Oral Answers to Questions

Henry Smith Excerpts

Tuesday 21st December 2010 Commons Chamber

[Mr Hoban]

I hardly think that a Government who have embarked on a programme of radical regulatory reform of the financial services sector, introduced the bank levy, and set up the independent banking commission to consider the structure of banking in the UK could be viewed by anybody other than the Labour party as a roadblock to reform.

[Henry Smith (Crawley) (Con)]

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

[The Chief Secretary to the Treasury (Danny Alexander)]

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.

[Henry Smith]

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?

[Danny Alexander]

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.