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The university landscape is changing, but not fast enough
Aug 18th 2012 | from the print edition The Economist http://www.economist.com/node/21560574
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IT IS as much a summer ritual as Wimbledon. Every August Britain’s 18-year-old school-leavers tear open envelopes containing their A-level results and see whether they have done well enough to get into their chosen universities. The most successful students (and the prettiest ones) find their pictures splashed across the national newspapers. The less fortunate face the prospect of trying to get a place through “clearing”, the mopping-up exercise in which state universities offer their unfilled places to the best of the rest.
But this year, thanks to both the parlous state of government finances and renewed attempts to make universities compete among themselves for students, the landscape is significantly different. Undergraduates starting in the autumn will be the first to pay up to £9,000 ($14,000) a year for tuition, almost triple the previous maximum. Fears that higher fees would deter poorer students from applying have not been borne out. While there has been a small fall in the application rate among English students (somewhat different rules apply in devolved Scotland, Wales and Northern Ireland), the drop was sharper among those from wealthier areas.
The problem is not lack of applicants but lack of places. As David Willetts, the universities minister, points out, universities are still heavily oversubscribed—even with higher fees, around a quarter of students will fail to get places. Since fees are paid upfront by the government and repaid by students only if they get a decent job, to keep down costs to taxpayers admissions are determined by strict quotas. In effect, the state decides how many students will go to university.
In previous years, quotas applied to all students at state-funded universities. This year the best-performing among them—those with AAB grades or better on their A-levels—are excluded, which means that the universities able to attract them (ie, the best ones) can expand as much as they want. And the remaining, much reduced, quota has been cut further by reserving 20,000 “margin” places for which institutions charging an average of less than £7,500 a year can bid.
This in theory has introduced a hefty dose of welcome competition, and in reality a greater one of uncertainty. If popular universities expand to take more AAB students, their less popular but equally costly competitors will have fewer. Since non-AAB quotas overall have been cut, middling institutions face a squeeze in student numbers and income. So far their most prestigious rivals are not expanding much: Bristol University has added 600 places, and University College London 300; Birmingham, East Anglia and Exeter are all expected to make extra room for AAB students in clearing, but few others. No one will go bankrupt, though some departments at some universities will suffer, says Andrew Fisher, a university registrar—it will be a “slow-motion apocalypse”.
The apocalypse could speed up, however, if private universities continue to expand. They are not restrained by caps on places or fees, and students are entitled to government loans, of up to £6,000 per year, towards their tuition. At the University of Buckingham, which takes around 750 undergraduates a year, applications have more than doubled. BPP, a for-profit business and law school, and Regents College, a private college in London, report similarly heightened demand. Fees are “the most wonderful thing”, says Terence Kealey, Buckingham’s vice-chancellor.
Many students used to think private universities were beyond their financial reach (Buckingham charges EU students £11,250 a year). But both Buckingham and BPP permit undergraduates to complete their courses in two years rather than the usual three, and now look better value. New entrants are trying to get in on the act: Pearson, an educational publisher which owns 50% of The Economist, announced this week that it plans to offer its own degree course, accredited by Royal Holloway, part of the University of London.
Private universities already recruit many students from abroad: at Buckingham, most are non-British. Now others too see foreigners as the prize. EU students are treated like their British counterparts, but those from farther afield are not subject to domestic quotas or fee caps. Some institutions are said to take foreigners with weak qualifications because they can charge them more—which irks well-heeled British parents who would happily pay more for a place at a mainstream university.
In a country where education and privilege remain neurotically intertwined, that option is politically impossible. For the moment, until more competitors spring up and reforms diversify tertiary education further, the ritual of life-shaping A-level envelopes is here to stay.
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