UK: Reforms make universities compete harderwhite paper last week. Top-ranking universities and institutions charging low fees are most likely to benefit.
Proposals include the freeing up of 85,000 student places from government control and allowing unrestrained competition for top-grade A-level students - those achieving AAB.
In addition, a flexible margin of places will be created to reward quality providers charging an average of £7,500 (US$12,000) or less for tuition, compared to the £9,000 maximum allowed.
Universities will also be made more accountable to students on teaching quality, enabling them to trigger quality reviews where there are grounds for concern.
In future, graduates will pay more towards the cost of their degrees, as the maximum allowable tuition fee rate is being tripled to £9,000 (US$14,400). But the reforms will improve their experience as students, expand their choices and make universities more accountable to students than ever before, the government said.
Vince Cable, Secretary of State for Business, Innovation and Skills, said: "Our university sector has a strong history with some world-class institutions attracting students from across the globe. Higher education is a successful public-private partnership, combining government funding with institutional autonomy.
"This white paper builds on that record, while doing more than ever to put students in the driving seat. We want to see more investment, greater diversity including innovative forms of delivery from further education colleges and others, and less centralised control over student numbers.
"But, in return, we want to the sector to be more accountable to students, as well as to the taxpayer."
The proposals contained in Students at the Heart of the System cover four broad areas: reforming funding; delivering a better student experience; enabling universities to increase social mobility; and reducing regulation and removing barriers for new providers.
The primary aim is to ensure that universities are held accountable for an improved student experience. In addition to freeing up controls on student numbers, the proposals will ensure better information for students before they apply, better teaching while at university, greater transparency in areas such as feedback on their work and better preparation for the job market.
A review will be carried out into how university-industry collaboration can excel and the decline in sandwich courses can be reversed. Universities will be encouraged to engage actively with employers to accredit or 'kitemark' courses, to indicate to students that they are valued by them.
As well as giving students the power to trigger a review on teaching quality, the government will examine the many student charters being adopted and whether they should be made mandatory in the future.
The Office for Fair Access will be properly resourced so that it can go further and faster to drive fair access for students from lower income families and widen participation.
A wider range of providers will be enabled to join the sector to offer more choice for students, and regulation and bureaucracy for universities will be cut back.
The government said the higher education reforms are part of a wider government agenda to put more power in the hands of the consumer by encouraging competition and opening up the market to new providers.
For universities this means that in future funding will follow the choice of the student.
However, the proposals drew a raft of mixed or critical responses from university groups, think-tanks and student bodies.
Professor Steve Smith, President of Universities UK, said: "It's important that government has put students at the centre of these proposals. The focus on transparency, consumer protection and accountability are all positive steps."
But he warned that changes to student number controls should be examined carefully to ensure they did not inadvertently damage universities' efforts to widen participation or maintain quality, and that the existing tough quality assurance system must apply to new providers.
He said: "The government's focus on providing transparency and more information for students and their families is extremely important. Universities are committed to providing prospective students with more information about what they can expect from their studies.
"The priority now for everyone involved - government, universities, schools - must be to make sure that people understand the new system and no one is put off from applying due to poor information about the costs and benefits of university."
Dr Wendy Platt, Director of the Russell Group of Universities, which represents 20 leading universities, welcomed the commitment to competition but warned that lifting the cap on top-grade students may have unintended consequences and increased spending on students must not lead to a cut in funding for vital subjects.
She was also concerned that institutions charging lower costs for higher-cost courses would get more funding. This would disadvantage universities providing high quality teaching in high-cost subjects such as medicine, engineering, chemistry and physics.
"We do not believe that re-distributing those student places to institutions charging lower fees will drive up quality or improve student choice," she said.
The million+ think-tank said the plans would do very little for student experience or student choice.
Professor Les Ebdon, Chair of million+ and Vice-Chancellor of the University of Bedfordshire, said: "There appears to be nothing new here for students and absolutely no evidence that the competition ministers are trying to inject will actually improve the quality of the student experience.
"Worse still, ministers are putting at risk the social mobility they insist is at the heart of their reforms. A mini-market in 'AAB' students could favour students from independent schools and actually constrain a university's ability to widen access."
He said by failing to acknowledge that universities plan to charge fees above £7,500 to protect the quality of the student experience in the face of huge cuts, encouraging low-cost providers would be in the interests of the Treasury and not in the interests of students.
Aaron Porter, President of the National Union of Students, said fees have been tripled and students have been exposed to the potential chaos of the market and yet there are still no concrete proposals for how quality, accountability and access will be improved.
"We welcome the drive for better information for students in the white paper, but the government must not confuse information with power. Market competition alone will not drive up quality," he said.
The University and College Union said the plans to increase competition among universities were an untried experience that would force down quality and do serious damage to the UK's international reputation for excellence.
UCU General Secretary Sally Hunt, referring to the fact that many more universities have indicated they will opt to charge the maximum fee than the government intended, said: "Trying to force down the cost of a degree after the government got its sums wrong will not solve the funding crisis it created. The only thing the government is likely to force down is quality.
"The siren voices calling for more for-profit universities here are the same as those who have immersed higher education in the US in a series of mis-selling scandals where poor students have lost out."
But David Willetts, the Universities Minister, said responding to student demand means enabling a greater diversity of provision. This might mean more higher education going on in a wider range of different settings, such as further education colleges and other alternative providers offering innovative types of course.
"Universities will be under competitive pressure to provide better quality and at lower cost," he said.