Vice Chancellor Calls For Rise In Tuition Fees And Student Loan Interest

Fri, 26 Jun 2009

A leading education figure has called for the cap on student tuition fees to be raised to help generate more funding for universities and increase competition.

Professor Paul Wellings, Chairman-elect of the 1994 Group, which represents 18 research universities, also said the rise should be accompanied by a higher interest rate on student loans in order to raise more cash to as maintain and improve higher education (HE) quality.

Prof Wellings, who is also vice-chancellor of Lancaster University, told a 1994 Group conference in London that the Government and higher education sector faced a clear choice between reducing student numbers or increasing funding for HE.

He explained that raising tuition fees in England, which are currently set at £3,225 a year, would encourage competition between universities, which in turn would drive up the quality of university provision.

"To maintain quality, the fees cap needs to be high enough to bring in sufficient funding and enhance competition to further drive up quality," he said.

"In addition, a sensible interest rate should be introduced on student loans, set at the current Government cost of borrowing, to rectify the huge subsidy that the Government currently pays."

The leading academic added: "The current system was never explained or communicated properly to users."

"It is essential to get the politics right and clearly communicate the benefits of the variable fees system, and universities have a key role in helping to do this. The message should be that HE is free to students .

"Whereas HE used to be paid for by a general taxation, it is now a personal contribution. It is payroll deduction, not a commercial debt ."

Wes Streeting, President of the National Union of Students (NUS), hit out at the professor’s comments, saying that they exposed many vice chancellors’ agenda of "higher fees and higher interest rates on student loans ".

"Vice chancellors in Britain need a reality check," he slammed. "It's easy to fantasize about higher fees and higher interest rates on loans when you're on a huge salary, but this summer many students will be graduating with record levels of debt straight onto the dole queue."

"We recognise that the economy needs more graduates and universities need more funding. That's why NUS has published alternative proposals for funding higher education that would include a progressive graduate contribution linked to earnings."
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