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By Tony Grew - 12th October 2010
The business secretary has said recommendations from Lord Browne on university funding are "along the right lines".
Vince Cable defied opposition claims he has betrayed his principles by moving towards the recommended rise in tuition fees and not a graduate tax, in an appeaerance in the Commons.
All Lib Dem MPs signed a pledge before the general election to oppose any rise in fees.
Today Cable claimed he had never favoured a graduate tax but was always in favour of "a progressive graduate contribution" and that is what the Browne report has proposed.
He accused Labour of "sheer hypocrisy" over its plans to cut 20 to 25 per cent from his department's budget, as most of that would have hit the universitites.
Cable claimed the last government has "landed the country" with a massive debt and the proposals he will present to the Commons at a later date will reflect the "current economic climate".
The business secretary said a "pure graduate tax" is unworkable, but claimed that a "progressive contribution".
He said there is a consensus that there should be no up-front payment of fees, but a £7,000 fee per year was likely.
Cable also said he will "consider carefully" proposals to allow some institutions to charge even more, but they would have to ensure a good social mix and promise to invest money in the quality of teaching and learning.
He told MPs his "progressive contribution" will be linked to ability to pay and take into account those doing "socially useful" work, including raising children.
Cable floated the idea of a £25,000 income threshold for repayments and said the top third of graduate earners would pay twice as much as the bottom third, a system he called "fair and progressive".
Shadow business secretary John Denham said the coalition plans to place the entire cost of education on young people who will be saddled with debt they will not be able to repay.
Denham said cuts to the business department budget would mean the teaching grant would be cut by 80 per cent, and in some universites up to 90 per cent of public funding will be cut.
He said it is wrong to target higher education in this way, given that it is so important for growth and success in a competitive world.
Denham reminded the House that in April, Nick Clegg said a rise in fees to £7,0000 would be a "disaster", with some people graduating with debts of more than £40,000.
The Lib Dems made promises that could not be "lightly thrown away", and under Cable's plans graduates will be paying off debts for more than 30 years.
Variable fees will discourage those from both working and middle class families from attending the best universities and they will be forced to "shop around" for cheap courses.
Cable reiterated that he is not yet committed to variable fees.
Simon Hughes (Lib Dem, Bermondsey and Old Southwark ) warned the government not to do anything to "discourage" children from council estates from going to university because of fears about running up debts.
Cable said he is "very conscious" of people from low income homes and said universities will have to ensure a wide social mix among their students.
Stephen Williams (Lib Dem, Bristol West) argued that the Lib Dems had had significant influence on this issue and as a result the coalition government' stance is "rather more progressive" than it would have been if the Tories governed alone.
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