Degrees: compare and contrast

Do we get value for money? Sir Ron Dearing is evaluating the cost of higher education worldwide.

How much does it cost to educate an undergraduate abroad, compared with doing so in this country? And what are the differences in costs between higher education institutions in the United Kingdom? Such questions are being asked by Sir Ron Dearing as part of his inquiry into the future of higher education, after complaints that Britain's elite institutions are poorly funded compared with their counterparts overseas. These are thought to be the first official investigations, certainly the first studies for a very long time, into the relative costs of putting a student through higher education in similar institutions in different countries.

One study, being undertaken by the management consultants Coopers and Lybrand, is examining a dozen institutions in the UK - old and new universities and institutes of higher education; the second, by JM Consulting of Bristol, compares the cost of a first-degree student in Australia, the US, Holland, Germany and England by reference to undergraduate programmes at two universities in each of the five countries.

Funding to boost the cash-starved university system is one of the key issues facing the Dearing inquiry. Committee members and staff are casting their net wide and have officially visited Australia, New Zealand, the US, Canada, the Netherlands and Germany to see how other countries organise higher education. Other members have made unofficial visits. Sir Ron Oxburgh, rector of Imperial College, London, visited Taiwan, Hong Kong and Singapore; and, last week, Quentin Thompson, an adviser to Sir Ron's funding working group and a partner in Coopers and Lybrand responsible for education, returned from a trip to Australia.

The inquiry will also study a report by Professor Gareth Williams of the Institute of Education in London, which shows that the United Kingdom gets great value for money from higher and further education. We have one of the highest rates of participation in higher education in the world, when part-time as well as full-time students are counted, and we educate students relatively inexpensively. In addition, we have high completion rates for degrees.

But amid this good news, Professor Williams sounds a note of caution. We have moved away from an elite, well-funded system of higher education towards one that looks much more like the US version, he says. "The new model provides for a much larger number of people but we are spreading the money out more. There are questions to be asked about quality."

Although the 12-member funding working group, chaired by Sir Geoffrey Holland, vice-chancellor of Exeter University, has agreed no proposals yet, it is thought to be looking at the possibility of funding undergraduate education through an Australian-style income-contingent loan scheme, of the kind favoured by the Committee of Vice-Chancellors and Principals. This would allow for introducing tuition charges. At present, full-time first-degree students in the United Kingdom pay no tuition fees.

"I'm pretty sure they will move towards a system of this kind," says Professor Williams. "I personally think there is no other way."

Another option is a graduate tax, but that is thought to be less of a runner because it would have to be paid over a lifetime rather than over the period necessary to pay off a loan. The funding working party is understood to be keenly aware of the effect that reduced funding per student has on the quality of education. It has strong views, too, about the inequity of charging part-timers but not full-timers for higher education.

One controversial issue it will have to address is whether universities will be able to charge different fees for similar courses. Quentin Thompson does not see why they shouldn't. "If there were to be a system in which students were charged and there were adequate safeguards on standards, I don't see why the level of charge should not vary by the quality of specification," he says.

The inquiry is also understood to be investigating the idea of a learning bank and learning accounts, as proposed by Professor David Robertson of Liverpool John Moores University. People would have "accounts" in such a bank. The government, employers and individuals themselves would put "credits" into the accounts, that could be spent at an institution of the individuals' choice at any point in their lives.

"It's a way of funding lifelong learning," says Richard Brown, director of the Council for Industry and Higher Education. "People could draw on their credits and top them up. It places power in the hands of individuals. And institutions would have to be more responsive"n

AUSTRALIA: Students repay loans when pay reaches a certain level

Australia's system looks most like that of the UK. It is predominantly national, with funding from the federal government and a participation rate that mushroomed in the Eighties. The divide between polytechnics and universities was abolished and replaced with a single system in 1988, so there are now 36 universities. Ever since, the system has been squeezed financially. Students used to receive grants and did not pay for tuition. That has changed. Students now pay an element of the cost of tuition (roughly pounds 1,300 a year in 1996) through the Higher Education Contribution Scheme, which means they pay back a loan after graduation when their income has reached a certain level. Individual universities receive block amounts from the government according to student numbers, but those amounts have been declining. All institutions can compete for research funds. Students start their courses at age 17 or 18, as in Scotland, and an honours degree takes four years. A pass degree is available after three years.

FRANCE: The exclusive grandes ecoles cream off the elite

France has more than 300 separate post-secondary institutions . Of these, 174 are the grandes ecoles, another 100 are specialised "high" schools which concentrate on higher-level training for teachers, school inspectors, and people in business, public administration and the military and the rest are universities. The grandes ecoles are highly selective. Universities are open to anyone who has passed the baccalaureate examination. Numbers passing the Bac and going to university have increased in the past 10 years. This open entry is accompanied by a high drop-out rate at the end of the first year when students fail their end-of-year examinations - almost half drop out at this stage. Two-year degrees are available at the Instituts Universitaires de Technologie, which are linked to universities. Students pay very low tuition fees. Funding is highly centralised. Central government provides student grants but there is little maintenance support and students take out loans. Despite a fierce debate, governments have been unsuccessful in getting students to pay much towards the cost of their tuition.

GERMANY: The debate has begun as to whether students should pay fees

German universities belong to individual states (Lander) and are financed mainly by them. There are two types of higher education institution: 89 universities and 136 Fachhochschulen. The latter are vocational, concentrating on public administration, economics and business studies, engineering and social work. Although less prestigious than universities, the Fachhochschulen are treated as being equivalent to universities with roughly equal standards. Students start higher education a year or two later than in Britain and spend longer at it. The average age of graduation is 28.8 in universities and 27.5 in Fachhochschulen. Germans consider their first degrees to be equivalent to a UK Masters. University spending has been under pressure in recent years as student numbers have risen without a commensurate increase in funding. Students pay no fees but debate has begun as to whether they should. German universities are not allowed to charge fees to regular students. Maintenance grants and loans are provided by the government.

AMERICA: Fees can reach pounds 10,000 a year in private colleges

American higher education is vast and diverse, with 3,300 accredited universities and colleges. Public sector higher education is run by the states, and there are hundreds of private colleges and universities. Most courses are modular. Credit transfer within and between institutions is common. Bachelors' degrees last four years. Associate degrees offered by community colleges last two years and take students into the final two years of a university degree. Standards are very variable. Students going to college have vastly different SAT scores (equivalent to A-levels), depending on which institution they attend. Students pay fees - less for a state college or university (average pounds 3,750 a year), much more for a private one (pounds 10,000 a year). Limited federal grants - and an official loan programme - are on offer, and individual colleges give financial aid packages containing grants, loans and work study. Unlike many European countries the US has not seen reductions in spending per higher education student in recent years.

JAPAN: Only a minority of the most able receive state funding

Japanese higher education consists of a hierarchy of institutions: the top 100 national universities are funded centrally; below them 40 public universities are owned by municipalities; then there are 400 private universities, a few of which are considered equal to the best national universities, and a much larger number that are not so prestigious. The sector also contains two-year junior colleges - some local, some national, most private - and about 2,500 special training schools. Competition for the best institutions is intense. The participation rate is high. The big difference compared with Britain is that the vast majority of students are in private universities and colleges, paying fees of more than pounds 4,000 a year. Only a small minority of the most able students, those who get into the national universities, are paid for by the state. Such an unashamedly meritocratic approach is quite common in the Far East, and also exists in South Korea and Taiwan.

Case studies taken from 'Resources for Higher Education in OECD Countries' by Gareth Williams (Available from the Centre for Higher Education Studies, Institute of Education, 55-59 Gordon Square, London WC1, pounds 6).