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Vince Cable’s graduate tax is far from ‘progressive’

This article is over 11 years, 11 months old
Liberal Democrat business secretary Vince Cable has floated plans to introduce a new graduate tax. Siân Ruddick explains how it will hit working class university students hard
Issue 2211
Staff and students protested against Vince Cable at London South Bank University last week  (Pic: )
Staff and students protested against Vince Cable at London South Bank University last week (Pic:

The attacks on education are coming thick and fast under the new Tory government.

Not content with slashing £200 million from universities’ budget, the government aims to restructure the sector even more along market lines.

Vince Cable, supposedly representing the “progressive” Lib Dem section of the government, is leading the charge.

Cable outlined some ideas for universities in a speech last week that horrified students and lecturers alike.

The coalition wants to change the way students pay for their education. Some ministers say that instead of the current system of tuition fees – capped at £3,325 per year – a “graduate tax” will be introduced.

This will mean a tax on earnings for everyone with a degree, for as long as 25 years after graduation.

The government is trying to couch this in progressive language.


So Cable said, “It surely can’t be right that a teacher or care worker or research scientist is expected to pay the same graduate contribution as a top commercial lawyer or surgeon or City analyst whose graduate premium is so much bigger.”

But although the full details aren’t yet known, the tax will mean that even people who don’t get “good” jobs after university will have their wages seriously hit by the move.

It will deter poor people from going into higher education.

Tuition fees are unfair and should be scrapped – but a graduate tax is no solution. Instead, free education, including student grants, should be reinstated.

And the rich – whether they have a degree or not – should be taxed appropriately to pay for it and for a better welfare state for everyone.

Cable has said that, like the banks, universities should be “allowed to fail”.

But the banks were not allowed to fail – the government bailed them out to keep them afloat at a cost of trillions to ordinary people.

Yet struggling universities will go to the wall instead of being supported.

The coalition also plans to turn some of the nightmare scenarios proposed by New Labour into reality.

One is that of the two-year degree – instead of the current three-year standard.

Cable told a gathering of vice-chancellors at South Bank university in London last week, “Universities are going to have to ask how they can do more for less.

“There will probably be less public funding per student … quite possibly fewer students coming straight from school to do three-year degrees.”

Cable was met with angry protests by staff and students outside.


Institutions with predominantly working class students will be pressured to offer the shorter courses.

Those with funding from outside institutions and businesses will be able to subsidise longer courses.

This will further exaggerate the two-tier higher education system in Britain.

It will also lead to a growth in private institutions, sponsored directly by business, which will compromise both the independence and variety of subjects offered to students.

And none of this solves the problem of how students pay for their degrees while at university.

Condensed two-year programmes will mean students have less time for paid work during their courses – which over two thirds of British students rely on to get by.

The government will decide how to distribute the money from the tax, meaning that huge chunks could be directed out of the education system.

The cuts have already led to hundreds of lecturers and support staff being sacked and departments closing down.

This will be the tip of the iceberg if the Tories’ latest plans go ahead.

The UCU lecturers’ union estimates that cuts already mean at least 170,000 applicants will not get a university place this year.

The National Union of Students (NUS) has pushed the graduate tax as a “fair”solution to funding universities.

NUS has all but dropped its demand for free education in recent years. Instead it has opted for more reactionary measures in exchange for a promise of a “seat at the table” when funding is discussed.

This strategy has failed monumentally.

The fight to save and improve higher education in Britain has to be integrated into the fight against all attacks.

And we need militant action – including strikes and occupations – to halt Cable’s bulldozer.


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