Universities: higher fees can help the poor

The proposal that universities should be allowed to charge students as much as £15,000 a year in fees looks like another new Labour betrayal of everything the left stands for. We shall be encouraged to imagine the ragged children of the poor gazingly longingly from a distance, in the style of Thomas Hardy's Jude, at inaccessible Oxbridge spires. We shall be asked to weep at the frustration of those hungry for knowledge and at the crippling burdens carried by those who graduate with debts. We shall be told that behind it all lies the sinister, hidden hand of Andrew Adonis, who, as the world has learnt in the wake of Estelle Morris's resignation (but as NS readers were informed as long ago as 16 October 2000), acts from 10 Downing Street as the real Education Secretary.

But on this issue Mr Adonis, whatever his other failings, is right. Far from being a betrayal of socialist principles, charging higher fees to the affluent lawyers, bankers and doctors of tomorrow (who also happen mostly to be the children of the affluent lawyers, etc, of today) would be a ruthless and effective act of redistribution. If you do not believe it, listen for the squeals from the middle classes. The inequity lies in the present system, where all students pay annual fees of £1,075. This is wrong on three counts. First, since the fees represent only a fraction of the true cost of courses, middle-class students are still heavily subsidised by working-class taxpayers. In effect, Etonians are gifted £10,000 upwards by the state. Second, a theology student pays the same as a law student, an Oxford student the same as a Luton student, even though the economic benefits of their courses vary hugely. Third, the exemptions for students from poor homes are less dramatic and less visible than they should be.

A new report from the OECD confirms that the private rate of return from higher education (extra lifetime income, minus taxation, lost earnings during study, maintenance costs and fees) remains substantial. In all ten countries studied, it is higher than real interest rates; in the UK, at 17 per cent, it is higher than any other country and higher than the most absurd promises once made in dotcom prospectuses. But this figure conceals dramatic variations. Research at the London School of Economics shows that graduates of former polytechnics earn on average 7 per cent less than those from older universities. Male law graduates earn on average 27 per cent more than men who have only two A-levels, while male arts graduates actually earn 4 per cent less. (For women, the relative advantages of a degree are much higher.)

It therefore makes no sense to charge the same fee to a philosophy student as to a medical student, particularly when the latter's course costs the university far more. Nor does it make sense to charge the Huddersfield student the same as the Cambridge student, particularly when the latter is more likely to come from an affluent home.

The objections to higher fees and differential fees fall into two broad categories. The first argues that poor students will be deterred and the most prestigious universities become bastions of privilege. These fears are unfounded. With proper means testing, poor students need pay no fees, as they don't now (two-thirds of all students get some reduction from the £1,075). If affluent students paid higher fees, the state subsidies could be concentrated wholly on the poor; higher education, now a uniquely regressive public service, would become a uniquely progressive one. Nor need anybody, rich or poor, be deterred by debt, since loan repayments would be tied to subsequent earnings: no income, no repayments. This principle would be most effectively established if the costs of courses were recouped through some version of a graduate tax rather than students taking out loans to pay up front. The second set of objections is to putting economic value on higher education the benefits of which supposedly lie in a finer appreciation of poetry, the wonders of the universe and suchlike. Universities may indeed have such merits; but their graduates still grab the best jobs and highest incomes.

The old left should understand that the present financing of higher education underpins privilege and inequality. It should also consider the alternatives to higher fees. Should the UK, for lack of funds, resign itself to third-rate universities? Or should the money be raised by cutting schools and the NHS? Or by stopping a scheme to pay maintenance allowances to poor pupils who stay at school after 16? Or by starving the already underfunded further education colleges, which really do educate the poor, and to which Labour MPs, as well as posh papers, pay a fraction of the attention they pay to the glamour of Oxford and Cambridge?

Pray for Andrew Marr

Is there anybody on television who - well, just gets paralytically drunk and commits adultery in the missionary position like respectable folk? The Daily Mirror screams: "Angus Deayton is a coke-snorting, hooker-hiring, three-in-a-bed love rat." The Daily Mail reports Michael Barrymore's "violence, drugs, paranoia". Another presenter (see Amanda Platell, page 34) is a serial rapist who "threw me around the bed like a leg of lamb". If broadcasting is to continue, we must rely on the wholesomeness of Andrew Marr, now, it seems, in line to present everything from Blue Peter to Crimewatch. But what is this? "I spy Venus bathing," says the Daily Telegraph next to a picture of Mr Marr. In his column, he confesses to watching a woman in a soundproofed booth read the shipping forecast. He may think this is a joke. But we must all pray that shipping forecasters do not have the effect on him that weather forecasters have on others.