End the cap on tuition fees
University tuition fees are a policy issue that seem to be the same the whole world over: whether in the United Kingdom or New Zealand (which is convenient for me, as a lazy person). All the Vice-Chancellors and Provosts in New Zealand have called on the new centre-right National-ACT-et-al government to completely lift the cap on tuition fees:
The heads of New Zealand’s universities say the Government is unfairly doling out money to students and forgetting the universities themselves. They also want the cap on fees removed so universities can set the cost of courses. The New Zealand Vice-Chancellors’ Committee yesterday called on the National Government to view universities as national “infrastructure” that was in desperate need of investment.
Great news - and a message we could do with following here. UCL has its very own Kiwi Provost, who has done the same here, calling for tuition fee cap to be lifted to at least £7,000, with a view to scrapping it entirely. Sadly, the students are having none of it, leaving me as the only student at the well-attended UCL Union AGM earlier this year to vote in favour of Malcolm Grant’s proposals (something about Kiwi blood, methinks).
It’s a mistake for students to oppose it. Currently, universities are tied into a Faustian pact with the government (does it go without saying that the government is the devil?). They take the government’s money, in exchange for which, they lose their ability to set fee levels, their academic freedom, and their ability to innovate.
If they didn’t take the government’s penny, but could charge students a reasonable amount, they’d be a hell of a lot better off. It’s not a mere coincidence that the UK’s only private university has the highest student satisfaction and is the only university to fit a degree into two years instead of three to four. It’s also not a mere coincidence that Buckingham is an explicitly libertarian institution. A two-year degree gives students an extra year in which to earn - meaning that Buckingham graduates have considerably lower debts than any other, despite not getting government subsidies!
The financial side of the equation is very straight-forward. Not only do graduates have less debt at private universities, but they wouldn’t have to pay taxes to support them. Given we pay £9.5bn a year to subsidise universities, that would allow the government to abolish inheritance tax (£3.1bn), vehicle excise duty (£5.8bn), and the proposed 45% income tax band (£670m): three taxes that fall disproportionately on high-earning graduates.
Students have got to stop thinking of themselves as life-long students, but look to their interests after university.* In the long run, we would all be better off if we had to pay universities directly - we’d get a better education and we’d get a better financial deal out of it, too.
* All about Ricardian equivalence, right?
