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    (Original post by mliela)
    I think you need to understand the idea of choice in this situation. In high income families parents have the choice. If they wanted to they could cut down on certain expenses to pay for their children's uni expenses. Many don't want to. But in a low income family where many people are already living on the bare minimum this choice doesn't exist.
    I also disagree with your point that students are as poor as each other. That's implying that people get no money from their parents at all. I'm sure many high earning parents give their kids money. They have the capacity to give them a lot more than low income families.
    I also think it boils down to individual families beliefs. This makes it difficult for the government to fairly assess everyone. No matter what change takes place certain people will lose out.
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    I don't think anyone needs to "lose out" if there's an equal maintenance loan for everyone. Particularly when it's a loan rather than a grant, it doesn't need to be means tested because on average, everyone would be repaying back the amount they borrowed (some more and some less, depending on how much they earn after university).

    People from low income families would continue to get what they already do, and people from high income families would also get the same amount. That would be essentially, the "basic" amount that everyone needs for university. And then if rich parents want to give extra money to their child, it's just a bonus (but nobody would be disadvantaged if they choose not to be that generous).

    I think that all students are as poor as each other (except for those who also work) because, even if some get money from their parents, those parents are not obligated to give it to them. So it's not really their money. So as far as the government is concerned, there should be no assumption that they receive any such money. You're right that there is an element of choice in high income families, but that choice belongs to the parents and not the student themselves. The system should be such that, regardless of what choices the parents may make (i.e. whether to give them additional money just for the sake of luxury or not), the student is still able to go to university.
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    (Original post by tazarooni89)
    I don't think anyone needs to "lose out" if there's an equal maintenance loan for everyone. Particularly when it's a loan rather than a grant, it doesn't need to be means tested because on average, everyone would be repaying back the amount they borrowed (some more and some less, depending on how much they earn after university).

    People from low income families would continue to get what they already do, and people from high income families would also get the same amount. That would be essentially, the "basic" amount that everyone needs for university. And then if rich parents want to give extra money to their child, it's just a bonus (but nobody would be disadvantaged if they choose not to be that generous).

    I think that all students are as poor as each other (except for those who also work) because, even if some get money from their parents, those parents are not obligated to give it to them. So it's not really their money. So as far as the government is concerned, there should be no assumption that they receive any such money. You're right that there is an element of choice in high income families, but that choice belongs to the parents and not the student themselves. The system should be such that, regardless of what choices the parents may make (i.e. whether to give them additional money just for the sake of luxury or not), the student is still able to go to university.
    It's the governments way of controlled lending and spending. It would cost a lot more to give everyone the same amount. Although it is a loan it isn't paid back for a very long time. This is probably the argument for the government selling the debt to a private company.
    I still think it's unfair to say all students are as poor as each other. Family income makes a very big difference.
    Even the maximum amount isn't a lot when you look at the cost of some accommodation.
    There are holes in the system which are difficult to fix without issues. Whether it be the cost to the government or the potential overcomplicating of the application system.


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    (Original post by mliela)
    It's the governments way of controlled lending and spending. It would cost a lot more to give everyone the same amount. Although it is a loan it isn't paid back for a very long time. This is probably the argument for the government selling the debt to a private company.
    Well as I said, that depends on what the terms and conditions of the loan are, as well as the interest rate that it's based on.

    Under previous arrangements where the interest rate was hardly any greater than inflation, and under which some people paid back a lot less than they borrowed whereas nobody repaid significantly more than they borrowed (in real terms), then yes it would cost a lot to give out too many of these loans.

    Under current arrangements where the debt is taken on by a private company at interest rates and terms and conditions set by them, there's no reason why it would "cost more to give everyone the same amount of loan", because each loan should be designed such that, all risks considered, it is expected to yield a profit for the lender.

    I still think it's unfair to say all students are as poor as each other. Family income makes a very big difference.
    It can, but the point is that family income is not their own income. They have no automatic right to it, and so they should be assumed by the government to be as poor as each other.

