David Willetts has urged anyone with ideas about how to improve postgraduate student funding to come forward - but has also warned that any state-funded solution would inevitably come with Treasury-imposed number controls on admissions.
The universities and science minister made the remarks at the Neil Stewart Associates Sixth Annual UK Research Conference, held in London earlier this week, titled Research Excellence Framework: Strategies for Success.
Fears have been raised in the sector that the increase in undergraduate tuition fees and the accompanying rise in debt upon graduation will make students less inclined to pursue postgraduate study.
Currently, postgraduates cannot access Student Loans Company support. The UK research councils no longer offer studentships for master's students and in some cases have also reduced the number of PhD studentships they offer.
The government has pledged to monitor the effect of the new undergraduate fees regime on postgraduate recruitment.
Mr Willetts acknowledged the recent proposal by Tim Leunig, chief economist at the CentreForum thinktank, for a government-backed loans scheme for master's students based on the undergraduate loan system. He also mentioned Libby Hackett, chief executive of the University Alliance, who recently travelled to Australia with a view to advising Mr Willetts on how that country's postgraduate student loan scheme could be translated to the UK.
But the minister said that one of his "frustrations" about the postgraduate funding issue was that there "isn't a particularly lively debate in the sector" about it. He said people with ideas about how to address the problem should make themselves heard. He also warned that "every time you bring an ingenious idea for public funding, it also brings with it number control".
Mr Willetts added: "You are not going to have an open, demand-driven system agreed by the Treasury. Every time we make something more generous, we also create an equal and opposite reaction of having to constrain the numbers."
Meanwhile, Sir Peter Scott, professor of higher education at the Institute of Education and a former board member of the Higher Education Funding Council for England, told the conference that it would be "naive" to assume that the research funding landscape would not be affected by the changes to teaching funding in "substantial but unpredictable" ways.
He put forward one "highly speculative" suggestion that increasing student fee income might make some humanities departments prioritise prestige over funding in their REF submissions, which could lead them to submit fewer academics than previously.
"However insulted they may feel about withdrawal of all teaching funding, if they are able to maintain their recruitment [of students] they will nearly always receive more funding than they [did] through the old system," he noted.
Sir Peter added that the fact that Hefce no longer distributed large amounts of teaching funding could allow the body to change its approach: "It no longer has to worry about the overall consequences of the funding it provides. It is free in a sense to be much more selective."
Mr Willetts also used the conference to reiterate his support for collaboration between universities - which he acknowledged appeared at odds with his free-market Conservative philosophy.
He said that although he regretted the tight constraints on university capital funding, its effect of forcing English institutional groups such as N8 to follow Scotland's lead on pooling capital equipment was a "welcome by-product".
David Willetts on the REF
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