It is striking that Keir Starmer should be setting out his stall for ten years at the helm of government to repair the mess he claims the Tories left. By chance or design the return of Odysseus, the king of Ithaca, from the Trojan wars also took a decade. The journey was outlined in Homer’s Odyssey and this Greek epic poem offers several pointers for Keir as far as university funding is concerned.
The siren voices of the sector are singing away in an attempt to lure Labour onto the rocks of throwing taxpayer cash at an outdated, inefficent financial and operational model. Like Odysseus, Captain Keir needs to strap himself to the mast and ensure that his ministers have beeswax in their ears as they row away from danger. This as an early challenge and the rocks of Scylla (union backed pay restoration) and the whirlpool of Charybdis (the NHS funding challenges) still await if he, like Odysseus, is to complete his journey home.
A Slippery Slope
Roman statesman and philosopher Cicero used the “slippery slope” metaphor and it should be another classics reminder to Labour that affairs can “glide readily down the path of ruin when once they have taken a start.” iNews has reported that the DfE has already established a special unit for universities in trouble and one has benefited from its support. But “university sources” whispers to them that there are “a relatively small number – but a number that you would notice if they went over the edge – that are in really significant financial problems.”
It’s a beautifully crafted statement from anonymous sources. It puts the scare in the story with “a number you would notice”, the urgency with “over the edge”, the scale with “really significant”, but pulls back to say the number is “relatively small” to suggest other institutions are good stewards of their finances. It could be characterized as seductively threatening. But Labour would be failing in its obligations if it didn’t ask why taxpayer money should be channeled to the whole sector just because a few cannot manage their budgets.
By focusing on the few, Labour could name them so that their leadership, including the university councils involved, could be properly reviewed to see if they have acted responsibly with public money and the future of their students. A clear out rather than a handout might be the most cost-effective option. Reorganization rather than more money was a drum Wes Streeting was beating about the NHS but his tune seems to be changing so the resolve of the government is under serious threat.
Time Flexes…Like Resolve
Aristotle told us that, “Time crumbles things; everything grows old under the power of Time and is forgotten through the lapse of Time.” In July, Bridget Phillipson told the World at One that “Labour had “no plan” to raise [university tuition] fees.” By August 16, iNews was reporting that “increasing student fees” was on the table, despite Phillipson saying just a week earlier that it would be a “really unpalatable thing to be considering.”
It is quite extraordinary that the Government is unprepared and appears in chaos over an issue which had been flagged for many months ahead of the General Election. Having already caved in to several union wage demands they may be willing to throw fuel on the bonfire of handouts by doing the same for universities that are unable to manage their own finances. But there is little wonder that Captain Keir’s office is said to be nervous – he’s the one that said he was renouncing the total withdrawal of tuition fees because the money was needed for the NHS.
It Will Never Be Enough
Epicurus explained that “nothing is enough for the man to whom enough is too little” and that’s a good mantra if it is true that Labour are considering an increase in fees but keeping it under £10,000 for “presentational reasons”. They are dealing with a sector that wallowed in the benefits of implementing £9,000 tuition fees when a figure of £6,000 was expected and feasted on the opportunity to recruit international students with little control. Some would argue that the wasted millions on restructuring costs, unwise investments, bloated bureaucracies and vanity projects indicates that some universities are incapable of making good decisions even when they have guarantees of more money.
Another good lesson comes from Wales where tuition fees have increased from £9,000 to £9,250 in 2024 (although the overall settlement is complex) with none of the universities showing any enthusiasm. Part of the problem for some of the institutions is that they have been presiding over longer-term declines in domestic students which suggests there are far more serious structural problems at play. Increasing reliance on international student income has become a feature of some, such as the University of South Wales, but that raises serious questions about the purpose of universities.
In Scotland, tuition is free for Scottish students but it is notable that the amount received per student is, according to the Institute for Fiscal Studies, only £7,610. Given the outrage of the English universities at their £9,250 tuition fee one wonders how Scottish universities continue to deliver effectively with little apparent difference in outcomes. While Scottish institutions get four years of tuition fee for many domestic undergraduate students they still have to spend money teaching and providing services in the extra year.
Tinkering with the tuition fee could infuriate the tax paying voter and may turn a number of students off incurring additional debt. It seems unlikely to satisfy the universities who continue to claim that the fee has been eroded by inflation to less than £6,000 and that every student they recruit loses them over £3,000. Leaving aside the dubious maths involved there is clearly a gap between university demands and Labour’s ability to pay, taxpayers’ willingness to fund and students’ appetite for debt.
The Public Good
Rome has some claims as an early (although far from perfect) example of representative democracy and in De Legibus Cicero tells us that “the welfare of the people is the highest law.” In that respect Labour needs to think hard about the views of the public when it comes to higher fees and funding for universities. It also needs to consider whether the sector is showing any signs of responding to current circumstances.
There is little evidence of genuine collaboration or strategic thinking in a sector where stronger institutions are hoovering up students in clearing to the detriment of those that are weaker. It is much the same in international recruitment where stronger Russell Group universities are able to outmuscle their supposed peers in terms of recruitment. Labour should not believe for one second that universities will stop acting in their own interests even if it means driving another institution to insolvency.
Labour must also be alert to the propensity of sector spokespeople to obfuscate, fantasize and cherry pick data when making assertions. There is, for example, no evidence at all to support the UUK Chief Executive’s statement that, ‘Most families will understand the need to increase university fees’. Public First research shows that this is wishful thinking because, “Across the board, people think fees are too high and that people leave university with excessive debt.”
We know from the same research that “..there is significantly more public support for further education and apprenticeships” than for higher education. In 2023 the UPP Foundation, working with the Higher Education Policy Institute, published research showing 32% of 18-24 year olds surveyed saying “a university degree is a waste of time”. 57% of the total surveyed were either uninterested, sceptical or negative about universities.
Even if the Chancellor could find ways of freeing up the money for the cost of higher fees in her budget who would thank Labour? Parents would just see higher debt, students would just see higher fees and the bill would have to be paid eventually. When Starmer is talking about a “painful” budget, making “difficult decisions” and “it won’t be business as usual” penalising students, rewarding poorly run institutions and giving the taxpayer a bigger than necessary bill seems a poor choice.
Strategy, Strength and Sucking It Up
None of this underestimates the challenges if a university becomes insolvent or the individual pain facing staff as cutbacks come. But in some cases university management have been spending money on restructuring for years and that there are clear examples of poor decision making. Continually propping the system up with generalized handouts of taxpayer money and no fundamental change would not help.
John Raftery makes a number of blunt points based on experience at London Metropolitan University and the University of Wolverhampton. A number of other “trouble shooting” VCs have taken on institutions in trouble and put them on a more solid footing. It is time that the shape, size and purpose of the sector was considered with any earlier financial input being contingent on competent management being installed to manage the situation. There is no one-size fits all answer.
To borrow from one more Greek source, the Labour government has set out on a task akin to the Herculean task of cleaning the Augean stables. They will certainly not be able to do it in a day but they will have to start by showing they have the nerve, the forethought and the fortitude to resist easy answers. Realigning the higher education sector to fit the needs of the country is a test of their ability to do so.
