Students would pay more for some degrees, says government research
January 28, 2010 by Jessica Shepherd, Guardian

University students would be willing to pay higher tuition fees for courses that lead to the highest-earning jobs

University students would be willing to pay higher tuition fees for degree courses that prepare them to enter the highest-earning jobs and careers, government-commissioned research has found. Such a system exists in Australia, where students can pay twice as much for a degree in law, accountancy and economics as for a course in education, nursing or statistics. But students leaders today branded the scheme "elitist" and said it would limit career opportunities for the poor.

The research, by the Institute for Employment Studies (IES), will feed into an independent review of tuition fees which is being led by Lord Browne of Madingley, the former head of BP. The researchers found students, particularly those from the poorest homes, were willing to pay higher fees for courses that would lead to high-earning jobs. The majority of the 81 university applicants who were quizzed could be "sold on the idea," they said. Students, from east London, Nottinghamshire, and south Yorkshire, were far less willing to accept the idea of the most prestigious universities such as Oxford and Cambridge, charging higher fees than other institutions.

Thomas Usher, a research fellow at IES and one of the authors of the study – The Role of Finance in the Decision-making of Higher Education Applicants and Students – said: "Across the board, but particularly among students from non-traditional backgrounds, there was a willingness to pay differential fees for different subjects. But when asked whether they would be prepared to pay higher fees for a particular kind of university, the majority were reflectively against this." But the National Union of Students said it would be unreliable and misleading if different courses charged different fees and it would consign the poorest students to "bargain basement" degrees. Wes Streeting, NUS president, said: "We believe allowing different instutions to charge different fees risks providing an elite system for the few that can afford it and a second-class experience for the many who cannot.

"This government report confirms that a hike in fees and a real market in price between universities risks further limiting the choice horizon of non-traditional students when they consider where to apply. Such fee differentials could see poorer students priced out of more prestigious universities and therefore consigned to the bargain basement. It is clear that earnings profiles for different subjects vary significantly, but it is also clear that earnings profiles vary significantly within certain subject areas. "Any individual financial contribution should be based on genuine earnings after graduation and not hypothetical course prices based on unreliable and misleading estimates of earning power which amount to guess work." The study's findings were announced as the first public hearing for Browne's review was held. Universities used the opportunity to argue for higher tuition fees.

Universities UK, the umbrella group for vice-chancellors, said the extra .1.3bn income they had received from top-up fees, introduced in 2006, had mainly been used to hire more staff and address a long-term fall in lecturers' salaries. Its poll of 58 university leaders showed that a quarter of the fee income had gone on bursaries for the poorest students, while some had helped improve the student-staff ratio. Universities said the income had been desperately needed because the number of students had risen from 1.86m to 1.92m between 2005 and 2008.

Universities UK said: "A common message is that the additional investment from fees has made a real difference to the financial sustainability of universities, allowing them to invest for the long term, reverse backlogs in maintenance, improve environmental performance, and go some way towards meeting rising student expectations. Institutions tell us that the new income from fees has speeded up developments or pan-university initiatives that would otherwise have taken longer, or been delivered piecemeal."

Meanwhile, university funders met this morning to decide how to make cuts to institutions' budgets. Universities face .315m of cuts this year and an extra .600m by 2013. Teaching grants, which account for nearly 70% of a university's funding, are likely to be cut.