Maintaining privilege?

Why should students vote Labour? The uncompromisingly socialist Prime Minister Clement Attlee once said that the much-squeezed middle classes should vote for his government “because it is the right thing to do”. Such moral courage would inject some desperately needed life into today’s moribund opposition, but instead Labour opts time and time again for the politics of reaction and the defence of whatever interest group they can successfully paint as vulnerable. Osborne’s replacement of the maintenance grant with an increased loan in yesterday’s Budget is a case in point. Whatever the wider merits of his austerity programme, sensible progressives ought to welcome the Chancellor’s announcement as heralding the removal of a socially arbitrary and ineffective subsidy.

There is a compelling narrative to the contrary, of course, a narrative of vicious right-wing cuts to student funding, entrenching socio-economic privilege as our parents’ generation pull up the ladder that allowed them to rise to the top and condemn the children of the less well-off to a lifetime of debt slavery. This story is peddled constantly by the Labour Party, in the Twitter-sphere, in the pages of the Guardian, and from our own representatives at OUSU.

Unfortunately, although it fits neatly with a presumed common sense account of the effects of decreasing direct grants to students, it flies utterly in the face of the facts. When the last government increased the tuition fee cap from £3,000 to £9,000 per year, they enacted essentially the same policy, of replacing funding through grants with funding through loans, on a far larger scale. If this is to be considered a fair test of the measure, which by any reasonable standard it must, the results bear out the Conservative argument: although UCAS models suggest applications last year were 2.5% down on a hypothetical low-fee situation, the decline in applications from less advantaged students was miniscule.

The real barrier to attending university is not the long-term implications for indebtedness, but the up-front costs, and here government assistance remains almost as generous as ever. For the vast majority of the poorest students, funding, at £8,200 a year, is sufficient to cover accommodation and living costs by itself. Exceptional circumstances aside, the only young people who cannot afford to attend university are those from more prosperous families whose parents will not subsidise them. But it is difficult to see what the government can do about this without giving significant sums of money to affluent teenagers who do not need it.

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We are right, however, to be concerned about whether this really works in practice. It is obviously not enough to ensure that less affluent students have the immediate financial means to study; it is also essential that the funding system does not act as a deterrent for other reasons. And given the high levels of personal debt already faced by many of Britain’s less well-off households, is it not likely that further increasing student debt will be a serious deterrent to poorer applicants?

Again, this argument is plausible, neat, and wrong. As debts go, student debt is exceptionally benign, involving no bailiffs or unpredictable interest rates and functioning more like a tax, coming directly out of your salary once you earn over £21,000 a year. It would make little financial sense to decline a place at university for fear of it, and indeed the tuition fee experiment yields no evidence that increasing future student debt actually deters working class teenagers from applying. The benefits of university still well outweigh the costs for Britain’s poorer young people.

Since Osborne’s measure is no actual obstacle to social mobility, why do the left so vehemently oppose it? Perhaps because the maintenance grant was seen as a better redistributive measure. But that it most certainly was not. The real losers from the change are those students from poorer backgrounds who go on to earn a relatively high salary. Contrasted with a loan, the maintenance grant had the effect of transferring money from taxpayers, many of them badly off themselves, to a small sub-section of the working class who had, by definition, already escaped from financial poverty. For those who don’t capitalise on university and so don’t pay their loans back, the funding is in effect still a grant. It is hard to find a coherent defence of this particular redistribution that goes beyond a generalised hatred of anything done for such a low moral reason as improving the health of Britain’s public finances. Unfortunately, there is nothing especially progressive about denying the necessity of doing so.

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The opposition to this measure, then, is in truth not progressive at all but obstinate and self-serving. Until the left develop a more creative approach to the problems of modern capitalism, they may enjoy plaudits for defending groups hurt by necessary cuts but will fail to enjoy any trust or respect from the public at large. Progressive students should by rights be at the forefront of the movement to recognise this by accepting that some cutbacks are really a means to move forward.