"It will be a disaster"
Stephen EalesProfessor of astrophysics, Cardiff University
For the last two decades I have been part of the consensus that students should pay a significant contribution towards their education. I did a degree in Cambridge in the late 1970s and didn’t have to pay a penny. It was manifestly unfair that the taxes of the vast majority who did not go to university should have paid for my education, whose main beneficiary has been me. Based on this “fairness criterion,” I supported the last government’s decision to raise tuition fees to £3,000 pounds per year. However, with Browne’s proposal to raise tuition fees to at least £7,000 per year, and possibly to set no limit at all, the "fairness criterion" is now pointing firmly in the other direction.
The standard argument for fees is that, over a lifetime, a university degree is worth the initial investment. With the new tuition fees, the cost of a three-year degree will be about £36,000, and the cost of a four-year science degree (now the de facto degree for anyone interested in a career in science) will be about £48,000 pounds—not much less than the cost of the first house I bought in the 1990s. But the figure given for the lifetime economic benefit of a degree is about £100,000, which makes a degree still look a reasonable investment.
However, it is impossible to accurately project what they will earn in the future—especially given the increasing number of people going to university. Many people, of course, will not benefit at all, since the flood of graduates has meant that many jobs that in the past which didn’t require a degree now require one. And this is the same generation that will be faced with further intergenerational unfairness, like the pensions black hole and the difficulty of buying a house.
The Browne proposals will also add to the unfairness that the top universities are already dominated by the children of parents rich enough to pay for private schools. This will now get much worse. There will be bursaries to help children from the poorest backgrounds, but the people that will really be hit will be the vast bulk of the middle class who are not part of the metropolitan elite, and do not earn enough to send their kids to private school or to help much with the new tuition fees. It is hard to see how Oxbridge will avoid becoming the higher-education equivalent of Eton, with just enough people supported by bursaries to give the impression that these universities are still public institutions.
The government, of course, will say there is no alternative. Among other things, they will argue that British universities need better funding to compete with the top US universities. But the top British universities are mass institutions, educating large numbers of undergraduates and exposing them to high-quality research and scholarship. As such, they should not be compared with US universities like Caltech, which have small numbers of undergraduates. Second, contrary to myth, British academics are not overburdened by teaching and administration, leaving little time for research. In my own fairly typical department we have 60-70 per cent of our time for research—so if we are not winning Nobel prizes it is because we are not clever enough. And it is also not true that British academics are poorly paid by international standards. It is only when one considers house prices that British salaries do not look so good, but this is a general problem of living on a small island.
We are facing a huge deficit, and the money has to come from somewhere. But it is fairly easy to see how one could, with some bearable pain, cut quite a lot out of the university budgets. Since academics had a generous pay settlement two years ago, a pay freeze for four years would not be an unbearable hardship—and that would save 10-12 per cent of the budget. Anyone who has seen spanking new buildings springing up in British universities over the last few years would acknowledge that there must be some scope for saving on capital spending, general waste and administration, and it seems quite plausible that with the savings on pay one could save 20 per cent of the overall budget. There are, in short, plenty of alternatives.
"We don't know yet what it will mean"
William Cullerne BownFounder of Research Fortnight
“More investment should be available for higher education,” says Lord Browne. Yet the reality is that the his review will be used to slash university incomes. Here, in the obfuscated gaps between a thorough set of proposals for reforming higher education and political reality, is the essence of what’s going on.
When he delivered his report last Tuesday, Browne recommended lifting the cap on the fees universities can charge. But, just after that, business secretary Vince Cable fudged the message, citing the figure of £7,000 as a possible cap, but in such a way as to leave unclear the government’s instincts. Are we on the road to unlimited fees or not? No one knows, not even Cable.
So it is one thing to consider the Browne report and its implications, but quite another to think about what it might mean after it has been through the ringer of internal wranglings within the Liberal Democrats, haggling with the National Union of Students, adjustments to take the edge off the Daily Mail’s disquiet, and coalition dealmaking.
The politics are dominated by the threat to the reputation of the Lib Dems, and especially Nick Clegg. Having solemnly pledged again and again to vote against any rise in fees, how can party’s leader now do the dirty? With bitter irony, the NUS is directing students to Clegg’s “Broken Promises” campaign video from the general election. In a bleakly-deserted Westminster street we are shown a piece of paper saying “No student tuition fees—Labour” then we hear Clegg say, “Broken promises—there have been too many in recent years.” Even those who believe student fees should rise will now gasp with involuntary revulsion when watching this video. The hypocrisy. The betrayal. Is it not reputational suicide?
