Labour pledges to bring back maintenance grants for poorest students

Graduation

A Labour government would bring back maintenance grants for the poorest university students and restore an abolished financial support allowance, to be funded by increasing taxes on companies, the shadow education secretary, Angela Rayner, has pledged.

Jeremy Corbyn has made education a central theme of his campaign for re-election as Labour leader, lamenting the “commodification” of the education system.

Labour said it would reverse the decision to replace means-tested grants for university students with loans, announced by George Osborne in his final budget earlier this year.

It would also reinstate the Education Maintenance Allowance, a means-tested cash payment, for 16- and 17-year-olds from poorer families choosing to remain in education.

Research by the Institute for Fiscal Studies thinktank suggested the EMA, which was worth £30 a week, helped to boost participation among teenagers. But it was abolished in England in 2011 as part of the coalition government’s efforts to reduce the deficit and replaced with a much less generous bursary system, following claims it did not represent good value for money.

Labour voted against the plans at the time. Rayner said the twin announcements “show that while the Tories continue to burden our young people with debt, the Labour party is committed to investing in our young people. It is only by investing in education that we can ensure that all of our young people, whatever their background, are able to succeed in whatever they aspire to”.

The MP for Ashton-under-Lyne remained in Corbyn’s shadow cabinet and continued to back the Labour leader following mass resignations and a vote of no confidence by the majority of the parliamentary party.

She said: “When we can help improve the education of over a million young people with a small increase in corporation tax, it is an investment we would be foolish not to make.”

Labour strategists are keen to work up concrete proposals for overturning some of the spending cuts made by the Conservatives. Corbyn’s challenger for the Labour leadership, Owen Smith, has accused him of engaging in “sloganeering” rather than producing detailed policies.

Corbyn’s Commons attack on the government’s plans to force all schools to become academies, which he condemned as a “top-down reorganisation”, was regarded as one of his more successful performances at Westminster since winning the Labour leadership last year. The plans were later dropped amid the threat of a backbench Tory rebellion.

Labour said the policy announced on Tuesday could be paid for through a 1.5 percentage point increase in corporation tax.

Allies of the Labour leader said such a move would raise £3bn a year. A Corbyn government would use half of that, about £1.5bn, to cover the increased costs of student support, and 40% to reverse the public sector pay freeze. The final £300m a year could yet be earmarked for other policies.

Osborne made repeated cuts to corporation tax as part of his attempt to create a business-friendly economic climate. He had suggested that the government should slash the rate further, to just 15%, as a way of boosting confidence after the vote to leave the EU, despite Britain’s rate already being among the lowest in the G20.

Theresa May sacked Osborne in one of her first acts as prime minister. It is unclear whether his successor, Philip Hammond, will press ahead with corporation tax cuts pencilled in for future years.

Powered by Guardian.co.ukThis article was written by Heather Stewart Political editor, for The Guardian on Tuesday 16th August 2016 22.00 Europe/London

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