It will recommend that those universities which want to expand and bid for funds will have to show that they not only have high-quality courses, but have low drop-out rates.
Vice-chancellors yesterday attacked the scheme, which will be based on the first ever official calculations of drop-out rates. Some reports suggest as many as one in five students are failing to finish their courses.
Officials from the Higher Education Funding Council, which has drawn up the plan and which distributes money, want to use low drop-out rates as one of the criteria for funding.
They are particularly keen to offer extra money to institutions which attract and keep good working-class and disabled students and those from other groups that are under-represented in higher education. Research carried out by the council shows that poorer students are more likely to drop out than their peers.
The proposals, which will be sent to all universities for consultation, are part of a wide-ranging package of measures to increase participation in higher education.
Ministers have made clear their determination to bring a wider variety of people into higher education. At present, students from wealthy backgrounds are 12 times more likely to attend university than the poorest students. But nobody is certain how many students fail to complete their courses. A student guide called Push to be published next week will claim that 19 per cent drop out, but it has already drawn criticism from experts.
The Push guide goes on to suggest that there are big variations in rates. At Oxford, according to the guide, it is 3 per cent, compared with 39 per cent at Brighton. The figures also include those who fail their final exams.
Difficulties in making the calculations arise because a growing number of students move from course to course. A funding council study last year found that half those who dropped out returned within a year. and others returned over a longer period. The new scheme to use drop-out rates as one criterion for extra money will be possible because funding council statisticians have devised a way of tracking students through the system and calculating drop-out rates for individual universities.
Universities already lose funding for each student who drops out but officials believe the new system will help to ensure that universities put more emphasis on retaining students and helping those from poorer backgrounds.
A spokeswoman for the National Union of Students said: "In theory, the idea sounds all right but there are many reasons why students leave college.
"Our research shows that, increasingly, students are leaving for financial reasons."
- More about:
- Higher Education
- London Metropolitan University
- Royal College Of Music
- University Of The Arts London