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Graduate Tax

Volume 520: debated on Tuesday 21 December 2010

18. What estimate he made of the effect on public finances of the introduction of a graduate tax. (31832)

I agree with the assessment of the graduate tax that the Chancellor gave in answer to earlier questions. I add that, under a graduate tax, those on the lowest incomes after leaving university would pay more than they do under our proposals. From a progressive point of view, there is an important argument against a graduate tax.

I am grateful to my right hon. Friend for that answer. Does he agree that a graduate tax is neither fair nor progressive and that it would do nothing to help the 17% of my constituents who go on to higher education?

I agree. Our proposals, which the House has agreed, ensure that no one will make a payment up front when they go to university, or start repaying until they earn more than £21,000 after leaving university. I note that some hon. Members now advocate a graduate tax. They have said that they will produce their detailed plans by the end of the year, and we greatly look forward to seeing them.