TWO of the Conservative Party’s leadership candidates have pledged to introduce a new deal for students as part of their manifestos.
Jeremy Hunt and Andrea Leadsom say it is time to tackle the tuition fee loans system to reduce the debt burden on students when they leave full-time education.
Mr Hunt, the Foreign Secretary, has pledged to slash unfair rates of interest on tuition fee debt and provide more support for young entrepreneurs.
Vying for the youth vote, Mrs Leadsom said she will overhaul the tuition fees system and expand it to include apprenticeships.
In an interview with The Sunday Telegraph today, she makes it clear she wants to adopt several of the proposals outlined by a major review of post-18 education commissioned by Theresa May.
Mrs Leadsom, who last month resigned as Leader of the House of Commons, said: “I have particular concerns about the time at which interest starts being charged, which is when you’ve just started out at university.
“You see the interest charges going up every day that you’re learning, so you can’t possibly be earning. I think that’s a problem.”
She added: “More importantly, I’d like to see the tuition fee scheme expanded… so that you could receive a loan for a degree, for a two year degree, for a higher level apprenticeship, for specific skills training as opposed to academic learning, but also really importantly, I think young people should be able to gain access to finance if they want to start a business.”
Mr Hunt said he wants to cut the interest rate paid on student loans RPI, which currently stands at 3.1 per cent.
Currently students pay interest rates on student loans at RPI + 3 per cent for current students, and RPI + up to 3 per cent for graduates. He says a fairer approach would be to reduce the interest rate to RPI for all students.
Mr Hunt says he also wants any government he would be in charge of to “incentivise entrepreneurs”, saying he would consider repaying the tuition fees of graduates who go on to start successful businesses.
Of the nearly 300,000 students that go into employment after leaving university, only 1 per cent start their own business and Mr Hunt argues that by employing people, entrepreneurs generate significant revenues from income tax and employees’ and employers’ National Insurance Contributions. Mr Hunt said: “There is no majority in relying just on those who voted for us in 2017, and the party now faces a choice about whether we want to write off our chances with young people. I believe we have to unite the country, especially the divide between young and old. As Prime Minister I would deliver my pledge to young people to show that – when it comes to housing, climate change, mental health and education – we are on your side.”
Meanwhile, John Penrose, the Northern Ireland minister, who is Mr Hunt’s policy guru, writes on www.telegraph.co.uk that university courses should be standardised so that students can compare like with like, allowing them to choose which institutions offer the best value.
“If universities pledged to make qualifications from similar courses equal no matter where students studied, it would be revolutionary,” he writes.
300,000 The number of students who go into employment after leaving university. Only 1 per cent start their own business.