Gavin McCrone: The price of free degrees is too high

IT IS seldom that a government policy seems so certain to be damaging and misguided as the proposals for university tuition fees. In England, in response to a drastic cut in the government grant, universities are to be allowed to raise undergraduate tuition fees from their present level of 3,290 to a maximum of 9,000 a year. In Wales and in Northern Ireland tuition fees have also been 3,290; the Welsh Assembly government is to set fees 2,000 below the average in England, which they had assumed would result in fees of 4,000; and in Northern Ireland fees are expected to be 5,750 following the revised Stuart report, which had previously recommended no change.

In Scotland, however, Scottish and European Union undergraduate students have free tuition, while English students have had to pay fees of 1,820 a year. This comes about because under the EU treaties, member states have to treat students from other EU states in the same way as their own; but there is no such requirement between the countries of the UK.

This is shambles enough. There are reports in the press that the number of English students applying to Trinity College, Dublin, is expected to rise sharply, where EU students, including of course those from the UK currently pay no fees, although all students pay a service charge. Given the dreadful economic situation in Ireland, where the government has had to borrow from the EU and the IMF, it would be absurd for the Irish taxpayer to fund free higher education for English students.

The Scottish universities are also likely to see a sharp increase in demand from England, despite the different treatment of English and Scottish students, if fees stay at their present level. Given the ability of students to go to any university that provides a suitable course, one might have expected an attempt at some degree of co-ordination in devising future policy between the constituent countries of the UK. I do not know whether any such attempt was made, but I doubt it. Perhaps it illustrates a reluctance on the part of Westminster to take proper account of the implications of devolution.

The big rise in tuition fees in England is the consequence of the coalition government's decision to try to eliminate its fiscal deficit during the lifetime of this parliament. Personally, I think the cut in grant too great and the consequence for fees too radical. There are, however, major implications for Scotland.What the Scottish Government will receive in block grant from Westminster will be reduced, since the size of the grant is related to what is spent on similar services in England. Furthermore, if English universities are encouraged to raise fees, while Scottish universities do not, a gap will open up between the funding of English and Scottish universities that will be extremely damaging to the latter.

How have we got into this situation? In the 1950s there were four universities in Scotland and fewer than 10 per cent of school leavers went on to university. Today there are 15 universities, counting the recent conferment of status on the University of the Highlands and Islands, and close on 50 per cent of school leavers go on to university. The cost has therefore greatly increased and it is not surprising that the coalition government is looking to higher education for a share of the savings it has to find.

University education provides a shared benefit: a benefit to the individual graduate through increased earning opportunities as well as cultural and intellectual enhancement; and a benefit to the state if it is to take advantage of the economic opportunities that are only available with a highly skilled and trained workforce. It is therefore not unreasonable to expect the cost to be shared. And it may be no bad thing for students to pay something towards their tuition, if it makes them realise that there is a considerable cost involved. It may encourage them to apply themselves to their work and to be critical of the value of the courses they are offered. But it is also, in my view, a very bad idea to load young people with a huge burden of debt. The question is what is a fair balance? If English fees are raised as is proposed, it would seem that for many subjects the bulk of the cost would be met by the student and those with the highest fees could leave university owing some 27,000, or more for courses exceeding three years. This would have to be paid off but not until their earnings rise above 20,000.

Faced with this situation, Alex Salmond has said that "the rocks will melt in the sun" before he agrees to impose tuition fees on Scottish students. The leaders of the Labour and Liberal Democrat parties in Scotland, not to be outdone, have followed this with a pledge to impose no tuition fees at least during the coming parliament. Is this sensible and how can they stick to it? The Scottish Government set up a technical group to estimate the funding gap that would result if no fees were imposed in Scotland but the proposed English fees went ahead.This group estimated the gap at between 97 million and 324 million in 2014-15 depending on the average level of English fees and whether they are indexed to inflation.

SNP education secretary Michael Russell, in arguing that the Scottish Government can maintain its no fees position, has taken the lowest estimate of the gap - 97 million - and claimed that this can be filled by philanthropy, greater efficiency and by business. This is totally unconvincing. Universities are already trying to get as much as they can from philanthropy and in present economic conditions it is unlikely that much more will be forthcoming from business. As to efficiency, does he have anything in mind? The amalgamation of some of the newer universities perhaps? Furthermore the gap seems certain to be much larger than the lowest estimate. It is already clear that many more universities - not just Oxford, Cambridge and some of the London colleges - will go for the maximum 9,000 fee; indeed it seems likely that the majority will set fees in excess of 8,000, thereby invalidating not just Mr Russell's assumptions but also those of coalition government ministers.

The perverse consequence of this situation is that it would benefit Scottish universities to take as many English and non-EU students as they can, since they will pay fees, and to push those fees up substantially, something that Mr Russell apparently accepts.

But imagine a situation where Scottish students continue to get free tuition at Scottish universities, along with students from Estonia, Bulgaria and other EU countries, but English students have to pay substantially more than at present. If these fees were put up to say, 6,000 a year, they would still be lower than the average at English universities estimated by the technical group, but it would be surprising if the unequal treatment with Scottish and EU students did not provoke an outcry in England.

So there are two concerns. The first is that Scottish universities will be more poorly funded than in England, resulting in the closure of departments, possibly even some universities, and the loss of key staff. This would be a major tragedy, when Scottish universities are so highly regarded internationally, and damaging to Scotland and its economy.

The second problem is political. Already there is a fairly widespread view in England that the higher level of public expenditure in Scotland, as compared with England, while taxation remains the same, cannot be justified. The council tax freeze, free care for the elderly and free prescriptions all create the impression in England that the Scottish Government can only do this because its grant from Westminster is too generous.

If no tuition fees for Scottish students continue while fees are sharply raised for English students not only in England but also for those studying in Scotland, the backlash from English MPs and the English public could become serious.On neither count do I think this policy is tenable.