New policy could axe social mobility
In the past month there has been growing controversy surrounding the higher education policies adopted by the coalition government.
One month ago, the Higher Education Policy Institute (HEPI) released a report criticising the government’s new university policies, outlined in the White Papers in June.
In an interview on Radio 4, Bekhradnia, the head of the institute, said that figures had been miscalculated, asserting that “the cost to the government is going to be much higher than they antici- pated”.
He also said that the “government’s own advisors have told them it’s going to cost them half a billion more a year than they had thought”.
Bekhradnia went on to call the government’s predictions over-optimistic, as the institute believed the government to have made calculations based on exaggerated figures.
An example he cited was the predicted average graduate earning: £100,000 a year, in real terms.
The HEPI report also said that, “most universities will be obliged if not immediately then within a year or two, to reduce their net fees to £7,500” in order to avoid losing students.
Initially 47 out of 123 universities intended to raise their fees to £9,000 but the HEPI report predicts that maintaining this high fee would cause the majority of universities to lose eight percent of their student body annually.
The government has attempted to incentivise reduced fees, by giving universities that charge £7,500 or less a margin of 20,000 full-time undergraduates to bid for.
Watchdog says that in light of this proposal, two universities have stated that they aim to reduce their fees substantially, while another ten are aiming to reduce theirs to below £7,500.
However, many opposition members have criticised this policy, saying that it is likely to result in a hierarchical educational structure.
Gareth Thomas, the shadow Universities Minister, has voiced fears about creating a system in which the top universities gain higher revenue from tuition but the same amount of governmental funding.
He warns that these “poorer universities” will be less able to improve, resulting in a stagnant “two-tier system”.
One of the government’s key policies, outlined in the white papers, is that there will be no cap on the number of students with AAB grades; a policy aimed at increasing competition across universities for the highest achievers.
HEPI’s report warns that this will push universities to create financial incentives for these students, and that these incentives will be “means blind”, resulting in scholarships and grants being offered to the more financially able students.
Eric Thomas, the president of Universities UK, has also criticised the policy, saying that it is likely to result in adverse effects on “social mobility”.
In response to these criticisms, Vince Cable has argued that this more flexible system would give universities more freedom and described the old policies as a “Stalinist system of number control”.
An LSE study suggests that the changes to higher education will also have a substantial effect on enrolment, with seven and a half percent fewer male applicants and five percent fewer females.
However, a spokeswoman for the Department of Business, Innovation and Skills has argued that the government is doing more than ever to increase tuition loans and increase maintenance grants.
She also drew attention to the progressive repayment system instituted by the government, which she believes should incentivise enrolment.
The reforms have also been defended by key governmental figures.
David Willets, the Minister of Universities, has argued that “the total income of universities for teaching could rise by ten percent between now and 2014-15”.
This comes at a time when one in five universities are in deficit, and almost half the universities in the UK are not meeting the target three percent budget surplus.
The Higher Education Funding Council for England (HEFCE) has released a report corroboraing Willets’ claim, stating that the “sector is in good financial health” and that “no institution is currently at risk of insolvency”.
However, the Grant Thornton report on Higher Education Finance predicts that while the Russell Group and 1994 Group (of which Sussex is a member) will improve their financial situation, the ‘middle’ universities will suffer from an 11 percent cut in income by 2013-2014, which would result in a significant worsening of their deficit.
The debate came to a head last week when opposition leader, Ed Miliband,announcedthatLabour’s manifesto would include a policy to cap university fees at £6,000.
In his interview with ‘The Observer’, Miliband said that this reduction would be paid for by reversing tax cuts for banks and by asking high-earning graduates – those earning over £65,000 – to pay a higher rate of interest on their loans.
He criticised Cameron and Clegg for “loading the costs of paying off the deficit onto our young people”. David Willets has attacked Labour’s pledge however, criticising Miliband for having made a U-turn in policy.
Willets said: “it makes Labour’s vote last year against fee increases look completely cynical.”