'Battle' for cash goes on, says No 10 aide

The future funding of higher education is insecure despite the introduction of top-up fees next year. Vice-chancellors may face "another battle" to win extra cash, according to a new Downing Street aide.

Philip Collins, former director of the Social Market Foundation (SMF), writes in the latest edition of the Higher Education Review that "nobody seriously believes the question of funding (for universities) has been settled".

Mr Collins, who wrote the article before taking up a post in the No 10 Policy Directorate, states that the Government "rushed to legislate" with the Higher Education Bill and failed to settle the fees argument with its own backbenchers, making it likely that future policy changes would be "more acrimonious".

He writes that Labour opponents of the Bill were not persuaded that the Government's fee and bursary plans were progressive - "taking down a small part of the middle-class welfare state" in favour of poor students - and he suggests that it would have been better to describe the new system as a graduate tax.

Mr Collins concludes that despite an increase in government funding for universities in the next few years, cost pressures facing vice-chancellors will be "substantial and increasing". Such pressures could fuel an increase in recruitment of overseas students or push some institutions into opting out of state control.

But he also predicts that the government budget for universities might be squeezed by pressure to spend more on early-years education. "The problems lie too deep to hope that engineering at the level of admissions will be the solution," Mr Collins argues.

"Even outreach... can only do so much. We have to be honest about this: the problem (of social mobility and access) occurs long before the age of entrance to university."

According to an SMF report, Mr Collins says, it would cost taxpayers an extra £21 billion to pay for a package of early-years policies, including one year's parental leave after the birth of a child and extra education and care for infants aged one to four years.

Rather than raising taxes, he adds, "it is far more likely... that the funds will come from a gradual reordering of spending priorities". He says that about 8 per cent of UK education spending goes on children aged up to five, while 15 per cent goes on higher education.

Finally, he warns that one of the key arguments for expanding higher education may also come into question if a dip in the economic cycle leads to "extensive graduate unemployment" in five to ten years. This may lead to a "backlash" against going to university, he concludes.

paul.hill@thes.co.uk