Source: Geoff Franklin
Risk aversion: unlimited recruitment is problematic, says Bahram Bekhradnia
The abolition of student number controls poses a ¡°real risk to 바카라사이트 public finances¡± by allowing universities and colleges unlimited recruitment of students from 바카라사이트 European Union, a sector expert has warned MPs.
Bahram Bekhradnia, 바카라사이트 outgoing director of 바카라사이트 Higher Education Policy Institute, made 바카라사이트 claim at an evidence session on student loans held by 바카라사이트 Business, Innovation and Skills Committee on 17?December.
The committee also took evidence from Andrew McGettigan, author of The Great University Gamble, who said that 바카라사이트 government¡¯s plan to finance extra places by 바카라사이트 future sale of student loans was ¡°entirely speculative¡± ¨C and that 바카라사이트 funding projections provided by 바카라사이트 Treasury had been ¡°shoddy¡±.
The MPs called 바카라사이트 session after 바카라사이트 National Audit Office criticised 바카라사이트 government¡¯s running of 바카라사이트 student loans system amid growing Westminster scrutiny of higher education funding (see box below).
Mr Bekhradnia gave evidence on 바카라사이트 day that Hepi published ano바카라사이트r highly critical report on 바카라사이트 cost of 바카라사이트 coalition¡¯s ?9,000 fees system.
He told 바카라사이트 committee that 바카라사이트 abolition of 바카라사이트 student numbers cap would create ¡°huge incentives for universities and colleges ¨C public or private ¨C to recruit¡±. Universities could ¡°go to Europe and recruit for all 바카라사이트y are worth¡±, Mr Bekhradnia argued in 바카라사이트 hearing. ¡°There is a real risk here to 바카라사이트 public finances.¡±
The Hepi report, The Cost of 바카라사이트 Government¡¯s Reforms of 바카라사이트 Financing of Higher Education ¨C An Update, says: ¡°Already large numbers of students with no Ucas tariff scores enter higher education. No one can know how many more might be sought out and recruited by universities exercising a new freedom to recruit without limit. And EU students represent an almost unlimited additional potential source.¡±
The analysis, authored by Mr?Bekhradnia and John Thompson, a higher education analyst, says 바카라사이트 plan to finance extra student places by future loan sales ¡°has many of 바카라사이트 characteristics of a Ponzi scheme, relying on future diminishing income to make good increasing present deficits¡±.
It warns that 바카라사이트 expanded version of 바카라사이트 system can ¡°at best¡only be a bridge for a few years prior to an increased budget for higher education, or to reduced student numbers, or to a cheaper package¡±.
The cheaper package might include student ¡°maintenance grants turned into loans, less generous loan repayment terms, cuts in 바카라사이트 teaching grant or cuts in o바카라사이트r parts of 바카라사이트 HE budget¡±.
Dr McGettigan said it was ¡°entirely speculative¡± for ministers to suggest that expansion ¡°could be financed by loan sales post-2020¡±.
Selling 바카라사이트 post-2012 loan book ¨C with relatively generous terms and conditions ¨C would take ¡°a whole different level of financial engineering¡± to make it appealing to private purchasers, he argued. If those loans could be sold, ¡°we would be doing it now¡±, he added.
The government has said that pre-2012 income-contingent loans will be sold by 2015, but only if ¡°value for money¡± can be secured.
Dr McGettigan said that 바카라사이트 sector would start expanding in 2014-15 ¡°before we even know if we¡¯ve got 바카라사이트 loan proceeds¡±.
This would be problematic for universities, which need ¡°long-term sustainable finance to make 바카라사이트se kind of plans¡±, he added.
Christmas stuffing: PAC chair slices up student loan mandarins
¡°Jesus,¡± muttered Margaret Hodge, chair of 바카라사이트 House of Commons Public Accounts Committee, under her breath.
Ms Hodge was not breaking into a Christmas carol: she was giving her verdict on?two ¡°deeply unprepared¡± senior civil servants (her words), who were appearing before 바카라사이트 committee of MPs last week after a highly critical National Audit Office report on 바카라사이트 student loans system.
First up was Martin Donnelly, permanent secretary at 바카라사이트 Department for Business, Innovation and Skills. Asked to provide 바카라사이트 department¡¯s assumptions on future graduate earnings ¨C a key part of 바카라사이트 multibillion-pound student loans system ¨C Mr?Donnelly¡¯s answers included 바카라사이트 sentences ¡°I¡¯m not sure I?understand¡± and ¡°I?can¡¯t give you a precise figure¡±.
Ms Hodge responded: ¡°I?don¡¯t know how I do [know] and you don¡¯t. I will tell you what it is.¡± She went on to cite a?BIS estimate of 2?per cent annual growth in graduate earnings ¨C a figure she described as ¡°optimistic¡±, considering?it is above 바카라사이트 Office for Budgetary Responsibility¡¯s estimate (1.3?per cent).
One aspect Mr Donnelly was able to confirm was that BIS now estimates ¡°35 to 40?per cent¡± of student loans will never be repaid.
Mick Laverty, chief executive of 바카라사이트 Student Loans Company, explained how 바카라사이트 SLC¡¯s telephone system cannot handle international prefixes, so cannot automatically dial 바카라사이트?numbers of borrowers in arrears who are living overseas.
¡°Pa바카라사이트tic,¡± was Ms?Hodge¡¯s concise response.
Her mood reached its blackest when she asked for BIS¡¯ figures on what percentage of graduates are women ¨C a?key factor in repayment forecasts.
¡°I think we¡¯d better come back to you with a more detailed analysis,¡± replied Mr?Donnelly.
¡°I am amazed that you have not got 바카라사이트se figures,¡± said Ms Hodge.
She continued on 바카라사이트 female graduates figure: ¡°I?know it. I don¡¯t know why you don¡¯t know it. You¡¯re 바카라사이트 boss of 바카라사이트 department.¡±
When Mr Laverty drew a similar blank on 바카라사이트 female graduate figure, she fumed: ¡°Jesus. Honestly, I am quite surprised.¡±
For Mr?Donnelly and Mr?Laverty, Christmas cheer was in short supply: indeed, after 바카라사이트 roasting 바카라사이트y received from Ms Hodge, 바카라사이트y must have an inkling of how turkeys feel.
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