Labour promises to reduce tuition fees to £6,000

Ed Miliband says Labour would cut university tuition fees in England to £6,000 per year from autumn 2016.

He says a Labour government would pay for the fee cut from £9,000 by reducing tax relief on pensions for those earning over £150,000 per year.

This commitment to cut fees would not be negotiable in any post-election coalition deals, Mr Miliband promised.

Business Secretary Vince Cable attacked the proposals as "fraudulent" and a "tax on pensioners".

Chancellor George Osborne said: "Ed Miliband's sums don't add up because the universities would get less money and there would be fewer students so it's bad for students, bad for universities, bad for the taxpayer and bad for the British economy."

'Keep my promise'

In a speech in Leeds, Mr Miliband said higher fees had been a "betrayal of an entire generation", leaving students with average debts of £44,000 and putting an extra burden on public finances.

And he attacked Liberal Democrat leader Nick Clegg for his U-turn on tuition fees, which he said had "left a whole generation doubting politics - doubting anyone can be believed or trusted".

But the Labour leader said there would be no retreat from the fee proposals: "I made you a promise on tuition fees. I will keep my promise."

Mr Miliband said reducing tuition fees would save taxpayers £40bn by 2030 - and promised that this was a "fully funded policy" and universities would receive an extra £2.7bn per year to replace the fee cut.

An analysis by the Institute for Fiscal Studies said that overall Labour's policy would "leave university finances largely unaffected in the short run" and "reduce government debt in both the short and long run".

There would be higher interest rates for repayments for those graduates earning more than £42,000, up from 3% to 4%, said shadow chancellor, Ed Balls, in a bid to offset concerns that the biggest winners would be high earners.

But Paul Johnson of the IFS said "the group who will benefit from this are the higher earning half of graduates".

"So those graduates who go on to the best jobs will find that their repayments go down, whereas those graduates who go on to less good jobs will not find any difference in the repayments."

The Labour leader announced an increase of non-repayable maintenance grants by £400 per year to cover students' living costs, up to a maximum of about £3,800.

But these grants are only available to families with a total income below about £42,000 and there have been warnings that young people from "squeezed middle" families do not have access to sufficient student loans.

The changes to pensions allowances to fund the fee cut would also mean the lifetime limit on pension pots would be reduced from £1.25m to £1m, and annual maximum contributions to pension pots would be cut from £40,000 to £30,000.

Universities UK welcomed the reassurances on funding for higher education, but warned that "the long-term feasibility of such a promise may be difficult"

Sir Christopher Snowden, president of Universities UK and vice-chancellor of the University of Surrey, said the proposals would cost £3.1bn of extra public funding each year, which would put pressure on other investment such as research, innovation, and social mobility.

University heads have also argued that the increase in tuition fees to £9,000 has not deterred applications from poorer students.

The announcement of Labour's policy on fees has been much delayed, with reports of disagreements between senior party figures over whether cutting tuition fees should be a priority for investment.

Student debt

Mr Miliband says the current system is putting unacceptable levels of debt on to young people and proving expensive to the taxpayer, because so much of student loans is written off.

"The government has designed a system which is burdening students with debt today and set to weight down the taxpayer with more debt tomorrow," the Labour leader said