Raising the current £3,000 cap on tuition fees is likely to be "part of the way forward" for university funding, leading educationalist Lord Dearing said this week.
Speaking at a Universities UK conference, Lord Dearing said higher education needed "markedly higher" levels of funding if UK universities were to remain at the top of the world rankings.
But the sector was on "a long list" when it came to the need for more public funding, meaning higher education "may need to look beyond the state" to meet any further significant increase in the unit of funding for tuition costs, he said.
Looking ahead to the review of top-up fees in 2009, Lord Dearing, who first proposed tuition fees in a report ten years ago, told the conference: "The imperative need for substantial increases in income for leading institutions to remain in world rankings... suggests to me, as foreseen by my committee in 1997, that differential fees will be a part of the way forward."
The advantage of lifting the cap on fees was that "it would in fact lead to differential fees and lead to institutions consciously seeking different missions to respond to different opportunities," Lord Dearing said. But the argument against it "is that to break into such new ground is to move into the unknown and the risk of some serious accidents and a period of damaging instability," he added.
He said this led to the possibility of "identifying a middle ground" with some cap, but set at a level that would lead to differential fees. In his speech, Lord Dearing also discussed the possibility of a graduate tax.
Last year, Education Secretary Alan Johnson said he would like to see a "marketplace" in higher education. However, currently there is little variation in what universities charge, with only a handful of universities opting to charge below the current maximum of £3,070.