It struck me today, while doing some basic maths, that the estimated total amount of money required to pay for all of the tuition fees (at current levels) for all UK & EU students in the UK (around 1.9 million) would only be around £5billion. I previously assumed that it would be much, much more than this. Let me put this number in perspective:

- £5bn is 1/30th of the total amount of revenue the Treasury raises from income tax;
- £5bn is just under 5% of all national insurance contributions raised per year;
- £5bn is the total amount raises from petroleum, air passenger & spirits taxation revenue;
- £5bn is a tad over a tenth of what the UK spends on defence each year.
* Source: Wikipedia.

Considering that UK students currently have to saddle themselves with tuition and living cost debt, often more than £30,000 worth before they even get onto the jobs market, isn’t it time that we looked at other ways of paying for university education? It is already the case that students in Scotland (either home students there or EU students residing in Scotland) have their tuition fee subsidised by the public purse. It is unethical, unfair and constitutionally baffling that a student in England or Wales should have to break their back with debt when a student in Scotland does not.

When Vince Cable introduced the idea of a graduate tax, I wrote here that I agreed in principle with the idea. But in practice there are a range of problems, not least the fact that the tax effectively “stops at the border” and that EU students, with the legal right to be treated equally with UK students, would be able to study here and then leave having received in-effect a free university education.

The whole of society benefits when a large proportion of its citizens receive university-quality education. It results in better doctors, better engineers, managers and scientists, amongst others, which makes the country run better.

Instead of saddling 18 year olds with tens of thousands of pounds in debt, and instead of a clumsy change to the tax code, why not just raise all taxation by 0.8% across the board to make university education free at the point of use? Now that would be progressive…

We don’t often look to smaller, less influential countries like Portugal when it comes to social & economic policy. Well, at least not until sovereign debt entered the wider public lexicon, and economists, politicians and financially-minded people realised that a failure of a small, quiet south European state to pay its debts had the potential of a knock-on effect on the more prosperous economies of the north.

Portugal has had particular difficulty of late in setting out trustworthy austerity plans, aimed to reduce its deficit, which reached as high as 9.3% of GDP in January this year. In order to shield itself from the effects of the credit crisis, and the ensuing recession, Portugal borrowed billions of euros to pay its bills. Having spent in total around two years living in Portugal, in one of Europe’s most amazing cities Porto, and as a speaker of Portuguese I have had the benefit of being able to follow politics and economics in Portugal relatively closely over the last seven years or so.

This knowledge of how Portugal works as a society and economy has me baffled as to where all of these billions are going. Whenever I contrast government spending and the size of the state of the United Kingdom with that of Portugal, I see two vastly different systems, attitudes and approaches. In the UK, everyone can see and experience the state almost on a regular basis. We have certain social and historical economic problems which one could argue require state intervention, which result in many, many people being dependant on welfare, and millions relying solely on the state for their housing needs. The Portuguese are much more self-reliant, either by spirit or just out of necessity. The footprint of the Portuguese state is smaller than in the UK, for some of the following reasons:

• There isn’t much in the way of a welfare culture. People find ways to make ends meet, and welfare is an absolute, distant option of last resort. It’s more likely that somebody would be helped by family and friends before claiming welfare. You have to work longer and contribute more in order to be paid unemployment benefit and even then the provision is hardly generous.
• There are very few state-provided social housing programmes. Rents are low, it’s relatively easy to purchase properties and overcrowding is not yet a serious issue.
• There is universal healthcare, but it is is hugely underfunded and fees are charged for almost any medical procedure (often significant fees). At least 25% of the population is covered either by private health insurance or by cover from mutuals and receive treatment privately.
• Although active in some conflicts over the last few decades, Portugal is not a major player on the world stage and therefore doesn’t have to spend much on defence.
• The education system is not as expensive as it is not as advanced as in some richer countries. The “functional literacy” rate of Portugal is one of Europe’s lowest. Nearly 50% of all secondary students drop out before completing their education.

Not only does Portugal have a small state, it has quite a large private sector influence in areas which states are often the main players. For example, all major roads in Portugal are owned by private enterprises, and they are free to collect massive amounts in tolls. As I mentioned above, 25% of healthcare is not provided by the public purse. The national airline, TAP Portugal, is to be privatised.

Portugal is currently governed by the centre-left Partido Socialista, under a charismatic Prime Minister Jose Socrates. There is a rising star on the right however, Pedro Coelho, who since taking over the leadership of the centre-right PSD in March has moved sharply to the right, and this is an interesting development. The next election is scheduled for 2014, although the current government is a minority one, and the President has the right to dissolve that government if they cannot deliver or if they cannot effectively slow down Portugal’s economic crisis. Pedro Coelho is more charismatic, younger and seems more in touch with the public than the current PM, and there is every chance that he will be Portugal’s next leader.

Two major developments have happened in the last week which should be of alarm to left-thinking people with an eye on EU countries like Portugal. The first is an attempt by PSD to amend the constitution to remove the right to free universal healthcare for all Portuguese citizens. In a country where the healthcare system already fails in many ways to provide the level of care one would expect of a developed western European country, this is indeed an alarming move which may result in even less Portuguese citizens receiving the treatment they need. Although having said that the Portuguese private healthcare system is much less expensive and more accessible that its equivalent in the UK, Switzerland or USA. The PSD would also like to remove the constitutional right not to be fired from a job without “just cause”.

