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Graduate Endowment Bill
20/12/2007
Plans to scrap the graduate endowment fee - the charge paid by Scottish graduates - took a further step forward today.
MSPs voted in favour of the Graduate Endowment (Abolition) Bill as it completed stage one of the parliamentary process.
The bill now returns to the Education Committee for further scrutiny before a final vote in the Parliament.
Cabinet Secretary for Education and Lifelong Learning Fiona Hyslop said:
"This Scottish Government is committed to removing the burden of student debt. We believe that debt, and the fear of debt, acts as a barrier that prevents some youngsters from entering university.
"The removal of the unfair and inefficient graduate endowment fee is an important first step in our plans and I'm delighted that Parliament has approved it.
"Abolishing the fee is not just good news for students and graduates - around 50,000 will benefit immediately - but is also in the best interests of the public purse as taxpayers lose around a third of all fee income collected."
The graduate endowment fee was introduced for Scottish domiciled students and EU students entering a Scottish university from 2001-02.
It is a one-off payment on successful completion of a higher education course of three years or more. The first students became liable to pay the fee - currently £2,289 - on April 1, 2005.
Students can pay the fee in cash, add it to their loan or use a mixture of both. Around 70 per cent of graduates have been adding fees to loans each year.
It is estimated that around £12.7 million has been paid back in cash from the three cohorts of graduates liable to pay the fee, with £26.3 million being added to loans.
Of this £26.3 million, only £57,000 has been returned to the taxpayer.