    If the student is then fortunate enough to receive even more money from their parents, grandparents, uncles and aunts, friends and other relatives, winning the lottery or wherever, that's just their own business. It should never be assumed that students will receive extra money from additional sources, because there's absolutely no guarantee that they will. If they do, it's lucky for them, they can spend it on lots of nights out. But if they don't, they shouldn't be rendered unable to go to university due to the lack of basic financial support.

    I don't think the loans need to be based on household income at all, because the loan doesn't get repaid from the student's household income. It gets repaid from their own earnings once they start working after university. It's at that point that the poor need to be subsidised by the rich, when the payments are being made - not from beforehand, when they're all just receiving money.
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    (Original post by jalby1992)
    You can get a job as well as go uni, there is plenty of time between lectures and you get 2 days off at least a week and weekends! I work full time and go university I am doing really well and have saved up enough for a house deposit whilst doing it
    We were born the same year based on your username so like where do you work, and when did you start working, if I can ask. Because I'm in a bad way yet we're the same age and you seem to currently be ina better spot. Cheers.
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    (Original post by tazarooni89)
    Well as I said, that depends on what the terms and conditions of the loan are, as well as the interest rate that it's based on.

    Under previous arrangements where the interest rate was hardly any greater than inflation, and under which some people paid back a lot less than they borrowed whereas nobody repaid significantly more than they borrowed (in real terms), then yes it would cost a lot to give out too many of these loans.

    Under current arrangements where the debt is taken on by a private company at interest rates and terms and conditions set by them, there's no reason why it would "cost more to give everyone the same amount of loan", because each loan should be designed such that, all risks considered, it is expected to yield a profit for the lender.



    It can, but the point is that family income is not their own income. They have no automatic right to it, and so they should be assumed by the government to be as poor as each other.

    If the student is then fortunate enough to receive even more money from their parents, grandparents, uncles and aunts, friends and other relatives, winning the lottery or wherever, that's just their own business. It should never be assumed that students will receive extra money from additional sources, because there's absolutely no guarantee that they will. If they do, it's lucky for them, they can spend it on lots of nights out. But if they don't, they shouldn't be rendered unable to go to university due to the lack of basic financial support.

    I don't think the loans need to be based on household income at all, because the loan doesn't get repaid from the student's household income. It gets repaid from their own earnings once they start working after university. It's at that point that the poor need to be subsidised by the rich, when the payments are being made - not from beforehand, when they're all just receiving money.
    That change has only been made recently due to the fact that it was costing the government a lot of money so they found means to quickly recover that money. You do realise there are such things as government spending budgets? They're not able to just shell out loads of money at once just so everyone can get the same loan. They have to find ways to save money and to them this system was the best way of doing it. I'm not saying whether I think the system is good or not I'm just saying it from an economical standpoint.
    The maintenance loan could be increased, or just increase the threshold. It's unfair that people at extreme ends of the spectrum will get the same amount. Children from families with a large income will probably get some support from their parents. The system disadvantages that middle belt more so. In the future, although this will make the system more timely and intrusive they can looks further into household bills, not leisure spending just bills alone ie. Mortgages, rent, other dependents. Things like that to instead test it on disposable income instead of flat income.

    There's a reason why the maintenance loan is 'means-tested'. This means that they look at whether or not a family potentially has the means to support the student in uni or not. Like I said the government found a way to save money and this to them is probably the easiest and most money saving system.


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    (Original post by mliela)
    That change has only been made recently due to the fact that it was costing the government a lot of money so they found means to quickly recover that money. You do realise there are such things as government spending budgets? They're not able to just shell out loads of money at once just so everyone can get the same loan. They have to find ways to save money and to them this system was the best way of doing it. I'm not saying whether I think the system is good or not I'm just saying it from an economical standpoint.
    The maintenance loan could be increased, or just increase the threshold. It's unfair that people at extreme ends of the spectrum will get the same amount. Children from families with a large income will probably get some support from their parents. The system disadvantages that middle belt more so. In the future, although this will make the system more timely and intrusive they can looks further into household bills, not leisure spending just bills alone ie. Mortgages, rent, other dependents. Things like that to instead test it on disposable income instead of flat income.

