Leading article: Set them all free to fix their own fees

We should not be surprised by the suggestion yesterday from Lord Dearing, the architect of the Government's controversial policy on tuition fees, that many UK universities will want to raise the amount they charge students even further. The £3,000 per annum cap was a political compromise by the Government to get the measures through Parliament. It bore little relation to the true cost of a typical student's education. And the universities were always going to press hard to be permitted to charge more. And so they should.

It is too early to evaluate fully the effects of the introduction of tuition fees on UK higher education. But already we can see that some of the apocalyptic arguments of their opponents have not come to pass. It was asserted that the introduction of fees would lead to a sudden decline in the number of students prepared to apply to university. Applications did indeed dip ahead of their introduction in autumn 2006. But by January this year applications had recovered. It seems that most of Britain's young people recognise that, over the course of a lifetime, a university qualification is good value for money.

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One of the more powerful arguments against charging tuition fees was that they would discourage bright working-class children, fearful of debt, from applying to universities. It is true that a survey of sixth-formers last year found a quarter were indeed put off applying to university because of fees. But it also discovered widespread ignorance about the bursaries and grants available to those of lower income backgrounds. The Government needs to make greater efforts to make it known that loans need not be paid back until after graduation and the student has begun work.

The opponents of fees also tend to ignore that working-class students were getting less out of the old regime of free higher education than the middle classes. Research for the Sutton Trust carried out for the London School of Economics this week found that, contrary to popular impressions, the large expansion of the higher education system in the late 1980s and early 1990s disproportionately benefited the offspring of the comfortably off, rather than the bright working classes.

But it would be wrong to gloss over the fact that the end of state-funded higher education does raise some problems. If Lord Dearing's predictions of higher fees come to pass, it would intensify the anomaly of the Scottish Executive's refusal to introduce university fees north of the border; it is not easy to justify why a student in Edinburgh should emerge from university debt free, while a student in Manchester, on the same course, should owe £9,000. Lord Dearing's predictions would also create some problematic economic disincentives in England. Some subjects, particularly sciences, are much more expensive to teach, but do not necessarily translate to higher salaries. Yet Britain needs to encourage science specialists.

The solution to the latter problem is for the Government to establish bursaries in certain strategic skill areas. It should encourage business to do the same. As for the Scottish problem, only time will tell whether the executive's decision to deny its universities a direct and guaranteed stream of funding is a wise one. What ultimately united English academics behind the concept of tuition fees was increasing global competition in higher education. Britain is the second most popular destination for overseas students. But unless our universities are put on a much surer financial footing, that will not remain the case. Ultimately, students and academics will vote with their feet. And those universities that cannot attract the best talent will suffer the consequences.