Funding and Student Finance chaired by Lord Browne. The published report was recently endorsed by the goverment and the government has now released its proposals for Higher Education funding in light of the forthcoming legislation on this issue.
The Browne Review propses an unlimited cap on fees. The Government has decided to cap fees at a lower threshold of £6,000 and an upper threshold of £9,000. Universities will be free to set their own fees and those wishing to charge more than the lower threshold will need to increase their efforts to attract students from lower-income families. Such moves will regulated by the Office for Fair Access. A £150 million National Scholarship Programme has been announced to which upper threshold universities will be expected to contribute funds.
Moreover, student support will be extended by increasing maintenance grants available. For students who cannot commit to full-time study, part-time students will have equal access to student loans. I welcome such moves as I believe that Higher Education opportunities should be made available to all those that seek it.
The proposal to increase the repayment threshold from £15,000 to £21,000 protects graduates on lower incomes. In addition, graduates earning below £21,000 will not have a real rate of interest applied to their loan. For graduates earning between £21,000 and around £41,000, a real rate of interest will start to be charged, reaching a maximum of RPI plus 3 per cent. Above £41,000, graduates will repay at the full rate of RPI plus 3 per cent. Introducing real interest rates, alongside raising the repayment threshold, will ensure graduates on lower incomes will pay less than they would do under current arrangements.
The Government's commitment that there should be no upfront tuition fees for students is fair and I do not believe that families from lower economic backgrounds should be deterred from entering into the Higher Education sector. I also welcome the government's positive steps to attract students from lower-income backgrounds with the proposals it has put forward.
I am in favour of proposals that support lower-income students, widen participation, and increase opportunities for all who chose to pursue Higher Education opportunities. The proposals introduced by the Government empower Higher Education Insitituions to act responsibly and with the interests of the students at the forefront of their actions.
It is also worth noting that under proposals announced by Universities Minister David Willetts, thousands of university students from poorer backgrounds could have their tuition fees paid for up to two years. Up to 18,000 students could get support for their fees from a new fund. I hope that the proposal will calm student concerns about proposals to raise fees to £9,000. Under the plans, universities which charge more than £6,000 a year could be forced to pay poorer students' fees for a second year.
I can assure you that I would not support plans that I thought would be prohibitive to those from poorer backgrounds, but I am also very aware that it is simply not viable for those who benefit from Higher Education not to contribute to its cost.
The proposal made by the NUS and supported by Ed Milliband, the leader of the the Labour Party, is a graduate tax. This would see students lumbered with an eternal debt, never to be paid off. I fail to see how this is at all fair.
I do, of course, recognise that it is hard for people to accept such radical change. However, I can assure you I would not have supported these measures if I was not totally convinced that they are in the interests of Higher Education and the country as a whole.