Following on from earlier announcements by Oxford, Cambridge and Imperial that they intend to charge the maximum possible tuition fees from 2013 for undergraduate courses of £9,000 per year, Exeter university has entered the fray today by indicating it will follow suit.
The Exeter announcement is important, as they are the first university outside of the “Russell Group” of self-proclaimed elite establishments to decide to do this. I’m hoping that BIS are looking on with a degree of alarm and concern about this development as it suggests that many universities will now do the same.
By dint of the way that the complicated funding maths works out, this development means that the taxpayer will be paying even more to fund university education in the future than under Willett’s and Cable’s over-optimistic projections that the average fees would end up around £7,500 per year and that “low-cost” subjects such as arts and humanities would be closer to £6,000 per year.
Remember that the introduction of the new funding arrangements were going to mean it costing the taxpayer more, not less, than the current arrangements during the period of the current comprehensive spending review (i.e. between now and 2015.) If the average fee is going to be closer to £8,000-£9,000 per year, then it will cost taxpayers more still. The universities get the money now, of course, not as the students pay it back, so it needs to be found from somewhere along with the interest that the government will incur borrowing it on our behalf. This is in addition to saddling the majority of students with the equivalent of an extra 9% tax bill (over earnings of £21,000 per year) for up to 30 years after graduation.
That 9% “graduate contribution” is significant. It will obviously reduce graduate disposable income and mean they won’t be spending it their local economies helping the business community to thrive and so create jobs. It also probably means that they won’t be saving towards their pensions either. I’m glad I’m probably not going to be alive (or at least, not be a taxpayer!) in 2060 to pick up that “little bill” from the welfare state.
So we already know that Willetts and Cable have been caught out. After all, if you tell someone they can charge “up to” an amount for a service that while not a monopoly is certainly one delivered by two or three cartels of universities, what cartel would say that they would charge less than that amount?
There’s also the prestige argument being advanced. If you charge less for something, it’s obviously not going to be perceived as being as good as the more expensive item. Reality is usually different of course – Apple iPads are expensive, certainly, but they’re not as good for the purposes I require, or as cheap, as (say) an Android tablet. However, UK universities seem to believe that they are all Apple iPads rather than Google Androids and that they need to be perceived in this way to be taken seriously on the international stage.
Whether or not university VCs become seen as the next “greedy bankers” will depend to a large extent on how slickly Willetts and Cable can argue the case that they simply don’t need to put their fees up this much to replace the direct funding from government they will lose. They’ve done a pretty poor job of this so far, of course. However, there’s certainly a chance that the coalition will be able to portray the £9,000 a year universities and their VCs in this way. Public anger, whipped up by the usual suspects in the media is an easy thing to re-direct when organisations are apparently attempting to get away with shady pricing practices.
It’s interesting that the registrar and deputy CEO of Exeter University in his email to current students today doesn’t attempt to justify the £9,000 a year price tag for undergraduate courses by saying it’s necessary to fill a funding gap. Instead, he concludes:
I am sure you will share our confidence that Exeter should seek to be in the same fee bracket as universities such as Oxford, Cambridge and Imperial, which have already signalled their intent to charge the full amount.
I sense that a whole new set of battle lines in the funding debate for higher education are about to be drawn. It will not end well for anyone.