Student Loan Repayments
Debate between Lord Johnson of Marylebone and Jim Shannon
Jim Shannon
In my intervention on the hon. Member for Walsall South (Valerie Vaz), I mentioned that the system we have in Northern Ireland is much more manageable than the system here on the mainland. Has the Minister had a chance to look at how the Northern Ireland example works and gives a better response to students when it comes to repayment?
Joseph Johnson
Yes, of course. Higher education has been devolved in Scotland and Wales since 1999 and in Northern Ireland since 2007, and we continue to look at how other nations within the United Kingdom choose to allocate public funds to the higher education system to see what lessons are to be learned from that.
In England, we now have a fair and sustainable system of funding our higher education system. The £21,000 threshold is higher than the one we inherited from Labour, and is fairer on lower earners. The system is also more progressive. Interest rates after graduation increase with income so that higher earners repay more. For someone earning £21,000 or less, the interest rate is set at RPI—the loan balance does not increase in real terms. For graduates who earn more than this, the interest rate increases to a maximum of RPI plus 3%. It is only fair that the graduates who have benefited most from their education should pay the most back into the system.
Student loans are very different from a mortgage or credit card debt. Repayments are determined by income, not the amount borrowed. Graduates are protected; if at any point their income drops, so do their repayments. The loans are income-contingent, so borrowers will repay only if they earn above the threshold, and, as I said, the loans are written off after 30 years, meaning that many graduates will not repay the full amount. This is a crucial part of the taxpayer’s investment in our country’s skills base.
Our approach is based on the fundamental principle that a borrower’s contribution to the cost of their education should be linked to their ability to pay. Graduates generally benefit from higher earnings than those who do not go to university, and we must ensure that we maintain a fair balance between taxpayers and graduates in the costs of higher education.
It is clearly important that students know what they are signing up to when they agree to take out their loans. All students are provided with clear information to help them understand what financial support they may be eligible for, as well as the interest rates and the repayment terms that will apply. They must also confirm that they understand the information before they are granted the loan. All of the information that the Student Loans Company provides to students is reviewed regularly to ensure that it is both accurate and accessible.
Let me turn to the threshold freeze, which the hon. Member for Walsall South has mentioned. To put higher education funding on to a more sustainable footing, we must ask graduates who benefit from university to meet more of the costs of their studies. It is clear that graduates benefit hugely from higher education. On average, graduate earnings are much higher than those of non-graduates. In 2015, graduates’ salaries averaged £31,500, compared with a non-graduate average salary of £22,000. The only alternative to asking higher-earning graduates to support higher education is to ask the taxpayer, who on average will earn much less than those graduates.
We did not take the decision to freeze the repayments threshold lightly. We consulted on the changes before they were announced last November and conducted a full equalities impact assessment. The changes will mean that graduates earning more than £21,000 will repay about £6 per week more than if we had increased the threshold in line with average earnings. The threshold is higher in real terms than the one we inherited from Labour, meaning that graduates under this system keep more of their earnings before they start to repay.
A sustainable student finance system enabled us to abolish student number controls, lifting the cap on aspiration and enabling more people to receive the benefits of a university education. That is essential if we are to maintain our place as a country with a modern, highly skilled economy. We still send proportionately fewer people to university to study at undergraduate level than our main competitors. Between now and 2022, more than half of job vacancies will be in occupations most likely to employ graduates. If we are to continue to grow our economy, we must equip our young people with the skills and qualifications they will need to fill those roles.
Fireworks
Debate between Lord Johnson of Marylebone and Jim ShannonWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
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Joseph Johnson
As I said, national trading standards continue to receive significant Government funding, to the tune of almost £15 million last year, but the hon. Lady’s concerns are on the record.
On public awareness, there is Government-sponsored guidance on the safe and considerate use of fireworks on the gov.uk website, including the fireworks code. It includes a link to the Safer Fireworks website, hosted by the Royal Society for the Prevention of Accidents, which includes a section on thinking of one’s neighbours and letting them know when planning a display, especially those with pets or animals, elderly neighbours and people with children.
In addition, the very useful “Celebrating with bonfires and fireworks: A community guide” is produced by the Department for Communities and Local Government. It, too, encourages consideration for neighbours and advising them of any fireworks planned.
Many local authorities provide advice on how to use fireworks safely and considerately on their websites, as well as links to other sites. In addition, UK fireworks manufacturers support the fireworks code, which is supplied with all their products and contains advice on safety and on considerate use, including informing neighbours when a garden display is planned. Many retailers have copies of the fireworks code available at point of sale. Retailers also have advice and safety information on their websites, including encouraging consideration for others. All such guidance means that the public have ample opportunity to be aware of their responsibilities.
My hon. Friend the Member for Northampton South also asked whether manufacturers and retailers could do more to mitigate the impact on animals. As I have already set out, the fireworks industry takes a responsible approach to the issue, and is keen to work with us to minimise the detrimental impact of its products. The sector supports the fireworks code, and its representatives regularly meet officials from the Department for Business, Innovation and Skills to discuss areas of concern, including those mentioned in the debate. However, I am confident that legislation already provides adequate safeguards and that the industry is doing everything it can to ensure that it continues to operate within that legal framework.
