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December 02, 2011

Now there's market pressure for you - just FOUR universities cut tuition fees

OFFA has revealed today that just FOUR universities have cut the cost of their first degrees to squeeze in under the £7,500 tuition fee threshold set by the government.

The four are the University of Chester, the University of Cumbria, the Institute of Education and Teesside University.  Sparsholt College is the one college to have reduced its fees.

These are the only institutions to have cut the price of their main undergradaute degrees for 2012 despite the introduction of the new "core-margin" policy intended to create a competitive market in higher education and drive down fees.

While 24 universities have agreed revised access agreements with the Office for Fair Access, most of them have only cut the cost of foundation courses or revised the subsidies they offer students. Bursaries (which don't reduce average fee levels) are out, fee waivers (which do) are in.

Across all the institutions that revised their access agreements, OFFA reports

  • an increase of £37.4m in fee waivers
  • a reduction of £13.8m in bursaries and scholarships
  • a reduction of £2.1m in outreach and retention measures.

So the first results of the government's core-margin policy seems mixed. The market moves made by the government seem to be having relatively little effect so far. Yes, the amount of money being leant to students by the government is going to go down a bit. This will reduce the losses on the loan scheme for the government and make the whole thing a bit cheaper for the Treasury. But students won't be saving so much because fee waivers are often replacing bursaries. And many financial advicers think bursaries are better for students than waivers.

Ministers say it's only a start. But for now at least, the effect of the core-margin policy seems to be, er, marginal.


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In the hundreds of posts I've read so far about fees, I don't remember a single one along the lines of 'I don't mind fees being a few hundred quid extra in order to supply bursaries for poorer students'. Universities switching from bursaries to fee reductions are simply falling in line with the way the debate has gone. All the fee is supposed to benefit the individual borrowing the money, hence all those reductive 'hourly rate' comments. When these are the terms, widening participation (e.g., bursaries reducing the need for poorer students to work part-time, and thus increasing their chances of performing well) hasn't a chance.

I agree with all that, except putting the root cause down to "debate". The government wants to minimise its lending to students. Hence it has a policy aimed at driving down fees. That seems much more important to me.

Whoever could have predicted that a last-minute policy designed to "create a competetive market" wouldn't work?

Well, not the government, clearly.

I also note that in terms of predictions, my prediction (made in the comments on this blog) that university applications wouldn't fall very much has come true

Only a 6% fall from last year (and last year may have been artificially high.)

I suppose that the government will watch this for two or three years before they make any more adjustments. They may hope that some universities will change their policies to benefit students more in the next academic year.

I am not sure how the students see this. Could they appeal at the student government level for their respective universities to take action that was more beneficial to them?

Since the government policies are intended to produce more affordable fees, hopefully pressure form both sides would push university heads in this direction.

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