The House of Lords Economic Affairs Committee has welcomed recent
papers by the Office for National Statistics and the Office for
Budget Responsibility which recognise the need to reconsider the
treatment of student loans in the national accounts. Further, the
Office for Budget Responsibility acknowledges the extent to which
fiscal illusions caused by the accounting of student loans flatter
the deficit.
The Committee published a report last
month, Treating Students Fairly: The Economics
of Post-School Education, which found that the
decision to switch almost all higher education funding to tuition
fees financed by student loans has hidden the true cost of public
spending on higher education. The changes have distorted the
education system in favour of undergraduate degrees at the
expense of other options.
, Chairman of
the Economic Affairs Committee, said:
“We welcome the recognition by the Office for
National Statistics and Office for Budget Responsibility this
week that the treatment of student loans in England should be
reconsidered, and that the Office for Budget Responsibility
appears to support our recommendation that write-offs on student
loans should be recognised upfront.
“It is also welcome that others have now recognised,
as we show in our report, the pyramid of fiscal illusions in the
treatment of student finance in the national accounts which
flatters the deficit.
“Both Offices recognise the work of the Economic
Affairs Committee in reaching these conclusions, and we await the
Government’s response to our most recent
report, Treating Students Fairly: The Economics of
Post-School Education, shortly.”
Notes to Editors
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Read the full report Treating Students
Fairly: The Economics of Post-School Education here.
