So student fees will cost more than the old funding system. Now what?

It’s been something long predicted, but today the Guardian finally reports on the fact that the RAB charge for student loans is now on the cusp of the 48.6% figure identified by HEPI as a break-even point. What this means is that – despite Liberal Democrat hand-wringing about difficult choices at the time – the imposition of large student tuition fees is on the point of costing the government more than the old (pre-2011) system of higher education funding via HEFCE.

Any argument about the change being needed to bring down the deficit is now dead in the water. And there are important implications about the planned use of fee repayments to raise the student number cap.

This leaves us saddled with an expensive, unwieldy system that – as I have already discussed – doesn’t do any of the things it was designed to do.

Now what?

First up – we need another independent parliamentary inquiry into HE funding, similar to the Browne review in that it would be supported by all parties and report after the handily placed 2015 general election. My preference would be for a much more technocratic inquiry with the close involvement of existing HEFCE staff and the likes of HEPI. (Sir Michael Barber should not be involved, under any circumstances.)

The report should be bold and be backed by as much expert advice as can be mustered. My suspicion is that it would want to advocate a return to a system with a greater level of central control, and ensure that stability and affordability are baked in to the proposals.

Secondly – as much as it pains me to say it, we need to hold on to the student number controls for a little while longer. Allowing university access to anyone who would benefit from it is absolutely the right thing to do for the long-term future of the country. But given the current system, it is not affordable. We need to build a system where it would be affordable and return to it.

Thirdly – we need to look at why the graduate job market looks so bleak that these repayment estimates keep going up. Generation Y have been hit particularly hard by the uneven and delayed economic recovery – we need to do some serious work in creating well-paid and dependable jobs for all young people.

Fourthly – Nick Clegg should apologise. Again, for lying to us in his initial apology. “I shouldn’t have committed to a policy that was so expensive when there was no money around” – he can say that again in relation to the policy he actually did commit to. Other members of the government should also apologise, but particularly Nick.

Fifthly – (and I admit this is unlikely) we should look again at the imposition of a market in HE – and in other areas of the public sector. Markets have never saved money in the delivery of public services. They have never driven up quality. We need to abandon it as a failed experiment and move on.

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