I'm entirely incapable of understanding how a UK SLC "loan" can be considered a loan in the conventional sense of the word when it seems to have literally no characteristics of a loan, and every characteristic of a tax:

* You only pay it when you are in employment and earning money (with a minimum salary for repayments to be taken);

* The repayments are calculated as a function of your taxable income;

* The balance isn't discharged by bankruptcy;

* The balance isn't considered by lenders when assessing your suitability to take on "real" debt.

As far as I can tell, it's a graduate tax (on those who took a loan) for all intents and purposes.

I see comments from students talking about being "crushed by debt" as a result of taking an SLC loan, and I just can't work out where this perception comes from: yes, it decreases your take-home pay, but since there's a minimum salary threshold for payments to be taken, it's never going to leave you destitute.

I think that the modern loans are a far less amicable deal than I had just a few years ago. Interest rates far higher despite an incredibly low rate environment.

But. The repayment thresholds and the loan forgiveness period do massively reduce the onerousness, especially on those in lower paid roles who would otherwise never repay. My main complaint about the system is really how it drags on the middle.

The successful graduates pay off their loans in 6-7 years, or less. If you're earning 40-50k, you'll take more like 20 years to pay off the loan which feels like a long hard slog. I still think graduate tax would have been the right call.

6-7 years on standard repayments would require a salary of around £100k straight out of uni.

On £40k you'd end up with them cancelled and likely repay less than you borrowed (45k typical borrowing, £38k repaid over 30 years).

1. The amount that you "borrowed" is a fake number, though, with no correspondence to the true cost of the course and is non-existant for e.g. Scottish students in Scotland.

2. Your salary will (is expected to) inflate; the repayment threshold currently does not, so the "time value of money" has something to say about how much you repay. Someone whose salary remains constant on the equivalent of £40k will find their repayments an increasing burden.

The repayment threshold is expected to rise with average earnings so someone on an equivalent salary of £40k would be expected to pay back less in real terms than that calculation if wages rise above inflation.

The amount you borrow is not a fake number, whether it is related to the course cost or not, just as the price of a car is not a fake number even if it was cheaper to produce. It also includes literal cash payments to you.

What £ of tax would the working class family contribute towards university education (assuming you accept this paradigm of tax and spend)? Back of envelope calculation suggests income tax collected from a median family would be £50 per year.

Meanwhile, I know plenty of working class/blue-collar families who believe that debt is an unmanageable risk that they should reject if at all possible.

Their children take that to mean that they absolutely shouldn't go to university, no matter how capable they are.

> Back of envelope calculation suggests income tax collected from a median family would be £50 per year.

Back of envelope calculation is definitely wrong.

I'm not necessarily disagreeing with you, I'm just saying that £50 figure is definitely not right, without doing any calculation. (OK sure - 50/0.2 = £250 taxed at basic rate above personal allowance. Which this year I think is £12k5, and median household income is surely above £12k75.)

Ah apologies, I was answering my own question: I meant marginal tax required to pay for university level education in place of current student loans system.

this, but also that:

“ What £ of tax would the working class family contribute towards university education”

Is not really fair to the issue. It’s not a cost for university education, because it’s not open to all - there are gatekeepers - and those from underprivileged backgrounds have very little chance of being accepted to the most prestigious institutions, so it’s unfair to expect them to pay for it, is essentially my point.

My point is that people from underprivileged backgrounds realistically don't pay any different amount in tax and are only further removed from access.

To repeat myself: "Their children take [accruing debt] to mean that they absolutely shouldn't go to university, no matter how capable they are."

Tax pays for plenty of things that working class people don't use; it also pays for plenty of things that working class people do use, that other people are paying for - and the latter category should include university education. Tax is an agreement that we find these things valuable to pay for, as a society. Not everything paid for in taxes has a direct benefit to everybody.

"Tax is an agreement that we find these things valuable to pay for, as a society."

But we don't agree. A lot of people are affronted that as they see it they're being asked to, in essence, fund a high quality education for wealthier people's kids that their own kids can never have access to.

Whether they're right or wrong (and I've yet to see evidence that they're wrong), that's their view. And there are a lot of them. Which is why Clegg could never sell it to the electorate back in the coalition days.

If we all took the point of view that any government spending that doesn't directly and immediately benefit us personally should be cancelled, no government spending would be likely to happen at all. It's an inherently right-wing/individualist position.

I think this is an issue of right-wing media spin, rather than beliefs that working-class families innately hold. (Also since my experience of working-class families' views is generally the opposite of your claim.)

There is a lot more egregious government spending distribution problems than this one, which get ignored. In general, government spending benefits the middle classes (and upper classes) far more than it does the working class, and that's true in other areas more than it is in education.

From https://www.tutor2u.net/economics/blog/does-uk-government-sp... e.g. "The wealthy also drive three times as many miles as the poor. This makes them big beneficiaries of spending on roads, worth £8 billion a year. Poor people make up ground elsewhere: they use buses twice as much. But bus subsidies are smaller."