The free market think-tank Reform has recommended that the £3,145 cap on tuition fees be scrapped.  Reform’s report, The Mobile Economy, advises removing both the tuition fees cap and all government funding to universities to create a free market in higher education.  The report calls for a system which would allow British universities independence in “decision-making over fees, student numbers, curriculum and staffing and capital investment”.  

Reform’s report lays out a scheme whereby the £9.6 billion budget for higher education would be reallocated through a voucher scheme.  Each 18 year-old would be given a non means-tested voucher of £13,000 to spend on university or vocational education.  This support would be available to all students on top of the existing student loans system.

Laurie Thraves, the author of the report, argues that these reforms would benefit students by giving them more choice and greater consumer power.  As well as lifting the tuition fees cap, the reforms Thraves recommends would allow universities more freedom to design their own courses by disestablishing the Quality Assurance Agency, allow institutions to set their own salaries, forecasting the demise of national pay bargaining.

Thraves also calls for an end to caps on student numbers, which he says give the most popular institutions an unfair advantage which “places them in a comfort zone in which they don’t have to think entrepreneurially”.  The report says that making universities more independent would encourage them to act more entrepreneurially and improve the quality of courses offered.

The report was launched by the Conservative MP and Shadow Universities Secretary, David Willets.  Willets, however, was keen to emphasise the report did not outline Conservative policy, and he commented on the potential problems of a voucher system, which he said would be unfair to mature students and ignored variation in the costs of different courses.  He said: “a degree in engineering costs so much more than a theology course – it’s hard to see how giving everyone a standard sum of money would work.”

Debt is already a major worry for today’s students, and the National Union of Students (NUS) argue that an increase in fees would deter people from undertaking higher education study.  Wes Streeting, NUS President, said: “Against the current economic backdrop, it would be extremely foolish to trust the provision of any major public service entirely to the market.”

“These proposals would put the long-term security of thousands of vital courses serving our most deprived communities in jeopardy. They would confine the vast majority to a utilitarian education system based on weighing up financial risk.”  In the face of these criticisms, Reform cited countries charging the highest fees as also having the highest participation rates.

The report also faced harsh criticism from Universities UK, who admitted that the question of funding for British universities requires serious debate, but added: “What the funding debate needs is informed and thoughtful analysis and discussion, not the headline-chasing soundbites and outdated assumptions presented in this report”.

Wendy Piatt, Director General The Russell Group of universities, was more sympathetic, saying: “International comparisons of universities have shown that the most successful universities are those that are allowed to operate independently – particularly those with autonomy over their budgets,” but the group refrained from endorsing the report’s reforms before a more substantial survey of different funding strategies across the world had been carried out.

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