Originally Posted by Ed

What relevance is it how it's spent?

If you earn say £30K cos you had a loan-funded education, and you'd otherwise have been able to do a job that paid say £20K, and you have to repay the loan that enables that extra £10K, then the tax on the £10K is effectively a double repayment. I can't see it's relevant whether it's spent on higher education, health, or some quango. Fact is, you're paying twice.