Fall of bill may make fees soar

TUITION fees could soar if peers and MPs fail to reach agreement over the Teaching and Higher Education bill in the next few weeks.

The bill, designed to prevent top-up fees, abolish maintenance grants and set up income-contingent loans, is in serious danger of falling after peers voted overwhelmingly for a third time this week to reject Scottish tuition fees policy.

If there is no agreement on the so-called Scottish anomaly by the end of the current parliamentary session then the bill automatically falls. It can only be reintroduced in the next parliamentary session, meaning it could become law only well after the start of the new academic year.

The National Union of Students said: "The government cannot possibly keep up this ridiculous position over an illogical clause in its flagship legislation. For the sake of students we ask the government to end its constitutional bickering."

Peers voted by 319 to 108 on Tuesday for the amendment that fourth-year tuition fees be waived for all UK-domiciled students studying for their first degree at a Socttish university. They look set to fight the government all the way over its plans to charge English, Welsh and Northern Irish students up to Pounds 4,000 while charging Scots and other EU nationals up to Pounds 3,000. The government admits that it would cost just Pounds 2 million to end the anomaly.

The government shows no signs of giving in even though it is well aware that it risks delaying legislation crucial to its reform of the grants and loans system. The bill also underwrites government promises to students that no university will be able to charge more than the prescribed Pounds 1,000. Institutions that do so would have any extra income clawed back.

A senior source in the Department for Education and Employment said that there was no chance of the government backing down because the Lords' amendment would lead to the larger anomaly of having to exempt students from fourth-year fees at English universities. He said this would cost Pounds million, which would have to be taken from the Pounds 40 million earmarked for improving access in 1998-99.

He said: "There is no question of the bill being lost. We have a strong case and we will continue to seek to persuade the Lords."

Ministers have tried to claim that the House of Lords has overstepped the mark in rejecting policy that "involves charges on public funds". But peers, speaking in the debate before Tuesday's vote, denied this and pointed out that it was questioning legislation that had been attacked by almost every higher education-related body including the Committee of Vice-Chancellors and Principals and the NUS.

The bill is due back before the Commons next Tuesday. The Lords' amendment will almost certainly be overturned and, based on the strength of Tuesday's vote and in the absence of a compromise from the government, peers will be sorely tempted to reinstate their amendment when the bill returns. Opposition parties are anxious not to lose the bill and say they will continue to seek a compromise.

* Attempts to challenge the government over the Scottish fees anomaly in the European court may founder on the wording of the Treaty of Rome. It specified that EEC rules and regulations apply only to relations between the nations which have signed the treaty. The United Kingdom, not England, Wales, Northern Ireland or Scotland, is the member state.