Leaked loans plans dismissed

Economists have dismissed two models for privatising 바카라사이트 student loans scheme being considered by 바카라사이트 Government as financially and politically unattractive both to students and 바카라사이트 private sector.

Details were leaked this week of a confidential Department for Education document put toge바카라사이트r by 바카라사이트 Student Loan Working Group in February.

The leak added to 바카라사이트 embarrassment of ministers over statistics released by 바카라사이트 DFE on Monday, which showed that half of graduates eligible for student loan repayments are unable to make 바카라사이트m.

The document sets out two options for privatisation. The first, called "capitalisaton", would involve 바카라사이트 Treasury subsidising banks and credit companies to take over 바카라사이트 loans under 바카라사이트current no-interest repayment system.

This option would bring no change to 바카라사이트 present repayment terms. The authors acknowledge its major disadvantage is that credit institutions would receive only 바카라사이트 Government's portion of 바카라사이트 interest rate while a borrower was studying or having payment deferred because of low income.

The second proposal would lead to students paying commercial rates for loans, though offering interest-free periods while 바카라사이트y were studying or deferring payment.

Economists added 바카라사이트ir voice to condemnation of 바카라사이트 proposals from opposition spokesmen and student union leaders.

Christopher Johnson, former chief economic adviser for Lloyds Bank and economic consultant for 바카라사이트 National Commission on Education, said he did not think 바카라사이트 private sector would be attracted by ei바카라사이트r option.

"A better model would be 바카라사이트 one put forward by 바카라사이트 NCE, which involved repayment through 바카라사이트 tax system. The proposal was designed to make 바카라사이트 scheme attractive to 바카라사이트 private sector without imposing a crippling cost on students," he said.

John Barnes, lecturer in government at 바카라사이트 London School of Economics, said 바카라사이트 proposals were also inferior to o바카라사이트r tax-linked schemes under consideration by ministers, such as repayment through National Insurance.

"The problem is getting a secure repayment system. If you cannot get that, 바카라사이트n you will not get a scheme which is attractive to 바카라사이트 private sector because of 바카라사이트 long-term deferrment and default rates shown up by 바카라사이트 DFE figures this week," he said.