    There's a reason why the maintenance loan is 'means-tested'. This means that they look at whether or not a family potentially has the means to support the student in uni or not. Like I said the government found a way to save money and this to them is probably the easiest and most money saving system.


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    The problem with being "means-tested" though is that they're testing whether or not the students parents have the means to fund them through university, even though those parents have no responsibility to do so. Legally speaking, the child is a totally financially independent entity once he becomes 18, and so it has nothing to do with his parents.

    I mean as an extreme example, the government could also say "No we're not giving you the full loan, you have an extremely rich next door neighbour, get him to fund you through university instead". But obviously the problem with such a suggestion is that the neighbour has no obligation to give you any money - you're being forced to rely on him being generous enough to give it to you, which may or may not be the case. The same is true of parents.

    It might make sense if we were talking about children much younger than 18 who are still, by law, the financial responsibility of their parents. I agree with the concept of means-tested bursaries for students attending private schools for example. But in the case of university we're talking about fully-fledged adults, and so parents ought to be irrelevant.

    Even from an economical standpoint, where the government doesn't want to spend too much of its own money (in one go), I think there are better ways of doing this. Rich graduates can subsidise poor graduates, rather than rich parents being assumed (but not required) to subsidise poor parents.
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    (Original post by tazarooni89)
    The problem with being "means-tested" though is that they're testing whether or not the students parents have the means to fund them through university, even though those parents have no responsibility to do so. Legally speaking, the child is a totally financially independent entity once he becomes 18, and so it has nothing to do with his parents.

    I mean as an extreme example, the government could also say "No we're not giving you the full loan, you have an extremely rich next door neighbour, get him to fund you through university instead". But obviously the problem with such a suggestion is that the neighbour has no obligation to give you any money - you're being forced to rely on him being generous enough to give it to you, which may or may not be the case. The same is true of parents.

    It might make sense if we were talking about children much younger than 18 who are still, by law, the financial responsibility of their parents. I agree with the concept of means-tested bursaries for students attending private schools for example. But in the case of university we're talking about fully-fledged adults, and so parents ought to be irrelevant.

    Even from an economical standpoint, where the government doesn't want to spend too much of its own money (in one go), I think there are better ways of doing this. Rich graduates can subsidise poor graduates, rather than rich parents being assumed (but not required) to subsidise poor parents.
    Means testing is a way to see if people have the capacity to pay. Whether they want to or not.
    Even though an 18 year old is legally an adult, when in full time education the ability to be fully financially independent and pay fees isn't an option for the majority of people. Not to be harsh but in some cases it comes down to selfishness. Some parents aren't willing to give their kids a little money in uni to help them kickstart their adult lives.
    When it comes to bursaries for private schools I don't necessarily agree. There are perfectly good schools which are free ie grammar schools. A lot of which are actually better. You can't compare it to university as there isn't a direct alternative. Whereas with private schools there is.
    Why should rich graduates subsidise poor undergrads. It's not their business. You can't say it's not the parents business but it's the business of newly qualified strangers. That makes no sense. And it's not rich parents subsidising poor students. It's rich parents subsidising their own kids. The money they give to their kids doesn't go to other students.
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    (Original post by mliela)
    Even though an 18 year old is legally an adult, when in full time education the ability to be fully financially independent and pay fees isn't an option for the majority of people.
    ^this

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    (Original post by tazarooni89)

    Even from an economical standpoint, where the government doesn't want to spend too much of its own money (in one go), I think there are better ways of doing this. Rich graduates can subsidise poor graduates, rather than rich parents being assumed (but not required) to subsidise poor parents.

    This is already the case.

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    (Original post by Princepieman)
    This is already the case.

