The Scottish Labour manifesto was launched today by a confident Anas Sarwar. There were no real surprises and it is clear that Scottish Labour and the wider Labour Party are ‘joined at the hip’ on nearly all policies. But Higher Education funding is devolved and represents a rift between the two. It is possible to square the circle, but it would take a brave government to do it. Labour will have to address student fees and support soon and look at a fairer progressive system of payment.
The Scottish Labour manifesto ‘Change’ closely matches that of the Labour Party ‘Change’ in both style and substance. Launched earlier today, there were no real surprises. Many people in Scotland have already decided and will soon cast their postal vote since the election day is in a week of Scottish holiday.
Last week the Labour manifesto accepted that student fees would remain despite acknowledging, “Higher education is in crisis” (TEFS 14th June 2024 ‘Labour manifesto reveals a bold plan for universities’). Instead, on fees and loans they say,
“Reworking the present system gives scope for a month-on-month tax cut for graduates, putting money back in people’s pockets when they most need it”
However, Scotland presents a significant problem with the Scottish Nationalist Party (SNP) government using its devolved powers on education to avoid fees for students. This means a take of more money from all taxpayers and a cap on numbers, a problem they cautiously bypass. This is hardly fair.
To avoid ‘scaring the horses’, the Labour response in Scotland is to take a position very different from the rest of Labour with,
“Scottish Labour remains committed to free tuition for Scottish students attending Scottish universities and we want to ensure that the progress made on widening access continues.”
Reconciling both positions with a fairer system would seem impossible. Having no fees across the UK would work, but at the expense of all taxpayers as happens in Scotland where taxation is higher. It would also be possible by the introduction of a progressive graduate tax over the UK to cover the costs of existing fees. There would be no fees and no loan repayments as they are phased out. But capping numbers would be necessary and would not chime with the Labour commitment in its manifesto to,
“Build on the legacy of the last Labour government’s target for 50% of young people to go to university”.
‘Squaring the circle’
The task of squaring a circle exactly is geometrically impossible. However, it is possible to reach a very close approximate area of a square to match that of a circle so that the difference is imperceptible. This has been known for a long time,
“Go not thou about to square either circle, to bring that which is equal in itself to angles and corners”. John Donne 1624.
Therefore, using similar logic, it is possible for Labour to come up with a solution to the circle of student fees and the square of fee repayments. This involves a graduate tax designed to seek contributions from both employer and graduate employee. Along with wider society, these are the main beneficiaries of university education. The wider tax payer might be expected to cover larger investments, research, and student maintenance grants for the less advantaged. A UK government could do this across the UK and the simplest to administer would be a ‘National Insurance Graduate Levy’. It is not a new idea and TEFS has argued for this for some time (more recently TEFS 10th May 2024 ‘Funding students and Universities: a graduate National Insurance Levy is gaining traction’). Both graduate and employer would pay into a UK-wide fund to cover university costs. It would be highly progressive, and track pay inflation. This would act like the state pension in reverse and relieve the current crisis in universities hamstrung by inflation and frozen fees.
‘Swings and roundabouts’,
It is simple to start and if this was to be instigated in 2025 it would take some persuasion. Labour might have to wait till 2026 when they have a fair chance of becoming the government in Scotland after elections. Students outside of Scotland would already see a major cut in the payments they were making as graduates. A fairer earnings threshold of around £30,000 to £35,000 per year before paying they levy would be at a point where graduate pay exceeds the mean for non-graduates. Students in Scotland might expect it to be balanced by lower taxation to mitigate against the higher taxes they already pay. This would have the effect of removing the tendency of Scottish graduates leaving Scotland to avoid higher taxation.
Looking to 2026.
Just as on fees, Labour might have to keep one eye on the Scottish Parliament elections in 2026. Despite this barrier to current policy, due to it being devolved, they pressed on with’
“Increased investment for Scotland’s education system…… A modern curriculum so young people are ready for work and life……..Reform apprenticeships so they work better for young people and Scotland’s economy”.
More radical, and greatly affecting higher education, is a proposal aimed critically at devolved SNP responsibility,
“Scottish Labour supports replacement of the SQA and Education Scotland with new bodies so that the system of curriculum development, accreditation, and assessments is fit for purpose”.
This would upend the current arrangements and alter how students are selected for higher education. It’s the first warning shot across the bows of the SNP minority government in Scotland before the elections in 2026.
The author, Mike Larkin, retired from Queen’s University Belfast after 37 years teaching Microbiology, Biochemistry and Genetics.