Tory MPs set to revolt over ‘graduate

Latest News Update About Tory MPs set to revolt over ‘graduate: Ministers are keen to reduce the cost to the taxpayer of running the universities by placing more of the burden on to the students who benefit from the system.

But the reforms have been a source of tension within the Coalition, with Business Secretary Vince Cable leading Liberal Democrat calls for a formal graduate tax – meaning students would repay their tuition costs through taxation once they started working, and higher earners would pay more.

Conservative MPs largely oppose the idea, arguing that it would be a further financial drain for middle-class voters.

Now Government sources say that agreement has been reached to introduce a ‘disguised’ graduate tax, under which the loans intended to cover maintenance costs and tuition fees would remain cheap to repay for the lower paid, but be more expensive for higher-rate taxpayers.

Last night Mr Cable sent out an email to his party’s MPs which appeared to confirm the plans. He said that while a ‘pure graduate tax is not the way forward’, the Government’s objective was to introduce a ‘progressive funding structure’ – code for charging more to higher earners. Mr Cable wrote: ‘I am entirely committed to a progressive system of graduate contributions, the details of which we will confirm shortly.

‘And I have been open-minded about the possibility of a pure graduate tax. But it is clearly not the right vehicle. We can do better – and we will.’

But Tory MP Dominic Carswell warned against any introduction of a graduate tax by the back door. Read More.