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    It's not already the case; in order for it to be the case, maintenance loans have to be totally unrelated to parental or household income. The same amount of loan should be given to everybody. Instead, the only difference between rich and poor would be that rich graduates repay more of the loan than poor graduates.
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    (Original post by mliela)
    Means testing is a way to see if people have the capacity to pay. Whether they want to or not.
    Even though an 18 year old is legally an adult, when in full time education the ability to be fully financially independent and pay fees isn't an option for the majority of people. Not to be harsh but in some cases it comes down to selfishness. Some parents aren't willing to give their kids a little money in uni to help them kickstart their adult lives.
    Yes, but what I'm saying is that just because a student has rich parents does not mean that the student has the capacity to pay for university even if they really want to, any more than having a rich next door neighbour does. This is because the person who is expected to provide the funds still has the right to refuse.

    It doesn't make sense to expect someone else (other than the student) to contribute towards university costs, whilst at the same time saying "but if you don't want to contribute, you don't legally have to". Because then you're forcing the student to rely upon someone else's unreliable generosity rather than a reliable, automatic source of funds.

    You may say it comes down to selfishness on the part of parents, and maybe you're right in some cases. But simply calling the parents "selfish" does not make it any easier for that student to go to university. Something needs to actually be done about it.

    Why should rich graduates subsidise poor undergrads. It's not their business. You can't say it's not the parents business but it's the business of newly qualified strangers. That makes no sense. And it's not rich parents subsidising poor students. It's rich parents subsidising their own kids. The money they give to their kids doesn't go to other students.
    Well, for the same reason that rich taxpayers subsidise poor taxpayers. The government needs to collect a certain amount of money from everyone they provide the service too, but they can't collect the same amount from everybody because the poorest people wouldn't be able to handle such a financial burden. Instead they collect more from rich people and less from poor people. This is what already happens; rich graduates already pay more for university than poor graduates (by repaying their more of their loans).

    The reason it ought to be done entirely this way is because nobody can end up disadvantaged through a decision made by someone else. A taxpayer cannot refuse to pay tax, and a graduate cannot refuse to make payments on a student loan. But parents can refuse to fund their child through university, which means that child suffers through no fault of their own.



    My whole argument effectively boils down to this: You can't expect a student to rely upon an unreliable source of funds. The money is either theirs to use for university costs, or it's not. It can't be both.
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    (Original post by tazarooni89)
    It's not already the case; in order for it to be the case, maintenance loans have to be totally unrelated to parental or household income. The same amount of loan should be given to everybody. Instead, the only difference between rich and poor would be that rich graduates repay more of the loan than poor graduates.
    The case is: if you're a poor grad, you get subsidised by the richer grad (regardless of their status before entering uni)... That's kind of the whole point in making repayment income assessed

    It would, imo, be a major waste of money to give everyone the same maintenance loan. Just because you're 18, doesn't magically get rid of all the years your parents have supported you and it in no way is an excuse for parents to stop supporting you. Fact of the matter is, if your parents earn a lot of money they should continue supporting you, some choose not to but they are the minority. If you're not happy with the sitch, then declare emancipation from your parents.

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    (Original post by Princepieman)
    The case is: if you're a poor grad, you get subsidised by the richer grad (regardless of their status before entering uni)... That's kind of the whole point in making repayment income assessed
    I know, but my suggestion includes the idea that household income should be disregarded when it comes to determining how much maintenance loan you get, and that all subsidising of the poor by the rich should take place after the students graduate and start to earn money. So my suggestion isn't "already the case".

    It would, imo, be a major waste of money to give everyone the same maintenance loan.
    I completely disagree. It's not free money, it's a loan, which is expected to be repaid, plus interest. It is easy to set the terms, conditions and interest rate of the loans such that, on average, each loan makes a profit for the lender (or at least allows them to break even) rather than a loss.

    You're not "wasting money" if you get your money back later on, plus interest. If that were the case, banks and building societies would never give out loans.

    Just because you're 18, doesn't magically get rid of all the years your parents have supported you and it in no way is an excuse for parents to stop supporting you. Fact of the matter is, if your parents earn a lot of money they should continue supporting you, some choose not to but they are the minority. If you're not happy with the sitch, then declare emancipation from your parents.
    It's all well and good to say that parents should continue to support their children beyond 18, but the fact of the matter is that they're not obliged to. Turning 18 does "magically" get rid of your parents' legal financial responsibility towards you, because by law you have suddenly become financially independent adult, and your parents are perfectly entitled not to give you any money for anything whatsoever.

