UK: Wrong time to raise fees, say global rivals

How will plans to slash 40% of the teaching budget in England and allow universities to raise tuition fees threefold affect the competitive edge of UK universities globally? We asked university leaders around the world to tell us what they think. Some of them conclude that the UK is at a critical tipping point.

The UK government has picked the 'wrong time' to gamble on the competitivity of English universities, according to university leaders elsewhere.

The decision to cut the universities' teaching budget in England by 40% and raise the cap on tuition fees threefold to £9,000 (US$14,360) could make foreign students look elsewhere, precisely at the moment when many more options are being made available, they say, and many are hoping to attract UK students seeking cheaper options than at home.

The areas of concern are the likely impact on teaching quality of the cuts in funding if they are not replaced by rises in fee income and the potential deterrent effect to EU and other overseas students of allowing a massive fee hike.

A study by the UK's Higher Education Policy Institute has concluded that tripling the fee cap will be no more successful in creating a market in higher education than the original introduction of £3,000 top-up fees.

Instead, HEPI predicts that, within just a few years, most universities will charge students the full £9,000 for tuition, as university managers will feel they have to charge the full rate to avoid being perceived as being of a lower standard or less prestigious. If this prediction is borne out, the impact may be felt more through the rise in fees than a fall in quality.

The UK hosts 10% of international students in tertiary education (OECD 2008) and international students make up 14.7% of its tertiary student population. Of those international students, most are not studying in subject areas ring-fenced from teaching budget cuts - sciences, maths, engineering and technology.

OECD figures show that 13.9% of international students in the UK are studying in humanities and the arts; 41.1% in social sciences, business and law; and 13.4% in sciences; 14.7% in engineering, manufacturing and construction; and 9.3% in health and welfare.

The cap raise will immediately raise the cost of tuition fees for 92,000 EU students studying full-time in England, because they pay the same rate as UK students. But there are also concerns that the effect of cuts might drive quality down or lead to universities putting up fees for the 214,000 non-EU international students even further in the long run. Most of these come from Asian countries and currently pay fees ranging from £8,000 to £15,000.

OECD figures for the whole of the UK show that in 2008 nearly 48% of international students were from Asia, compared with 28% from EU countries, 10% from Africa, 6% from North America, 2.3% from South America and less than 1% from Oceania (OECD 2008).

The top individual countries of origin include China (13.5%), India (7.7%), Ireland (4.5%), and Germany (4.1%), the US (4.1%) and France (3.8%), Greece (3.8%) and Poland (2.6%).

In Beijing last week, David Cameron, the UK prime minister, strongly denied that fees for students from outside the EU would rise. He said in the past universities had driven up fees for non-EU students as a means of "keeping them down on our domestic students". But, as the government had done "the difficult thing" of putting home and EU fees up, universities should be able to keep rises for overseas students under control.

He said: "It will make sure that our universities are well funded and well supported, because our universities have to compete with universities in China, India and America."

Asian perspectives

But Cameron's confidence in English universities' ability to maintain their competitive edge in the international student market does not seem to be shared by university leaders in Asia.

"The 'buzz' around colleagues in China and Hong Kong is that it is likely to make the UK less attractive than other parts of the world," says Mark Bray, director of the Comparative Education Research Centre, University of Hong Kong. "And, interestingly, a few people felt that it might make Hong Kong and China more attractive - even to UK students."

Kevin Downing, coordinator of academic planning at Hong Kong's City University, says: "If funding for UK universities falls and fewer students can afford [high domestic] fees, they will have to recruit more international students. It is going to become more competitive globally to attract international students.

"It is already difficult for Western universities to attract international students from Asian countries. Meanwhile places like Hong Kong are making it easier for international students to work after finishing their studies. So students may begin to go the other way, instead of looking west they may look east.

"Whether you like it or not, the cuts [in the UK] are going to have a significant effect on the kind of students going to university. Universities are going to have to diversify their sources of funding, mainly towards international students."

A progressive student scheme will allow students in England to take out long-term loans to pay their fees, but many prospective students are put off by the increasing burden of debt they will face when they graduate.

John Spinks, senior adviser to the chancellor of the University of Hong Kong, says parents of British nationality children in Hong Kong are already talking about the implications of the domestic fee rise for their education.

"UK universities have enjoyed an excellent reputation over the years, but the academic world is a very different place now. There are many alternatives, from the US to Asia. Many of these families, as well as local families, are looking at the economic development of Asia, and seriously considering this to be a good alternative to the more traditional educational destinations."

Professor Zaini Ujang, Vice-chancellor of the Universiti Technologi Malaysia, one of Malaysia's top universities, which charges £2,000 a year compared with £8,000 to £15,000 fees paid by international students studying in the UK, says his institution will be sending far fewer students to the UK on government scholarships and then only to top universities such as Cambridge and Imperial if they raise the fees. Currently it funds about 30 students to go to top UK universities for postgraduate work.

