That seems pretty sensible to me. When the educational funding bubble pops in the U.S., I could imagine something like that taking it's place.
Federal loans (90% of student loans) are paid directly by the government, and come with income based repayment plans capped at 10% of disposable income.
The debt is cancelled after 20 years, so if you don't find a decent job, you'll pay very little.
There is interest though.