fees

A new cap or a new price?

The government today responded to the Browne review recommendations.  A few brief details on government proposals:

  • A rise in the tuition fee cap up to a possible £9,000 (including a lower cap of £6,000);
  • higher interest rates on loans, up to 3% above inflation;
  • students pay back once they earn above £21,000;
  • slightly higher maintenance grant for students from families earning below £25,000;
  • Introduction of £150m ‘National Scholarships Programme’;
  • greater loan support for part-time students.

For greater detail, Times Higher Education have put together the main detail in the proposals.  There will be a lot more discussion throughout the week across the media, that’s for sure.  Then there’s the small matter of a demo in London on November 10…

Wordle: David Willetts - 3 Nov 2010, response to Browne & HE proposals

Just after the majority of teaching funding was slashed by the government, universities are going to have to find a lot of money from elsewhere.  So it’s unlikely that institutions will want to charge less than £9,000 if possible.  As with many capping exercises of the past, expect to see the cap become the price. Chances are that £9,000 will become a standard figure, with £6,000 being charged by any universities that cannot work toward the extra agreements.  Whether or not you agree with a full marketisation of higher education in a cap-less system, it’s hard to see a variable rate up to £6,000 or £9,000 do more than push the standard price up across all institutions.

This situation is clearly one in which the financial burden will be placed on students.  Those in favour of these changes are keen to say that it is graduates, not students, who will pay back the debt.  These graduates are still the same individuals, regardless of what you call them.  Students don’t pay up front at the moment, so the government is not proposing any type of revolutionary change.

Today’s proposals appear to be more of an offsetting exercise in regard to government debts. People won’t be saddled with credit card or mortgage style debts, but neither are they faced with that under today’s system.

Graduates will likely pay back more over 30 years.  The lower debt we currently have, coupled with a cut off of 25 years, is not much different to a higher debt and a cut off of 30 years.  The only real difference is the amount of time many individuals spend paying money back.  Some call this a stealth tax.  Some say that NUS and other opponents to fee hikes are scaring potential students unnecessarily.

Yet these proposals will make an impact.  And alternative measures have been offered.  For example, NUS released a blueprint outlining a graduate tax long before the Browne review was announced.  That graduate tax was essentially ignored.  The type of graduate tax dismissed in the Browne report was a basic, pure graduate tax; not the one offered by NUS.

For all the discussion going on today and all the debate within government, today’s proposals are not all that different to what is currently on offer.  Yes, graduates won’t find themselves having to pay scary amounts every month once they’re earning over £21,000, but those payments will go on for much longer than they do today, because:

  1. The fees will be higher;
  2. The interest rate will be higher than inflation;
  3. The cut off before remaining debt is written off will go up from 25 years to 30 years.

Some complaints regarding the graduate tax offered by NUS suggested that many graduates would have to pay back more than they do now.

However, at a time when fees are set to potentially treble, that argument cannot work.  There are pros and cons to everything.  Despite mentioning NUS recommendations, I’m not suggesting any particular solution here.  My main issue is that people are not being listened to.

And while debate rolls on regarding the future of HE, it’s difficult for anyone to sensibly debate the issues because the goal posts keep being changed.  Is it any wonder so many people are angry at Liberal Democrat moves to support higher fees when every single Lib Dem MP signed the NUS pledge that they would not support those very proposals?

Situations change and decisions do need to be updated based on new developments.  However, much of the situation was known when those pledges were signed and many alternatives had been proposed, including by Lib Dems themselves.

With an almost total cut in government funding for university teaching, much higher fees will not provide universities with extra income.  Those fees will also, therefore, result in no change to the student experience.  The individual is set to pay more for the same and, quite possibly, more for less.

It is, therefore, no surprise that so many students, academics, parents, and other individuals are unhappy with what’s happening in higher education right now.

As things stand, I imagine there will be a considerable turn out in London on November 10.  Mario Creatura recently said:

“I’m concerned that the decision to protest has been built on a foundation of emotive language gleaned from activists and the headlines which were ultimately based on Browne’s recommendation rather than what the coalition has actually said.”

Now the coalition has spoken.  Creatura was worried that the London demo may protest too many issues and cover too much ground.  But I feel this shows the magnitude of what is happening.

The Conservatives have been fond of saying “We’re in this together”, so why can’t people covering all aspects of higher education say the same thing?  The issues may be plenty and cover a large proportion of HE, but that’s exactly the reason why solidarity is necessary more than ever.

Far from diluting the noise, a collective effort may be exactly what’s needed to point out why the situation must be taken more seriously and with greater focus on the bigger picture.

The government wants students to have more of a say in what’s important to them regarding higher education.  I couldn’t agree more.  It’s time to speak up.

Universities: A non-market market?

With a Browne Report and a Comprehensive Spending Review out of the way, it’s now clear to see what the future holds.

Wait, no it’s not.  The future is more clouded than ever.  Fiddlesticks.

If you’ve had any interest in Browne and the CSR, you’ll have seen plenty of commentary.  I don’t want to go over the same stuff, although I’ve made lots of notes and can post more at popular request… 😉

Instead, I’ll keep in brief.  And I’ll leave most of the words to others.

