Monday, 9 August 2010

Will the coalition really adopt a graduate tax?

Today's Times (£) claims that the coalition has now come down in favour of a graduate tax, following David Willetts' interview with James Landale on Marr yesterday. When I saw the Times headline this morning, I assumed I must have seen a different interview. But, no, the Times uses the following quote to justify its position:
“We do have a preference for a way of going forward that involves graduates after they have got into work,” he said. “Graduates on average earn at least £100,000 more during their lives than non-graduates. We think [they] should make a higher contribution to the benefits of the university education they have received.”
I also heard Willetts telling Landale that the Browne review was 'looking at' a graduate tax along with everything else. But Willetts was very careful, whilst soothing his boss Vince Cable's injured ego, to avoid saying anything that could be seen as an endorsement of the graduate tax.

What he was describing in his quote could just as easily mean extending the payments required under the existing system. The difference between doing that and what Cable wants is that the latter would involve graduates paying a fixed proportion of their income for life, while the former could be paid off quickly if one's earnings grew. It may be that David Cameron and George Osborne are committed to raising income tax from all graduates. But I doubt it. Which makes it rather odd to see the Times getting so excitable about some (perhaps too) clever wordplay by David Willetts yesterday.

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