Ministers gave the green light to the most radical shake-up of higher education finance in history yesterday, allowing universities to triple their fees to £9,000 a year.
The move immediately prompted claims that it would lead to a two-tier university system, with disadvantaged school leavers being priced out of certain courses. Doctors warned that medical students would face debts of £70,000 on leaving university after a five-year degree course.
"The Government's proposal to potentially treble university fees will have a devastating financial impact on thousands of talented young people from low and middle-income backgrounds who want to become the doctors of tomorrow," said Karin Purshouse, of the British Medical Association's medical students committee.
University lecturers' leaders also pointed out that graduates' tax bills would rise by 20 per cent once they had reached a salary of £21,000 a year, which is when repayments kick in. An average teacher would see his or her pay bill rise by almost a quarter.
Deputy Prime Minister Nick Clegg was last night trying to avert a rebellion among his Liberal Democrat MPs against the rises. A series of backbenchers – including two former party leaders, Charles Kennedy and Sir Menzies Campbell – spoke out against the increases, saying they flatly contradicted party policy at the last election.
Several ministers are also known to be considering abstaining on the vote when the issue is put before Parliament just before Christmas. Under the Government's proposals, there will be a new minimum fee of £6,000 for universities – although they will be able to charge up to £9,000 a year in "exceptional circumstances".
Universities Secretary David Willetts made it clear last night that such circumstances would apply to elite universities such as Oxford and Cambridge, which are trying to compete on a world stage with institutions from the United States.
He said he could also foresee a growth in two-year degree courses, with universities charging students £7,500 a year for a 48-week course rather than £6,000 for a three-year version.
Universities will also have to convince the Office for Fair Access that they are taking steps to recruit students from disadvantaged areas before they are allowed to charge higher fees. A £150m national scholarship fund will be made available to finance bursaries for poorer students.
Mr Willetts insisted that 25 per cent of graduates would be better off under the new system, as they would not have to pay back their loans until they earned £21,000 a year.
The rise in fees follow massive cuts to university budgets in the comprehensive spending review. Teaching has been slashed by 80 per cent so only maths, science, engineering and some language courses will receive state funding.
John Denham, Labour's business spokesman, said: "English students now have the highest fees of any public university system in the industrialised world and they have less public money spent on their teaching than any other university system in the industrialised world."
Mr Willetts added that the Government was considering a 5 per cent levy on those who sought to repay their loans in full immediately after graduation. "Overall this is a good deal for universities and for students," he added.
The new fees system
* A new £6,000 minimum annual course fee is to be introducedn However, some universities can charge up to £9,000 in "exceptional circumstances"* Loans will not have to be repaid until a graduate is earning £21,000 a yearn Graduates will start repaying their loans at 9 per cent of their income at a real rate of interest when they earn £21,000n They will face interest repayments of inflation plus 3 per cent if they earn more than £41,000 per yearn After 30 years, outstanding debts will be written off
In the classroom: 'Pupils are being offered jobs – and taking them'
For 15 years, Steve Baker has been building up the sixth form at Lipson Community College in Plymouth, Devon. When he arrived as headteacher, there were only 50 pupils in it. Now it has 350.
Mr Baker is worried that yesterday's announcement of a university fees hike for students will be a "double whammy" as far as his pupils are concerned. "To be honest this fees rise seems like a crushing blow to the aspirations of very hard-working families in an area like Plymouth," he said.
The school, despite being ranked as "outstanding" by Ofsted, the education standards watchdog, was on the last government's hitlist of "National Challenge" schools with fewer than 30 per cent of pupils getting five A* to C grade passes at GCSE including maths and English.
But that is all behind the school now and 30 per cent of those in the sixth form go on to higher education, including Oxford and Cambridge.
This marks years of steady achievement for a 1,400-pupil school serving one of the poorest parts of Devon. But a number of youngsters have already expressed concerns over whether they will still go on to university once the new fees regime is in force – even the brightest ones.
"We're already beginning to see the effects of it," he said. "A couple of students in the sixth form have been offered jobs – like supervisor in a local food chain – and they're off. They've taken them," he said. They think 'a bird in the hand is worth two in the bush'." He said: "It is a big worry. There are youngsters who would be a shoo-in for university who are thinking again about whether they will go."
Mr Baker added: "We're still having concerns about the effect of cutting educational maintenance allowances." These means-tested payments of up to £30 a week, which were paid to youngsters aged between 16 and 19 from the poorest homes to help them stay on at school or college, were axed in the comprehensive spending review.
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