British politicians have often pointed out with justification the weakness of the country vocational training as one of the top priorities for reform. A royal commission from the 1880s unfavorably opposed the standard of education among ‘workers’ in England to that in Germany. Although many reform efforts point to the same concerns – inadequate provision, craft snobbery, and the belief that university education is the only way to the middle class, few have succeeded in providing lasting solutions. A government plan to lowers salary threshold whereby graduates today have to start repaying their student loans will only contribute to the list.
As the Financial Times reports, Chancellor Rishi Sunak is considering changing the tuition loan system so that graduates can start repaying their debt if they currently earn £ 23,000 rather than £ 27,295. The move would save the government about £ 2 billion a year; About half of the students are expected to never repay their loans, and debt is written off after 30 years. This forecast is reflected in public finances at the time of the loan, with about half the value being considered government spending.
The proposal is also an attempt by the government, skeptical about the expansion in university education, to reduce the number of students who get little value from their courses. The Augar review of post-18 training in 2019 suggested lowering the salary reimbursement salary to £ 23,000, or the average non-graduate income, as well as lowering tuition fees. The threshold then reflects the principle that students should be expected to contribute from any benefit they receive from their degree. It will also encourage future students to think more deeply about the value they get from their course: students and universities currently have little chance of repaying their loans if the course offers only minor benefits.
Applying this change retrospectively to graduates who have completed their degrees below the current thresholds would be wrong and unfair. Those with existing loans cannot change the decisions they have made about the rate they have taken. Raising what is essentially an income tax may appeal to a treasury that wants to borrow after the cost of the pandemic, but would take more from non-particularly high earners and young people will soon have to pay the higher rate of national insurance, already introduced by the government.
Reforms to strengthen further education, the often ignored counterpart of British universities, is still long overdue. This is partly to reverse a decade of budget cuts; the number of students attending such institutions has declined over the past few years. So too the number in apprenticeships, the most important alternative to classroom-based learning. If alternatives to university education are considered the second best and inadequate, increasing the price of a degree will not discourage students. A poll by the Social Market Foundation found that although older generations prefer vocational training over university education, the majority of those who should actually make the choice, 18-24 year olds, still prefer an academic path.
Britain’s politicians have been trying for more than a century to figure out how to improve vocational training, but a different approach is now required to solve problems in the 21st century. A more radical redefinition is needed on how to prepare students for an era in which craft computers and the kind of fundamental skills, such as creativity and problem solving, can be involved employers value the most.