The Labour Government

[hilts]

Can someone balanced summaries this 2 child policy vote ?

What is Starmers reasoning ?

He doesn't want to appear too socialist about sums it up. The main message from his campaign was prudence economically. So even though many in the Labour Party have said the cap is morally wrong now they're in power they will put those morals to one side because their boss has threatened them.
To prove new new Labour is not old Labour they have to be more centre right Tories.

Personally I'm not in favour in paying benefits to an unlimited number of kids before I'm accused of being commie or such like.

 

[I'm With Stupid]

According to Martin Lewis.
Although I’ve seen various other figures ranging from 60% upwards.

Yep, the whole thing was always a massive con. It was always a promise to fund our universities with the tax of future taxpayers. They knew, and even proudly advertised the fact, that people won't have to pay it back. It's basically funding university with debt, but keeping the debt off the books, even though the government is ultimately liable.

Someone did a thread about the impact of Reagan and Thatcher, and one of the biggest impacts on both sides of the pond is this absolute explosion of funding basic government expenditure with debt. And it's been a long time, but I vaguely remember reading that a particular set of rules were changed to allow this.

 

[I'm With Stupid]

Apologies, my mistake. I had always thought student debt was repaid before tax (it’s calculated on pre tax but taken after tax) - hence if you paid their debt you’d be paying more as you’re paying + whatever your tax rate is. That’s very wrong IMHO and should be changed. Why? Because when it’s taken after tax it ends up being an increased tax rate so you have two people earning the same who pay different rates of tax based on their education path. As a principle tax should always be fair.

Overall the student debt is getting out of control and going to get worse. You can see why the government have no interest in saving universities with cash injections and why Sunak wanted to make sure students were on “worthwhile” courses - not for the interests of the students but this mountain of debt that exists and won’t ever be paid off in full and is getting much larger. When you consider a large chunk of the maintenance loan goes to private landlords (and often needs topping up by parents) the government needs to somehow get across rents in this sector. My second daughter just qualified as a midwife and she says her debt is about £76k… how is a midwife ever paying that off when they chuck the interest on top. I appreciate she has particular circumstances that meant her debt is likely higher than usual but it’s bonkers numbers. Will be a similar story for teachers and other public sector workers even if the numbers are a “mere” £40-50k + interest.

I wouldn’t personally pay the government back under any circumstances, this a beast of their own making, I’d rather put the £76k in to an appreciating asset such as a house for them if it was laying around spare.

I've still got student debt from 2005 and I'm not paying it back until I'm legally obliged to, on Martin Lewis' orders. I live abroad and every year, they ask me to report my income then charge me a piddling amount per month. I could pay it off today, but fuck 'em.

 

[metalblue]

Yep, the whole thing was always a massive con. It was always a promise to fund our universities with the tax of future taxpayers. They knew, and even proudly advertised the fact, that people won't have to pay it back. It's basically funding university with debt, but keeping the debt off the books, even though the government is ultimately liable.

Someone did a thread about the impact of Reagan and Thatcher, and one of the biggest impacts on both sides of the pond is this absolute explosion of funding basic government expenditure with debt. And it's been a long time, but I vaguely remember reading that a particular set of rules were changed to allow this.

That sort of makes sense from a balance sheet perspective. It would look like the money has an equal and opposite.

Makes you wonder why they don’t put our NHS treatment, or calling out dibble and the such on the never never. When they come round to collect we can close the curtains and hide behind the sofa like ma made us do when the provy or rent man came round and she spent her housekeep on moonshine. It would look like they never spent any money on health, police, fire brigade. Hell make all schools “private” - fuck off the state system just give us an IOU!! We can then spend money on stuff that matters like arming Ukraine with nuclear bombs and torturing immigrants by making them work in nail bars and having to listen to Ethel’s health conditions.

I’m sure an actual accountant will be along soon to tell me why it wouldn’t work ;)

 

[SkyBlueFlux]

Apologies, my mistake. I had always thought student debt was repaid before tax (it’s calculated on pre tax but taken after tax) - hence if you paid their debt you’d be paying more as you’re paying + whatever your tax rate is. That’s very wrong IMHO and should be changed. Why? Because when it’s taken after tax it ends up being an increased tax rate so you have two people earning the same who pay different rates of tax based on their education path. As a principle tax should always be fair.

