Section 6: Universities as a free market

Student access to institutions in a free market

In a letter to Mr Duncan Hames MP of November 30th I asked

If the number, and perhaps the quality, of English applicants drops as a result of this policy will our top universities be allowed to fill themselves up with overseas students paying maximum fees, and become the private wealthy institutions they wish to be?'

He referred this to Mr. David Willets MP who replied on February 3rd as follows:

In regard to international students, there are no caps under the current system on the number of international students that universities are allowed to take. It is for universities themselves to decide how many international students to take, dependent on their capacity and resource. The government cannot intervene in this. It will remain up to universities to decide how many international students they take: and the government will not be able to intervene.

Tuition charges for international students are under the current system, unregulated.

I believe David Willets' announcements of 28th June are also the beginnings of an answer to this.

Given the number of Chinese school students studying 'A' levels with the specific intention of attending a British university there will be no lack of well qualified wealthy Chinese to fill our universities
(A Chinese girl who was a guest with us last autumn told me there were two schools in her town where A levels were studied which allow application only to an English university, not a Chinese one).

Welsh or Scottish students fees will be funded by their parliaments, overseas students fund themselves and wealthy students may also be self-funding. Is the government willing or able to fund unlimited places for English students? If not will this lead to a situation where two students, both able, both good
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candidates for the same course, may end up having a place based
on who pays, or who can pay, the bill? Will English students be disadvantaged if government funded places are capped?

The government's current policy seems to fund good universities to the benefit of Welsh, the Scottish the wealthy and overseas students. The Scottish and Welsh have taken care of their students. But who, in this free market, is taking care of English students? Not, it would seem, the UK parliament.  What will be put in place to make sure new competitive universities provide an education for English students? The Scottish and Welsh seem to have shown better concern for their children.

Market effects on universities

In introducing new private universities their success must require either more students or some older institutions to fail. Increased student numbers do not seem certain under the new loan system. How will the market deal with students, carrying large debts, whose institution fail part way through their courses?

Fair trade between 'old' and new private universities

 Will the new private universities also be obliged redistribute part of their fees collected from students to fund poorer students and widen access? I believe around 30% of everything over £6,000 is required now. If not they will be able to promote themselves as using more of the fees a student pays on that student, certainly better from the point of view of the fee paying applicant.  

Proper consumer information

In his statements of 28th June Mr. Willets promised information on teaching quality and graduate prospects for the new loan bearing students. The 2012 entry group are visiting and choosing universities now. They are the first students, and hence the least well prepared, and entering into an ever changing system, yet they are not being supplied with this information.

If this is really a free market then surely, with a purchase of this value, consumers are entitled to the same level of information they would expect with any other product.
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Quality control in the market

There is a suggestion that higher fees in this market will improve the quality and value for money of our universities through students being more selective. This market is made largely of 18 year olds with borrowed money, whose primary concern should be getting the qualifications they need and choosing the right course,                                                      
 not university quality control. Although they may have a role in a market if there is a problem with poor courses surely controlling these is primarily the responsibility of the people in power, and with the new higher fees a student might reasonably expect this to be the case.

Another recent suggestion has been to reduce fees for students taking up places through clearing, that is the places, which the students with most choice have rejected. One might reasonably assume these are the least desirable courses, yet under this policy they would be the places with the highest taxpayer funding.

I am not sure if this idea has disappeared (See section on 2012 entrants) but if not, where does the 'quality control' of a free market rest with this?