Spinks says the funding that a number of Asian governments are providing to develop their top universities into institutions that can compete at a global level - South Korea and China would be the most obvious examples - contrasts strongly with what is happening in the UK.

"The UK decisions will almost inevitably lead to a more market-driven tertiary sector, as institutions seek to recover decreases in revenue, but unfortunately at the wrong time, since they now have to work in increasingly competitive marketplaces," he says.

He warns that the quality of education provided by British universities has been key to maintaining high levels of applications from overseas students, but the market can be changeable.

The US' share of the mobile student market dropped from 32% in 1998 to 19% a decade later, for instance. "This is not a drop in absolute numbers, but it is a very clear sign of the alternatives available today," he says.

European market

The immediate threat is to English universities' ability to attract EU students who might be put off by rising costs.

A number of EU countries do not charge tuition fees while others impose very low fees. The question is how the push factor of a fee hike would play out against the attractions of the quality of UK institutions and of studying in English.

According to the UK Council for International Student Affairs (UKCISA), the introduction of the £3,000 fee does not seem to have deterred the 60,000 or so EU students taking first degrees, despite the fact that an undergraduate degree now costs more in the UK than anywhere else in Europe.

But Beatrice Merrick, UKCISA director of services and research, says it is difficult to predict whether an increase in the cap will deter other EU students: it may depend largely on expectations about repayment.

Most French students come to the UK under European exchange programmes or bilateral agreements, which should not be affected by the reforms, and do not have to pay extra fees. But if these arrangements were affected there would be a risk of "disaffection" for England among French students, according to Jean Pierre Gesson, President of the International and European Relations Commission of the Conférence des Présidents d'Université.

German students already appear to be turning away from England. The latest available statistics on destination countries for student exchange by the German Academic Exchange Service (DAAD) refer to 2007, showing a slight drop of 475 compared with the 2006 figure of 12,145 going to the UK.

Additionally, in those two years 46.2 % studied law, economics and social sciences but, at least in the field of economics, especially business management, a growing number of courses are being offered in English at universities on the continent, many of them in Germany itself.

Gesson, who is also President of the University of Poitiers, said if UK-style measures were introduced in France, where there is no fee for tuition, students would take to the streets. "We would say to students 'increase your mobility, but diversify'. At present the two most popular countries [for French students] are England and Spain; we'd suggest to mobile students to go to other countries, not necessarily England and Spain. The Netherlands and other northern countries such as Sweden offer studies in English. If they had to pay up to EUR10,500, they'd go to the Netherlands instead!"

The landscape in northern Europe is changing, however, with calls this week in Denmark for an end to free higher education for international students, and tuition fees higher than those proposed for England already on the cards in Sweden.

According to Kåre Bremer, Vice-chancellor of Stockholm University, there is almost unanimous agreement that higher education shall be free for all Swedish citizens - or rather paid for by taxes - and hence also for other EU citizens. So tuition fees are not on the agenda for Swedish students. And as state finances are in a better shape than the UK there is no need for the cuts in spending that led to the fee cap being raised in England.

But tuition fees for non-European students are being introduced from autumn 2011, ironically as a means of tackling the cost of the trend of universities and university colleges accepting considerable numbers of foreign students, particularly from Asia, to fill courses - as a result of universities being funded by the government according to how many students are accepted and examined.

As in the plans for England, universities will decide the level of fees themselves, but in Sweden the fees must cover all costs for the education of non-European students. They will be set at around EUR10,000 a year for full-time studies in humanities and social sciences, EUR15,000 for studies in natural sciences and EUR20,000 for medical studies. Furthermore, introduction of tuition fees for non-European students is expected to result in a significant drop in incoming non-European students to Swedish universities.

However, says Bremer: "University education in the UK has a very good reputation internationally and in addition the English language makes UK universities especially attractive. I think that the expanded fees in the UK will have a much less damaging effect on the ability of universities to attract European students than a similar raise in fees would have in other European countries, but no doubt the number of incoming students will be reduced in the UK."

Professor Ole Petter Ottersen, President (rector) of the University of Oslo, said the impact of the UK decision, if there is a knock-on effect on fees for international students, could lead to a decrease in the number of international students from Norway, which is not an EU member.

But he added that as they already pay high fees it was not a foregone conclusion. The impact might rather be to raise the number of applications for Erasmus exchange agreements - which are EU funded and include a tuition fee waiver - and reduce the number of applicants to Study Abroad agreements.

"If UK tuition fees for overseas students are raised considerably, this might lead to more Norwegian students choosing studies in other countries instead of the UK," Ottersen said. "But, for Norwegian universities not charging tuition fees, it will be interesting to see whether the UK decision to triple the tuition fees cap for domestic students will lead to an increase in the number of applicants to Norway from the UK, both for full degrees and for exchange."

