Complex contradictions

September 26, 1997

Huw Richards and Alan Thomson report on evidence to the Commons the Dearing report.

Committee of Vice Chancellors and Principals

"It is a complex issue," insisted Martin Harris, chairman of the Committee of Vice Chancellors and Principals as he gave evidence on Wednesday.

This view was reinforced by John Tarrant, Huddersfield University vice chancellor, who gave as an example the problem of a British local authority attempting to means-test a Greek family in order to set a tuition fee.

The four-strong CVCP team, completed by Janet Finch and Christine King, vice chancellors of Keele and Staffordshire universities respectively, was determined to make the case for universities getting all the money raised via tuition fees. Professor Harris said he could foresee "significant political problems" if fees were not paid direct to universities.

Professor Finch argued that the fee was in effect a contract between students and universities and that diverting the money for any use other than their education would damage the contract. Professor Harris rebutted suggestions that the extra Pounds 165 million announced earlier in the week would solve university funding problems, saying it would only bring them "up to the minimums recommended by Dearing".

The MPs homed in on access issues. Labour's Yvette Cooper asked why, if further education was better at access, it should not receive some of the money.

Professor King queried her use of "better at" and consistently pointed to developing partnerships between the two sectors, adding "unless we get sufficient funding, we will not be able effectively to carry out the work we need with schools, adult education, FE, the WEA and other agencies".

Clear that fees would not deter access, the vice chancellors were happier to share MPs' fears about the final abolition of grants.

National Union of Students

NUS president Douglas Trainer was forced to justify the apparent contradiction in the union's acceptance of income-contingent loans and its opposition to tuition fees.

Mr Trainer faced a series of questions from committee members gauging the strength of NUS opposition to Government plans to introduce Pounds 1,000 means-tested tuition fees for undergraduates.

Mr Trainer told the committee: "The student union movement rejects the notion of tuition fees of any sort. Breaching the principle opens the door to charges at much higher levels in years to come." He feared that fees would add to student debt without contributing anything to higher education funding.

Mr Trainer said that the NUS had supported income-contingent loans because of the desperate need to alleviate student hardship that he said was caused largely by the previous government. He said it was important not to confuse acceptance of income-contingent loans with tuition fees.

Mr Trainer welcomed the Government's announcement, made the day before, of an extra Pounds 165 million for universities next year.

However, the NUS told the committee that it wants to see industry and business contribute more to higher education, not only financially but By providing other input and support.

Nick Barr and Iain Crawford

The Government could have to plug a Pounds 1 billion hole in the education budget next year unless it removes student loans from the public accounts, according to LSE experts Nick Barr and Iain Crawford.

They said that it was not certain that the Government would be able to sell off existing loans debt by the end of the financial year.

Mr Crawford said: "If it fails to get through then we could have a hole in the education budget of about Pounds 1 billion, requiring some rapid thinking." He and Dr Barr told the committee that the only way to solve the short and long-term funding crisis in higher eduation was by the Government changing its accounting rules.

They say this could yield a "pot of gold" of Pounds 1 billion. Student loans are classified as part of the public sector borrowing requirement that the Government must keep low, limiting the amount of money available.

The pair's plan is for student loans to be tied to an income-contingent repayment systemcollected as part of income tax or national insurance. If loans were removed from the PSBR it should then be possible, they argue, to use the private sector, which is assured of a stable repayment system, to provide the money.

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