In reality, Clegg, Cable, Cameron and Willetts are now going to try and sell to their parties “Browne plus”: a revised version that is more progressive and cheaper for the treasury. To add to the pressure for a deal, George Osborne will announce on 20th October cuts of perhaps £4bn a year from university teaching budgets from 2012.
Cable’s statement to MPs, then, was more than a holding statement; it outlined a clear direction of travel. The upshot is now going to be weeks—possibly months—of discussion inside the Lib Dems, with negotiations running alongside with the Conservatives, universities and the NUS, the only organisation that can release Lib Dem MPs from their pledges. The five-page response of the NUS makes clear that the door is still open for talks, even as it prepares demonstrations that will make many Lib Dem MPs uncomfortable.
And at the end of this process, what are we likely to end up with? Most graduates will certainly have to pay more, especially the ones who earn more. The middle does indeed look likely to get squeezed again. Beyond that, it’s very unclear. For example, much of the discussion has focused on the market in undergraduate degrees that Browne envisages, and which is a key Conservative objective. This would indeed be truly radical, transforming the economics of study for universities, students and government.
For universities, such a market would certainly make the common room less comfy. Stable teaching income, which can be planned with some confidence years in advance, would be replaced with volatility and the threat of bankruptcy. That would mean more hiring and firing, more management, more managers. But if the coalition ends up capping fees at £7,000, this market will be limited. It is becoming clear that most universities would charge the full £7,000 or something close to it for most courses. Hence the price signals that are supposed to shape the market would be missing.
Ultimately, the central political truth is that while the coalition leaders have some momentum, there is no deal yet on anything. And there are 60-odd pages of this kind of detail still to be resolved.
"It is both progressive and affordable" Diane CoyleEconomist, and a member of the Browne Review panel
Two themes have dominated criticisms of the Browne report: one, that it’s just a vehicle for spending cuts; two, that it will deter many students and make university education once more a preserve of the elite. Both are wrong.
Yes, higher education is one of many areas where the government intends to reduce spending, but there are good reasons for transferring some of the burden from taxpayers to graduates. The amount of real funding per student is lower now than it was in 1992. Universities can’t for much longer spread the money they receive ever more thinly without starting to suffer a decline in quality. There is already some evidence that decline has begun. A sustainable funding system, allowing more investment in higher education and continuing increases in the number of students, is essential.
Why shouldn’t taxpayers just invest more? Bear in mind that taxpayers already shoulder most of the financial burden for universities, rather than graduates—even though the average income of graduates in Britain gives them a higher financial return to their degree than in most other OECD countries. There would be a deep unfairness in requiring non-graduate taxpayers to increase their share further. There are both social and private returns to higher education.
This takes me to the second strand of criticism: that a big increase in fees will deter many applicants, especially from low-income or “non-traditional” university backgrounds. It’s a natural concern, and one the review panel debated at length. The evidence available suggests that introducing charges for tuition has not had a deterrent effect so far, and that a key factor is ensuring that students do not need to pay upfront. The new student financing plan builds on this evidence, and the submissions we received from many experts, to ensure that no student is prevented from entering higher education for financial reasons, and that the repayment scheme is as fair as possible. These include: more cash in hand for all students; a higher grant for living expenses; a higher income threshold (above the level of British median income) before repayments begin, with payment holidays if income falls below that threshold; and access to finance for part-time students—an important reform overlooked in much of the comment. A graduate earning £25,000 a year would be paying just £7 a week, somebody on double that (so in the top 6 per cent of earners in Britain) just £50 a week.
One the one had, we need to invest more in higher education and improve quality, we want to see student numbers to go up overall and encourage participation by students from low income families in particular. But we must also save some public funds and ensure the affordability of repayments for graduates. Of course there are trade-offs. But the Institute for Fiscal Studies has concluded that the system proposed by Browne should be able to safeguard access, may even increase the take-up of places by reducing the complexity of student finance, and is “highly progressive.”
Finally, the structure of universities is going to change, with a radical move away from central allocation of funds and rationing of places, to a system in which the offer of a place guarantees funding for a suitably qualified student. All universities will in future have a strong incentive to focus on the needs of students (it makes no difference to their funding at present whether they teach well or badly). Some universities might struggle to improve quality, but poor performance seems a bad reason for protecting them. It’s likely that there will be more diversity in the type of courses on offer—more experimentation with two year or sandwich courses, more part time places, perhaps more universities specialising in teaching rather than research. There’s likely to be a range of fees as well.
Of course, we’re not in an ideal world of fiscal plenty. But the package as a whole will give students more choice, improve quality, allow numbers of students to rise (as long as the government doesn’t cap investment in higher education by setting a ceiling on tuition charges), and, above all, is progressive and affordable for graduates.
