Thursday 28 February 2019

Univeristy Fees - A good example of how to remove subsidies and improve outcomes

So, many moons ago now, Labour introduced University fees. This is one of those policies, which a bit like a pre-cursor to Brexit, forever split the electorate.

Those who came before fees became forever privileged and according to the leftist notice of 'privilege' are now not allowed to comment on the plight of those who went to Uni post fees.

However, the Uni's themselves have taken all sort of benefits out of fees. For one, they have decided to pay their own executives loads of money - having suddenly become pseudo-capitalists!

Also, they have raised fees and expanded their offer to Foreign students who they are allowed to charge more. This has led to big increases in their numbers and financing. Being known around the world means the UK has 13 of the top 20 Universities globally. Given the state of our lower education, this is frankly amazing. The rest of Europe manages one university in the top 20.

So with the traditional British skills of marketing, we have really smashed this market. However, it does mean that although overall the numbers of UK students going to Uni is steady, it has stopped its headlong increase. Also at the top Uni's a higher percentage of places are going to foreign students over UK students. But, thanks to fees, lots more UK potential domestic students are going to Continental and US Uni as they have to pay fees anyway - there are fewer stats on this, but it feels to me like this maybe compensating in a small way for the extra Foreign students.

Politically, Uni fees remain toxic, given they created a defined generational divide. It literally killed the Lib Dems as a political force, if not for a generation at least. Magic Grandpa Corbyn got a lot of votes in 2017 but deciding a wand waving exercise to remove fees would be a good thing to do - costings for this not applied. The Tories try to ignore something that was likely a good idea that they can forever blame on New Labour. But nobody will ever defend the fees, which is why I say it is kind of like Brexit - no one in Parliament will defend remain, but they all want it!

Overall increasing the money going into the Higher Education sector has seen it build a world-leading service and also start to exploit the capitalist benefits of the extra money - who knew those ivory tower lefties would turn out to be champagne socialists eh! It has led to more opportunity for the whole world to come to the UK with intangible benefits for our long-term global trading network. But it has not really helped the disadvantaged UK students and has acted as to enmesh our young in debt in a way previous generations had escaped. Some say it is a graduate tax, it is nothing of the sort - reducing a state subsidy can never be alikened to a tax. And of course, by reducing the subsidy and allowing/forcing private money into the sector the overall picture has improved.

No wonder the BBC don't like reporting on this!


Sackerson said...

Raise the school leaving age to 30. That should cure (a) the unemployment problem and (b) any desire to continue studying.

Raedwald said...

I'm not convinced we have value here. Tax subsidisation of HFE in ENGLAND currently costs around £3.6bn pa - £1.4bn via the Office for Students and £2.2bn via Research England, both split from the old HFECE. Scotland pays universities and colleges £1.8bn a year from tax for both teaching and research. That's £5.4bn in total.

Foreign student fees for the whole of the UK are currently around £4.8bn pa.

Of course there are externalities. Depending on whom you read, Foreign students either add £25bn to GDP or have a cost of £25bn of foregone GDP.

Likwise, the opportunity costs of losing all those productive years to the export-earning economy may exceed the additional lifetime graduate tax take - the graduate premium these days is much diminished. In other words, sending 50% of our 18 yos to uni may actually cost the economy a bomb.

With PwC forecasting 30% job losses in the UK from AI in the next 15 years, we really need to take a deep look at HFE in the UK.

dearieme said...

My dear old Dad used to say "Your friends aren't getting their education free, it's just that I am paying for it".

It was an elaboration on his line "I've paid a lot of income tax in my life and the only damn thing I've ever had back for it is part of your education".

E-K said...

It is important to discern between UK students who go to Russell Groups and those who don't, to get a real indicator of "It's amazing how many go bearing in mind the state of lower education." Most university courses are a waste of time and money.

The biggest divide is not generational but regional. The Scots get free tuition (and free old age care) leaving them hundreds of thousands better off.

The generational divide is false anyway. We did not get 'free' university education - we got NO university education. Only about 5% went in my area. There wasn't even any hint that UCAS forms existed. We were pure factory fodder.

I vowed that my boys would never go to a school like my comprehensive which turned out 10x more convicts than it did university students.

I still managed 7 'O' levels despite the disruptions in class.

*I made up my education with night classes and correspondence reaching A levels and then on to a professional diploma which took me 5 years. I did not go into management as planned because the working situation changed but I passed on my methods of learning to my boys. So not wasted.

E-K said...

"No wonder the BBC don't like reporting on this!"

Another thing they don't like reporting on is the other half of the story when they bang on about the need for migrants as our young are not up to the job.

Just what is it that's gone wrong with our education and welfare system ? It's about time the BBC reported on that instead of just giving us half of the story all of the time.

Anonymous said...