Overall the student debt is getting out of control and going to get worse. You can see why the government have no interest in saving universities with cash injections and why Sunak wanted to make sure students were on “worthwhile” courses - not for the interests of the students but this mountain of debt that exists and won’t ever be paid off in full and is getting much larger. When you consider a large chunk of the maintenance loan goes to private landlords (and often needs topping up by parents) the government needs to somehow get across rents in this sector. My second daughter just qualified as a midwife and she says her debt is about £76k… how is a midwife ever paying that off when they chuck the interest on top. I appreciate she has particular circumstances that meant her debt is likely higher than usual but it’s bonkers numbers. Will be a similar story for teachers and other public sector workers even if the numbers are a “mere” £40-50k + interest.

I wouldn’t personally pay the government back under any circumstances, this a beast of their own making, I’d rather put the £76k in to an appreciating asset such as a house for them if it was laying around spare.

My wife is a doctor in mental health and she is never going to pay off her student debt. Partly because mental health is worse pay than physical health but also because the interest grows faster than a “solid” wage can pay off.

If a doctor can’t pay it off, what hope does anybody else have?

Whenever people ask me about their kids going to university and whether it’s worth it these days, I tell them that depends if they can accept they are effectively going to be taxed an additional marginal rate of 9% for their entire useful working life. Graduates earn something like 30-odd% more by their thirties on average - but that is skewed by people in business/finance. So for a lot of people it will still make sense, but there are many academic careers where this system is actually economically disincentivising people to go to university. The whole thing is a mess.

But the golden rule is never pay student loans off in full unless you are 100% certain you will pay it off in full eventually. Otherwise you’re just giving money away.

 

[metalblue]

He doesn't want to appear too socialist about sums it up. The main message from his campaign was prudence economically. So even though many in the Labour Party have said the cap is morally wrong now theyre in power they will put those morals to one side because their boss has threatened them.
To prove new new Labour is not old Labour they have to be more centre right Tories.

Personally I'm not in favour in paying benefits to an unlimited number of kids before I'm accused of being commie or such like.

They had a chance to get rid of it. They didn’t. It’s their policy now however much they want to bleat about it.

 

[metalblue]

My wife is a doctor in mental health and she is never going to pay off her student debt. Partly because mental health is worse pay than physical health but also because the interest grows faster than a “solid” wage can pay off.

If a doctor can’t pay it off, what hope does anybody else have?

Whenever people ask me about their kids going to university and whether it’s worth it these days, I tell them that depends if they can accept they are effectively going to be taxed an additional marginal rate of 9% for their entire useful working life. Graduates earn something like 30-odd% more by their thirties on average - but that is skewed by people in business/finance. So for a lot of people it will still make sense, but there are many academic careers where this system is actually economically disincentivising people to go to university. The whole thing is a mess.

But the golden rule is never pay student loans off in full unless you are 100% certain you will pay it off in full eventually. Otherwise you’re just giving money away.

Great post mate.

 

[bluenova]

They had a chance to get rid of it. They didn’t. It’s their policy now however much they want to bleat about it.

It's been three weeks. We've not even had a budget.

If that's your logic, you could say that about absolutely everything the Tories did over the last 14 years.

Any public sector worker whose pay hasn't risen with inflation over the last 14 years? Unless Labour immediately give them all huge page rises, it's a Labour policy now.

I notice they haven't opened all the Sure Start centres again. Closing them is now a Labour policy.

 

[BrianW]

I see the King is getting a pay rise of £45 million.

It's good to know that in these hard times, essential public sector workers are being looked after.

(Looks around for Tories claiming the King's rise will cause inflation. No? Mmm, must be a magic sort of money not available for the rest of the public sector.)

 

[metalblue]

It's been three weeks. We've not even had a budget.

If that's your logic, you could say that about absolutely everything the Tories did over the last 14 years.

Any public sector worker whose pay hasn't risen with inflation over the last 14 years? Unless Labour immediately give them all huge page rises, it's a Labour policy now.

I notice they haven't opened all the Sure Start centres again. Closing them is now a Labour policy.

Have they voted on sure start? Have they decided on public sector workers pay yet? No, so to compare the two is absurd.

They voted on the 2 child cap limit and voted to keep it. For whatever reasons and however justified. It’s now labour’s policy as a consequence.