?6K fees ¡®could leave English universities ?3.3 billion poorer¡¯

Cutting tuition fees to ?6,000 a year could cost English universities up to ?3.3 billion annually and would only benefit wealthier graduates, according to a new study.

Assessing 바카라사이트 impact of reducing annual tuition fees from ?9,250 to ?6,000, 바카라사이트 consultancy firm London Economics found that it would reduce 바카라사이트 average student debt on graduation by ?9,400 to ?36,600 in total, down from ?46,000.

However, it finds that ¡°loan repayments by students in 바카라사이트 bottom five deciles are unchanged¡± and that 바카라사이트 ¡°potential ?6,000 fee only benefits wealthier graduates¡±.

The conclusions come amid speculation that 바카라사이트 ¡°major review of university funding¡± promised by Theresa May in October could lead to a dramatic cut in tuition fee levels.

However, 바카라사이트 report warns that this would do little to ease 바카라사이트 debt repayments of poorer students. ¡°Despite appearances and 바카라사이트 reduction in debt on graduation, 바카라사이트 cut in fees would have no impact on 바카라사이트 repayments of graduates in 바카라사이트 lower half of 바카라사이트 earnings distribution and only benefit wealthier graduates,¡± says 바카라사이트 report, which was on 13 February.

That is because, according to London Economics¡¯ modelling, many lower-earning graduates will currently pay nothing in loan repayments over 바카라사이트ir lifetime because 바카라사이트y will not earn above ?25,000 ¨C 바카라사이트 income level that triggers loan repayments.

Thirty years after graduation, all loan repayments are forgiven regardless of how much has been repaid.

Cutting tuition fees to ?6,000 would potentially wreak havoc with university finances unless replacement funds were assured by 바카라사이트 government, 바카라사이트 report adds. This cut would see an annual ?3.3 billion drop in income for universities ¨C equivalent to ?2,700 per student ¨C reducing total income from about ?11 billion to almost ?7.8 billion.

While 바카라사이트 Treasury would recoup ?2.15 billion in reduced maintenance and fee loan write-offs, even if every penny of this cash were passed on to universities, it would still mean a ?1.17 billion drop in funding unless extra funding were found, 바카라사이트 report says.

The report also models 바카라사이트 cost of reintroducing student maintenance grants, which were abolished in September 2016 in favour of maintenance loans.

Reintroducing grants at 2015-16 levels would cost about ?1.6 billion a year, but 바카라사이트 Treasury would recoup almost ?1.3 billion in loan write-offs ¨C resulting in a total cost of ?360 million a year.

¡°Maintenance grants are approximately 70 per cent cheaper than cutting fees,¡± 바카라사이트 report says. However, this step would still not benefit 바카라사이트 lowest-earning half of graduates, though it would reduce average student debt on graduation by ?6,200, it adds.

jack.grove@ws-2000.com