Bahram Bekhradnia: Scotching the great debt myth

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In a remarkable new study published today, Mark Corver and his fellow analysts at the Higher Education Funding Council for England have shed important light on participation in higher education by analysing the behaviour of young students during the past decade.

In a remarkable new study published today, Mark Corver and his fellow analysts at the Higher Education Funding Council for England have shed important light on participation in higher education by analysing the behaviour of young students during the past decade.

The key finding is no surprise. There are huge disparities in participation. Twenty per cent of young people live in wards where only 10 per cent enter higher education; by contrast, another 20 per cent live in wards where the rate is 50 per cent. This discrepancy has been known and has now been quantified. The report shows that the lowest participating wards are often clustered around schools with the worst GCSE results and that they have very few adults who have been to university, unlike those in high-participation areas. The suggestion is that this is not a result of university entry policies, so much as a reflection of inequalities within schools and society. There are important lessons here for policymakers.

The study looks at participation patterns between 1994 and 2000, and at what happened after the introduction of fees in 1998 and the replacement of grants with loans for the poorest students. So, what did happen? Not much. This is perhaps surprising in view of concern expressed at the time that the changes would lead to reluctance on the part of disadvantaged students to enter higher education, and that better-off students would be deterred by fees. The graphs in the report are remarkable. Trends in participation continue unperturbed through the period of change. Even when analysed by geodemographic group, there is virtually no difference between the most and least privileged.

These findings contradict other, widely quoted research that has purported to show that working-class children are particularly debt-averse, and are put off higher education by having to take out loans. It turns out that this research was flawed. First, it was based just on interviews with pupils about their attitudes and did not look at actual behaviour. Second, it did not distinguish between pupils for whom higher education was a serious option and those for whom it was not. When the data were re-analysed separately for A-level candidates after publication, it transpired that views about debt had no influence on decisions about higher education for the population as a whole or for pupils from poorer backgrounds. But this correction has not been published.

The new research - which examines what people actually do, as distinct from what they say - shows an apparent resilience of demand in the face of changed financial arrangements, irrespective of background. It would be wrong to deduce from this that financial issues are irrelevant, but, certainly, current fee levels and indebtedness don't seem to influence the decision to enter higher education.

Nor do changes in cost appear to have any effect on where people study. There was no change in the pattern of trans-border choice between Scotland and England after the Scottish Executive abolished fees. This apparent indifference to the cost of study calls into question the decision of the Scottish largely to exempt students from contributing to the cost of their education. It also suggests that any English institution charging a fee less than £3,000 is doing so on the basis of false assumptions about why students choose universities. Worse, such decisions will damage the interests of poorer students because of the large subsidy provided by the Government for loans. Reducing the fee by £1,000 will, in effect, deprive a university of £400 of Government grant for each student - money that could be used to provide bursaries for the poorest.

These are just a few of the conclusions in a report which also shows that the month in which you are born can influence whether you go to higher education and that background is not an issue in opting for postgraduate study. It is a pity the report was not available at the time of the Higher Education Bill discussions, which were largely based on belief rather than evidence.

The writer is the director of the Higher Education Policy Institute

education@independent.co.uk

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