by David Craig
The Sutton Trust charity has a strong interest in education and has produced a number of reports during the last ten years looking at the background of entrants to the UK’s elite universities. The findings of these reports are stark – the gap in performance between the state–school and private–school sector is huge. Even when state–school students achieve better grades than their privately–educated counterparts, they still do markedly worse in gaining entrance to top universities. According to the Sutton Trust: “A student in a state school is as likely to go on to a leading university as a student from the independent sector who gets two grades lower at A–level.” 391
The Sutton Trust identified two key factors for this gap. These were the relative aspirations of these young people and the quality of advice they received from their schools. There can be little doubt that the levels of aspiration and of advice received by pupils at the UK’s top independent schools will provide them with a significant advantage in gaining admission to an elite university. Not only will they have a peer group who are often selected on ability through entrance exams, they will also have a large number of teachers who attended the best UK universities and who can provide expert advice and guidance on application forms and interview technique.
Whilst the dice are loaded against state–school students, the actions of some state–school teachers disadvantage them even further. In 2008, the Sutton Trust discovered that:
“...only 54 per cent of teachers in state schools said they would recommend their brightest students to apply to Oxbridge. Fifty–six per cent of the 500 teachers surveyed wrongly thought it cost more to study at Oxbridge.”392
In 2009, the Sutton Trust found that a common theme amongst teachers in state schools was advising bright students that they would not fit in socially at Oxbridge and should therefore not bother applying. Speaking to the Times Higher Education Supplement Sir Peter Lampl, the founder of the Trust, stated that: “Many highly able pupils from non–privileged backgrounds wrongly perceive the most prestigious universities as ‘not for the likes of us’, and often lack the support and guidance to overcome this misconception.”393
Unfortunately, it appears that this problem is getting worse. In 2012, follow–up research by the Sutton Trust suggested that 54% of state school teachers would not advise their academically–gifted students to apply to Oxbridge.394 The survey also showed that, of the 730 teachers surveyed, many had very inaccurate ideas about the numbers of state–school students educated by the universities and the cost to students. It would be interesting to know how many of these teachers regularly read angry opinion pieces in the Guardian about elite universities discriminating against state–school pupils and a lack of “fair access” for state–school pupils.
This problem was visible in figures released by the Department of Education in 2009. These showed that nearly 1,400 schools and colleges, which teach A–levels, failed to send any pupils to either Oxford or Cambridge Universities. Moreover, 330 schools and colleges did not send a single student to a Russell Group university. This problem was experienced directly by one of the graduates interviewed for this book. They were studying at a state school and were clearly academically outstanding, achieving all A or A* grades at GCSE and regularly coming top or very near to top in all subjects. They took five A–levels during the sixth form and decided to apply to Cambridge to study economics. Unfortunately, their teachers were not supportive of this decision, with one suggesting that the student was “aiming too high” in wanting a place at Cambridge. The school provided little assistance in university interview practice, with a single practice interview given by a teacher who had no experience of what sort of questions might be asked or what the university would be looking for. They also provided no guidance on which college to apply to at Cambridge. The student’s teachers, personal tutor and head of sixth form failed to alert the headmaster (himself a Cambridge graduate) that a student was applying to Cambridge.
In addition, the school also entered all of the maths students for AS–level module examinations in January when there had been considerable teacher absence and it was openly acknowledged the students were not sufficiently prepared. Rather than waiting and allowing the students to sit the exams in June, the school decided that the students would benefit from the January exam practice. This student specifically objected to this and was told that if she didn’t sit the examination she would be entered anyway and awarded zero. The school did, however, insist that the results of these examinations would not be published. Despite this, it became apparent during the student’s Cambridge interview that the results had been published.
Because of the university’s experiences with students dropping out due to their inability to cope with the level of maths required to study an economics degree, this inevitably set back the student’s prospects and undermined them in the interview. With little interview practice, a poorly written reference (which it transpired had not been proof–read and contained half–finished sentences), the forced use of external examinations as “exam practice” and no encouragement or support, the student was not offered a place. Cambridge colleges send written feedback to schools in relation to every interviewee. This student’s school failed to relay this feedback to the student and failed to discuss the experience with them following the interview. One teacher did however smugly say that the student had “shot herself in the foot”, but then refused to explain why. Having achieved 5 A–levels at A grade, with an array of 100% results, the interviewee went on to take a first class degree in economics at a Russell Group university.
Their school was considered to be a good school within the local area. Nonetheless, it had not sent any students to Oxbridge since it had been a boys’ grammar school some decades earlier and many of the teachers had little inclination to help the interviewee. In fact, some of them displayed exactly the sort of reverse snobbery identified in Sutton Trust reports, going out of their way to discourage the student from applying. Several years later the student still felt angry and let down, not only for the total lack of help, but also for the way in which the school actually handicapped their application.