Giles H. Brown, Editor-in-Chief of HE policy journal, Perspectives, explains that universities can’t be viewed the same way as businesses:

“Research suggest tertiary education is unlikely ever to operate as a market in a way an economist would recognise (Brown 2008); we are therefore likely to remain market-like, but not a market, in the same way as we are increasingly having to be business-like, but cannot operate truly as a business.  Like it or not, we cannot strictly separate the sector from the market; we are increasingly dependent on the ‘market’, while recognising the importance of retaining some degree of autonomy from it.”

[Perspectives, Vol.14, No.3, 2010]

So how much autonomy will there be?  Times Higher Education (THE) highlights concern.  This week’s editorial stresses that Browne claims to be offering universities freedom, but actually introduces a ‘state-controlled and regulated industry‘.

The Higher Education Policy Institute (HEPI) has published their response to the Browne Report, dismissing much of it as a serious way forward.

Then there are the concerns surrounding fees.  Prospective students be warned; if Browne’s proposals go through, there may be no real market on fees, much like now.  THE reports that most unis may have to charge around £8,000 just to get by.  This has led NUS to say the spending review informs an entire generation, “you’re on your own“.  And these possible fee rises may not even accurately factor in the natural decline in 18-21 year olds from 2012.

This may also have a knock-on effect for widening participation.  Steve Smith, President of Universities UK (UUK), explains:

“We know we are facing a demographic downturn from 2012, with a 15.6% decline in the 18- to 21-year-old age group within the decade – not the only cohort, but a major one, for student recruitment: already this year the participation rate has fallen from 41% to 39.7%.  Unless we can raise the attainment levels of 16-year-olds, the numbers coming into higher education from the lower socioeconomic groups will not increase at the pace we would like them to.”

[Perspectives, Vol. 14, No. 3, 2010]

Compare this with Browne’s wish for a further 10% of students to enter higher education.  Getting a particular percentage into HE is not the point.  Widening participation isn’t about greater numbers, it’s about ensuring that those who can benefit from HE are given that chance.  Some people enter HE who would have benefited from something else and I believe just as much effort should be placed on helping these individuals.  One positive aspect of the Browne Report is its recognition that better careers advice and prospective student guidance should be given to allow greater understanding and to give individuals a better chance in making decisions that suit their individual needs.

But can we achieve these things under a market system that doesn’t necessary work like a market?

These are strange times.  Bonkers, in fact.  All of us will be affected one way or another.  And nobody really knows how yet.

But there is one certainty: No matter what your opinion is — even if you don’t care — none of us can put our head in the sand.

Why fees don’t act as a deterrent to uni

Would higher tuition fees put you off university?  A study by the University of Leicester suggests demand for places will be strong even if fees went up by triple their current amount.

730 university applicants were asked if they would be put off by higher fees.  The majority said they would still apply.  Slightly more than 10% would be put off by a £10,000 yearly fee.

photo by subcircle

Prospective students don't feel locked out over fees (photo by subcircle)

This is surprisingly low in contrast to the recent NUS & HSBC survey that asked a similar question to current university students.  Asked if they would have been deterred by higher fees, a whopping 78% said they would have been put off by fees of £10,000. [Click for full survey report in Word (doc) format]

So why the difference?  The NUS survey asked students already in HE.  Those students are more than aware of the fees burden, so it’s clear they would be alarmed by an even higher cost.

The Leicester study went the opposite way and asked sixth formers; those not yet in the higher education system.  With so many people applying to universities, I’m sure most students don’t feel they have much choice but to accept whatever price they have to pay.

At a time when university is considered the only route to career success by many, the focus on applying won’t rest on fees.  Suggest everyone had to pay £50,000 a year under these circumstances and I doubt even then you’d have a majority turning away from uni.

Bursaries and scholarships are available to cover some, if not all, costs.  These schemes would have to grow if fees were to rise.  Sadly, students most in need of this financial assistance are not sufficiently aware of such schemes.

The Office for Fair Access (Offa) reports that bursaries are not attracting poorer students.  The “chaotic patchwork” of bursaries are not doing the job of supporting students most in need.  Those at a financial disadvantage are far more likely to attend a university with lower bursaries.  The links are clearly not joining up.

Nik Darlington recently complained that he found the NUS/HSBC survey to be unrealistic.  He argued that by asking current or former students about fees, “This will not give you a realistic market opinion – these respondents are biased having already paid less than half of that amount for their current or former studies.  You have to be putting the question to future students for satisfactory realism”.

While the Leicester survey did put the question to future students, I don’t believe that survey can paint a full picture either.  The answers aren’t surprising.  So long as prospective students deem university to be the usual route forward after school, most students won’t appear to be put off by fees.

Darlington says Leicester have offered “vastly more robust research“.  Nevertheless, the results may be missing the wider point.  Put both sets of answers together to see why.  Before university, any fee is just a price that needs paying.  During university, that fee doesn’t seem quite so obligatory.  The change of opinion is important.

And how about after graduation?  Are current fees worthwhile and, if so, would higher fees still be acceptable?  I am skeptical about the £100,000 graduate premium in these changing times.  Would a graduate-only survey highlight resentment over fees even at their current levels?

How important is opinion in these matters anyway?  It seems that views vary, even amongst students.  And as Ferdinand von Prondzynski suggests, “the electoral impact of fees may be much less predictable than one might think”.

The future is going to be tough, whatever happens.  We have an ever increasing number of questions and very few answers.  Even if the Browne Review recommends higher fees, as is expected, the coalition government have to work a reasonable solution.  Under the circumstances, finding that solution will prove difficult.

And that last sentence is a contender for understatement of the year…