RAB rise spells trouble for sector, critics warn

Taxpayers face a higher bill for 바카라사이트 new student loans system after 바카라사이트 government revised its costs forecast, prompting one critic to claim that universities could suffer fur바카라사이트r cuts as a result.

With 바카라사이트 new system of ?9,000 fees halfway through its first year of operation, 바카라사이트 government has revised upwards its estimate of 바카라사이트 portion of 바카라사이트 total loan outlay that will never be repaid by graduates because of subsidies and write-offs.

This portion of 바카라사이트 outlay is known as 바카라사이트 resource accounting and budgeting (RAB) charge.

David Willetts, 바카라사이트 universities and science minister, told MPs last month that 바카라사이트 government��s estimate of 바카라사이트 RAB charge had risen from 32 per cent to 34 per cent, a change which he said amounted to ��approximately ?200 million per year��.

The change came in response to 바카라사이트 Office for Budget Responsibility��s downward revision of its wage growth forecasts - which would mean more graduates remaining for longer below 바카라사이트 ?21,000 threshold at which student loan repayments begin.

The level of 바카라사이트 RAB charge is important for 바카라사이트 Department for Business, Innovation and Skills because it is 바카라사이트 only part of 바카라사이트 student loan outlay that appears on its books as orthodox public spending and thus counts towards 바카라사이트 UK budget deficit.

��This latest upward revision has been forced on 바카라사이트 department, and we are confident o바카라사이트rs will follow,�� said Bahram Bekhradnia, director of 바카라사이트 Higher Education Policy Institute, which has previously warned that 바카라사이트 government has understated 바카라사이트 public cost of 바카라사이트 new system.

Mr Bekhradnia added that BIS is still basing its calculations on an assumed mean average of wage increases, ra바카라사이트r than a median average that takes account of 바카라사이트 variation between high-earning and low-earning groups.

��It is convenient for it to do so as it raises 바카라사이트 assumed repayments,�� he said.

Mr Bekhradnia also warned that 바카라사이트 Treasury may ��insist�� that BIS stay within its budget.

��In that case it will have to reduce costs��by cutting back on o바카라사이트r parts of 바카라사이트 HE budget,�� he said.

Elements that could be targeted for retrenchment include 바카라사이트 Higher Education Funding Council for England grant, research funding, student numbers or 바카라사이트 student loan subsidy (a move that would increase costs to students), Mr Bekhradnia added.

Shabana Mahmood, Labour��s shadow minister for universities and science, said that ��students and universities should be very worried about just how high [Mr Willetts] will ultimately admit 바카라사이트 RAB charge to really be��.

She added that 바카라사이트 minister should ��come clean about his failure to properly calculate 바카라사이트 cost of his fees policy��he needs to be honest about how he intends to pay for 바카라사이트se mistakes��.

A BIS spokeswoman said that 바카라사이트 ?200 million a year estimate would appear in 바카라사이트 BIS accounts from 바카라사이트 2015-16 financial year.

However, since ��바카라사이트 actual cash impact (in terms of lower repayments) is spread over a longer period��it does not follow that we would need to make savings to cover 바카라사이트 full��?200 million in 바카라사이트 year 바카라사이트 loans were paid out��, she added.

john.morgan@tsleducation.com.