Correspondents argued last week that higher education should be free ("Professors call for fee and grant rethink").
We agree completely that higher education should be free at the point of use. Upfront charges, whether through fees or parental contributions put access at risk - and mostly for the very people we (and the government) wish to encourage into higher education.
They then go on to argue that higher education should be funded through taxation. This is a blind alley. It was feasible - albeit regressive - when we had an elite 5 per cent participation rate. It is not possible with the mass 30 per cent system that (thankfully) we now have, particularly given the demands of an ageing population, of the NHS, and of nursery and school education (which is where the real barriers to access occur).
The solution is both different from and similar to that proposed - a proper loan system, designed explicitly to improve access.
The government has already taken the first praiseworthy step by announcing that loans will have income-contingent repayments (i.e. x per cent of a graduate's subsequent earning until the loan is repaid) collected as a payroll deduction, and hence automatically tailored, month by month, to what the person can afford. Low earners make low repayments, people with no earnings make no repayments. The government's next step - and a vital one - should be to increase loan entitlement to cover all living costs, to a level 25 per cent above the current maintenance package, and all tuition fees. The package should also be extended to part-time students and postgraduates, who are now disenfranchised. That way it will be possible to say to a young person: "Go to university; your living costs and fees are covered; you do not pay a penny at the time; you get your degree and go out and get a job; and when your earnings exceed a certain amount, you pay a small percentage of income on top of income tax as a contribution to the cost of the next generation."
Thus higher education is paid in general not by taxpayers but by graduates. The difference is fundamental. There is no regressive transfer from shopworkers to young people from private schools. Instead, people pay for the benefits they derive from higher education. But, because repayments are tailored to individual income, they contribute only if they benefit and only at times when their earnings make such a contribution possible.
Nicholas Barr. Senior lecturer in economics. London School of Economics
Iain Crawford. Visiting research fellow. Centre for Educational Research, LSE