Finally, I come to the question of whether more could be done to support pet and livestock owners. Government are often not best placed to produce guidance on such matters, as others are in a better position to do so, but we are more than happy to promote and support guidance produced by other organisations. In particular, animal welfare charities such as Blue Cross, the RSPCA and the Kennel Club have produced freely available guidance on how to minimise the impact of fireworks use on animals and on how to reduce any distress that they might feel.
While this debate is not specifically about changing the law, I want to take the opportunity to reflect on the e-petition that sparked the discussion and the calls for further restrictions on fireworks use to four traditional periods: dates around Guy Fawkes, new year’s eve, Diwali and Chinese new year. In my view, changing the legal restrictions on use of fireworks is unlikely to be effective. It is likely that those who already use fireworks in an antisocial or inconsiderate way will not be deterred by further regulation. Indeed, further restrictions on when fireworks can be used could lead to more incidents of illegal use at unexpected times. That might also be associated with trade in fireworks illegally imported from overseas, which might not conform to stringent UK and EU standards. Moreover, restrictions in use could lead to a drop in legitimate sales, leading to job losses not only in the fireworks industry but in dependent and associated businesses.
My hon. Friend the Member for Kettering (Mr Hollobone) called for a ban on fireworks outside tightly licensed displays. I remind him that this is a £180 million industry that provides employment to at least 250 people directly and supports thousands of others in the supply chain and I am not sure that they would share his optimism that the proposal he advocates would lead to an overall boost in revenues for the sector and an increase in the security of their livelihoods. We need to bear their position in mind in the debate, too.
In conclusion, there are already restrictions and penalties in place that I believe reasonably provide for animal welfare. Fireworks use, by both the general public and professional display operators, is heavily regulated. There are restrictions on when they can be bought—including on internet sales—and used, how they can be stored and noise levels.
Jim Shannon
I was hoping that we might have had some reference from the Minister to the good work done in the devolved Administrations. I hope that he has had an opportunity to consider that, but, if he has not, will he do so and come back to us?
Joseph Johnson
Indeed, we do reflect on differing practice around the United Kingdom. Fireworks use is of course a devolved issue and there is a differing regime in Northern Ireland. We look with great interest at how Northern Ireland approaches the question and any lessons that can be drawn from that will be learned.
Fireworks are subject to stringent testing regimes and new products undergo intense scrutiny before they are made available for sale. Low noise fireworks are becoming more widely available. UK manufacturers have introduced low noise fireworks and worked with animal charities on guidance for owners.
I understand the concerns of those who find the noise and flash of fireworks distressing, but I must reiterate that I believe the majority of people enjoy fireworks with consideration for others and in accordance with the regulations governing their use. It is a great pity that the actions of an antisocial minority tarnish the reputation of a responsible majority.
I am satisfied that enough is being done to make the public aware of their responsibilities when using fireworks and that fireworks manufacturers and retailers are helping with advice to mitigate the impact on animals. Moreover, many local authorities have advice and guidance on using fireworks on their websites. They will also be aware of any issues particularly affecting the local community with regards to firework use. I therefore suggest that those who feel that fireworks use in their area is excessive contact their local councils with a view to working together on seasonal awareness campaigns to promote consideration for others when organising domestic displays. In the meantime, the Government will continue to monitor the situation closely.
Treasury Support for UK Science
Debate between Lord Johnson of Marylebone and Jim Shannon(9 years, 1 month ago)
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Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Jim Shannon (Strangford) (DUP)
It is a pleasure to serve under your chairmanship, Mr McCabe. I commend the hon. Member for Penistone and Stocksbridge (Angela Smith) on bringing this issue to Westminster Hall for consideration.
I spoke to the Minister beforehand, so he knows which two issues I shall bring to his attention. I want to take up the issue of Northern Ireland, which was raised by my hon. Friend the Member for East Antrim (Sammy Wilson). I want to give two examples of science funding enabling universities in Northern Ireland to move forward with tremendous innovation and long-term vision to create and perfect medicines and research that will benefit people with diseases.
In Northern Ireland, we benefit from funding from a range of sources, including the EU, industry and charitable bodies, and others, including the hon. Member for Bury St Edmunds (Jo Churchill), have mentioned where moneys come from. A raft of funding comes into play. The key to that is the large amount of funding that comes centrally from the UK Government, which could be at risk if the UK science budget is cut in the spending review.
The UK science budget funds UK research councils, which in turn fund l5% of the research done by higher education institutions in Northern Ireland. The science budget also funds recurrent research funding. When I was about eight, which is a long time ago, I played with dominoes; one hits the next, and so on right round. There is that sort of domino effect with funding. The recurrent research funding covers 35.5% of the research income of higher education institutions in Northern Ireland. In addition to funding from the UK science budget, Northern Ireland also receives money from other UK Government sources that are not part of the UK science budget, such as Government Departments and Innovate UK. That represents some 22% of the research income of higher education institutions in Northern Ireland. A significant amount of Northern Irish universities’ research income is provided for by the UK Government. I am sure that that shows how important the budget is to the Province, to our students, and to innovation.
We need to continue with positive steps that will send out a strong signal of stability to the industry not just in Northern Ireland but across the United Kingdom. Evidence shows that private sector funding of science follows the lead of public sector funding.