In an email to Research Fortnight, the credit rating agency Standard & Poor’s has poured cold water on the government’s economic case for reforming university finance, saying there is “no important distinction” for the UK’s credit rating between borrowing for the existing system and borrowing for the new one being developed by ministers. By 2015, new borrowing for student loans is set to exceed savings in departmental expenditure.
The announcement undermines the Government’s assertion that the move was necessary to pay down the deficit and follows figures from the Office for Budget Responsibility which show that the controversial changes will actually increase government spending.
Commenting on the announcement, Aaron Porter, NUS President, said:
“This is yet another blow to already shaky plans that were squeezed through the House of Commons last week in the face of overwhelming public opposition.”
“Peers must use the opportunity to stop plans that will not only inflict huge damages on universities, students and the economy but will also fail to achieve what they were designed to do – paying down the country’s deficit.”
“The Government still has time to take these plans back to the drawing board and consider properly a plan which is fair and sustainable and will improve higher education in the UK.”