Currently, the main destinations for UK students studying abroad are Australia (5.9%), Canada (8.8%), France (8.8%), Germany (6.0%), Ireland (4.9%), Italy (0.9%), Japan (1.5%) Netherlands (2.9%), New Zealand (13.9%), Norway (1.1%), Spain (2.5%), Sweden (1.8%), Switzerland (1.4%) and United States (29.2%), according to the OECD.

"If universities want to recruit actively from elsewhere in Europe," UKCISA's Merrick says, "they will need to ensure there are clear messages about the loan and repayment systems for tuition fees, which EU students are eligible for on a par with UK students, as well as continuing to promote the quality and reputation of UK degrees."

One possibility is that universities in other parts of the UK may attract EU students seeking an English language medium higher education without the fee hike. "Depending on the arrangements in Scotland, Wales and Northern Ireland, we may see European students favouring these destinations over England," says Merrick.

However, such universities may be more interested in attracting non-EU students because of the higher fees they can charge for them. Glasgow University last week revealed plans to recruit more than 1,000 overseas students, to add to the 2,500 already at the institution, as a way to compensate for cuts in funding, according to The Herald.

Global losses

University leaders from further afield have lamented the perceived devaluation of the public benefits of higher education in general and of the humanities in particular that lie behind the UK cuts in the teaching budget.

Professor Alan Robson, Chair of the Group of Eight research intensive universities and Vice-chancellor of the University of Western Australia, said: "I am concerned the public benefit of a general education is not being adequately valued [by the actions of the British government].

"For all tertiary education there is a public benefit and a private benefit and hence there should be an appropriate sharing of cost between taxpayer and student. The actions in the UK represent a devaluing of the contribution university education, other than the STEM [science, technology, engineering and maths] areas, makes to a civilised society."

Glen Withers, CEO of Universities Australia, said it was disappointing that the UK government did not see that sustained higher education support was in a strong position to help to restore the country's fiscal stability. Pay-offs to university investment were high and flowed soon after making the investment, as graduates moved into employment.

Furthermore other countries would feel the knock-on effects of the UK decisions. "Any competitive advantage other countries might obtain by seeing the UK cut and run in higher education is well outweighed by the losses to us all from downgrading higher education support and depreciating the associated global benefits. University support is a win-win business across countries," Withers said.

Goolam Mohammedbhai, former Vice-chancellor of the University of Mauritius and head of the African Association of Universities, views the targeting of humanities for teaching budget cuts as "disastrous".

"Universities are not just for the production of manpower and to supply business and industry but also to have researchers and thinkers in many fields," Mohammedbhai says. "If you do not encourage the arts and humanities you will see them slowly disappear, but a decent university should have strengths in ALL fields.

"The schools will need teachers, and they will need teachers of the arts and humanities; where will these teachers come from? Teachers of history, English and so on. It is a narrow-minded approach. It will take some time but gradually this will have an impact and higher education in Britain will be unrecognisable."

Professor Malegapuru Makgoba, Vice-chancellor of the University of KwaZulu-Natal, one of South Africa's research universities, said he was "shocked" by the "draconian and myopic" plans to drastically cut funding to the humanities and social sciences in the UK.

"I pity humanity students and scholars in the UK. This narrow view of [supporting only] science and technology is regrettable."

Zaini Ujang, from Malaysia, pointed out that universities are not just competing against each other, but working with each other and the decisions had to be viewed from both perspectives.

"The cuts in the UK are good or bad depending on which way you look at it. For us we would like British universities to be strong because we have been collaborating with British universities in science and technology research. [The cuts] mean that universities in Britain will deviate their focus from thinking big to thinking on a survival basis and that is not good for research collaboration. Already some of our research collaborators in the UK have returned.

"On the other hand we are also able to recruit young academic staff from Britain, those in the first stages of their career looking to migrate from senior lecturer to professor. We can attract them to Malaysia if they see the prospects in Britain are not so good. They can see that the growth market is in this region [Asia] and they want to come."

From Hong Kong, Spinks warns that any deterioration in the quality of education provided in the UK will have "major and fast-acting effects on reputations - and reputations are major drivers of student quality". The UK will have to protect its reputation at a time when top Asian students who could have gained a place at any university in the world are choosing to stay in Asia.

The University of Hong Kong this year admitted fewer than one in 12 of the 40,000 applicants for undergraduate studies, among them top-scoring students in several Chinese provinces and a student from Taiwan who achieved 75/75 in the school-leaving exam.

"That is a sign of the competition that the US and UK are already starting to lose," Spinks says. "UK universities are at a critical tipping point."

What will ultimately happen may depend as much on the marketing strategies of UK institutions as on other factors. But the question, the University of Hong Kong's Bray asks, is what will they be marketing?

© University World News

* Additional research by Michael Gardner, Karen MacGregor, Jane Marshall, Geoff Maslen, Jan Petter Mycklebust and Yojana Sharma.