Stephen EalesProfessor of astrophysics, Cardiff University
For the last two decades I have been part of the consensus that students should pay a significant contribution towards their education. I did a degree in Cambridge in the late 1970s and didn’t have to pay a penny. It was manifestly unfair that the taxes of the vast majority who did not go to university should have paid for my education, whose main beneficiary has been me. Based on this “fairness criterion,” I supported the last government’s decision to raise tuition fees to £3,000 pounds per year. However, with Browne’s proposal to raise tuition fees to at least £7,000 per year, and possibly to set no limit at all, the "fairness criterion" is now pointing firmly in the other direction.
The standard argument for fees is that, over a lifetime, a university degree is worth the initial investment. With the new tuition fees, the cost of a three-year degree will be about £36,000, and the cost of a four-year science degree (now the de facto degree for anyone interested in a career in science) will be about £48,000 pounds—not much less than the cost of the first house I bought in the 1990s. But the figure given for the lifetime economic benefit of a degree is about £100,000, which makes a degree still look a reasonable investment.
However, it is impossible to accurately project what they will earn in the future—especially given the increasing number of people going to university. Many people, of course, will not benefit at all, since the flood of graduates has meant that many jobs that in the past which didn’t require a degree now require one. And this is the same generation that will be faced with further intergenerational unfairness, like the pensions black hole and the difficulty of buying a house.
The Browne proposals will also add to the unfairness that the top universities are already dominated by the children of parents rich enough to pay for private schools. This will now get much worse. There will be bursaries to help children from the poorest backgrounds, but the people that will really be hit will be the vast bulk of the middle class who are not part of the metropolitan elite, and do not earn enough to send their kids to private school or to help much with the new tuition fees. It is hard to see how Oxbridge will avoid becoming the higher-education equivalent of Eton, with just enough people supported by bursaries to give the impression that these universities are still public institutions.
The government, of course, will say there is no alternative. Among other things, they will argue that British universities need better funding to compete with the top US universities. But the top British universities are mass institutions, educating large numbers of undergraduates and exposing them to high-quality research and scholarship. As such, they should not be compared with US universities like Caltech, which have small numbers of undergraduates. Second, contrary to myth, British academics are not overburdened by teaching and administration, leaving little time for research. In my own fairly typical department we have 60-70 per cent of our time for research—so if we are not winning Nobel prizes it is because we are not clever enough. And it is also not true that British academics are poorly paid by international standards. It is only when one considers house prices that British salaries do not look so good, but this is a general problem of living on a small island.
We are facing a huge deficit, and the money has to come from somewhere. But it is fairly easy to see how one could, with some bearable pain, cut quite a lot out of the university budgets. Since academics had a generous pay settlement two years ago, a pay freeze for four years would not be an unbearable hardship—and that would save 10-12 per cent of the budget. Anyone who has seen spanking new buildings springing up in British universities over the last few years would acknowledge that there must be some scope for saving on capital spending, general waste and administration, and it seems quite plausible that with the savings on pay one could save 20 per cent of the overall budget. There are, in short, plenty of alternatives.
"We don't know yet what it will mean"
William Cullerne BownFounder of Research Fortnight
“More investment should be available for higher education,” says Lord Browne. Yet the reality is that the his review will be used to slash university incomes. Here, in the obfuscated gaps between a thorough set of proposals for reforming higher education and political reality, is the essence of what’s going on.
When he delivered his report last Tuesday, Browne recommended lifting the cap on the fees universities can charge. But, just after that, business secretary Vince Cable fudged the message, citing the figure of £7,000 as a possible cap, but in such a way as to leave unclear the government’s instincts. Are we on the road to unlimited fees or not? No one knows, not even Cable.
So it is one thing to consider the Browne report and its implications, but quite another to think about what it might mean after it has been through the ringer of internal wranglings within the Liberal Democrats, haggling with the National Union of Students, adjustments to take the edge off the Daily Mail’s disquiet, and coalition dealmaking.
The politics are dominated by the threat to the reputation of the Lib Dems, and especially Nick Clegg. Having solemnly pledged again and again to vote against any rise in fees, how can party’s leader now do the dirty? With bitter irony, the NUS is directing students to Clegg’s “Broken Promises” campaign video from the general election. In a bleakly-deserted Westminster street we are shown a piece of paper saying “No student tuition fees—Labour” then we hear Clegg say, “Broken promises—there have been too many in recent years.” Even those who believe student fees should rise will now gasp with involuntary revulsion when watching this video. The hypocrisy. The betrayal. Is it not reputational suicide?
