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Raising tuition fees cap to £16,000 would “increase inequity”, think tank warns

Lifting the tuition fees cap to £16,000, as proposed by Oxford University’s Vice-Chancellor, would lead to an inequitable two-tier higher education system, a universities think tank has warned. 

The idea has also been attacked by lecturers and student union leaders, who said Oxford’s Professor Andrew Hamilton was “astonishingly out of touch” with the financial and political realities of higher education funding.

Professor Hamilton suggested that the fees cap should be lifted to reflect the “real cost” of undergraduate courses, questioning the sustainability of the £9,000 upper limit on fees when the cost of an Oxford degree course was £16,000 per year.

The Russell Group of leading research universities backed his argument, saying that leading institutions could not continue to compete internationally and offer support to disadvantaged students “without access to increased funding.”

But the Million+ think tank said lifting the fees limit would increase inequity in the UK system.

Pam Tatlow, Million+ Chief Executive, said: “It’s difficult to see why some vice-chancellors continue to argue for what is likely to end up being a two tier system, which would be the result of increasing the fee cap to £16,000.

“This would inevitably depress demand and if the Treasury refused to fund this increase through the Student Loan Company and these universities were allowed to make a separate additional charge, this could only increase inequity in the student resource.”

Toni Pearce, President of the National Union of Students, accused Oxford’s Vice-Chancellor of being “astonishingly out of touch”.
She said: “The suggestion that tuition fees should be charged at this level shows just how astonishingly out of touch some university vice chancellors can be.
“Another hike in fees would stack up huge longer-term problems for individuals and for the economy, leaving our higher education funding system less sustainable for the future. Outside of the ivory towers, this issue remains politically toxic with voters.
“There are public and private benefits at stake in higher education, which is why there should be a balance of contributions between the state, graduates, and business rather than even greater loading of the burden onto the shoulders of the next generation.”

University lecturers also rejected the suggestion. Sally Hunt, the General Secretary of the University and College Union, said that “higher fees are not what this country needs” and pointed out that British students were already paying the most expensive fees in Europe.

Professor Hamilton, who has been in charge of Oxford since 2009 and is a former provost of Yale University, used the opportunity of his annual oration to the university to begin the debate on raising the fee ceiling. The government has already said that there will be no inflationary increase in fees in 2014/15.

He asked how a "market" in higher education could operate if everything "regardless of content and quality, is the same price". Different types of institutions should be able to charge different levels of fees, he said.

"Given the great diversity of the institutions in our higher education system, the notion of different universities charging significantly different amounts, doesn't feel inherently unnatural,” he added.

Bahram Bekhradnia, Director of the Higher Education Policy Institute, commented: “Universities will spend whatever they get.  If an Oxford degree costs £16,000 to provide that is because they have income of £16,000 per place.   If they got more they would spend more.  Professor Hamilton is not saying anything new.  And of course they are spending a lot more than a university that just spends £10,000.”