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Consensus, what consensus?

Jim Dickinson asks whether key areas of sector consensus on reform of fees and funding are real runners.
This article is more than 5 years old

Jim is an Associate Editor at Wonkhe

Throughout Phillip Augar’s post-18 review process, two central ideas have coalesced into something of a consensus.

The first is the notion that the language and branding of the current system – fees, loans, debt and interest rates – ought to be recast so that students and parents better understand the system and its subsidies. The second is that a form of maintenance grant ought to return in order to better support the poorest with the costs of education. Indeed, even though the call for evidence for Augar closed months back, both ideas have resurfaced in reports of party conference lobbying by UUK and the mission groups. But do either of them stack up?

We won’t stand a loan

Much of the press bemoans the double whammy of the headline fee and high levels of debt. Back in 2010, campaigners were able to successfully shout about the “tripling of tuition fees” even though the expected eventual contribution from students wouldn’t quite come to that once write-offs kicked in. Alarmist headlines repeatedly report on the anticipated amount of loan write off, even though it’s a deliberate feature rather than an unexpected problem. And hard-done-by twentysomething graduates get loan statements with headline debt levels that are enough to make them wince all the way to the ballot box.

Almost everyone that understands how the student loans system works knows that the system looks problematic – and argues for presentational change as a result. “It’s just a form of graduate tax”, they say, “and if we just reframed it as that the problems would go away”. But when they suggest this they never quite explain how they’d hide the truth. The progressivity built into the system (via the repayment threshold and the 30-year write off) are features of a loan and debt system. We’d still have to know how much was left on a graduates’ balance every year to determine how much they pay and when they stop. And we’d still have to tell them that balance – no amount of clever language could hide this. That’s why David Willetts in his book A University Education remarked that not calling it a loan would be like the attempt by the Tories to rebrand their ill-fated poll tax as the community charge.

There are alternatives, which may be easier to implement once the ONS removes the political incentive to fund HE through deficit-flattering loans. A real graduate tax – where well-off parents weren’t able to pay upfront, rich graduates weren’t able to repay early and everyone chipped in for a full 30 years – would allow for a much higher repayment threshold and a much lower monthly payment. But that would require picking a fight with the rich, and would break the umbilical link between the funding a university gets and the contributions that graduates make. The former would require political bravery, and the latter would require the sector to accept a loss of institutional autonomy. No wonder it never gets proposed.

Bring back my grant cheque to me

The second oft-floated idea is the return of the maintenance grant. There are sound reasons for wanting to ease the pressure on students’ day-to-day bills and relieve the pressure on parents that the hidden parental contribution creates. But with fixed costs like accommodation on the increase, even returning to the 2016 system – £3,500 a year for households with incomes below £25,000 – wouldn’t work, not least because there’s no guarantee that maintenance loans wouldn’t be cut by the same amount. And in a Brexit-befuddled spending review already dominated by the NHS, it’s hard to imagine that any element of higher education will be a winner.

One of the original elements of the £9,000 fees settlement was that some of the additional fee income would be used as financial support within an institution. Back in 2014 some 358,000 low-income students were getting a bursary, scholarship or hardship fund. The problem was that the money on offer was usually a mystery to prospective students, and so the Office for Fair Access nudged everyone to shift their spend to outreach on the basis of access impact. But students still need the money – the lobbying on grants confirms that – and the system means that much more of this fees top slice is available per student where a university does badly at widening participation, leaving those institutions doing the heavy lifting with much less to spend on those that need it.

It might make sense to run different outreach schemes for different courses in different providers. But why are students offered different amounts of student financial support based on the course or university they have chosen rather than their financial need? And why have low-income students lost out on cash because they weren’t told early enough about it?

Again, there are alternatives. We could simply top slice the £9,250 and offer financial support that is redistributed around the sector rather than around the campus. Students would know with real clarity what was on offer at the point of researching HE – vastly improving the impact on aspiration. But that would require revealing to the press that fees cross-subsidise others’ access, and would require the sector to accept a loss of institutional autonomy over where “their” fees are spent. No wonder that never gets proposed either.

Trade-offs

Unless the system can be made acceptable, the likely “retail offers” at an election will be lower fees from the Conservatives, or no fees at all offered by Labour. What that means for student numbers or maintenance is anyone’s guess, but even John McDonnell will feel some pressure to cost his manifesto promises – and with student costs on the rise and the NHS, social care, welfare and even the Educational Maintenance Allowance due an allocation, it’s hard to believe that all of HE under Labour would suddenly become free – especially if we’re talking tuition and maintenance, undergraduate and postgraduate, all without a cap on places or cut to the unit of resource. Who or what will get traded out?

If on the other hand this government survives, regardless of the ONS’ machinations, we could well continue to be lumbered with a debt-based graduate contribution scheme – which trades off fairness for students and graduates with a sector obsession for institutional autonomy. That’s a shame. If allowing a bit of redistribution around the sector as a whole and making the richest pay their fair share could enable lower monthly repayments, the eradication of “debt” and the reintroduction of a grant, it could be a price well worth paying.

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