A transformation of higher education funding in Wales could give it a “more attractive” system than England by creating “exceptionally generous” support for students’ living costs, funded by ending subsidies for tuition fees.
A Welsh government-commissioned review that reported this week, led by University of Aberdeen vice-chancellor Sir Ian Diamond, recommends that public funding currently used to subsidise tuition fees via universal grants should be ended and switched “towards improved maintenance for all full-time and part-time undergraduate students”.
Under the review’s recommendations, fees would be allowed to rise to the same £9,000 cap in place in England to be repaid by graduates via income-contingent loans. The Welsh student contribution to fees is currently limited to £3,900 a year thanks to public subsidies.
The review recommends using these savings to fund a £1,000 maintenance grant for all Welsh-domiciled students.
In addition, poorer students would be allocated a maintenance grant amounting to £8,100 a year. There would be maintenance loans for all those not eligible for the grant.
The UK's Conservative government has opted to scrap all maintenance grants for students in England to save money, instead offering loans.
The Welsh government will have to decide whether to implement the Diamond review’s plan. Labour currently forms the government in Wales, but with sole Liberal Democrat Assembly Member Kirsty Williams as education minister.
Gavan Conlon, a partner at consultancy London Economics who was a member of the review panel, said a key decision taken by the review related to whether to allow Welsh students to take their funding with them when studying elsewhere, including in England.
“The decision was taken that all students should be treated equally – there should be no limit on aspiration in terms of where individuals study,” he said.
Once that decision was taken it left the “untargeted” tuition fee subsidy looking “hugely expensive”, he added.
The savings from scrapping that subsidy would fund “an exceptionally generous maintenance package”, which evidence suggests would be “more effective” in encouraging students “to enter higher education and remain in higher education” than tuition fee subsidies, Dr Conlon said.
He said the system proposed for Wales was "certainly more attractive” than the one in place in England, although he added that the exact level of maintenance support provided “depends on your household income”.
The review also recommends extending the new student support system for full-time undergraduates to both part-time students and taught master’s postgraduates. This was “hugely important”, said Dr Conlon.
He said the review’s plan would still save the Welsh government money overall compared with the current system.
Nick Hillman, director of the Higher Education Policy Institute, argued that “in some ways, such as on £9,000 fees, the Welsh package brings Wales closer to England and further away from Scotland”. The Scottish National Party government has scrapped tuition fees in Scotland.
Lucy Hunter Blackburn, a former head of higher education for the Scottish government, said that if the Welsh plans were implemented, Wales would be “almost perfectly opposite to Scotland - using its cash support entirely for maintenance, in a substantially means-tested way, while Scotland uses its cash subsidy almost entirely for universal tuition fee support, with only a small amount as means-tested maintenance”.
Sir Ian told Times Higher Education that the review recommends a system that is “really good for Wales in terms of having exciting opportunities for Welsh students and a system of higher education which is globally strong”. He said the maintenance grants would be designed so that “the squeezed middle” are supported.
He added that there was “a diversity of systems” within the UK. “It will be possible and useful for people to look at the diversity of those systems over time and reflect on both costs to the state and to the student – and the benefits of different systems.”