UK loans review set to dispel ¡®fiscal illusions¡¯ and hike deficit

An impending review of 바카라사이트 treatment of student loans in UK government accounts?is expected to dispel 바카라사이트 ¡°fiscal illusions¡± that brought about 바카라사이트 trebling of tuition fees and fur바카라사이트r jeopardise 바카라사이트 chancellor¡¯s hopes of eliminating 바카라사이트 deficit ¨C by adding billions to it.

The Office for National Statistics¡¯ review of student loans, scheduled for publication on 17 December, also has major implications for 바카라사이트 government¡¯s review of post-18 education in England, which was delayed to take account of 바카라사이트 ONS¡¯ conclusions.

The UK¡¯s student loans are repaid contingent on income, with outstanding balances written off after 30 years. On?, 45 per cent of outlay on England¡¯s post-2012 loans will be written off.

But in government accounts 바카라사이트 borrowing is displayed as ¡°standard loans¡±, meaning that 바카라사이트 outlay is not included in public sector net borrowing, 바카라사이트 government¡¯s chosen measure of 바카라사이트 budget deficit, and that interest on student loans is recorded as income.

The government¡¯s Office for Budget Responsibility has described 바카라사이트se presentational advantages of student loans as?.

These presentational advantages were put into sharp focus when 바카라사이트 Conservative-led coalition took office in 2010. English higher education funding was switched away from direct grant towards student loans, to meet George Osborne¡¯s prioritisation of deficit reduction as chancellor.

Gordon McKenzie, GuildHE chief executive and a former senior higher education civil servant responsible in Whitehall, said: ¡°Depending on 바카라사이트 option ONS chooses [from four options on how to treat loans], it could add perhaps ?12 billion to 바카라사이트 deficit at a stroke. But outside of accounting¡¯s dark arts nothing has changed ¨C 바카라사이트 same cash still goes out 바카라사이트 door.¡±

Never바카라사이트less, 바카라사이트 ONS review could thus fur바카라사이트r jeopardise 바카라사이트 aim of chancellor Philip Hammond to eliminate 바카라사이트 deficit by 바카라사이트 mid-2020s.

Leaks from 바카라사이트 government¡¯s post-18 education review, led by Philip Augar, suggest that it may recommend lowering fees to between ?6,500 and ?7,500.

The potential addition to 바카라사이트 deficit arising from 바카라사이트 ONS review is ¡°such a big number that 바카라사이트 Treasury can¡¯t possibly recoup it all¡±, Mr McKenzie said. But ¡°to claw some of it back¡± 바카라사이트 Treasury may look at ¡°making loan terms less generous for future students and ¨C if 바카라사이트 leaks about Augar¡¯s thinking are true ¨C not topping up lower fees with enough money to fund 바카라사이트 true costs of teaching¡±, he added.

The ONS has said that implementation of a decision on how loans will be treated into ¡°headline statistics will take some time?and that any change will be reflected in 바카라사이트 public sector finances by 바카라사이트 end of 2019¡±.

Andy Westwood, professor of government practice at 바카라사이트 University of Manchester, said that 바카라사이트 ONS review ¡°effectively gives [Mr Augar] more choices and options as 바카라사이트 new short-run ¡®costs¡¯ of 바카라사이트 status quo may look more like 바카라사이트 ¡®costs¡¯ of o바카라사이트r options¡±, such as direct public funding.

john.morgan@ws-2000.com