The Commons: Tuition fees, loans or a tax?
Cleggmania swept the nation in 2010. After one televised debate, Nick Clegg came across as surefooted, trustworthy and reliable. He was inspiring to many after a decade of Labour rule and a wariness of David Cameron, voters were looking for another option. Nick Clegg was that option. In he swept, an answer for every topic, an insistence on a referendum on AV and a promise to never raise tuition fees.
However, in 2025, the AV referendum is one of the most meaningless points of British politics this century, Clegg is not remembered for how he garnered 57 seats in the 2010 election or his battle for proportional representation but simply for raising tuition fees. He went from being the most liked politician in the country to his name being run through the mud at Universities up and down the country. After gaining what he wanted out of the coalition with the Conservatives, it was their turn to strong arm him. A testament to if you dance with the devil, when the music stops, the devil keeps dancing. It took ten years to reverse the student loan increases for the Liberal Democrats. As a result, politicians of today are wary of touching tuition fees with a bargepole.
Last year almost £21 billion was given in student loans taking outstanding loans to a new high of £267 billion. Whilst more money than ever is being given out, universities aren’t feeling the benefit of this government loan. Data published by the Office for Students (OfS), the independent regulator for higher education, shows that 43% of institutions are forecasting a deficit for 2024/25. This would be a third consecutive year of decline for the sector.
Philippa Pickford, Director of Regulation at OFS said: “We still do not expect to see multiple university closures in the short term. But the medium-term pressures are significant, complex and ongoing.
“While institutions are working hard to navigate this challenging situation, we remain concerned that predictions of future growth are often based on ambitious student recruitment that cannot be achieved for every institution.
“Our analysis shows that if the number of student entrants is lower than forecast in the coming years, the sector’s financial performance could continue to deteriorate, leaving more institutions facing significant financial challenges.”
Universities have become increasingly more reliant on foreign students in order to fund themselves. Foreign students pay significantly more than the £9000 per annum that British students pay. According to the Higher Education Statistics Agency (HESA) international student enrolment dropped by almost seven percent in 2023/24. Brexit has undoubtedly been a factor in falling international student numbers. There was also a 55% decrease between 2019 and 2022 for EU student enrolment in the UK.
These falling numbers for foreign students are also reflected in the total number of students in the UK with numbers falling for the first time since covid last year.
Shadow Chancellor, Mel Stride, told Politics Home that “everything must be on the table” regarding university finance reform. After the Conservatives performed poorly among young people in the 2024 general election and hints of university reform would certainly capture the minds of the youth of today. However, voters will be difficult to convince, with many still associating Conservatives and Nick Clegg with the reason they are now saddled with thousands of pounds of debt.
Henry Stalder, 23, graduated University in 2023 and has started paying his student loan back. However, he doesn’t look at the total balance due to a fear regarding the number.
He said: “It is pretty daunting. I don’t even know when I’ll be paying it back.” He added that he views the loan as more of a tax.
The number of students according to government data forecasted to pay back their student loans is 65% for the 2023/24 academic year, more than doubling compared to 2022/23 which was 23%.
Save the Student is a campaign group for the eradication of university fees. When presented with the figures, Tom Allingham, a student loans expert said:
“If you believe its purpose is to help people access higher education, then in simple terms, you could say it has been successful. Record tuition fees and a cost-of-living crisis don't seem to have deterred young people from attending university, and the vast majority of them are taking out a Student Loan.
“But despite tuition fees increasing again this year, a rise of just £250 in 13 years has meant many universities are facing severe financial pressures. And, on the other side of the ledger, the failure to increase Maintenance Loans with inflation has led to students feeling the effects of the cost of living crisis more than most.
“And as for repayments, the government's own statistics project that a huge proportion of students and graduates will not clear their balances in full before their loans are cancelled.
“So, if you believe Student Loans should act as a sustainable way for universities and students to receive the funding they need, then it is arguably failing."
When Starmer initially began his election campaign in 2024, he had a goal of abolishing university tuition. However, he later abolished it claiming that he was more focused on reducing the size of NHS waiting lists. Politically, a shrewd decision. Voters overwhelmingly prefer the NHS to higher education, but a decision that forces millions into loans with overwhelming interest rates. After Biden forgave swathes of student debt in the US, older people who had paid back their debt cried that it was unfair. In a society such as Britain, one which embraces suffering and glorifies it, if a party does abolish tuition fees, there will certainly be people waiting in the wings crying out how much worse they had it back in their day.