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.

David Willetts: Student burdens and imaginative thinking

Universities are topping the news agenda again this morning. Lucky us.

Or maybe not.

David Willetts, the universities minister, has said that students should see tuition fees “as an obligation to pay higher income tax”.

Oh dear. Then again, we shouldn’t be such a “burden on the taxpayer”, should we?

photo by bisgovuk

photo by bisgovuk

Education, like health, like defense, like transport…like most things, is a taxpayer burden. We know taxes must be paid, even if we don’t like it, but we want them to be reasonable and to work.

The welcome expansion of higher education means we cannot expect all funding to come from the public purse. The system has changed too much to expect that.

But one thing about HE hasn’t changed over the years. That is the amount universities help the country achieve through both teaching and research. Based on this alone, public funding must still be the main way to help fund the system. It is reasonable to think that graduates should also contribute toward the future of higher education. But how much?

Willetts asks what can be done to ensure students can get more out of higher education. He asks for clarification on what we are getting in return for our investment:

“The system doesn’t contain strong incentives for universities to focus on teaching and the student experience, as opposed to research.”

This is a fair point in itself. Graduate repayments take 9% of your earnings above £15,000. This is too much of an ‘income tax’ when there is no specific and identified benefit.

One way of tackling the funding issue and that of student benefit is, according to Willetts, to look at systems of education provided by London University and Open University, providing more affordable teaching in HE. Methods like distance learning and local learning would certainly benefit some, but there’s already a lot of this going on, especially within further education. HE in FE is not a new concept. The format is welcome and useful, but it isn’t enough to transform the education system, especially if sufficient funding from the right sources is not forthcoming.

If the coalition government – whether through Vince Cable or collectively – is keen on reducing university places in coming years, a lot needs to change before it can work for students in general. Access needs to be guaranteed to all those who would benefit from HE. Additionally, those students need to be easily identified and given the help to understand what HE can do for them.

I’m not saying it’s an easy task, far from it. We need to tackle widening access as a priority before we start reducing the number of available spaces at universities. The system is already failing students with good grades who cannot get in to university. Widening participation doesn’t stand a chance when even already engaged and achieving students are unable to fulfil their potential.

I noticed that Newcastle University has been taking on local applicants with lower A-level grades for the past 10 years. Success stories such as Newcastle’s highlight mechanisms in place that allow access to all who would benefit. Even those who don’t achieve so well earlier on in life can go into HE and improve their chances considerably.

David Blanchflower suggests we look to Dartmouth College in the US for a way to combine widening participation with successful funding models. This would mean lifting the cap on tuition fees. But would that matter if half the students would receive scholarships and financial aid when it is needed? Would all this financial aid be possible anyway? I’m not sure, but the method is worth exploring in a time of big changes.

Graduates in the US are also far more likely to donate to their place of study. In the UK, graduate donations are nothing like as forthcoming, although they seem to be rising.

It is expected that Lord Browne’s review into higher education funding will list higher fees amongst its recommendations. Time will tell what comes out, but it seems we are being readied for this outcome. Willetts has said that people need to see the difference between a credit card debt and a graduate debt that is more akin to paying higher income tax.

I know the difference and it doesn’t have me sighing with relief.

If the fees cap is lifted – or removed altogether – the burden on the government and on students will increase hugely. Higher fees still won’t benefit the government due to the drain that loans have on the economy in the first place.

Willetts has, therefore, set out the need to “think much more imaginatively” regarding fees. He suggests that graduates may have to pay more for their education in the future, but they will be more accepting if they recognise the worth. That worth, he argues, can only come about through an improved teaching focus.

As far as students are concerned, imaginative thinking will certainly need to go beyond this.