The £9k exception norm

Today’s headlines on tuition fees are promising large rises. I’m about to discuss the fees announcement. But don’t be alarmed by the numbers.

MoneySavingExpert has a guide to understanding the new fees and loans system for 2012/13 and it’s worth checking that rather than worry about the figures in isolation.

The figures sound scary, but the reality is different. Whether you agree with it or not is a different matter.

There are underlying issues that could arise due to the government selling off loans in the future, but hopefully it won’t be something we need to cover. If you do want to read more about the sale of student loans, check out Part 3 of Andrew McGettigan’s report, “False Accounting? Why the government’s Higher Education reforms don’t add up” [PDF]. It’s also worth reading McGettigan’s recent post on finances at his blog, Critical Education.

Now on to the fees announcement.

photo by Leo Reynolds

photo by Leo Reynolds

The Office for Fair Access (OFFA) has published details of university fees for 2013/14. The fees are even closer to the £9,000 cap than they already were for 2012/13, when the new fees come into play. FT’s data blog lists the full 2012/13 fees.

After financial support from all areas is taken into consideration, the estimated average fee for 2013/14 is set to be £7,898.

That’s once everything is taken into account. A potential difference of £1,102 between the adjusted average and the absolute maximum fee. Not exactly the suggested ‘market’ that was touted.

A yearly fee above £6,000 was supposed to be the exception. Many HE commentators weren’t convinced. In November 2010, I suggested that we should “expect to see the cap become the price“. It hasn’t taken long.

In March 2011, I acknowledged that finances and access agreements cannot be worked out in any short-term plan:

“It seems that, even without any changes to the proposed fees system in coming years, it’s going to take a couple of runs through the process before we get a true picture of what’s happening.” [Source]

The new fees regime for 2012/13 hasn’t even begun and the next year of fees has been set. Clearing doesn’t start for a couple of weeks, and that’s set to be different to previous years. Salford VC, Martin Hall, says that clearing is “no longer a mopping-up opportunity for those who didn’t get their expected grades to find a spare place”.

This is just the start.

It’s understandable that fees have long been the big talking point surrounding higher education since the changes were announced. Sadly, that’s been to the detriment of other HE discussions. Postgraduates, institutional diversity, student engagement, the loans system and its future, public perceptions and engagement with HE…There is so much to talk about. It’s as if fees talk got in the way of other conversations. Well, unless you were more directly involved or particularly keen on HE policy and wonk-talk!

For applicants, there is still little reason to limit choices based on tuition fees other than the occasional exception. In general, the slight differences are less important than other considerations. The new fees system was billed to give students greater choice. People would vote with their feet and not accept unreasonably high fees as a matter of course.

With fees set so close to the cap, where will those feet tread?

Many considerations are needed when making university choices. It depends on each person and why they wish to attend (including whether or not to attend at all). I’ve got a list of 50 things to think about for uni decisions. It’s not exhaustive, because that’s not possible.

Fees may not be so important in choices right now, but bursaries are still worth researching. Bursaries make an immediate impact, unlike fee waivers, because the money goes directly to the student. Prospective students should make sure they know what bursaries are available to them.

Some institutions may find new reasons to set very different fees once we’re a year or two into the new system. There’s no way to accurately foretell this because there are no direct comparisons. Also, any additional policy changes change the situation once more. And there’s still a lot of room for that to happen.

However, as things currently stand, it’s clear that fees are sitting firmly around that £9k cap. Who’da thunk it?

Access agreements and uncertainties

If universities want to charge more than £6,000 in yearly tuition fees, they have to outline how they intend to help attract disadvantaged students and improve social mobility.

The Office For Fair Access (OFFA) has today published guidance to universities on how to produce an ‘access agreement’. Access agreements set out the ways in which an institution would promote and improve student retention, student outreach, financial assistance, and other activities to benefit social mobility.

It seems that, even without any changes to the proposed fees system in coming years, it’s going to take a couple of runs through the process before we get a true picture of what’s happening.

photo by john curley
photo by john curley

Speaking on the Radio 4 Today programme, OFFA’s director, Martin Harris, said that universities must prove what they promise to do ‘in retrospect’. While proposals must be ‘stretching and demanding’, this leaves universities with a largely free reign on how they want to proceed. For now.

Given the general flexibility so far allowed in creating access agreements, it’s no surprise that representative groups are positive. Paul Marshall, Executive Director of the 1994 Group said:

“By allowing universities to set their own widening participation benchmarks OFFA have recognised that each university has its own priorities, and will be best placed to set the most appropriate measures.”

Russell Group’s Wendy Piatt was equally upbeat:

“We welcome the fact that OFFA will be allowing universities some scope to set their own targets and milestones for access work, noting that ‘there is no single perfect measure of access performance’.”

Such open possibilities make it difficult to see how anyone will achieve an overall awareness of what will end up becoming necessary in the longer term. I strongly suspect that there will be alterations based on the first year or two, which will result in an even longer period before a manageable picture is revealed.