The second is a speech today in which Coelho sought to further differentiate himself and his party with the centre-left PS. He said that “no more will people be able to say that PS and PSD are the same thing” and that the PS governs on the principle that “only the rich should contribute to the state and the poor should not”. He said he believes that “politicians should not be afraid of making a storm, or of introducing different kinds of policies for government, even if unpopular”. These statements, in conjunction with the attempts to remove minimum barriers to exclusion, equality and fairness from the Portuguese constitution, are a preview to a future government which will take Portugal sharply to the right, and which will see more of Portugal’s state services in the hands of private companies.

In a country which already has such a small state, this will be a very interesting experiment indeed. But if you live in Portugal, just don’t get sick, and don’t get fired otherwise you might view the political philosophy of this rising star as more terrifying than interesting.

Chris Patten is one of the UK’s leading foreign affairs figures. To my sadness, and despite the best efforts of Chatham House, Britain doesn’t really have much of an academic/expert foreign affairs community in the American style. Hilary Clinton’s predecessor, Condoleezza Rice was an accomplished foreign affairs academic before entering the world of politics, completing her PhD in her 20s on Czech politics in the Soviet era. That she ended up directing US foreign policy, showed a willingness to have experts leading the external affairs policy and implementation of a government, and this policy was continued by Obama when he appointed Dr. Susan Rice as UN Ambassador, who carried out her doctoral studies in Oxford, and who’s dissertation was entitled “Commonwealth Initiative in Zimbabwe”.

Contrast this with the UK, where major appointments at ambassador level are career civil-servants, and where ministers who fill the ranks of the Foreign & Commonwealth Office often have close to zero experience on the world stage, let alone doctorates in international studies. Chris Patten is an exception. After 13 years in Parliament, he took to foreign affairs, taking over the role of governor of Hong Kong from 1992 until the colonial outpost was handed back to China in 1997. Since then he has become something of a foreign affairs academic, as well as an important figure in European foreign policy (having served as Commissioner for External Affairs for four years), and has written several books on Asia, British relations with America and on the changing landscape in foreign affairs.

The Guardian is carrying an interview with Lord Patten today, marking his visit to Gaza. He makes some interesting points, and reading the interview I am baffled as to why William Hague, a man with little foreign affairs experience and not much gravitas in the world (although he is highly educated, with an MBA from much-respected INSEAD in Paris as well as serving a stint at one of the world’s leading management consultancies), is our Foreign Secretary when Patten himself is a Conservative peer. If the world is to tackle and finally resolve the problems in the Levant, we need to be bold and put an end to this idea that we can simply isolate Gaza and allow Israel to continue the status-quo on the ground. It seems Lord Patten agrees, and he thinks Europe and European countries shouldn’t just wait around for America to fix the problem:

“The default European position should not be to wait to find out what the Americans are going to do, and if the Americans don’t do anything to wring our hands. We should be prepared to be more explicit in setting out Europe’s objectives and doing more to try to implement them.”

Patten went on to specifically criticise Israel’s Gaza blockade:

Patten, who found it “easier to get into a maximum security prison in the UK than to enter Gaza”, said Israel’s relaxation of its blockade had not gone far enough. “It’s moved from about minus 10 to about minus eight. It doesn’t do anything to help restore economic activity in Gaza.

And something you would hardly ever hear a leading Western politician saying, that the blockade of Gaza might not have anything to do with security but more to do with punishing Gazans and punishing Hamas:

“It’s difficult to understand what preventing exports has to do with security. It has everything to do with the view that Gaza should be collectively punished to discredit Hamas. Unfortunately there are some centuries, if not millennia, of history that show that does not work. Presumably the international community as well as Israel wants at some stage – sooner rather than later – to be able to persuade Gaza and its political leadership to take a course which will lead to reconciliation and peace and stability. It’s difficult to know how you accomplish that if you deny the people of Gaza any social or economic progress.”

Perhaps over the next few years we will start to see more of an effort to actually sit down and talk to Hamas leaders. The world made a very big strategic mistake after the 2006 elections which resulted with a Hamas leader of Palestine. To dismiss the result of a democratic election, no matter how unsavoury that result, was an insult to everybody in the Palestinian territories. Israel, Europe & America should have sought ways to engage with this group and try to bring them into the fold of moderate statesmanship. The only way the long-standing dispute in Northern Ireland was solved was to sit down with people on all sides. As Patten says:

“You don’t always agree with people you talk to – indeed sometimes you find them despicable – but you need to ease them out of the corners into which they’ve painted themselves rather than lay on the paint much thicker.”

And he goes on to explain how isolating Hamas & Gaza may be counter-productive in the medium-long term anyway:

“I think it’s wholly reasonable to say we couldn’t deal with Hamas unless they agreed to a comprehensive and complete ceasefire. But do we need to insist on them accepting all past agreements? Has Israel accepted all past agreements? If you simply isolate them, do you weaken them? You strengthen people who are even more extreme than they are”.