Following comments from David Willetts that universities should be given the opportunity to buy the debt that their graduates owe, Professor Steve West, Chair of University Alliance, said:
“David Willetts is proposing that universities should be able to buy their own student loan books as a way to sort out the unsustainable HE funding system. While there is of course merit in looking at ways of sorting out the unsustainability of HE funding, making this policy would have unintended consequences. Firstly, it would reward universities that take low risk students – those from wealthy backgrounds – as they would more likely to get high-paying jobs and be able to repay their loans off more quickly. These students would create a safer and more lucrative loan book with higher rates of return.
On the flip-side such a policy would penalise those universities that take students from non-traditional backgrounds who are more likely to stay within the region they study (usually closer to home to start with) and go into lower-salaried graduate work. While Alliance universities as a collective have above-employability rates, their graduates are also more likely to stay within the region where graduate salaries are inevitably lower. In the North East, 50% of graduate level jobs are filled with graduates from Alliance universities.”Focusing on the Future