4th June 2013 9:00
By Blue Tutors
This week the Million+ group of universities published research which suggests that Tuition fees in England could be reduced to £6,000 a year without increasing the costs of Universities or the Treasury. The research was designed to provide an alternative model as to how tuition fees could work. Under the plan put forward by Million+, students would pay £6,000 a year, and universities would receive addition funding from the government.
The research, supported by a study from London Economics, argues that fees could be reduced while maintaining the same level of funding for universities. In the alternative funding model, the government would make up the shortfall left from reducing fees using treasury funds. Universities would receive a greater higher education subsidy instead of relying on students to pay the maximum of £9000 in tuition fees a year. The study claims that limiting the amount that students are borrowing would actually save the government money, as currently many students do not pay their loans back in full. Saving this money could even allow universities to fund extra places whilst reducing tuition fees.
However, the study has not been welcomed by the Department for Business, Innovation and Skills, which said that they anticipated a £2bn shortfall if tuition fees were to be reduced to £6000 a year. They also rejected other proposals suggested in the same study, including a graduate tax system which would see students pay no fee, but be subject to a higher level of taxation after they graduate. The Department for Business, Innovation and Skills concluded that, even if there were ways to save money in the short term, it was not in the country’s interests to step back from the marketization process. The higher the student fees, the more pressure there is on universities to provide better services. Million+ has commented that, with 35% of students currently unable to pay back the money they owe from loans, it is time new funding methods were given greater consideration.