A solution or California dreaming?

August 25, 2000

British ministers, keen to learn from the United States, might like to study the decision of the state of California to extend its Cal Grant programme from next year (back page). The new scheme has some striking characteristics. Criteria for eligibility, along with family income and assets, are students' high school or community college achievements and the costs of the higher education institution by which they are accepted. This provides strong incentives for poorer students to improve their high school performance and staying-on rate. The entitlement also extends to part-time study.

Second, unlike the previous Cal Grant programme, the new programme will not be cash limited: all who qualify and apply will be entitled to grants. And, because the rules cover private as well as public universities, the state cannot easily limit its liability by rationing places.

Third, the money is paid to the students. Higher education institutions will not even necessarily know whether incoming students have grants and the state will not be able to use this extra funding to attach strings to institutions.

The British government (outside Scotland) is still firmly against restoring entitlement to student grants. It looks at higher education application figures - running roughly at last year's level - and assures itself and everyone else that student numbers are up and the system of support is working.

Meanwhile, the Higher Education Funding Council for England has become so concerned at the burden of red tape on universities that it has commissioned a report from PA Consulting, quantifying the cost of accountability (Pounds 250 million) and suggesting how it might be reduced (page 4). The authors comment that while institutions view themselves as independent enterprises competing for funds, students and business opportunities, government funders regard them as public service providers accountable for delivering government's policy goals. This is the partially nationalised industry that the deputy vice-chancellor of the Northumbria University, Tony Dickson, would so like to see liberated (page 5).

Governor Davis of California has produced a scheme that might meet at least some of Professor Dickson's objectives. It recognises that different institutions have differing costs and charge differing levels for tuition. It lessens micro-management by the state. And it should help meet government objectives for wider participation among those who can least afford to meet the costs of college education.

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