Students Staff
University of Essex

October 19, 2018

Fairness should lie at the heart of any funding reform

Universities owe it to students to create a transparent and fair higher education funding model – our Vice-Chancellor, Professor Anthony Forster, tells Times Higher Education.

The current review of post-18 education and funding aspires to be comprehensive, yet it would appear to be missing the views of students studying at university, even though it is students as a community who have the most direct experience of how the current system operates and it is their voices that should be helping to shape the funding of higher education.

Through a survey undertaken by the Institute for Social and Economic Research (ISER), we now have robust evidence on student understanding of the current fees and loans system. It is clear that the system is too complex for students to fully understand its ramifications. While some features are well understood by most, other features generate confusion.

Students have also shared their insights into the trade-offs they would be willing to accept. If tuition fees cannot be scrapped altogether, then the headline cost to students pursuing different subjects should remain the same. Students are strongly against differentiation of fees between subjects – even if they would expect personally to benefit from lower fees.

Irrespective of their own family income, students have said that they are strongly in favour of those from lower-income households receiving more financial support during their studies. They also prefer to receive more support for living costs through the reintroduction of maintenance grants, but they are not prepared to pay for it by increasing their debt.

They are particularly anxious about the prospect of the debt continuing to grow after they have graduated, and they are worried about facing a significant repayment burden on their fees and loans when their incomes might be low.

The views expressed in the ISER survey offer valuable insights into how the current system should be reformed.

There should be no fee differentiation by course on the basis of cost to teach or in relation to graduate earnings. Variable course fees would: fail to recognise the integral contribution that pan-university activities make to students’ learning; undermine the ability of universities to undertake outreach and engage with low-participation communities; and diminish the scope for universities to ensure that their research activities feed directly into the educational experience.

Varying course fees on the basis of graduate earnings is equally flawed. Jobs with a high social value such as nursing and teaching do not always pay well, but they require highly skilled individuals. Forcing universities to charge less for these courses would threaten their quality. If graduates pay back less of their fees after graduation because they are in high-value but lower-paid jobs, this should not be seen as failure in the system, but a greater collective investment in essential professional education for jobs that are equally valued by our society, even if their market remuneration is different.

The reintroduction of maintenance grants for the poorest students – scrapped in 2016 and replaced by loans – would address a student concern about taking on more debt. It would also be an important step in promoting social mobility and ensuring that all students can access the full benefits of a university education. Students are clear that they would like more support for their living costs, but are adamant that they do not want to have higher fees or higher repayment rates after they graduate.

By contrast, students have signalled a willingness to take on a higher debt at the point they graduate in return for, first, deferring the start of loan repayments until they are better able to afford them, and second, being charged a less steep schedule of interest rates after graduation.

The claim that lower-earning graduates are less likely to pay off their loan prior to the 30-year cut-off point overlooks student concerns about debt loading. While higher interest rates have been leveraged to create a more progressive repayment schedule, the fact that for most graduates the amount of debt will persist or even grow for a long time creates substantial anxiety.

Finally, it is clear that while the headline features of the current system are understood, the detailed operation is not. We see that students change their opinions about what features of the system they favour once they are presented with their financial implications. This clearly suggests that we need a funding system that is easier to understand – and seen by students to be affordable.

Intergenerational fairness is best served by older people making some sort of contribution through general taxation and the fees regime, so that younger people can benefit from a university education – in a context where those in the older generation who went to university benefited from free education. This would also provide demonstrable support to the next generation for the wider public benefits of having highly educated graduates in our society. Through this review, the government really does have a significant opportunity to create a more equitable and more sustainable way to fund university education.

Professor Anthony Forster

Vice-Chancellor

University of Essex

Leave a Reply

Your email address will not be published. Required fields are marked *