May warns universities over high cost of tuition fees

Theresa May is to press ahead with attempts to force universities to charge less for some courses based on their costs and potential graduate earnings, despite critics within her own party and the higher education sector branding the move incoherent and unworkable.

Announcing a long-awaited review of education funding for over-18s in England, the prime minister will say that reserving university for the middle class and vocational training “for other people’s children” is outdated.

Her comments come after the new education secretary, Damian Hinds, hinted on Sunday that the review would recommend that some universities cut their fees for social science and humanities courses, particularly if recent graduates earned salaries below those of others.

In a speech in Derby on Monday afternoon, May will say that higher education institutions should change the existing structure whereby all undergraduate courses cost £9,250 a year in tuition fees.

“The competitive market between universities which the system of variable tuition fees envisaged has simply not emerged,” she is to say. “All but a handful of universities charge the maximum possible fees for undergraduate courses. Three-year courses remain the norm. And the level of fees charged do not relate to the cost or quality of the course. We now have one of the most expensive systems of university tuition in the world.”

May’s speech is the Conservative party’s latest attempt to grapple with the complexities of the funding system it created as part of the coalition government in 2012, which has pushed up average graduate debt toward £50,000 and up to £57,000 for students from the poorest backgrounds.

The hike in fees from £3,600 to £9,000 has not dented the appetite for undergraduate study, but universities have been heavily criticised for swiftly raising the pay of their vice-chancellors and other senior leaders.

Speaking ahead of May’s speech, Hinds said the review would look into various options for fees.

“I don’t think it’s as straightforward as just separating arts from sciences – and of course there’s great value to both arts degrees and science degrees,” he told BBC Radio 4’s Today programme.

“But I think there different considerations for courses, There is the cost to put it on, there’s the return to the individual, and there’s also the returns to our economy and to society as a whole.”

The idea would be to offer “more variety” for university courses, not just with fees but also on the length of course, Hinds said.

Labour’s performance among young voters and their parents at the last election has been attributed to Jeremy Corbyn’s promise to scrap tuition fees entirely and reintroduce maintenance grants for the less well-off.
In her speech May will attempt to tackle Labour’s policy head on, criticising her government’s own support for the current system even as ministers defend it by arguing that more people from disadvantaged backgrounds are now in higher education than ever before.

According to May, widening access to university “is not made easier by a funding system which leaves students from the lowest-income households bearing the highest levels of debt, with many graduates left questioning the return they get for their investment”.

May also hints that the review, which the Guardian understands will be led by a senior figure from the City, will look at restoring income-related grants in some form by examining “how we can give people from disadvantaged backgrounds an equal chance to succeed. That includes how disadvantaged students and learners receive maintenance support, both from government and universities and colleges”.

The review panel is likely to include Prof Alison Wolf, an economist at King’s College London with a strong interest in further education provision and qualifications. Other members will include a former vice-chancellor and head of an Oxford college.

May has been determined to make universities offer variable fees for many years, backed by her former special adviser Nick Timothy, who last year complained about receiving a haircut from a university graduate. Timothy also accused the former education secretary Justine Greening of blocking May’s efforts to cut tuition fees. May removed Greening earlier this year and replacing her with Hinds, a more enthusiastic supporter.

On Sunday Greening appeared to confirm the rift over tuition fees, suggesting that the review would be more talk than action. She proposed more radical moves, such as doing away with interest payments on student loans and bringing back grants for poor students.

“The thing that really matters from my perspective is social mobility, and making sure we don’t end up with a system where young people from more disadvantaged backgrounds feel like they ought to do one of the cheaper degrees, rather than doing the degree they actually want that will unlock their potential in the future,” she said.

Greening’s comments echoed those of Angela Rayner, Labour’s shadow education secretary, who said the Conservatives had lost touch with reality over education funding. “Charging more for the courses that help graduates earn the most would put off students from the most disadvantaged backgrounds from getting those same qualifications. So much for the prime minister’s talk about social mobility,” Rayner said.

“To make science and maths degrees more expensive flies in the face of what our economy’s going to need in the future. As part of our industrial strategy we need to ensure that we get more students on those courses.”

Prof Janet Beer, the president of Universities UK and the vice-chancellor of the University of Liverpool, took issue with May’s claims of an academic-vocational divide. “The perception may be of academic versus technical qualifications, but the reality is very different. Universities are key to developing the skills needed by employers and students across a wide range of industries, sectors and professions,” she said.

Mark Leach of the higher education thinktank Wonkhe said the government’s arguments were incoherent and could damage the sector. “Forcing struggling universities to charge lower fees to poorer students, and therefore have less money to spend on their retention, learning, facilities and other real value for money indicators, could simply entrench a cycle of poverty,” he said.