When the government’s new Annual Budget leaked in September, the conclusion was that just about everyone stands to benefit from the current growth. Apart from over 750,000 students in higher education that is. On average, hbo students (attending a university of applied sciences) can expect their purchasing power in 2020 to fall by 0.42 percent, while students at a university can expect a 0.91 percent decrease, according to ISO’s calculations.
Disproportionate
The association mainly attributes this to the increase in the legal maximum for tuition fees and rising room rents. Moreover, ISO writes that students have been ‘disproportionately’ affected by the decision to increase the lowest VAT rate from 6 to 9 percent. “The Cabinet has decided to raise the minimum sales tax and lower taxation on labour. However, this doesn’t work out for students, since in many cases they don’t – nor are they able to – work as much as others. This means they will hardly be compensated for the VAT hike.”
Students at universities will see a stronger drop in their purchasing power than their colleagues at universities of applied sciences. That’s because they move out more often – meaning they will bear the brunt of the higher room rents, in ISO’s analysis. “In addition, hbo students tend to work more hours, so they benefit more from wage increases.”
Worrying
Gillesse calls for an end to this ‘worrying trend’. “Ultimately, it may restrict access to higher education for students whose parents are unable to chip in,” writes the ISO Chair in a statement.
To counter this development, he argues that the government should at the very least freeze the maximum tuition fee for the time being. “This would provide some immediate relief – the very least they could do.” In addition, Gillesse is amazed by the Netherlands Bureau for Economic Policy Analysis’s decision to leave out students when calculating citizens’ expected purchasing power. “The government needs these figures to make solid policy decisions. This lack of insight into students’ purchasing power is indefensible.”