This failure of advice and guidance is partly created by the relative lack of state–school teachers who have themselves attended Oxbridge and, to a lesser extent, the Russell Group universities. It might be difficult to significantly adjust the number of teachers in the state school sector who have attended Oxbridge or the Russell Group in the short term. It is professionally inexcusable, however, that every secondary school teacher responsible for university applications cannot provide accurate and unbiased information to their students about admissions to elite universities. Information about entry processes, criteria and intakes is freely available on the internet and should take any teacher about a day to find and digest. This clearly has not happened in many state schools. As the Sutton Trust pointed out in 2012:
“...state school teachers hugely underestimate the proportion of state school students at Oxbridge. When asked what proportion of state school students were at Oxbridge 14% of teachers said they didn’t know. Of the 86% of teachers who gave an answer only 7% thought it was over 50% and almost two thirds thought it was less than 30%. The actual number admitted to Oxbridge is 57%.”395
If more state–school students were given accurate advice by their teachers about Oxbridge and the Russell Group universities, more would apply to these universities. If more state–school teachers actively encouraged and supported students to apply to these universities, again, more of their students would apply. If state schools accounted for 80% rather than 63% of applications to Oxford University, then their percentage of places would rise significantly.
The issue of low applications from state schools to elite universities appears, in no small part, to be cultural with many state schools wanting to avoid failure rather than achieve success. This mindset is not necessarily the fault of individual schools and teachers; instead it is another m
anifestation of a target culture within the education system. This culture would rather see all students pass mediocre qualifications with poor exam boards and is in evidence when teachers dissuade their students from applying to elite universities. It would prefer all students to be accepted at poor or middle–of–the–road universities – with poor job prospects after graduation – than applying to and maybe failing to get into the best universities. This culture is not only about fulfilling targets and avoiding failure, it is also about minimising or avoiding competition and anything that might be construed as elitism. It is a mindset that strives for equality of outcome rather than opportunity and it is a mindset that leads to mediocrity or worse.
CHAPTER THIRTEEN: THE STUDENT LOANS FIASCO
They say that nothing is ever so bad that government can’t make it worse. And that’s certainly true of government efforts to ‘improve’ and ‘modernise’ and ‘transform’ how we pay for our universities. UK governments, of all political parties, are no strangers to wasting prodigious amounts of our money. The NHS computer system was supposed to cost us about £2.4 billion. It was scrapped after about £4 billion or £5 billion was spent. Actually nobody really knows how much money was wasted. The London Olympics were coincidentally also supposed to cost taxpayers a mere £2.4 billion. They actually cost us over £9 billion and made some insiders very rich indeed. Then there are destroyers that won’t destroy much as they often don’t work, aircraft carriers with no aircraft, spy planes that couldn’t spy, the Millennium Dome which lay empty for years, supposedly ‘smart’ motorways that are anything but smart and many more similar exercises in profligate, public–sector ineptitude. But these many billions are just small change compared to the massive bill taxpayers could be landed with due to the student loans fiasco.
Each year students borrow about £10 billion to £12 billion – a figure that has been increasing as tuition costs have risen. Coincidentally, the current Foreign Aid budget of over £13 billion a year would cover the cost of student tuition fees and maintenance loans in their entirety. As much of our foreign aid is wasted through incompetence, bureaucracy and corruption, diverting some or all of our foreign aid to help pay for our university system might appear a reasonable alternative to the prospect of future UK generations being saddled with massive, unrepayable debt. Unfortunately, the foreign aid budget is something of a virtue–signalling comfort blanket for the UK’s political class and their fellow–travellers in the media, who can afford both to pay for their own children’s education and to be extremely generous with other people’s money. Thus it is hard to imagine them voluntarily relinquishing something so morally and ethically valuable (to them) for something as trivial and practical as our Higher Education system and graduate debt.
So, the big question is: how much of this massive amount of money being loaned to students will actually be repaid and how much will be dumped back onto taxpayers? The House of Commons committee which scrutinised recent Higher Education reforms noted:
“A large number of variables can affect the likelihood of loans being repaid, including the initial size of loans (larger loans are less likely to be repaid); the proportions of male and female graduates and their earning profiles (recent trends show once employed, male graduates tend to earn more than female graduates and so are more likely to repay in full); and the behaviour of the economy, including inflation, interest rates and earnings growth.”396
All in all, not terrifically enlightening and certainly not answering the question of how much would actually be repaid by students and how much would have to be picked up by Britain’s ever gullible taxpayers.
