“A university education will be free to every man and woman …” predicted John Elfreth Watkins in 1900 for the Ladies' Home Journal, the highest-selling US women’s magazine of the day. His article, “What may happen in the next Hundred Years”, got a few things right. A civil engineer and polymath, Watkins foresaw ready-cooked meals, 120-mph trains and the ability to telegraph photos from a distance reproducing “all of nature’s colours”.
Alas, free university education for all did not materialize in the United States, though it flourished for a few decades in Britain. By the mid-Sixties, a generation of baby-boomers was assured free university places if they did well enough in A-levels. In addition, students from lower-paid families could get full or partial maintenance grants for three years. Some of that generation (myself included) had three or more years’ higher education and maintenance at no cost or future indebtedness to themselves or their parents. It was as ordinary as paying nothing to go to school.
A university education was seen as an unalloyed good. Good for the student, good for society. Some saw it as passport to a vocation – doctor, engineer, teacher; some as a rite of passage or chance to leave home. A few, studying subjects such as classics or philosophy, reveled in the learning. For many, it was straightforward upward social mobility. These were students who, like myself, were the first generation in their families to go to university. The paid-for opportunities of the children of the rich became, for the first time, also available on merit.
The pretence that the university system today is still broadly meritocratic is becoming harder to sustain. It rests on two pillars of faith: firstly, that access to university is via ability rather than class, race or social status; and, secondly, that money worries need not deter any school-leaver with the will and ability to go to university.
But the first pillar is crumbling under the weight of evidence that access to university, particularly higher-status universities, is far from equal. The second is contradicted by watching working-class families simply priced out of higher education. They have been hit first by the scrapping of the Education Maintenance Allowance which had helped families keep 16-19 year olds in school long enough to take A-levels, and then by the daunting debt burden of three years of university fees and living costs.
Earlier this month a a report by John Jerrim for the Sutton Trust looked at family background and access to “high status” universities in Britain, Australia and the United States. It found that children with professional parents entering university were “approximately three times more likely to enter a high-status (one) … than those with working-class parents”. At Oxford and Cambridge, researchers found that only one in eight undergraduates came from families with lower-income occupations; in the newer universities more than half were from such families.
Nor could this inequality be explained by the academic opportunities the applicants had enjoyed up until that time. “At least a quarter of the difference in England, the US and Australia is not explained by academic ability,” the study found.
A report published earlier this year, on British universities only, was even more damning, revealing systemic inequalities of race, income and social status throughout the university admission system. This study, led by Dr Vikki Boliver of Durham University, looked at students applying to the higher-status Russell Group universities. It found that state school pupils “need to be better qualified than their private school counterparts on average by as much as two A-level grades before they are as likely to apply to Russell Group universities.”
“The headline conclusion of the analysis is that access to Russell Group universities is far from ‘fair’,” said Dr Boliver.
It is tempting to say that the situation could hardly get worse but two recent Government announcements this month promise just that.
The first game-changing policy was Chancellor George Osborne’s announcement in his Autumn Statement, that the cap on the number of students that universities may admit would be lifted. Next year, student numbers will be able to expand by up to a further 30,000. Then, in 2015, there will be no limit at all. Russell Group representatives have questioned whether quality can be maintained with such uncontrolled expansion. The Chancellor claims it has a social purpose: “This year is also the fiftieth anniversary of The Robbins Report, which challenged the nonsense that university was only suitable for a small few,” he said.
He has the support of Professor Les Ebdon, director of the Fair Access to Higher Education who has expressed delight at the move. The current system, he said, “allows unrestricted recruitment of students with very high grades, which effectively limits the places available to students who may have the same potential but lower grades due to educational or other disadvantage”.
Between 1992 and 2012 the percentage of graduates in Britain rose from 17 per cent to 38 per cent. So why stop there. Why not increase that to 50 or 60 per cent? Graduates are more likely than non-graduates to find jobs; non-graduates are more likely to be unemployed and over a lifetime will earn less. For women, the financial advantages of a degree are particularly marked as revealed in recent research from The National Institute of Economic and Social Research. NIESR found that the lifetime advantage of a degree for women was £250,000 and for men £165,000.
However – and it is a huge “however” – although employment is higher among graduates, the Office for National Statistics reported last month that almost one in ten recent graduates is unemployed. Of those working, the percentage in non-graduate jobs is the highest it has ever been – up from 40 per cent to 47 per cent in the past five years. In other words, a school-leaver must now go to university in order to compete for a job that doesn’t actually require a degree.
New loans for old
But supposing it is a good idea to strive towards universal tertiary eduation. How is this increasing number of students to be financed? If there is to be no cap on places, there can also be no cap on loans which, in the first instance, have till now been paid upfront by the state. But this is a government that has staked its reputation on reducing borrowing and tax. So it needs another game-changing policy.
“The new loans will be financed by selling the old student loan book, allowing thousands more to achieve their potential,” the Chancellor explained. The plan Government has for achieving this in a climate where it is striving to eliminate public borrowing is of such surreal complexity it could only have been invented in a merchant bank. And, as it happens, it was. The idea was mooted by Rothschild Bank in 2011 in a secret report since made public following a Freedom of Information Act request from the campaigning website False Economy.
If, as Osborne suggests, new loans are to be financed by selling the old student loan book, then there is no income from the loan book to finance future loans. So the new loans have themselves to be sold to finance a further tranche of loans. And so on.
Martin McQuillan, Dean of arts and social sciences at Kingston University has described this as a Ponzi scheme. But there is worse. Rothschild suggest that the interest cap that makes a loan attractive to a student would make it unattractive to buyers of government debt. They propose that the buyer has the choice of raising the interest rate and/or that the Government guarantees a return to private investors (presumably with the taxpayer picking up the difference). Either the student debtor loses or the taxpayer does. Like other recent privatizations, private finance buys a public asset at a discount. But there is a risk (in this case students defaulting) so the government guarantees to cover the losses.
And that is the future of our universities. An entrenched system of privilege for the top institutions and a perpetual cycle, profitable for some, of indebtedness for the rest.
So what would civil engineer Watkins say of his prediction now? His idea of free university education may not have been based on idealism but just on what he saw as the most sensible way forward for a nation.
A university education cannot guarantee any student a job or income. For some, it may not be a sound personal investment. But it is a proven sound investment for a nation to invest in educating its young. The NIESR report on the relationship between graduates and economic growth argues that in recent decades a fifth of UK economic growth can be attributed to the increase in graduates. As the number of graduates increase so does the nation’s long-term productivity. If we all benefit, we should all pay.
If a university education is turned into a commodity for purchasing a good life, then the richest will always buy more than their fair share. Perhaps the best way to address the social inequalities and stratification that give rise to the different application rates, and outsmart the prejudices of selectors, is that put forward by award-winning education writer Peter Wilby. He proposed that Oxford and Cambridge selectors, who currently find a third of their pupils from just 100 schools, should be obliged to offer places to the cleverest one or two pupils from every single school. It is a simple solution that could be adapted to ensure that all high-status universities take a broad social mix of undergraduates.