An elitist's manifesto

September 17, 2004

Tory plans for higher education funding would restrict access, argues Vincent Carpentier.

The Conservatives' "Funding the Future" has been presented as a radical project for higher education that will have overall benefits for students, parents and universities. It also attempts to make university fees a key issue in the forthcoming election.

But measures such as the introduction of a government-funded national scholarship for students and student loans based on commercial interest rates have to be seen in a historical perspective. UK expenditure per student started decreasing in the early 1990s. Since 1999, funding per student has been stabilised, but it remains well below the US level. The Government's response to this situation was the Higher Education Act, which sought to establish a fair and efficient world-class higher education system while arguing that the 50 per cent participation target could not rely only on public funding.

The Act's main measures are top-up fees and the promise of an increase in public funding. As last year's heated debates showed, it remains to be seen whether this commitment to increase public expenditure will be strong enough to maintain access for poorer students and sustain expenditure per student.

What do the Conservatives' proposals offer to this debate? There are lessons to be learnt from the past about the relationship between access and funding - in particular, the crucial role played by financial aid in promoting access. Under the Conservative plan, well-off students who do not need loans for living expenses will obtain free education. But those having to take out loans will have to pay a higher interest rate, and interest charges will be a heavier burden for graduates on low salaries who will take longer to pay off their loans. Abandoning the 50 per cent participation target may be an upfront acknowledgment of this likely outcome.

With the Labour policy, there is a risk that the increase in fees will be used to reduce public funding rather than to create additional resources for universities.

But under Conservative plans it is unlikely that scrapping fees will increase the funding available to universities, unless it is combined with alternative resources. The national scholarship and the savings on the student loans subsidy will replace the current system of grants and fees, but any plans for extra funding in the future are not clear. In that respect, the plan represents a medium-term commitment to increase public resources rather than a long-term viable system that would provide a stable income for universities. There are in particular uncertainties about how the Conservatives intend to organise a system of private contributions, which inevitably tend to fluctuate. It is possible that, in the long term, a Conservative government would have to cut the number of scholarships it offers or invest massively to compensate for the lack, or instability, of resources.

Finally, what about the level of funding per student? The Conservative policy of the 1980s led to a rise in expenditure per student, which was the combined result of limiting the increase in participation, stagnating resources and a drop in the number of staff per student.

At first sight, Labour's proposal based on top-up fees looks reactionary, while the Conservatives' abolition of fees seems quite progressive. But it is difficult to judge a particular measure in isolation.

An increase in fees won't necessarily harm access. It depends on the mechanisms put in place to sustain it. And here Labour may indeed be faulted. But, similarly, the abolition of fees won't necessarily promote access. A system combining higher interest loans for living expenses and vouchers could harm access.

It looks as if what the Conservatives are proposing is an ancien régime of higher education that would solve underfunding issues by limiting access, rather than increasing resources.

Vincent Carpentier is a research officer at the Institute of Education, University of London. His research project on higher education and the UK socio-economic system was supported through an Economic and Social Research Council award.

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