It’s time to radically rethink university tuition fees – The Guardian

9,000 tuition fees need to be replaced with a fair and financially sustainable system. Photograph: Getty

University tuition fees are back in the spotlight. Labours manifesto pledge to abolish fees saw a re-energised student constituency help put paid to expectations of a Conservative majority. Now, Conservative political leaders are scrambling to respond to the issue. The overwhelming impression we are left with is that the current system has lost credibility. It must be swept away and replaced with one that is both fair and financially sustainable.

Students and their parents feel they have been unfairly treated by paying the bulk of their higher education costs themselves they are right. Under the 2017 system the average debt for graduates is over 50,000, with students from the lowest income families averaging nearly 60,000. This is politically unsustainable.

I believe there needs to be a fresh approach. It is in the national interest for universities in England to be able to educate students, carry out research and contribute to the community. A strong university system is crucial for economic and social development, with society and businesses alike benefiting from a well-educated graduate workforce so it is fair that they should foot significant proportions of the cost.

The pre-2012 system was a reasonable compromise, with students paying approximately one third of the total fees through an interest-free, index-linked government repayment scheme.

Since there are three beneficiaries of higher education, there should be three principal sources of funding: taxpayers, companies and the individual. As well as tuition fees and general taxation, there should be a payroll tax or levy on enterprises with the proceeds earmarked for higher education. Introducing a contribution from companies will ensure that philanthropic funding provides a vital boost without serving as a substitute.

There is a pressing need to develop a new system, now that several recent developments have thrown into sharp relief how unsustainable the 2012 student finance system is. Firstly, the rate of interest on student loans from September will be an eye-watering 6.1%. This means that most recent graduates will find their real debt increasing in their early years of graduate employment, even though they are making payments through the tax system and paying tax after 21,000 at a rate of 29%.

Secondly, the decision to bring nurses and midwives into the fees system attacks a large and valuable group. These students are studying to enter professions that are highly valued socially but poorly paid. Entrants to these professions are much more likely to be drawn from working class backgrounds than those of other professions such as medicine, law and accountancy. While studying, these students are expected to work 2,100 hours in practice, on the wards and in the clinics. The student midwives need to successfully deliver 40 babies. Nursing and midwifery students work night and weekend shifts how are they to undertake paid holiday jobs and part-time work?

Successful nursing and midwifery graduates will typically progress to earnings of around 35,577. Graduates with an average debt of 50,000 will find that it never diminishes in real terms until it is eventually written off after 30 years. The impact of the student loan system is that our nurses and midwives will simply receive a take-home pay cut of 4.8% (at the top of the scale). This makes absolutely no sense when there is a significant and growing national shortage throughout England of both nurses and midwives.

The fee reform has also had a disastrous impact on the number of part-time students and mature students. This has made much-needed continuous professional development more difficult. The government should contribute to provide re-training and re-education instead the current system inhibits this.

Immediate action is needed in parliament to restore an inflation uplift only arrangement for student fee debt and for HM Government to meet the fee costs for nurses and midwives. I am optimistic that a majority can be secured for both proposals.

One question remains: would abolishing fees mean a re-introduction of a cap on student numbers? While I welcomed the abolition of the overall student number control, it is clear that it has had detrimental effects. It was neither necessary nor good policy for all number controls to be abandoned on all individual institutions. This has simply resulted in greater competition for students to come to university X rather than Y. It has not resulted in a concerted effort to increase the number of students studying at university. In fact, numbers of full-time students are dipping slightly and numbers of part-time students have diminished very sharply.

Instead, government should abolish the overall number control while subjecting individual institutions to a form of crawling peg control, dampening individual fluctuations while still allowing for overall growth and for institutions to grow or decline in the medium term. A new form of clearing could be introduced for all unplaced and appropriately qualified students at the end of the admissions cycle. This will widen participation and lead to sustainable reform.

Current higher education policy makes it likely that many universities will become financially unstable amid the scramble for students. We are already seeing the early warning signs with the 4% drop in applications and announcements of job loss programmes in a number of institutions. Reform is needed now in the interests of the students, graduates, universities and the country as a whole.

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It's time to radically rethink university tuition fees - The Guardian