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In the red? V-cs would fear for their coffers if tuition fees were lowered
A public letter from the Universities UK board warning Labour against a ?6,000 fee policy was needed because the party has ignored the “legitimate concerns of vice-chancellors” and the policy would cut support for students’ living costs, according to two of its signatories.
The 19 English board members of Universities UK launched a pre-emptive attack on the possible Labour policy with on 2 February.
The move may increase the chances of Labour opting to pledge that it would hold a wide-ranging Robbins or Dearing-style review of higher education if it wins the election, which could allow it to avoid a detailed policy commitment now. Nick Hillman, director of the Higher Education Policy Institute, said the chances of this were “hardening all the time”.
The letter’s signatories, led by Sir Christopher Snowden, the UUK president and University of Surrey vice-chancellor, say that “at least ?10 billion of additional public funding would need to be found” to close the funding gap for universities if fees were lowered to ?6,000. They say it is “implausible” that any government would be able to do this, so “cuts to universities” would be the result.
Sir David Bell, the University of Reading vice-chancellor and one of the signatories to the letter, said that the move was “necessary as there was increasing speculation that Labour was about to announce its policy, and little sense that it had taken account of the legitimate concerns of vice-chancellors”.
Graham Henderson, the Teesside University vice-chancellor and another signatory, said that simply cutting fees could “result in critical funds being redirected to finance this change that could otherwise be used to facilitate wider access to higher education”, such as putting “more money in students’ pockets to assist them” with their education costs.
But Gavan Conlon, partner at London Economics, which has carried out research on the resource accounting and budgeting charge (the estimated write-off) on student loans, said that the actual costs of lowering fees to ?6,000 are “nowhere near” ?10 billion.
He argued that the RAB charge on the portion of loans between ?6,000 and ?9,000 is high under the current system – meaning that cutting fees could bring a saving on future loan write-offs.
Dr Conlon said that “approximately 60 to 65 per cent of the fee income between ?6,000 and ?9,000” is being paid by the taxpayer through loan subsidies, “and a further 15 per cent is being ploughed into access bursaries” by institutions.