The student loan book and graduate repayment
Students who drop out of university, graduates unable to secure employment, graduates employed in non–graduate jobs and graduates who decide to disappear off to work abroad are all unlikely to repay their loans. In each case, this debt is likely to become bad debt – a cost to be borne ultimately by the taxpayer. Unsurprisingly, the scale of this problem has not been fully articulated to the public during expansion. In 2008, a parliamentary question raised by the Liberal Democrats revealed that:
“A third of students who started university since fees were introduced in 1998 are earning too little to make repayments on their loans. Nearly 400,000 graduates have not made repayments on their loans up to seven years after they graduated because they are not earning above the £15,000 threshold.”397
It should be noted that this was the situation before tuition fees increased from around £3,000 a year to £9,000 or more a year and when the threshold for starting repayments was only £15,000 a year compared to the new, more challenging level of £25,000 a year introduced in April 2018. With much higher tuition fees and a much higher threshold before repayments start, the bad debt situation described above will be quite limited compared to what we can expect in the future. In fact, the long–term cost of bad debt is something which should concern UK taxpayers as the overall size of the UK student loan book (the sums owed by graduates) is increasing dramatically. In 2015, the government estimated that the student loan book at the end of the 2014–15 financial year had reached £73.5 billion.398 Though another government publication a year later put the figure at just below £70 billion. (Figure 1).
Figure 1 - The UK student loan book £ Billions 1990-2015399
From 2016 onwards, the (possibly misnamed) Office for Budget Responsibility (OBR) estimated that the Student Loans Company would lend more than £12.7 billion a year.400 Within a couple of years the student loan book will be around twice what we spend on defence every year. The Government projected that the cash value of publicly–owned student debt in England alone would have increased to £100 billion at the end of the financial year 2016–17, £500 billion in the mid–2030s and £1,000 billion – one trillion pounds – in the late 2040s. As these are official estimates, we can safely assume that they are likely to be somewhat optimistic in outlook.
The problem for the repayment of this ever–growing debt mountain is that many graduates will not hit the repayment threshold even in the event of them finding work quickly. Moreover, when graduates do start making loan repayments, the majority will never repay in full – partly because their wages remain too low for them to do so, partly because of the size of their loans and partly because of the crushing burden of compound interest.
Figure 2 is taken from Student Loans Company repayment data in 2016. It shows that between 2010 and 2014, around 40% UK and EU graduates were not making payments on their loans (for a variety of reasons). It is worth re–emphasising that these repayment figures were against a repayment threshold of £15,000 per year till 2012 and then £21,000 a year rather than the £25,000 threshold for graduates from 2018 onwards. We should expect the “unable to repay” section of the chart to expand significantly for the 2015–2019 repayment figures and then to grow again impressively for the 2020–2024 period.
Figure 2 - Graduate repayment of student loans 2010-2014401
Between 2001 and 2006, the percentage of graduates unable to make repayments hovered between 26% and 32%, before rising to 53% by 2012. The figure for 2014 graduates means that, two years after graduation, the majority of graduates (53%) were not in a position to start paying back their student loans as their earnings fell below the repayment threshold. This is not a track record to inspire confidence in the sustainability of the new loans system. Whilst the coalition government responsible for the system acknowledged this difficulty, incredibly it maintained that the system was unlikely to generate any additional cost for the taxpayer. But, as most of today’s politicians will be comfortably and lucratively retired by the time the taxpaying public realises the immense amount of student bad debt for which they will become liable, we should perhaps not be surprised at current politicians’ insouciance?
At the time of the funding reforms, a number of independent commentators rejected the government’s forecast as overly optimistic an
d their objections appear to have been borne out since. For example, in 2012, the Institute of Fiscal Studies warned that:
“.... the government’s analysis over–estimates the number of graduates at the top of the distribution who would earn enough to face the full 3% real interest rate while they are making repayments.”402
Clearly, if graduates don’t earn enough, their loans will not be repaid. The government has already reluctantly admitted that many graduates will not repay their loans.403
To give an idea how difficult it would be for a graduate to repay their loans in full, we can look at a simplified example. We’ll assume there is no inflation and take a graduate who earns £25,000 a year in their first ten years in their post–graduation job, £35,000 a year in their second ten years of working and a more impressive £50,000 a year in their third decade of work. This graduate would have to repay their loan at a rate of 9% of all income above the threshold of £25,000 (at the time of writing).
We’ll further assume that the graduate borrows £9,000 a year for tuition fees and that their parents are earning almost £40,000 a year so they’re able to borrow around £7,000 a year for living expenses. By the end of their course, the graduate would owe £48,000 plus interest giving a total of about £51,000.
