Policy Exchange report fails to consider radical options for university funding

Policy Exchange's new report follows the CBI and other right wing commentators down the road of lazy conclusions when it comes to how best to fund universities.

Sally Hunt is the general secretary of the University and College Union

The latest report from Policy Exchange follows the CBI and other right wing commentators down the road of lazy conclusions when it comes to how best to fund our universities.

More Fees Please?spectacularly fails to consider any radical options for the funding of higher education and falls back on the lazy and tired option of students, and their parents, footing the bill.

The rationale for this decision seems to be that the state cannot pump any more cash in because times are tough and therefore the other ‘beneficiary’, the student, must pay.

What this argument misses is the fact that the likes of America, France and Germany are ring-fencing money for education as part of their recovery packages – these countries are happy to match the rhetoric about the need for a highly-skilled future workforce with the resources required to deliver it.

The Russell Group of research-intensive universities came closest to mentioning the elephant in the room in its response to the Policy Exchange report. Its director general, Wendy Piatt, said:

The state, employers and graduates benefit hugely from universities, but at the moment the taxpayer still foots the lion’s share of the bill. One of the fairest and most effective sources of additional funding is a contribution from graduates.”

Piatt actually mentions employers as a beneficiary, but when moving back to discuss who pays, there is no mention of business; the bill is pushed back to the student. Lord Mandelson must have been hoping for something a little more creative when he called on universities to use his latest round of cuts to try and diversify their funding.

Simply asking the group that has been hit the hardest in recent years to pay more is not a new or bold approach to the problem.

It is in universities’ interests to try and be a bit creative, considering Mandelson has previously warned that they will have to demonstrate a higher level of value for money if they want to even consider raising fees. A task he has just made much harder with his punitive cuts throughout the sector.

The University and College Union (UCU) will be unveiling more details on what a proportionate and fair payment from business will look like at the start of next month. We do not believe that asking students to take on greater debt, or forcing their parents to put their house up as collateral against commercial levels of debt represents a sensible economic approach.

What the Policy Exchange, Wendy Piatt and other commentators fail to recognise is the impact debt already has on students and their families. Current graduates are going into an uncertain job market with record levels of debt. It is a myth that student loans do not accrue interest or that the repayments are barely noticeable.

Student loan debt takes years to pay off and is one of the monthly costs that is likely to delay people taking out some form of pension. It also makes getting onto the property ladder a pipe dream for the majority of graduates.

We do need a full and frank debate on the future of how we fund our universities, but we need a proper debate. We do not need the same old tired arguments in favour of students paying more from people with no understanding of the reality of student debt on graduates or their families.

And we certainly don’t need elaborate ways to put whole families’ assets at risk or even more complicated debt plans that are likely to enshrine the view amongst people from the poorest backgrounds that university is not for them.

UCU welcomes a fresh debate on the future funding of our universities, but it rejects the old arguments and believes it’s time business started to pay for the benefits it gets from graduates. Watch this space…

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