HE as well as apprenticeships which are mutually beneficial to business, society and the economy as a whole. It is currently paid through Pay As You Earn (PAYE) system, we recommend that the levy is increased to 1% and chargeable through HMRC concurrently with corporation tax to decrease bureaucratic inefficiency. We propose that it be renamed, the ‘Future Workforce Levy,’ in recognition of the fact that apprenticeships, training, further education and HE develop individual potential which motivates and allows them to make valid contributions to the workforce and economy. We estimate that the 1% levy on revenue would generate £2.6 billion based on projections of a 1 percentage point increase in corporation tax. Reducing Tuition Fees A reduction in tuition fees would have multiple benefits in reducing student debt, making university more accessible to mature students and increasing the probability that student loans will be repaid within the thirty-year term. The decrease in income for universities could be offset by increasing HE teaching grants. Both policies would incur a large short-term expense but the long-term balance sheet of the Exchequer would be improved by less total student loan debt overall. We suggest tuition fee reduction rather than scrappage as research on Scottish HE funding suggests social inequality is not improved by free tuition. Remove Interest Rates from Loans for Low-Income Students We recommend the removal of interest rates on fees for low-income students due to its impact on debt and use to flatter the budget deficit.
Cap Interest Rate at CPI We propose to change the use of RPI to CPI for interest rates on student finance, to better reflect static wage growth and the 0.5% bank base rate. Restoring Maintenance Grants The King’s Think Tank strongly recommend the reintroduction of the maintenance grant for home students from disadvantaged backgrounds to counteract the advantage that other students have and will continue to have throughout their professional careers. Conclusion Inequality in education has been a recurring topic in policy debate over the last thirty years but presently political debate means that there is a window of opportunity to improve and make student finance fairer. While inroads have been made in widening participation and access to HE, improvements have been small and reveal worrying detail when analysed in a larger context. These measures have been undermined by the changes to student finance, the evolving crisis of student debt and its unclear future consequences. It is clear that there is no magic solution to fix disparities within education to address social inequality that will be palatable to all groups. Our policy recommendations recognise that enabling more people to prosper and drive economic growth for the nation benefits the greatest number of people and thus should be implemented.