Labour promises to cut tuition fees to £6,000
Ed Miliband has promised to cut university tuition fees in England to £6,000 per year from autumn 2016.
Mr Miliband said his government would pay for the fee cut from £9,000 by reducing tax relief on pensions for those earning over £150,000 per year, because the current fees were leaving graduates with so much debt many could never repay their loans.
Mr Miliband said reducing tuition fees would save taxpayers £40bn by 2030. There would also be higher interest rates for repayments for those graduates earning more than £42,000.
However, the Labour leader faced a growing backlash over the proposal, with critics pointing out that only the very richest graduates currently repay their student loans in full because their debts are written off after 30 years. This means that cutting student fees does not help the majority of graduates who never earn enough to repay their loans anyway.
Business Secretary Vince Cable described the proposals as 'completely financially illiterate', and warned it would create a costly black hole in the national budget.
Universities UK has previously warned that limiting the fees to £6,000 per year would create a £10 billion funding gap over the next five years.
Sir Christopher Snowden, president of Universities UK and vice-chancellor of the University of Surrey, said the proposals would cost £3.1bn of extra public funding each year, which would put pressure on other investment such as research, innovation, and social mobility.
University heads have also argued that the increase in tuition fees to £9,000 has not deterred applications from poorer students.
Mr Milliband said: "This is a system that will have added an extra £16bn more than predicted to public debt by the end of the next Parliament. If left unchecked, the system will have added £281bn to debt by 2030.
"And much of this money will never be paid back. By the late 2040s, student loan write-offs will be hitting £21bn a year - almost double the entire cost of police services in England and Wales. It must go down as one of the most expensive broken promises in history."
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