Tuition fees heading down in 2019?

Sean Coughlan

If the education secretary and universities minister are looking across the snowy pages of next year's diary, there will be one date they'll already be thinking about.

The recommendations from the review of tuition fees and university funding in England are going to land on their desks, most probably in January or February.

The government won't respond immediately - it could be months before anything appears - but at some point, the Department for Education, 10 Downing Street and the Treasury will have to hammer out a decision.

Should tuition fees in England be reduced from the current £9,250? Should the cost of studying be linked to future earnings? What about training for those who don't go into higher education?

The start of this review already feels like another age. It was announced in 2017 by a prime minister chastened by the loss of her parliamentary majority and challenged by Labour's promise to the young to scrap tuition fees.

Fees facing a cut

The financier Philip Augar was commissioned to find a system that would offer better "value for money" than a system with some of the world's highest fees and interest rates of 6.3%.

This year the questions about fees will have to be answered.

The prospect of cutting tuition fees became much more likely after a decision this month by the Office for National Statistics.

The portion of student loans which are not expected to be repaid - about 45% of the total - will be reclassified as public spending, adding £12bn to the deficit, which measures the gap between the government's income and outgoings.

The economics think tank, the Institute for Fiscal Studies, said this would provide a big incentive for the government to cut lending to students - which could mean lower fees or fewer students.

The value for money argument for the current level of fees has also taken a bit of a battering.

A report from the Department for Education showed a third of male students are at universities where their returns in higher earnings are no better than "negligible".

There were a number of courses where graduates could expect to earn less than non-graduates, despite an average of £50,000 of debt.

For a system where almost all universities charge at the same level of £9,250, there were some extreme differences in levels of returns.

Among the recommendations could be one to charge higher fees for courses that are more expensive to teach or which have a better chance of high earnings.

That would make science or maths more expensive to study than English or philosophy.

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But such so-called "differential" fees would open up another academic can of worms, such as deterring students from poorer backgrounds from taking science and maths and creating a downward spiral of underfunding and low status for the arts and humanities.

The direction of travel of the review seems to have been about lowering the headline figure of £9,250.

And in political terms, how could you have a review working away for over a year and then emerge with the same problematic numbers for fees and debts?

There have been suggestions of £6,500 - but that could be a kite-flying starting point for negotiations.

When the last big review of fees was carried out in 2010, the assumption was that most courses would cost about £7,500, rather than the £9,000 which went from an upper limit to the standard price.

Cutting fees, cutting places?

Universities have already been pre-empting this by warning that any cut in fees would have to be matched by replacement funding.

In particular, they are concerned it would limit the number of students and reverse decades of widening access.

Working within the existing funding levels, cutting fees to £6,500 or £7,500 would give the government a significant pot of money for direct grants.

It could top up courses which were more expensive, or which were of particular strategic importance to the economy, or which had a strong record in social mobility.

A report from the Higher Education Policy Institute recently suggested a national fund for widening access to university, rather than individual universities taking a slice of each tuition fee to run their own schemes.

This is a "post-18" review and not just about universities - and if less money goes through tuition fee loans, more could be diverted towards further education and apprenticeships.

The review is expected to produce a more "joined up" approach to make it easier to take non-university vocational courses.

This could dovetail with the ambition to reduce spending - as getting more people to go down the non-academic route is cheaper than sending them to university.

Maintenance grants

In terms of how this might happen, another leaked idea suggested an A-level grade cut-off, so that those with low grades would no longer be eligible for tuition fee loans, and so would be nudged towards cheaper vocational courses.

But that would challenge university independence over admissions and would be seen as blocking social mobility - as those most affected could be poorer students from low-achieving schools.

Another decision will be about how students should be supported.

A cross-party line-up of former education secretaries, including Justine Greening, Nicky Morgan and Charles Clarke have called for the return of maintenance grants for poorer students.

There will also be broad support for more funding help for part-time and mature students.

The review has also been looking at the idea of putting more money into students' pockets while they are studying.

But it's not simple. For instance, the review has the reasonable concern that if they allowed students more maintenance funding, universities or accommodation providers could increase their rent by the same amount and all the extra cash could disappear.

It's part of the same problem that has faced previous attempts to generate a "market" in higher education, where the maximum level of support, such as for fees, immediately defaults to a standard charge.

Of course there is one other bigger rogue factor in all of this. Events.

The months ahead are unpredictable and the response to the review is likely to have to wait for Brexit.

If another election becomes imminent, that could completely rewrite the headlines of what the government will want from the review./agencies