“Pssst. Hay mister, do ya wanna buy this student loan book for cheap?!”

So a little while back it came to light that the government was putting forward plans to sell off the student loan book with the aim of clearing this debt from its books. In the short term, it would mean a nice little lump sum of cash for the government and some debt removed from the deficit, in the long run, it would mean those graduating university could be hit even harder than they already are. my original post can be read below.

“Massive education and political rant coming… 

Its becoming more and more apparent that the students coming out of school and university are begin saddled with staggering amounts of debt, that some have no hope of ever paying back. Taking this debt on has almost become the norm and the only option for most individuals wanting to attend further or higher education. Whether it be paying the tuition fees, the rent and living cost that come with studying away from home or feeding a family or dependents while on a course. 

Mainstream politics is seen to be standing up to this world of credit by publicly taking on the payday lenders and voicing their outrage at an industry taking advantage of the needy and the sky high interest rates, but this is a small action that is attempting to divert the eye from a long line of problems that need taking on. Politicians and Policy makers still actively promote “credit as an answer to a society in which the state is no longer willing to tax wealth to pay for basic public services, and in which the gap between the cost of living and real term earnings has consistently risen since the 1970s”. 

Successive governments have attacked the once world leading, and all inclusive UK education system with a number of differing policies year on year, with the most recent being the tripling of tuition fees to £9000 a year for home undergraduate students. This alone will put millions of students and future graduates in a position of owing huge debts before they even get their first “Graduate” pay pack (that’s if they can even get a graduate job) 

Many Recent Studies I have read in my job have consistently shown that this rise in fees has pushed working class students away from further study, further reinforcing a social class divide that is shameful to see in this day and age. The only positive to consider for those who do choose to go to university, is that this debt is actually an OK debt to have. The repayments are a graduate contribution, based on your earnings, plus the interest rates are are far more stable than any high street bank can offer, they don’t effect a credit history, wont be passed onto a loved one if the worse were to happen and will never result in a bailiff knocking on your door. 

Unfortunately though, now even that is under attack! Not only have we seen a tripling of tuition fees, we also had to watch the scrapping of EMA preventing some of the poorest young adults in the UK from furthering themselves and attending college. Now the government has announced that all student debt between 1998 and 2012 is to be packaged up and sold off to private companies from 2015. To encourage private companies to buy the debt (And as a result, clear it off the governments debt sheets while shouting “Hay guys, look how much debt we got back and cleared from the UK economy! Aren’t we a fantastic government”) it has been suggested “the government will either have to use a ‘synthetic hedge’ – effectively a subsidy for shareholders – or attack the repayment conditions for graduates, by making us pay back more and sooner.”

If the second option were to be chosen, it would be the equivalent of a large hick in fees for all students since 1998….”

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