I suspect your analysis is suspect. The choice of the UK for University education is that

a) we speak the lingua franca of business - not too well but good enough and
b) we are cheaper than the US given the usual trashing of our currency.

Anyone can do cheap which appears to be the new strapline for UK plc. Come to us - we have no standards......

Anonymous said...

There's an interesting Dominic Cummings post on (among many other things, mostly why the NHS should do a simplified DNA scan of the whole population) UK education. He's not exactly a fan (neither am I)

"One of the arguments I made in my 2014 essay was that we should try to discover useful and reliable benchmarks for what children of different abilities are really capable of learning and build on things like the landmark Study of Mathematically Precocious Youth. This obvious idea is anathema to the education policy world where there is almost no interest in things like SMPY and almost everybody supports the terrible idea that ‘all children must do the same exams’ (guaranteeing misery for some and boredom/time wasting for others). NB. Most rigorous large-scale educational RCTs (random controlled trials) are uninformative. Education research, like psychology, produces a lot of what Feynman called ‘cargo cult science’."

I'be been saying for decades that organisations like the Institute Of Education are not just useless, but actively harmful - a view which was reinforced when one of their staff, a guy really old enough to know better (50s? 60s?) had poor security on their £1,000 drug stash as a result of which a girl died of an overdose.

Anonymous said...

"Most university courses are a waste of time and money. "

I think that's an exaggeration. Some are, but the main things that determine whether a course is worth while are the quality of the lecturers and technical staff, and the motivation of the student. For a lazy, stupid student, any course is a waste of time, and so is any kind of job training.

Generally the universities that were polytechnics place more emphasis on course that lead to professions -- civil engineering, electronics, programming, industrial design, computer games design, etc. Provided the teaching staff are good, these are not a waste of time and money. People do go on these courses and then have worthwhile careers.

Don Cox

Anonymous said...

E-K - it's amazing, isn't it, how we have the Blair Generation, "the best-educated generation in history" (D. Miliband 2009), yet employers continually moan about not being able to get the right staff*.

* the right staff at a cheap wage, of course. We need more immigration! These Brits just don't want to work (for what I'm prepared to pay)!

Bill Quango MP said...

Dominic Cummings always makes me feel like a dim pupil. I only ever get a percentage of what he is driving at. While being aware I am reading the dumbed down version fore idiots.

Anonymous said...

BQ - the only thing with Dominic C is that he's very intelligent, even more than Gove - and Gove was bright enough to be very stupid. I remember Gove praising what were basically Pakistani vigilante gangs in Birmingham ('campaigning' robustly/violently against street prostitution) as fine examples of community-based initiative.

Cummings is also on board with modern genetics, which has huge implications for social policy, all of which are diametrically opposed to the ideology of those actually running social policy, and indeed to the blank-slate ideology of May and Cameron's Conservative Party (who nonetheless still send their kids private).

Intelligence is heritable ("why do middle classes dominate the best state schools?", "why are so many elites privately educated?")

So are a lot of other traits ("why are there so many stabbings in London?")

For the last 40 years (ever since "unmarried mothers" stopped being a problem class and became heroic "single parents") the least intelligent have had the most babies.

As we push more and more of the brightest women into higher education, so they have fewer babies (more years in education=less kids, true in India and Mexico as well as the West).

60% of medical students are now female ("there's a shortage of doctors" - because women doctors still have kids, just not as many, so work part time)

Result - we are getting less intelligent on average - and that's before the effects of mass immigration.

These truths are all basically unsayable ("Nazi eugenics!") - which is why Cummings is a bete noire of the Left and a "loose cannon" of the Right.

patently said...

Not all university courses are a waste of time or money. Some are useful, and then we make those students pay back their loan. For the courses that are a waste, we end up writing off the debt. So whilst I can see the argument for making students pay for their own tuition, I don't fully understand why we subsidise the pointless courses but charge full rate for the useful courses. Surely it should be the other way round?

E-K's experience would suggest that tuition fees were a solution to the wrong problem...

Anonymous said...

" For the courses that are a waste, we end up writing off the debt."

But in the meantime, up to their 50th birthday, the former students (mainly in the top half of intelligence) will be paying a marginal extra tax of 9%, at a time when they should be buying houses and starting families. I can't imagine a more dysgenic policy.

It's almost as if our elites don't want us to have kids.

Anonymous said...

The really intelligent ones move house a few times and avoid paying back their loans. ;-)

But I can't see paying off your student loan as a tax, any more than your mortgage payments are a tax. Nobody forces you to go to a university, or if you do go, forces you to go to one in an expensive town like Cambridge.

As for the genetics argument, I think it is greatly over-simplified. Intelligence is only partly determined by genetics. And anyway, nobody knows exactly what it is, or agrees on how to measure it.

Are there figures anywhere to show that doctors really have fewer children ?

Don Cox