In reality, Clegg, Cable, Cameron and Willetts are now going to try and sell to their parties “Browne plus”: a revised version that is more progressive and cheaper for the treasury. To add to the pressure for a deal, George Osborne will announce on 20th October cuts of perhaps £4bn a year from university teaching budgets from 2012.
Cable’s statement to MPs, then, was more than a holding statement; it outlined a clear direction of travel. The upshot is now going to be weeks—possibly months—of discussion inside the Lib Dems, with negotiations running alongside with the Conservatives, universities and the NUS, the only organisation that can release Lib Dem MPs from their pledges. The five-page response of the NUS makes clear that the door is still open for talks, even as it prepares demonstrations that will make many Lib Dem MPs uncomfortable.
And at the end of this process, what are we likely to end up with? Most graduates will certainly have to pay more, especially the ones who earn more. The middle does indeed look likely to get squeezed again. Beyond that, it’s very unclear. For example, much of the discussion has focused on the market in undergraduate degrees that Browne envisages, and which is a key Conservative objective. This would indeed be truly radical, transforming the economics of study for universities, students and government.
For universities, such a market would certainly make the common room less comfy. Stable teaching income, which can be planned with some confidence years in advance, would be replaced with volatility and the threat of bankruptcy. That would mean more hiring and firing, more management, more managers. But if the coalition ends up capping fees at £7,000, this market will be limited. It is becoming clear that most universities would charge the full £7,000 or something close to it for most courses. Hence the price signals that are supposed to shape the market would be missing.
Ultimately, the central political truth is that while the coalition leaders have some momentum, there is no deal yet on anything. And there are 60-odd pages of this kind of detail still to be resolved.
"It is both progressive and affordable" Diane CoyleEconomist, and a member of the Browne Review panel
Two themes have dominated criticisms of the Browne report: one, that it’s just a vehicle for spending cuts; two, that it will deter many students and make university education once more a preserve of the elite. Both are wrong.
Yes, higher education is one of many areas where the government intends to reduce spending, but there are good reasons for transferring some of the burden from taxpayers to graduates. The amount of real funding per student is lower now than it was in 1992. Universities can’t for much longer spread the money they receive ever more thinly without starting to suffer a decline in quality. There is already some evidence that decline has begun. A sustainable funding system, allowing more investment in higher education and continuing increases in the number of students, is essential.
Why shouldn’t taxpayers just invest more? Bear in mind that taxpayers already shoulder most of the financial burden for universities, rather than graduates—even though the average income of graduates in Britain gives them a higher financial return to their degree than in most other OECD countries. There would be a deep unfairness in requiring non-graduate taxpayers to increase their share further. There are both social and private returns to higher education.
This takes me to the second strand of criticism: that a big increase in fees will deter many applicants, especially from low-income or “non-traditional” university backgrounds. It’s a natural concern, and one the review panel debated at length. The evidence available suggests that introducing charges for tuition has not had a deterrent effect so far, and that a key factor is ensuring that students do not need to pay upfront. The new student financing plan builds on this evidence, and the submissions we received from many experts, to ensure that no student is prevented from entering higher education for financial reasons, and that the repayment scheme is as fair as possible. These include: more cash in hand for all students; a higher grant for living expenses; a higher income threshold (above the level of British median income) before repayments begin, with payment holidays if income falls below that threshold; and access to finance for part-time students—an important reform overlooked in much of the comment. A graduate earning £25,000 a year would be paying just £7 a week, somebody on double that (so in the top 6 per cent of earners in Britain) just £50 a week.
One the one had, we need to invest more in higher education and improve quality, we want to see student numbers to go up overall and encourage participation by students from low income families in particular. But we must also save some public funds and ensure the affordability of repayments for graduates. Of course there are trade-offs. But the Institute for Fiscal Studies has concluded that the system proposed by Browne should be able to safeguard access, may even increase the take-up of places by reducing the complexity of student finance, and is “highly progressive.”
Finally, the structure of universities is going to change, with a radical move away from central allocation of funds and rationing of places, to a system in which the offer of a place guarantees funding for a suitably qualified student. All universities will in future have a strong incentive to focus on the needs of students (it makes no difference to their funding at present whether they teach well or badly). Some universities might struggle to improve quality, but poor performance seems a bad reason for protecting them. It’s likely that there will be more diversity in the type of courses on offer—more experimentation with two year or sandwich courses, more part time places, perhaps more universities specialising in teaching rather than research. There’s likely to be a range of fees as well.
Of course, we’re not in an ideal world of fiscal plenty. But the package as a whole will give students more choice, improve quality, allow numbers of students to rise (as long as the government doesn’t cap investment in higher education by setting a ceiling on tuition charges), and, above all, is progressive and affordable for graduates.
