Labor has promised to reverse changes to the student loan system planned by the Conservative government in a way that would reduce the monthly repayments of graduates.
Bridget Phillipson, the shadow education secretary, said on Friday that the tuition fee system was “broken”, but repeated the insistence of her party leader, Keir Starmer, that Labor could not afford it all scrapping charges.
Starmer’s decision to drop a promise to end the fees has sparked anger among students and the Labor left. But Phillipson’s comments to the Times provide the first insight into how the party is seeking to win back voters.
Phillipson said: “The Conservative tuition fees system has been broken for a long time, and their latest set of reforms will only make it worse.”
He added: “Several proposals have been put forward on how the government can make the system fairer and more progressive, including modeling that shows the government could reduce the monthly payment for each new graduate without increasing one penny of government borrowing or general taxation. – Labor cannot increase its government spending.”
Under plans announced by the Treasury last year, graduates will have to start repaying their loans when they earn £25,000, instead of £27,295, and will have to continue paying for a maximum of 40 years rather than 30. Interest rates will be cut for new borrowers and tuition fees will be capped at £9,250 for the next two years.
The measures are predicted to double the number of graduates who pay their debts in full, and save the government tens of billions of pounds. But those with lower incomes will have to pay more, thanks to the reduction of the lower payment threshold.
Phillipson said: “The Tories’ choices are damaging the next generation of nurses, teachers and social workers; of engineers, designers and researchers.” But he did not go into detail about how Labor would reform the system, or how the party could reduce monthly payments without spending public money to do so.
Phillipson’s promise, however, did not ease the anger of many in the Labor party over the decision to renege on the promise to end the compensation system.
Fabiha Askari, vice-chair of the National Labor Students Committee, said: “When Labor committed itself to abolishing tuition fees in 2017, hundreds of thousands of students flocked to the Labor party. While many young people -on the political disenchantment of Westminster, Labor must make commitments that seek to build a broad coalition of voters to remove the Tories and their failed policies.
A spokesman for Momentum, the left-wing grassroots campaigning organisation, said: “Once again we see a worrying lack of ambition from the Labor leadership. The proposed cuts to rates will still leave those young people facing huge debts, even as they struggle with high rents.