The Higher Education Policy Institute today publishes a new
report entitledHow Should Undergraduate Degrees be
Funded? – a compendium of essays edited by Rose Stephenson,
Director of Policy and Advocacy at HEPI.
The report explores a range of potential funding models for
undergraduate education, against a backdrop of financial
sustainability concerns for higher education institutions.
Key findings:
- Abolishing tuition fees would cost the public purse £10.5
billion per cohort and sees onlya tiny rise in the percentage of
potential students who would be likely to apply to university.
- The most popular proposed alternative model with potential
students is the graduate employer levy – where employers pay a
small percentage of graduate salaries to fund higher education.
- Potential students are already carefully considering the cost
implications of living in different university towns when making
their application choices.
- Half of potential students say they won't apply to university
if fees rise with inflation.
Ahead of the upcoming general election, HEPI is focussing on the
significant policy questions about the future of higher
education. This report arrives at a crucial juncture, as the
sector seeks to adapt to a challenging economic environment while
still meeting the expectations of students and society.
The collection includes authoritative contributions from student
leaders, leaders of higher education and two former Ministers for
Universities. Proposed funding models include: dismantling the
marketisation of higher education; differentiated tuition fees
tied to Teaching Excellence Framework (TEF) outcomes; and
innovative proposals like a graduate employer levy.
Each proposed model has been analysed by London Economics for its
economic impact on students, institutions and the public
purse. Polling was undertaken (by UCAS on behalf of HEPI)
with potential students to understand better how each model might
impact application rates, providing a unique window into the
minds of those directly impacted by funding decisions.
Rose Stephenson, Director of Policy and Advocacy
said:
‘Higher education institutions across the UK are under financial
strain. In England, the cost of higher education is
disproportionately borne by graduates, and in Scotland, it is
disproportionately borne by the state. This report aims to
breathe new life into the debate on university funding before the
election, analysing different options, including how the cost of
higher education could be split between graduates, the state and
employers.'
In his contribution, the Rt Hon. the Lord Willetts,
Minister for Universities and Science (2010-14), writes:
‘The forthcoming election presents a dilemma to both big
political parties. They have to say something about higher
education, but they do not want to nail their colours to any
particular proposal now. A review of the calibration of the
scheme is a way to avoid political traps now and give them
maximum room for manoeuvre after the election.'
In his chapter, the Rt Hon. the Lord
Johnson, Minister for Universities and Science (2015-18),
writes:
‘Finding a higher education funding system that protects
both the student and taxpayer interest is not complicated. We do
not need a big review. The mechanism to link funding to quality
exists already in law in the Higher Education and Research Act
2017 (HERA).'
In her piece, Chloe Field, NUS Vice President for Higher
Education, writes:
‘Higher education needs to be publicly funded and in public
ownership, not only to ensure access for all students from all
backgrounds, but also to make sure every single community has a
stake in their universities, and that they are run as truly civic
institutions. We must invest in all areas of education and build
a system that will ensure a future for my generation and for our
planet.'
The other contributors to the collection are:
- The Rt Hon. James Purnell, President and Vice-Chancellor of
the University of the Arts, London, who proposes some radical
reforms to student loans including a stepped repayment model.
- Johnny Rich, Chief Executive of the Engineering Professors'
Council and Chief Executive of the outreach organisation Push,
who proposes a levy on graduate employers.
- Alison Payne, Research Director at Reform Scotland, who
proposes a graduate contribution model for Scotland.
- Lily Bull, Policy Manager at the Russell Group, who writes
about the financial sustainability of higher education
institutions.
