Ed Miliband's Tax Cut for Rich Graduates

So Ed Miliband has decided that Labour's policy on tuition fees is to reduce the cap in England from £9000 per year to £6000 per year. He says that this will be funded by more taxes on the banks and increasing the rate of interest paid by the highest earning graduates.

The reason? This is what he says, in an ever so pious dig at the coalition:

"We can't build a successful economy if the kids from all backgrounds are put off going to university."

Now we can debate the rights and wrongs about the Coalition policy until the cows come home. But let us look at what practical difference this actually makes. I have used the projections that MoneySavingExpert.co.uk deduced. I refer you to the red table at bullet point 17 "How much do you pay".

As we have established many times before, the loans repayment programme (thus in practice for a student, their tuition fees) has a 30 year limit, after which any existing "debt" is written off and the system effectively operated as a graduate tax on their earnings over the earnings threshold (currently £21k).

If a student earns less than £35k as their initial graduate salary, and their earnings rise to slightly less than £140k after 30 years, they will not have paid off their student loan, regardless of whether or not they actually chose a course that charged £6k a year or £9k a year. There is no appreciable link between what that graduate "owed" and what they "paid" for their University education.

Contrastingly if a student earns around £50k initial graduate salary and that rises with career progression and inflation etc. so after 30 years they are earning over £200k, they will pay back the whole of their student loan, and will do so well before that 30 year period elapses. In this instance, it therefore matters a lot more how much they "owed" and it correlates much more closely to what they "pay". The difference for that student taking a £9k course rather than a £6k course is that they pay about 50% more, because, funnily enough, they owed roughly 50% more.

So can you see where I'm heading with this? Yep. That's right. Lowering the limit on tuition fees to £6k has ABSOLUTELY no effect on the lowest-earning graduates, but represents a potentially HUGE saving for the most affluent of graduates! Since we have established that the funding system is effectively a kind of graduate tax, this means that Labour are advocating a TAX CUT on the richest beneficiaries of an English University education! The difference between what is owed is substantial enough that the interest rates they'd need to charge the richest graduates to make them pay the same, let alone more, would be of Wonga.com proportions compared to those they pay now.

And of course, this poses the question of where the Universities are going to plug the hole in the finances this creates? Are we to expect more direct state funding? Where is that coming from without increasing the deficit? "Tax the banks" Labour reply. Well here's the thing. Your bonus tax raised absolute pittance compared with the Coalition's banking levy. Just like with the very tuition fees you promised you would never introduce, you command no credibility for delivery.

But that is not even the worst thing about this sordid affair. The worst thing is that Labour, by engaging in this piece of political misrepresentation, are perpetuating the very myths that they have used to scare young people into thinking they can no longer afford to go to University under the Coalition changes. They are doing the very thing that the Lib Dems got crucified for: politicking with the tuition "fee" when they know full well that that headline figure is of zero relevance to the majority of graduates, for whom the repayment matters. They have scaremongered those from poorer backgrounds into believing they can no longer aspire to a University education and all the benefits that brings. Yet their own policy does absolutely nothing to help these people. There is nothing about maintenance grants, which are what really affect the ability of the poorest to be able to go to Uni. This throws money at graduates who are already benefiting in a huge financial way from their degree.

Remember, this is the Labour Party. The Party of Keir Hardie, of Nye Bevan and of Clement Attlee. Those men would be turning in their graves if they saw what this manipulative and regressive cabal led by Ed Miliband and Ed Balls has become.

The Labour Party. Party of the Poor? Words truly fail me.

DNA - Do Not About-turn

Just over a month ago at PMQs, Ed Miliband tried to bounce David Cameron into a u-turn over plans to end the routine retention of DNA samples given by those who are arrested but not charged with rape and other related offences.

At the time it was heartening to see Cameron refuse to back down on that front. From the outset, I should make clear that I don't think the Government's policy as it stood a month ago goes far enough to protect basic freedoms: those charged but never convicted will still have DNA routinely kept on file and those arrested but not charged can, on application have samples retained. My own position is pretty much exactly as stated in the Lib Dem Manifesto:

"Remove innocent people from the police DNA database and stop storing DNA from innocent people and children in the future, too." Liberal Democrat Manifesto 2010 p94

I recognise that the Coalition's position on this was more nuanced, stating:

"We will adopt the protections of the Scottish model for the DNA database." Coalition Agreement 2010 p11

And for the sake of completeness, the Conservative Manifesto said of DNA retention:

"The indefinite retention of innocent people’s DNA is unacceptable, yet DNA data provides a  useful tool for solving crimes. We will legislate to make sure that our DNA database is used  primarily to store information about those who are guilty of committing crimes rather than those  who are innocent. We will collect the DNA of all existing prisoners, those under state supervision who have been convicted of an offence, and anyone convicted of a serious recordable offence. We pushed the Government to end the permanent retention of innocent people’s DNA , and we  will change the guidance to give people on the database who have been wrongly accused of a  minor crime an automatic right to have their DNA withdrawn." Conservative Party Manifesto 2010 p80

For those who are unfamiliar with the Scottish system, anyone who is found innocent of any crime in relation to which they have given a DNA sample has it removed from the database (unless specifically challenged) after 3 years. The position in the rest of the UK is different; the limit is 6 years and was introduced under the Labour Government. Last year the Scottish Labour party's Holyrood delegation attempted to amend the Criminal Justice and Licensing (Scotland) Bill to bring Scotland into line with the rest of the UK, but the SNP, Lib Dems and Tories(!) told them where to go.

My concerns today arise with news that whilst DNA samples of innocent persons will no longer be stored on the centralised national database, they will be retained by some local forensic labs. Whilst I can appreciate that there may be practical difficulties in ensuring the total destruction of innocent persons' DNA data, I have huge misgivings about this. It is inconceivable that particular samples cannot be linked to individuals even if they're being held locally rather than nationally, and that's simply unacceptable if those people have never been convicted of any serious offence.

If the government proceeds on that basis, it's a cop-out. My message to Clegg, Cameron, May and Clarke is this: ignore Ed Miliband; stand-up for freedoms and Do Not About-turn on your Coalition agreement with this miserable little compromise.

Don't let the state turn you
into a binary series

Nick Clegg speaks his mind

It's well known that there's no love lost between Nick Clegg and Ed Miliband, but a brief exchange between the two at PMQs seems to have slipped under the radar. Nick Clegg appears to rebuke comments about private sector involvement in the NHS in the most unparliamentary of language!

UPDATE: Sadly it appears from further examination that he says "You were the ones who gave the private sector a free pass". I'm sure my failure at lip-reading was what he was thinking though!