Make students pay for what their degrees are worth

by Stephen Pollard Senior Fellow at the Centre for the New Europe, a Brussels-based think tank

IN all the tributes to Estelle Morris's honesty in admitting that she wasn't up to the job of Education Secretary, we seem to have lost sight of one key fact. Ms Morris's failures were not simply personal - her authority was critically undermined by losing a fundamental battle with 10 Downing Street over the future of higher education.

Ms Morris was implacably opposed to top-up fees - in which universities can supplement the money they receive from Government by making charges of their own for their undergraduate courses. Mr Blair, on the other hand, has come to believe such charges are essential if British universities are to avoid accelerating further into decline.

Ms Morris lost her battle.

Top-up fees are coming: the upcoming White Paper will make that plain. A fortnight ago, Imperial College led the way by revealing that it wanted to be able to charge some of its students pounds 10,500 a year - a tenfold increase on the current pounds 1,100 annual flat fee which universities receive per student.

The extra money is needed because British universities are in crisis. There is a brain drain of some of the best academic minds to foreign, mainly American, universities, which are able to offer salaries vastly in excess of what can be paid in the UK.

Government funding - or rather, underfunding - has meant that the money is simply not there to enable British universities to compete with the rest of the world.

COUPLE that with the breakneck speed at which undergraduate places are being expanded. Labour wants to see half of all schoolleavers studying for a degree - and the universities are caught in a spiral of decline.

The universities themselves say that they need another pounds 9.94 billion just to cope with the Government-led increase in student numbers, let alone any thoughts of regaining their global competitiveness.

Something has to give. The universities are determined that it will not be quality, and they point to one of the causes of their foreign rivals' success: top-up fees at different levels depending on the subject studied and the university attended.

The idea is simple, and it's one we accept in almost every other walk of life: you get what you pay for. Why after all, should it cost the same for a trainee cleric to study theology as for a potentially highearning lawyer to read law?

Why should a degree in history from Oxford cost the same as a degree in golfcourse management studies from the University of Central Lancashire? It makes no sense - and it is, put simply, unfair.

Those who argue against top-up fees say some students will simply be unable to afford the market rate. That is to misunderstand the way they work.

Take America, where the social mix at universities is far broader than it is in Britain, and which operates a system of top-up fees. Even in America, the home of the free market in education, universities do not simply charge what they want to whomever they want.

Don't forget that the reason this issue has arisen in the first place is because the universities want to increase standards.

That means attracting the best students - regardless of their ability to pay.

So the best American universities, which can charge the most, operate on one admission criterion: if you are good enough, they take you. If you can pay the fees, fine - and if you cannot, the fee will be paid for you. That can be done by a college endowment fund, as in the US, or by the taxpayer, as the White Paper will propose.

One plan being touted around Number 10 is to waive all fees for parents earning less than pounds 30,000, and then gradually to increase the amount paid until full fees kick in for those earning pounds 50,000 or above.

Couple that with a student loan at low rates, and a new maintenance grant, and you have the makings of a sensible mix.

The ground has shifted on all this remarkably quickly.

Until last year's election, the higher education minister was Baroness Blackstone, who was implacably opposed to anything resembling a market in education - a view shared by her fellow junior minister at the department, one Estelle Morris. But Baroness Blackstone's successor as higher education minister, Margaret Hodge, has taken a different view.

Mr Blair - initially neutral on the matter - has finally been swayed by Andrew Adonis, his chief policy adviser and a former academic. Mr Adonis could see that, without big changes in funding, universities would be the latest in the lengthy line of British institutions which fall from leading the world to trailing behind.

Put simply, Ms Morris gave up. Caught between her own higher education minister and 10 Downing Street, she had no alternative but to accept that top-up fees would appear in the upcoming White Paper. I am sure that this, as much as any other crisis of confidence, contributed to her decision to go when she did.

There was a further, previously undisclosed factor: in the Russell Group of elite universities there were some still bolder vice chancellors who were simply not prepared to accept defeat on this issue.

THE older, wealthier universities - led by Oxbridge - threatened that if they were not able to charge their own fees, they would effectively opt out of the higher education system, set their own fees and no longer accept any Government funding - thus freeing themselves of Government diktats over entrance policy. Mrs Hodge and Downing Street feared a fragmented future, where the best universities privatised themselves and the rest steadily deteriorated with paltry tax funding.

They feared, in other words, that higher education would come to resemble the divide between private and secondary education.

That is the real choice and one we cannot fudge. It is simplistic to argue that universities' needs should be met by the taxpayer: the scale is too vast for that.

The issue is straightforward: do we slouch along, accepting permanent decline as a part of British life, or do we give our universities - and thus our present students and our children in the future - a higher education which can hold its head high in the world?

It's not a choice we can afford to get wrong.

Copyright 2002
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