Proposals for a private college charging tuition fees of £18,000 each year could radically alter the higher education sector over the long term
AC Grayling’s plans to establish the New College of the Humanities (NCH) as another ‘private’ university in the UK (the third) has led to much controversy.
However, it is not always easy to establish what are the underlying reasons for the criticisms being made. After all, nobody would object to a proposal to establish a new private shop or restaurant. Clearly, it is something to do with higher education being seen as a public service and not a private good.
Many people object to the involvement of the private sector in the provision of any public service and this could include higher education. But this seems odd given that UK universities are already private sector organisations. Universities were established by private subscription and operated successfully without regular government grant or intervention until 1919, when the University Grants Committee was established.
Moreover, governments insist that universities comply with all the rules and accounting practices that control private bodies. They must also aim to make a financial surplus, albeit that this surplus is not distributed to shareholders but is re-invested in the organisation.
Some may still try to argue that traditional universities are really public sector organisations since they receive vast amounts of public funds, but then so do Capita or British Aerospace and they are clearly private sector bodies.
Media reports suggest that NCH will charge undergraduate fees of £18,000 per annum. Clearly, this is well above the levels charged by the majority of universities and may be explained, at least in part, by the absence of government teaching subsidies. Thus, the level of fees coupled with the inability to access student loans means that NCH will probably only be accessible to a relatively small number of students.
This discussion takes place in an environment where the demand for HE places will be well in excess of the supply and therefore, critics maintain, NCH will become the province of those who have failed to get into a traditional university but can afford to pay high fee levels.
Some argue that students should not be denied access to a university place because of their lack of means. This has echoes from the past, where some claimed that people should not be able to obtain private health provision where NHS care was not available in a reasonable period of time. Similarly, there were some who wished to ban parents from sending their children to a private school in preference to the local state school.
Whatever the merits of these viewpoints, they are probably now redundant because of severe impracticality. In a democratic society one cannot easily stop people deciding how to spend their money, whether that be on private health, private schools or private universities. Even if we all had the same income and savings, some would choose to spend their money on housing and cars and others would choose to spend it on their children’s education.
Some people have suggested that new private universities like NCH will have poor teaching quality. At one level, it could be argued that people willing to pay £18,000 per annum in fees should first check on teaching quality themselves. But also, presumably, the teaching quality regime of the Quality Assurance Agency for Higher Education will apply to NCH in the same way as for other universities including the University of Buckingham, which is the best known ‘private’ university in the UK.
There may also be a fear of competition. Competition already exists in the higher education sector, but it is largely to do with access, quality, location, and facilities, and not price. This is because even after the new funding regime commences in 2012 it appears that undergraduate fee levels will be compressed into a fairly narrow band of between £7,500 and £9,000 per annum irrespective of subject or institution.
Furthermore, it could be argued that competition in HE is also constrained by a range of cultural factors such as national terms of pay and conditions and high levels of interference by the funding councils. At the moment the lack of subsidies for institutions like NCH or Buckingham must mean that they cannot compete in price terms with other universities and their high levels of fees are a barrier to most students.
However, in years to come it is possible that the cap on levels of university fees might be lifted and players such as the ‘private’ universities might provide stiff competition for existing institutions.
Overall it seems to me that the creation of NCH should not be a big issue in the short term. However, in the longer term with a group of private universities and the removal of the current fees cap, the sector could be radically changed.
