Ben Chu: Universities: beware the American model

The 'social signifier' of where you went to university seems to matter more on this side of the Atlantic. Seven out of ten ministers in the Cabinet went to Oxford or Cambridge
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The coalition appears to be beating a retreat from a graduate tax. The Business Secretary, Vince Cable, who floated the idea of a progressive levy on former students to pay for their education in a speech last month, spoke at the weekend only of a "graduate contribution". There are many hurdles to cross over the coming months and Lord Browne's report into higher education funding is still to come, but the ultimate outcome seems increasingly likely to be a lifting of the cap on university tuition fees and some progressive window dressing, such as charging those who go on to high-paying jobs a premium to help subsidise others.

Despite being an instinctive supporter of a graduate tax over the present fees system, I can see the logic of the retreat. While a graduate levy would be fairer, it would also break the link between academic institutions and students; a link that should, over time, force institutions to raise their teaching performance as they compete for students. I can also see the attraction of preserving and enhancing the financial autonomy of the university sector. To judge by most rankings of the world's top universities, the Sorbonne and other historic European educational institutions, which are mostly still directly funded by the state, are not the intellectual forces they once were.

That said, we need to be awake to the implications of our direction of travel. If the exiting £3,000- cap on tuition fees, which was put in place when the previous Government introduced variable fees in 2006, is lifted, does anyone imagine it will be for the final time? We will be taking a big step closer to a full-blown US-style market in higher education.

Many academics will see little to fear there, as they survey the lavish facilities and higher salaries enjoyed by their counterparts across the Atlantic. And liberalisation will certainly help our university sector to recruit the best research and teaching talent from around the world. But we must examine the wider social and educational implications. Some of the fears are probably exaggerated. The idea that universities would suddenly become obsessed with vocational degrees is not borne out by the experience in the US which produces some of the top international scholarships in the liberal arts. American universities choose to subsidise areas of intellectual pursuit such as medieval history and English literature, despite their relative unpopularity, because they believe these subjects have worth beyond their superficial market value. The market does not mean philistinism.

But a pure market system does create problems, in particular when it comes to access to the elite academic institutions. The rich, of course, take care of themselves. And in America there exists a generous system of university scholarships and government grants for those bright children who come from disadvantaged social backgrounds. But in the US those in the middle often get squeezed. There are plenty of students whose families are of modest means, but not in poverty, who are put off from taking up places at the elite colleges. Although loans are available, they do not expect ever to earn enough to pay off the vast fees these institutions charge (a course at Harvard is $38,000 a year). If a student suspects they might want to become a librarian, or a teacher, for instance, rather than a lawyer or a banker, there is a big disincentive when it comes to taking up that place to read philosophy at Yale or Harvard.

The counter argument to this is that going to a distinguished university in America is not necessary to become a librarian or a teacher and that much better value for money can be found by attending a cheaper, less fancy, institution. It is said that attending an ultra expensive university such as Princeton or Columbia is more of a "social signifier" for the politically ambitious, or the self- important, than an economic necessity.

Perhaps. There is certainly some strong evidence from the US that bright students do well in their chosen career regardless of whether or not they shell out to attend one of the elite universities or not. But I still have serious reservations about what would happen if Britain were to scurry blindly down the American road. Even if higher tuition fees are accompanied by generous US-style bursaries and scholarships for poorer students, we should expect to see the likes of Oxford and Cambridge, who would inevitably charge the most, become even more dominated by children who come from wealthy families. According to the Higher Education Statistics Agency, 16 per cent of students at the 20 elite Russell Group universities in Britain come from poorer backgrounds at the moment. Compare that to America, where the recent survey by US News and World Report magazine showed that the average intake of disadvantaged students (those whose family incomes are below $20,000) by the top 20 institutions was just 12 per cent.

It might be argued that such statistics would matter less in the future because many bright British students would choose to attend cheaper, but still perfectly good, universities, and go on to break the monopoly of the alumni of existing elite institutions on the best jobs and opportunities. But the "social signifier" of where you went to university seems to matter more on this side of the Atlantic. Seven out of ten ministers attending Cabinet went to Oxford or Cambridge. And the alumni of those two institutions (of which I am one) still dominate the upper reaches of the professions, from the judiciary, to the media, to the Civil Service as Alan Milburn's report on social mobility pointed out last year.

The combination of an entirely privatised university sector and a socially-exclusive ruling elite could make a future Britain resemble an aristocracy even more than it does today. If a free market in higher education is inevitable, I want to know from ministers what the safeguards will be against this social regression. And, regrettably, I can't envisage men with gilded backgrounds like David Cameron and George Osborne putting my mind at rest.

For further reading

Professor Robert Reich's Higher Education Policy Institute lecture 2004: 'The destruction of public higher education in America, and how the UK can avoid the same fate'.