Labour commits £7.2 billion to axeing fees and reviving grants

Labour’s election manifesto confirms its commitment to abolishing tuition fees and reintroducing maintenance grants in England, which it costs at £7.2 billion, while also pledging to “fundamentally rethink the assessment of research and teaching quality, and develop a new funding formula”.

Critics of Labour’s plan to replace tuition fees with direct public funding for universities have long argued that it would mean the reintroduction of student number controls in order to control spending. The policy costing published alongside the Labour manifesto says that “despite projections for the number of [full-time] undergraduates to decline in the forecast period due to a falling number of 18 year olds, we have allowed for an increase in participation”.

The costing also says Labour would follow the plan for a three-year freeze in per student funding recommended in the government’s review of post-18 education, but allow a wider increase in funding in line with inflation.

“Under the Tories, universities are treated as private businesses, left at the mercy of market forces, while top salaries soar and students pay more for less,” says the manifesto in its plan for a National Education Service.

Changes to the classification of student loans made by the Office for National Statistics – which significantly increase the impact that the Conservative government’s £9,250 fees system has on the deficit – mean the cost of Labour’s plan has come down from £11.2 billion in the 2017 manifesto to £7.2 billion.

Labour will “end the failed free-market experiment in higher education, abolish tuition fees and bring back maintenance grants”, it adds.

The party promises to “fundamentally rethink the assessment of research and teaching quality”. And it also says it would “develop a new funding formula for higher education”, one that would ensure “all public HE institutions have adequate funding for teaching and research”, “widens access to higher education and reverses the decline of part-time learning” and “ends the casualisation of staff”.

Labour also confirms some other pledges it had previously outlined, on English sector regulation and admissions.

“We will transform the Office for Students from a market regulator to a body of the National Education Service, acting in the public interest,” it says.

And Labour will “introduce post-qualification admissions in higher education, and work with universities to ensure contextual admissions are used across the system”, it adds.

The costing document offers further detail on the calculations used to arrive at the £7.2 billion “net cost” figure, in 2023-24, for the abolition of tuition fees and the reintroduction of maintenance grants.

The costing cites an estimate from the Institute for Fiscal Students that the two policies would involve increasing “direct grants” by £12 billion a year, but a total deficit impact of about £6 billion a year.

There is “a saving on CDEL [capital departmental expenditure limit] due to the ONS’ reclassification of student loans: the money being spent on the current system which will no longer be necessary under Labour”, the costing says.

It also says: “In line with the recommendations of the government’s ‘Augar review’ we have assumed a three-year freeze from 2020-21 to 2022-23 on per pupil funding but total RDEL [resource departmental expenditure limit] outlay increases with inflation every year, to ensure maintenance grants get more generous and universities have the funding that they need. This means that, despite projections for the number of [full-time] undergraduates to decline in the forecast period due to a falling number of 18 year olds, we have allowed for an increase in participation.”

john.morgan@timeshighereducation.com

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