    You might say that parents who are able but unwilling to fund their child through university are just being bad, selfish parents. This is not always the case; for example, some families have a high household income, but also a lot of debt, and therefore can't pay university costs. I gave my own personal example earlier; I have a very high "household income" because my mother got remarried to a rich man, but that man is not my parent, so it makes no sense for the government to expect me to ask him for money (though thankfully I didn't need to because I got an academic scholarship to university). And even in those cases where you're right, the parents are just being selfish; simply calling them selfish doesn't help that student go to university. Something actually needs to be done about it.

    As long as you're relying on a cultural expectation for parents to support their children (rather than a legal obligation to do so), you're faced with the problem that some students will be disadvantaged by parents who are unwilling or unable to do so (despite having a high household income). Giving everybody the same maintenance loan is economically viable, and it solves this problem. So I see no reason at all why we shouldn't be doing it this way.
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    (Original post by tazarooni89)
    Yes, but what I'm saying is that just because a student has rich parents does not mean that the student has the capacity to pay for university even if they really want to, any more than having a rich next door neighbour does. This is because the person who is expected to provide the funds still has the right to refuse.

    It doesn't make sense to expect someone else (other than the student) to contribute towards university costs, whilst at the same time saying "but if you don't want to contribute, you don't legally have to". Because then you're forcing the student to rely upon someone else's unreliable generosity rather than a reliable, automatic source of funds.

    You may say it comes down to selfishness on the part of parents, and maybe you're right in some cases. But simply calling the parents "selfish" does not make it any easier for that student to go to university. Something needs to actually be done about it.



    Well, for the same reason that rich taxpayers subsidise poor taxpayers. The government needs to collect a certain amount of money from everyone they provide the service too, but they can't collect the same amount from everybody because the poorest people wouldn't be able to handle such a financial burden. Instead they collect more from rich people and less from poor people. This is what already happens; rich graduates already pay more for university than poor graduates (by repaying their more of their loans).

    The reason it ought to be done entirely this way is because nobody can end up disadvantaged through a decision made by someone else. A taxpayer cannot refuse to pay tax, and a graduate cannot refuse to make payments on a student loan. But parents can refuse to fund their child through university, which means that child suffers through no fault of their own.



    My whole argument effectively boils down to this: You can't expect a student to rely upon an unreliable source of funds. The money is either theirs to use for university costs, or it's not. It can't be both.
    That's where you're wrong. It tests the capacity of students household to provide for them. Not the student. So it's very different to a neighbour. The government assumes that since the parents had financial responsibility for the students before, if they have the means they should provide.
    Of course calling the parents selfish doesn't help. But there are ways around the issue.
    Sometimes that's just a fact of life. Someone will always be disadvantaged from a system.
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    (Original post by mliela)
    That's where you're wrong. It tests the capacity of students household to provide for them. Not the student. So it's very different to a neighbour. The government assumes that since the parents had financial responsibility for the students before, if they have the means they should provide.
    Of course calling the parents selfish doesn't help. But there are ways around the issue.
    But that's exactly the problem; they're assuming that the parents should provide for the student if they have the means to do so, even though the parents have no legal obligation to do so. It is therefore a false assumption in a number of cases.

    It really isn't that different from a next door neighbour. Even your neighbour is rich and can afford to pay for your university costs, he's at perfect liberty to say "Yes I can afford to pay for it, but why should I?" By law, parents have the right to do exactly the same. Students are being forced to rely upon an unreliable source of funds.

    The fundamental problem is this: For students from high income households, the government is, to a great extent, effectively handing over the decision over whether or not the student gets to go to university to the parents, instead of leaving it with the student.

