The Augar Review highlights the shortcomings of the student finance system with no solution
With taxpayer money on the line, the government must justify these outlays and how it manages the debt. Securing repayments played a significant part of the Review, with recommendations including revising the repayment threshold back down to £21,000 (which was brought up to £25,000 only in April 2018) and increasing the write-off period to 40 years after the loan enters repayment.
In terms of outlays and distribution of funds, the Review urged for more support going into improved skills and vocational training in line with what the economy needs. Lifetime learning was also emphasised with employment patterns changing rapidly due to technological advances. The Review blamed the UK's "weak productivity performance"
Kim Aviv, CEO at Pathfinder, said: "We have been working with representatives of the government to identify the causes of the current student debt crisis, and although the recommendations of the Augar Review can help, this is not the solution. We think the core issue behind the repayment default rate lies in underemployment and job-hopping. Efforts should be channelled to ensure these are mitigated through better career guidance during university to ensure graduates achieve higher-paying jobs. The result will be graduates employed in jobs that they are qualified for, not over-qualified, allowing them to develop successful careers, thus moving to senior, higher-paying roles quicker. At the same time, job-hopping would be limited as graduates would pursue jobs that are a good match in the first place instead of finding themselves confused and in need of developing new skills for new jobs."
Baroness Verma, Member of the House of Lords, stated: "The Augar Review has highlighted what many of us have been saying for a long time, that the student experiences are very dependent on the outcomes of what they leave their institutions with, both the academic value and equally important the burden of debt from tuition fees. I think it is high time to recognise that the skewed way decisions are taken by students when deciding which course and university to apply too is underpinned by inadequate and poorly informed career advice options, given that employment markets are rapidly evolving, now is the absolute time to look at digital solutions that eliminate personal and cultural bias and ensures better informed choices much earlier on in the student's decision making process. With ever-increasing student debt on the Student Loan Book, there must be a total revisit to how student debt is reduced and better-informed choices made available for students."
NOTES TO EDITORS
• Pathfinder http://www.pathfinder-
• The first and second sales (Dec 2017, Dec 2018) of the student loans debt caused an outcry in the media as they returned only 48p in the £1 (selling £3.5bn of debt for £1.7bn) for pre-2012 loans that were far less risky than today's loans. Since 2012, there were radical increases in average loans taken out, more awards given out, and no rise in repayment rates.
• The Careers Group (2016) found that an overwhelming 52% of final-year students are stuck in the "deciding stage" and uncertain about their employment prospects.
• CIPD research (2018) found that 49% of UK workers are in the wrong jobs, jobs for which they are either under or over-skilled. Only 52% of recent graduates get graduate-level jobs in the six months after graduation. That questions why 48% of graduates accumulated a massive debt to go to university only to end up in low-skilled jobs.
• Job-hopping behaviour that is at an all-time high (average of 2-year intervals) and Gallup's most recent survey (2017) on millennials argued that employee dissatisfaction and high turnover is costing economies billions annually, as well as undermines labour productivity growth in the long run.