Oh, Jeremy Corbyn
What the hell are you playing at man. It’s an open goal!
During the election the exalted JC said “I don’t see why those that had the historical misfortune to be at university during the £9,000 period should be burdened excessively compared to those that went before or those that come after. I will deal with it,”.
Now he, no doubt on the mistaken advice of his shadow chancellor and whatever Wormtongues he is unfortunately listening to, is backpedalling on that statement faster than a Mussolini-era tank division.
Labour are establishing a working party to look at the policy, because apparently it takes an entire team of Labour top brass to come up with the three steps that are required to end student debt.
Let me save them the cost and bother. The process is as follows:
- Write to the Department of Education instructing it to wind up the Student Loan Company by writing off all the debt and closing the now insolvent operation. Get the Insolvency service to give the necessary paperwork to HMRC so they can issue the redundancy payments to the staff, plus any ex gratia compensation the government may consider appropriate.
- Return university funding to the Department of Education proper, if it isn’t there already.
- Pass legislation that cancels securitised loans sold to the private sector and any consequential government guarantees. When the private financial debt collectors moan, let them know they backed the wrong political horse and that’s capitalism. If you live by the sword, you have to be prepared to die by it.
(Note to EU fans — this is the sort of thing we can only do outside the EU. Much like the EU would have stopped us taking the voluntary hospitals to form the NHS — as we did in 1946).
It really is that simple. A massive political win amongst the young and not so young — all by writing a couple of letters and a few paragraphs in a Finance Bill.
Oh and letting the cat out of the bag about the Magic Money Tree.
Student loans are not really loans. It’s just a list of people who are liable to a form of additional taxation after graduation. Even then it is only paid by those who managed to get a decentish job after graduation. Two thirds of the loans will likely be written off anyway. Scrapping tuition fees and the loan system is simply a tax cut for those who have bettered themselves and managed to get a reasonable job.
Getting rid of the albatross around their necks and the necks of thousands, if not millions, of ex-students who were not quite so lucky in the jobs market will increase their capacity to spend in the economy. The resulting expansion and multiplier effect throughout the economy will absorb that spend via additional production and job expansion. As ever, if you can count people on the unemployment queue you are likely over-taxing for the size of government you have.
So let’s explain reality to people. Student loans are not really loans. They are a list of people subject to additional taxation. We’re going to get rid of that taxation because those who earn more already pay more tax and we want to encourage people to follow the path of lifetime education, not put spikes in the road.
And we want the private sector to be very clear. If they buy chunks of securitised taxation in the future, a subsequent Labour administration will just cancel them.
This is as near a zero cost political choice as you could get. The only real cost is to those who currently have a job at the Student Loans Company in Glasgow, Darlington and Llandudno, and finding them new work has to be a priority. (Perhaps that’s what the ‘working party’ is actually going to be talking about. Of course, there is a simple solution to that problem as well).
So go on Jeremy. Be brave. Tell people the truth. Tell them a Labour government will end this administrative fiction once and for all.