    Sometimes that's just a fact of life. Someone will always be disadvantaged from a system.
    But in this case, people are unnecessarily disadvantaged by the system. By giving everyone an equal maintenance loan and setting the interest rate and repayment terms in an economically viable manner, it's quite easy to give everyone a fair chance of going to university regardless of their financial situation or their parents decisions. So I literally see no reason not to make this adjustment to the system.
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    (Original post by tazarooni89)
    By giving everyone an equal maintenance loan and setting the interest rate and repayment terms in an economically viable manner, it's quite easy to give everyone a fair chance of going to university regardless of their financial situation or their parents decisions. So I literally see no reason not to make this adjustment to the system.
    Come back when you have fully costed your initiative and established the "economically viable" repayment terms.

    I think you'll find the devil is in the detail.

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    (Original post by jneill)
    Come back when you have fully costed your initiative and established the "economically viable" repayment terms.

    I think you'll find the devil is in the detail.

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    It is not necessary to fully cost the initiative to know that an economically viable set of repayment terms exists.

    Existing student debt has already been sold to a private company, which would be impossible unless it were, on average, expected to yield an overall profit per loan (or break even at least). This has been achieved simply by increasing the interest rate from what it originally used to be, so that rich graduates repay much more than they borrowed, to make up for the losses incurred on poor graduates who repay less than they borrowed.

    Unless there's some reason to expect that students from high income households are disproportionately more likely to end up repaying less of the loan than they initially borrowed (which there isn't), there is no basis to suggest that scaling up the debt so as to include these students too would be economically unsustainable. If anything, it should be more profitable.

    The only possible reason I can think of not to do this is because there are so many people who don't fully understand how the student loan system works and fear the concept of having "debt looming over their heads before they've even begun earning", and so a rise in the interest rates on student loans is likely to be unpopular with the public and a bad political decision. But there's no doubt it makes for a fairer and more efficient system.
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    (Original post by tazarooni89)
    But that's exactly the problem; they're assuming that the parents should provide for the student if they have the means to do so, even though the parents have no legal obligation to do so. It is therefore a false assumption in a number of cases.

    It really isn't that different from a next door neighbour. Even your neighbour is rich and can afford to pay for your university costs, he's at perfect liberty to say "Yes I can afford to pay for it, but why should I?" By law, parents have the right to do exactly the same. Students are being forced to rely upon an unreliable source of funds.

    The fundamental problem is this: For students from high income households, the government is, to a great extent, effectively handing over the decision over whether or not the student gets to go to university to the parents, instead of leaving it with the student.



    But in this case, people are unnecessarily disadvantaged by the system. By giving everyone an equal maintenance loan and setting the interest rate and repayment terms in an economically viable manner, it's quite easy to give everyone a fair chance of going to university regardless of their financial situation or their parents decisions. So I literally see no reason not to make this adjustment to the system.
    You have to be realistic no system is perfect. If everyone had the same maintenance loan then students with richer families who will give them money will be at a huge advantage.
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    (Original post by mliela)
    You have to be realistic no system is perfect. If everyone had the same maintenance loan then students with richer families who will give them money will be at a huge advantage.
    What do you mean by "a huge advantage"? An advantage in what sense? Yes, if they get a maintenance loan and more money from their parents, they'll be able to afford more nights out, rent on a nicer flat etc. But I don't really see the problem with that. If someone's parents want to give them extra money to live a lavish lifestyle then that's their own business, it isn't hurting anyone.

    However in this system, nobody is "disadvantaged", to the point where they don't have enough money to realistically go to university to study for the degree they want. Everybody has the basic required level of funding to go to university, and then anything else they might receive on top of that from elsewhere is just a bonus.

    The problem is not that students have more money than others. The problem is that some people don't have enough money to realistically go to university and get a their degree in the first place.

    To me, having an equal maintenance loan for everyone (and then means-tested repayment after university) actually does sound like a perfect system, as it solves the problem without creating any new ones.
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    (Original post by tazarooni89)
    It is not necessary to fully cost the initiative to know that an economically viable set of repayment terms exists.

    Existing student debt has already been sold to a private company, which would be impossible unless it were, on average, expected to yield an overall profit per loan (or break even at least).
    No because the current loans are means tested so not everyone gets the full amount. Under your system everyone gets the full amount increasing the loan book significantly.

    Crunch the numbers - I'm sure you can do it...
 
 
 
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