University Tuition Fees: Fair and Necessary

Old Joe at the University of Birmingham

When the coalition government announced its plans to increase the cap on university tuition fees to £9000 it was greeted by outcry and protest; predominately amongst students.

I am part of the current generation of students who have been directly impacted by those ‘mean Tories’ and ‘treacherous Liberal Democrats’… and yet I am an ardent supporter of them, and let me tell you why.

University education gives a private benefit to graduates through access to better paid jobs and thus on average earn more than non-graduates. The graduate wage premium is estimated to be £168k for men and £264k for women. If going to university increases a person’s lifetime earnings, then it is only fair to ask them to pay for that privilege. And if the government makes sufficient loans available, so that students don’t have to pay upfront, then tuition fees should not deter students from poorer backgrounds.

The reason for the recent hike in fees was due to the fact that the UK government finances were decimated by the 2008 financial crisis and the long recession that followed. This drop in revenue forced the government to reduce spending in order to avoid raising taxes (something the Conservatives, in particular, dislike doing) or increasing borrowing (totally out of the question with the already high levels of debt). However, irrespective of how government finances are faring, there is also another factor at play, which made tuition fee reform necessary: the increase in higher education participation rates.

Those highly educated lecturers, elegant campuses and libraries stuffed full of expensive textbooks don’t come cheap.

Back in the good old days when our parents were going to university, it was free. Yep that’s right, totally paid for by the government. This was a perfectly affordable system in the 1970s and 1980s when less than 15% of school leavers went to university. Today the rate has shot up to almost 50%, which is a good thing because it shows more students get the opportunity to go to university and it also means we have more highly skilled graduates in our economy. But university education is costly. Those highly educated lecturers, elegant campuses and libraries stuffed full of expensive textbooks don’t come cheap.
So, there were two options: increase taxes or ask the students to pay a contribution. Raising taxes means everybody – including those who don’t go to university – cleaners, bus drivers, postmen – ultimately have to pay, which is simply not fair. Why should lower income people in society be made to subsidise the cost of enhancing student’s earnings? It would be totally backward.

The classic argument against raising tuition fees is that it makes university less accessible to students from poorer backgrounds. This is actually untrue. In fact UCAS data shows that today English students from disadvantaged backgrounds are now twice as likely to apply to university as in 2004, and overall the number of 18 year olds applying to University is at a record high.

Labour has pledged to reduce tuition fees to £6000, which in my opinion is a truly misguided idea. Due to the 30 year lifetime of student loans, only those graduates who go on to earn the highest salaries will ever pay off their entire student loan, meaning this new policy will mostly benefit higher earners. The reduction in fees would shift the burden of higher education away from high earners and onto the taxpayer. Not to mention the fact that this policy will cost an extra £2.7bn – surely money that could be much better spent.

Postgraduate education remains, sadly, financially inaccessible to many.

Now let me bring your attention to an issue that seems to have flown below everyone’s radar: postgraduate education. Unlike undergraduate education, postgraduate education remains, sadly, financially inaccessible to many. Currently students have to rely on grants, bursaries, or credit cards to get them through a master’s degree course. But, in last year’s autumn statement, George Osborne announced new loans of up to £10,000 for postgraduate students under 30, starting in 2016/17. This is expected to help 40,000 students afford their postgraduate fees and encourage a further 10,000 who would otherwise be unable to afford the fees. This is excellent news because it increases accessibility to less well-off students and will be beneficial to the economy by increasing its skills base.

Hopefully I’ve managed to go someway to convince you that £9000 tuition fees aren’t so bad once you scratch beneath the surface. Tuition fees ensure that those who receive the most benefit from university education pay for it, which is both sensible and fair.

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