With the government launching a review of higher education funding, there has been talk about cutting the tuition fees cap or the interest on student loans. This would be terrible politics and terrible policymaking. Both ideas are ignorant, foolish and regressive. The only winners of these two policies would be older, affluent graduates, who would pay less in student loan repayments than they do now. In effect, it would be a tax cut for the luckiest, wealthiest people in society.
It is a good idea for the government to try to encourage more variability in the tuition fees that universities charge, including lower fees for particular institutions and courses. This is mainly because the high fees charged at some institutions can be especially costly to taxpayers, who have to subsidise the loans of graduates who do not earn that much in the labour market. To try to reduce overcharging, the government should apply a levy on universities that will have a disproportionately high number of graduates whose loans will be heavily subsidised by the taxpayer.
Damian Hinds, the education secretary, has rightly stressed the importance of helping people to study while they work. Part-time students are key to beating skills shortages, but their numbers have collapsed in England since 2012. Let’s hope that the government’s review will reverse this decline.
It also needs noting that Mr Hinds was inaccurate in claiming on The Andrew Marr Show that “there are more disadvantaged students going to university than ever before”. Analysis of figures from the Higher Education Statistics Agency shows that while the number of full-time students from disadvantaged backgrounds rose by 17 per cent over the past five years, the number of similar part-time students fell by 54 per cent – meaning that there has been an overall decline of 17 per cent.
The Open University
GuildHE urges the government to take this opportunity to restore student maintenance grants, to reform the apprenticeship levy to address the catastrophic decline in part-time and in-work study, and to review the gap between the way degree apprenticeships and traditional degrees are funded.
We think the current tuition fee and loan system broadly works for young, full-time students. Our main priorities for change are addressing student poverty, including by restoring maintenance grants, and addressing the massive decline in part-time study, including by allowing more flexible use of the apprenticeship levy.
Longer term, funding for higher education and degree apprenticeships must be brought closer together – it’s not sustainable to have two routes to the same qualification level where in one all the cost falls on the graduate and in the other all the cost falls on the employer.