Universities charging maximum tuition fee could have student numbers cut

Vince Cable threatens to withdraw any unfilled places if students feel too many universities are charging the maximum

One of Britain's biggest teaching-oriented universities has announced plans to charge a �9,000 tuition fee next year, prompting accusations that the government's strategy on fees has collapsed as institutions flock to charge the maximum.

The University of Central Lancashire, which has more than 27,000 undergraduates, said it would be forced to triple fees because of government cuts to its grant for teaching.

But ministers are now preparing to cut student numbers at universities that fail to fill all their places because they are over-priced, while those that are cheaper or more popular may be allowed to expand.

In a speech on Wednesday, business secretary Vince Cable is expected to warn universities against gambling on high fees. He will say: "Institutions could very well find themselves in trouble if students can't see value. In circumstances where places are unfilled, we might withdraw those places, and institutions should not assume they will easily get them back."

A total of 32 universities have now declared their fees and two-thirds of them have opted to charge the maximum, including institutions as diverse as Aston, Bath and Liverpool John Moores.

The average fee ? which the government predicted would be �7,500 ? currently stands at �8,855. Fees set by the remaining universities would have to average �7,029 to bring the overall average down to the government's figure.

Two further announcements have been made: Portsmouth is seeking to charge �8,500, while Derby proposes a maximum of �7,995. Nine of the 16 elite Russell Group universities in England have announced their proposed fees, all at �9,000.

Two more big teaching universities ? Manchester Met and Sheffield Hallam, which each have more than 27,000 undergraduates ? are due to make fee announcements by the end of April.

Sir Peter Lampl, chair of the Sutton Trust, a charity that focuses on social mobility, said: "I think the government's tuition fee policy is backfiring. We're now seeing second- and third-tier universities charging the maximum amount. I think these fees are going to put a lot of children from low and middle-income homes off universities."

Pressure on universities to charge high fees stems from the government's decision to cut funding for teaching, which will hit newer universities hardest as they receive less research funding. A total of �940m ? 12.6% ? is being cut from the budget for teaching, research and buildings for the next academic year.

Malcolm McVicar, vice-chancellor of the University of Central Lancashire, said the university had calculated it would lose 90% of its current teaching grant by 2014-15. He acknowledged students' concern over high fees but said that even a �7,000 fee would result in "significant debt".

"We are committed to providing excellence, we spent a long while looking at financial implications of cuts in public expenditure, to replace them and to continue providing excellence, and the conclusion we've come to is we'd had to charge �9,000, recognising that a percentage of that �9,000 would have to go to national scholarship programme and bursaries and so on.

"This is not a decision we've taken lightly, it reflects our standing as a university, our commitment to providing excellence to our students and our ambition for the future, because we don't want to reduce the quality of what we deliver.

"Even if you charge �7,000 you're still talking about a very sizeable debt. In many ways the fee that you're charging is set, unless you charge a ludicrously low level; �7,000, �8,000, �9,000 ? those all result in significant debts to students.

"I think there is a lot of concern about the potential level of debt in the context of an economy in recession, where people are pessimistic about the economy and we have to recognise that. In return for this fee they'll get an excellent service," he said.

The University of Derby announced that it plans to charge between �6,995 and �7,995 a year. Some 80% of its courses will cost under �7,500. It is using a sliding scale, with classroom-based courses the cheapest and degrees requiring field trips, such as geography and modern languages, the most expensive.

Professor John Coyne, vice-chancellor of Derby, said other universities "may have been a bit simplistic" in setting their prices. "There is a bit of a herd instinct and the feeling that 'we are in x club and so if those in our club are charging y, we will too'. There is a bit of a tendency for people to use prices as a signal of what club they are in."

Coyne said the decision on fees was based on student expectations rather than prestige. Derby is one of England's smaller universities, with 9,500 full-time undergraduates. "At Derby, we don't have centuries of tradition and you aren't going to win brownie points at a middle-class dinner party by saying 'my daughter is going to Derby'."

The government's fees policy was attacked by David Blanchflower, a leading labour economist who now teaches at Dartmouth College in the US. Blanchflower said it was "completely inevitable" that most universities would plan to charge the maximum in tuition fees.

"Willetts and Cable made a complete error because the last thing a university wants to do is to show it is of a lower quality than any of its rivals. But there is no way for universities to raise money for themselves," he said.

"The concern is that the government is going to have to reduce the number of students at a time of high graduate unemployment. There is a U-turn coming on this."

Labour's higher education spokesman, Gareth Thomas, said: "The idea that fees of over �6,000 would be the exception rather than the norm, as independent experts were warning even before the fees vote, looks even more ill-considered and misconceived."

Meanwhile, Cambridge University has rejected the option of making lower offers to state school students, as it published a study looking at the links between A-level results and degree performance.

The study found that pupils from state or private schools who got into Cambridge were equally likely to do well at their degrees.

This finding runs counter to a major study of 8,000 A-level candidates, published last year, which found that comprehensive pupils out-perform children educated at private or grammar schools when they get to university.

Jeevan Vasagar

Jessica Shepherd

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