In countries across the world, debates are taking place about how student places in higher education should be funded. Essentially, these debates centre on the issue of the division of funding between the student and the state. How much should students pay in terms of fees, either in terms of up-front payments or in terms of deferred payments through student loans or a graduate tax? How much should the state pay through taxation? Should the split between student and state funding be the same for all subjects? And how is access to higher education by those from socially disadvantaged groups to be promoted?
The debate reflects the generally held view that there is both a public and private benefit from university education – a private (or student) benefit in terms of enhanced lifetime earnings and public benefit in both economic and social terms:
• the economic benefits that flow from having a highly skilled workforce (the ability to attract and retain high value-added jobs);
• wider social benefits in terms of the fact that a well-educated population tends to make fewer demands on health and social services, and the fact that well-educated populations tend to result in greater political stability.
In the UK, the funding of higher education is devolved and the funding regimes vary between the four nations. At one end of the spectrum, Scotland relies on public funding for Scottish-domiciled students. At the other end of the spectrum, England focuses on private funding with student fees of £9,000 per annum (which can be deferred through student loans). There is no state funding for some subjects and a limited amount for others. Whilst universities are free to set fees below £9,000, few now do so, or can afford to do so.
Northern Ireland has taken a middle position. At the start of this Stormont Assembly’s mandate, fees were set at £3,500 per annum and were combined with public funding so that, overall, the income that universities received per student was similar to that received by universities in England and Scotland.
Over the life of this Assembly, student fees have been held constant in real terms whilst the public contribution has been cut by about 18 per cent in real terms. As a result, universities in Northern Ireland now receive some £1,500 to £2,500 (depending on subject area) less per student per year than do universities in England and Scotland. This is an unsustainable position.
The Northern Ireland Executive Budget for 2015-2016 will see a further cut in public funding and the universities are agreed that the only way to deal with this is to seek to maintain the quality of provision by cutting the number of student places. This will take place in the context of Northern Ireland already having the lowest number of student places per head of population of the four UK nations. The disconnect between the Executive’s central aim of promoting economic development whilst cutting the skills pipeline (which Invest NI promotes as Northern Ireland’s top selling point) has been widely recognised. We are not in a position to take advantage of any cut in the corporation profits tax.
The 2015-2016 Budget is a temporary ‘sticking plaster Budget’ and we are now entering the Comprehensive Spending Review (CSR) discussions for the next four years. We do so with a financially unsustainable system of higher education funding and a declining skills pipeline. As a consequence, before the CSR discussions begin, it is vital that we join with those countries across the world and have a serious debate about how student places here should be funded. To pretend that the current system is sustainable will be in nobody’s interest, least of all that of our young people.
Richard Barnett is the outgoing Vice-Chancellor of Ulster University.