Financial & Travel Musings

Funding university seems destined to always be a matter of considerable political debate but it’s even worse when the economy isn’t doing too well.

The argument arises because, on the whole, graduates get more pay than those that didn’t make it through university. Therefore, it seems obvious that people going to university should pay the full cost of their education, doesn’t it?

The other side of the argument is that those graduates are the people who create the most wealth for the country. Therefore, it seems obvious that their education should be completely funded by the government, doesn’t it?

At the moment in the UK the funding is split between the individual and the government, reflecting the two arguments above. The problem is that the universities are arguing that they need more money than this system is giving them. Since times are hard, the thinking presently is that this funding will largely come from the students, albeit after they have graduated and have started earning enough to start contributing for their previous university education.

However, that breaks the long held idea that since both the graduates and the country as a whole benefit, then both should contribute. Quite what one can do when there just ain’t the cash around to continue with this approach is a question that’s far from easy to answer.

One notable problem in requiring the graduates to pay up later is that one would expect a fair proportion of them to leave the country before the bills start rolling in. After all, why would one stay to face a bill of £30,000 or more when one could get a similar (and higher paying) job in America and not have to pay that bill?

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One of the interesting things on the agenda of the new Conservative/Liberal government was the rolling back of the surveillance culture that we seem to have been saddled with in recent years.

There seems to be a security camera almost everywhere you look these days. In the early days they were placed in places which clearly needed them. Thus shops sprouted them like nobodies business in the hope that it would eliminate shop lifting. The snag is that they then needed to recruit security people to watch the cameras and in many cases one suspects that the losses due to shoplifting were smaller than the wages of the security guards. Of course, these days there are the security tags on the products but although I’ve seen the alarm go off many times as I’ve been going in or out of a store, I’ve yet to see anyone other than legitimate customers being stopped.

It’s going to be interesting to see if they get to the point of removing cameras. Somehow I can’t see it happening.

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Whilst the welfare state was a laudable aim back in the 1940s, trying to support those most in need when they fell sick or lost their job, that aim of support in time of need seems to have been lost in recent years.

The problem is that originally the idea was that people would obviously want to get back into work (and be able to) and wouldn’t want to remain dependent on benefits. That view clearly isn’t held by a number of people these days and these people can take advantage of the lack of limits on the help available. For example, take a typical family of two adults, two children who have become unemployed. Very roughly their entitlement would equate to £60 for the adults and £40 each for the children (neglecting, for the moment, any potential housing benefit etc.). That’s a total of £120 a week or around £6000 a year. Actually, it would be more as there’s child benefit of £35 a week so the total in basic income benefits is about £155 a week, £700 a month, £8000 a year (equivalent to a gross salary of around £12,000). Not a massive income for sure but, potentially, one that the family might live on as, of course, there would be assistance with housing costs, free school meals, and a few others.

However, consider instead a family with 10 children. Each child adds £55 a week so that’s £600/week, £2600/month or £32000 per year. Bearing in mind that the benefits are tax-free this equates to a salary of around £50,000. Even though I’m quite highly qualified, I would find it difficult to get that level of salary.

Now, I accept that people with large families don’t necessarily have them to pick up massive benefit payments but even if they don’t, surely there should be some kind of limit in terms of a maximum benefit payment regardless of other circumstances? If not, it would appear that the best plan would be to pop out kids on a regular basis: it can’t be right that the benefit system seems to be actively encouraging that.

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