This is my presentation made to the University All Party Parliamentary Group on 6th April. The model is essentially the same as outlined in the RSA lecture but with some updated figures to reflect recent BIS data on the rate of debt cancellation.
John Denham – opening remarks to University APPG 6th April 2014
This evening I will summarise, with updated figures, the alternative model for funding higher education I set out at the RSA in January.
The recent revelation that the cost of debt cancellation was now 45% of all the student loans made has provoked a wide public debate about the sustainability of the system introduced in 2012.
I would argue that the need for a radically different approach has been apparent for some time.
When I started work on the model I’m going to outline tonight, the RAB rate (debt cancellation rate) was 35%. My model made sense then. The worse the RAB rates become, the more urgent is the need for change.
Financially we want a system which is a good deal for the taxpayer (it should cost no more than it does at present), better for the graduate (it should cost less than the current system), and better for the university sector (it should provides at least as much income and if at all possible increase the resources available to the sector).
This apparent Holy Grail may actually be achievable.