Private sector poised for boom

January 17, 1997

PRIVATE higher education could absorb rising student numbers without increasing the Government's education budget burden and without excluding students unable to pay tuition fees, a key private sector academic will tell Sir Ron Dearing later this month.

Marcel van Miert, director of the European Business School and prospective chairman of the Council of Independent Colleges and Research Institutes, will tell Sir Ron in a meeting on January 23 that the private sector is set for a "dramatic boom" if given the right cash incentives.

Mr van Miert will recommend the introduction of a significantly bigger student grant for those who choose private sector higher education in favour of the public sector. "The Government spends around Pounds 6,000 per student on fees and maintenance in public higher education at the moment," he said. "This could be cut dramatically if it offered a bigger maintenance grant to students who opted for the private sector but who had to pay their own fees."

Under Mr van Miert's model, a private sector grant would be bigger than the public sector student grant, but much lower than the total amount the Government pays per student. "Those who could afford it would choose the private sector, freeing places in the public sector for students from lower income groups who could not pay their own fees."

The abolition of VAT on private degree course education was another of Mr van Miert's recommendations. "Private institutions have to either charge more for their courses or lose about 17.5 per cent of revenues because of VAT. If people can't make a profit then they will not invest in private higher education."

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