Read "Free Our Universities to Charge Whatever Fees They Can Get" by Ba(London, England), July 7, 2000 | Questia,

Your Online Research Library

04-05-13 18:02

Hello, Felipe

Free Our Universities to Charge Whatever Fees They Can Get

Barr, Nicholas, The Independent (London, England)

THE GOVERNMENT, the vice-chancellors and the rest of us want improved access to high-quality university education. It will require a lot more resources. Over the past 10 years, the number of students has almost doubled but funding for universities has hardly changed. The Russell Group Report, published today, was commissioned by the vice-chancellors of the country's leading universities to discuss how to deal with the problem. The report puts forward a strategy with three interlocking pieces: the ability of each university to set its own fees, more scholarships and other direct measures to improve access, and a well- designed loan scheme. Yet the Russell Group vice-chancellors are worried that the strategy is too radical, and the cover of the report notes that "the analysis and conclusions... should not be attributed to the Russell Group or any of its members." It's a cop-out on their part. The reality is that the report's strategy is not only feasible; it is the only way to achieve access and quality. The Russell Group vice-chancellors may think that being nice to government will bring more public funding, but there is now many years of evidence that that is politically and economically unrealistic. The UK now spends the lowest fraction of GDP on higher education of any OECD country. In kicking the report into touch for further study, the vice-chancellors are turning down a golden opportunity to support access and quality with actions as well as words. The report advocates scholarships for students from poor backgrounds. But scholarships are not enough. Extra teaching is needed to make sure that once a student starts at university, he or she gets the support to make the transition successfully. In addition, more resources are needed earlier in the education system, which is where the real barriers to access occur. That means more money for schools. It also means raising schoolchildren's aspirations. Perhaps the single most devastating barrier to access is an attitudinal one: many children do not even think of going to university. The question, obviously, is where the money will come from. Historically, with a small university system and a limited range of subjects, central planners could determine funding levels for different universities. Recent years have seen two welcome changes - many more students and much greater diversity in what universities offer. Universities therefore need widely different funding levels, a problem which is now too complex for central planners. Different universities should charge different fees. In contrast with the US, that does not mean a free-for-all. Rather than "big bang" deregulation, there should be a phased relaxation of government control of fees, accompanied by a parallel expansion of student loan entitlement. Some people argue that higher education should be paid for entirely out of taxation. They are wrong. Free tuition is expensive. Public spending on universities is at the expense of nursery education, reduced class sizes and a more generously funded National Health Service. Yet the benefits of public spending on universities go to those attending university, the very people who disproportionately come from better-off backgrounds. As the report points out, an applicant from a private school is 30 times as likely as one from a state school to go to one of the top 13 universities. Free tuition is badly targeted; the money would do much more if directed at people for whom access is most fragile. With flexible fees there could be larger subsidies for access to universities whose costs are high because of the need for remedial teaching. Thus flexible fees benefit all universities. Balls Pond Road Tech College cannot compete with the LSE on quality. It certainly could on price. It is only right that universities charge fees. But - in contrast with America - university should be free at the point of use. That is why a well-designed loan scheme is essential. I have long argued that the central feature of such a scheme is income- contingent repayments, that is, repayments in the form of x per cent of
http://www.questia.com/read/1P2-5095113/free-our-universities-to-charge-whatever-fees-they Pgina 1 de 2

Read "Free Our Universities to Charge Whatever Fees They Can Get" by Ba(London, England), July 7, 2000 | Questia, Your Online Research Library

04-05-13 18:02

earnings collected alongside a borrower's income tax until the loan has been repaid. The introduction of such loans in 1998 was an enormous step forward. Repayments are automatically tailored to ability to pay; low earners make low repayments; people with no earnings make no repayments; and the repayments of someone whose income falls sharply, instantly fall sharply in parallel. A person's repayment is determined not by where he or she starts but by where he or she ends up. This has a strong appeal to social justice. Second, loans should be sufficient to cover all fees and all living costs. Thus it is possible to say to students (and their parents): "You go to university; you have enough to live on; it is all free at the time; you get your degree and go out and start earning; and only if your earnings are high enough do you repay some of the costs of your degree - a no-lose bet." Third, students should pay an interest rate on their loans broadly equal to the Government's borrowing rate, not the much higher rate for unsecured commercial loans nor the lower interest rate that students currently pay, which requires a taxpayer subsidy. Interest subsidies are inefficient, expensive and unfair. Well- off students take out the maximum loan and put the money into a bank to make a profit. On the Government's own estimates, confirmed by simulations at the LSE, interest subsidies mean that about one- third of lending to students is never repaid. If total lending by the Student Loans Company is pounds 1.2bn (this year's figure), the long-term cost of interest subsidies on this year's loans is around pounds 400m - enough to pay one-year maintenance scholarships to 75,000 students. Flexible fees and an interest rate broadly equal to the Government's borrowing rate together save hundreds of millions of pounds of public spending each year, making possible wide-ranging measures to promote access and restore quality. Flexible fees supported by income-contingent loans redistribute from today's middle class (who lose a fraction of their tuition subsidies) to tomorrow's least well-off (who, with incomecontingent loans, do not repay in full). This is redistributive beyond anything contemplated by successive governments. The vice-chancellors should have the guts to go for it. The writer, a reader in economics at the London School of Economics, was a member of the Russell Group
Questia, a part of Gale, Cengage Learning. www.questia.com Publication information: Article title: Free Our Universities to Charge Whatever Fees They Can Get. Contributors: Barr, Nicholas - Author. Newspaper title: The Independent (London, England). Publication date: July 7, 2000. Page number: 4. 2009 The Independent - London. Provided by ProQuest LLC. All Rights Reserved. This material is protected by copyright and, with the exception of fair use, may not be further copied, distributed or transmitted in any form or by any means.

http://www.questia.com/read/1P2-5095113/free-our-universities-to-charge-whatever-fees-they

Pgina 2 de 2