Will it ever be clear which aspects of the system really can help HE and student intake? Students and staff alike know they must jump through particular hoops to get from one place to another. The difference now is that the hoops have slightly changed and may change again.

Potential students can see they might suffer in terms of fees and repayments, but can they be certain at the same time that they’ll benefit from a more level playing field? Is there enough potential in the future to break down barriers and help young people in a more targeted fashion, even before the idea of university becomes an important life choice?

Unfortunately, we just don’t know. Social mobility has a long way to go. All universities play an important part in enhancing mobility. Therefore, it’s important to make sure there’s a limit to unnecessary exclusions that could have still played a helpful part. If these elements are removed prematurely due to lack of funds, improvements elsewhere will, at best, cause stasis, not growth.

At times like this, I often acknowledge the bumpy ride that’s ahead for anyone involved. But when is the road not bumpy? If it’s going to take several years before greater clarity can be achieved, it will probably be just in time for a new set of sweeping changes to come about.

Not everyone is having to tread water and there is plenty of opportunity for HE to shine further, but it would be foolish for me to say that any wide-ranging situation can ever experience a bump-free terrain.

Mission groups are mainly positive that access agreements won’t be a barrier to setting fees of their choosing. Future students are now aware that fees are likely to be a lot higher and they must choose based on new rules. Current developments expose the latest hurdle that needs crossing (or fighting). But the next hurdle will never be far away.

My analogy shouldn’t consist of a bumpy journey. It’s more like a bucking bronco ride. We stay on for as long as we can.

And if we fall off? Either jump back on or choose a different ride. Make of that what you will. I’m not sure I’ve worked it out yet…

Tuition Fees and the Future

Oxbridge and Imperial want to charge £9,000 in fees from 2012. The highest amount possible.

While we’re well aware of student protests and unhappiness with higher fees, it’s still no surprise that universities are announcing the wish to charge students top whack for tuition.

original photo by RachelH_

original photo by RachelH_

Take away the controversy of higher fees for a moment and focus on what’s happening to see why a varied market in fees is unlikely.

The Browne review wanted to see no price cap in place. A big, scary thought for many future students. But the cap hasn’t been removed; it has merely been raised.

Under current terms, the natural move by universities will be to charge the highest possible amount. This is because they face:

  • A near total removal of public funding for teaching;
  • The unrestricted ability to charge fees of £6,000;
  • A requirement to create an ‘access agreement’ for universities choosing to charge above £6,000, up to a maximum of £9,000;
  • A need for the average tuition fee to be £7,500 in order to simply recoup the losses from the removal of funding.

In turn, this means:

  • Universities need to find more money from somewhere in place of public funding;
  • £6,000 isn’t enough, on average;
  • An access agreement is required for £6,000.01 just the same as it is required for £9,000, so there is little incentive to charge below the £9,000 maximum.
  • As the average £7,500 required is above the unrestricted cap, all universities are likely to require a written access agreement.

This is why, back in November, I suggested that the cap will become the price. If different prices do occur, my guess is that they will be £6,000 and £9,000; the two caps.

Now that the Office for Fair Access (OFFA) have been issued with guidance for universities charging fees, commentators suggest that there’s not much stopping all institutions charging the maximum. David Willetts even states in the guidance to OFFA:

“It is, of course, not within your legal powers to impose any quota for how many institutions charge what level of graduate contribution, and that is consistent with our policy of an autonomous higher education sector, where institutions take their own decisions.”

Willetts suggests that further legislation may be required if all institutions charge the same amount. Universities, therefore, either face further turbulent times further down the line (when matters are already less favourable for them right now), or they face some kind of climb down from the government. Neither situation would be pleasant for anyone. Not for the government, not for the public, not for universities, and not for students.

OFFA’s role is to “promote and safeguard fair access to higher education for lower income and other under-represented groups” [source]. The government is, therefore, one step removed from social mobility arguments that could continue if access agreements don’t make the situation much better than they already are. Essentially, the ball is now in OFFA’s court.

But they’re in a tough position. You can see why £9,000 is being tipped as the way all universities will want/need to go. That’s before you take into account the idea of prestige. As soon as one institution suggests a lower fee, it will appear to be less worthy than those charging a higher amount, regardless of the realities.

There is little surprise that Oxbridge and Imperial are touting £9k fees. But it will only take one or two less ‘prestigious’ universities wanting to charge top whack for everyone else to follow suit. They’ll feel the *need* to follow suit, even if they’re thinking about charging slightly less.

When £3,000 fees were introduced in 2006-07, only Leeds Metropolitan offered a lower tuition fee (around £2,000). The move didn’t work for them and they eventually charged £3,000 like everyone else.

Will we see a repeat of this, with only a handful of institutions introducing lower fees? Who knows? The expectation remains — and is growing daily — that everyone will want to use £9,000 as the standard tuition fee.

As with everything in the future, only time will tell. But if we do see the tripling of fees as the norm, be sure to expect further moves in years to come. This is only the beginning of what may be a pretty long journey.