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Privatisation by stealth?

Mandelson remains unapologetic about drastic cuts to university budgets.

The bitter dispute between the government and universities over funding rolled on today, as vice-chancellors warned that swingeing cuts will leave thousands of students without a university place this year.

The representative group Universities UK said that last year, about 160,000 students who applied didn't get a place. With at least 75,000 extra expected to apply this year, there will simply be too many students, and no extra funds to help accommodate them.

The government, perhaps unsurprisingly for a party that has made so much of its commitment to education, is defensive.

The higher education minister, David Lammy, has accused universities of "scaremongering", echoing Peter Mandelson in defending Labour's record of spending on higher education. But I'm not sure whether "Well, they've had their turn" is a very effective case.

Mandelson has been keen to downplay the impact that the cuts will have. Writing in the Guardian last month -- a piece provocatively titled "Universities will benefit from tighter budgets in the long term" -- he set out why he thinks universities need not feel the pinch. His comments were telling:

Tighter budgets can be a spur to further diversifying the funding of British universities. It can also focus minds on teaching and research excellence and new ways of delivering higher education. Both of these trends are already part of the picture of British higher education. Both need to become more so.

The Business Secretary praised universities that open their doors to international students, who pay full fees, and those that build "more collaborative relationships with business and industry to fund research and teaching" (although he did not explain precisely how intense pressure on teaching and research budgets might help a focus on "excellence").

The merger last year of two departments to create the new Department for Business, Innovation and Skills caused controversy among academics. Its fusion of education and commerce appeared to be further evidence of New Labour's oft-cited "privatisation by stealth".

Certainly, the emphasis on "competition" and "choice" in Mandelson's article echoes the language surrounding foundation hospitals, city academies and private finance initiatives.

It is this blithe confidence that universities will be able to get the money from somewhere -- as they will, indeed, be forced to do -- that allows Mandelson to brush off the potentially disastrous impact on participation and quality. (He dismisses figures from the Institute for Fiscal Studies as "purely speculative" and says that the cuts aren't that much, really.)

He also implies that investment over the past decade will act as a buffer, but this is not the case: much of this spending has been targeted at getting more people into university, and the associated costs. As University UK's statement today illustrates, the combination of cuts and this increased number of students will soon start to pose a grave problem.

The unsympathetic stance adopted by the government, and Mandelson's statements that universities should, in effect, just shut up and look elsewhere for funds will confirm many people's worst fears that we have begun the slow but steady slide towards a privatised system in which both quality and equality are undermined.

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