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Finance News |
Loans with caps off lie ahead
OXFORD and Cambridge, like Australia's top universities, are competing with "vastly better funded" US institutions and have a case for crying poor, according to a visiting British academic.
University of East Anglia vice-chancellor David Eastwood says although Britain's two leading universities are also the best funded, the increasingly global nature of higher education is creating new pressures. Oxford and Cambridge are up against the likes of Harvard and Stanford for students and staff.
"There are two ways of looking at [the funding debate] in the UK," Eastwood says. "One is that Oxford and Cambridge simply are the two best funded universities because they get a premium ... so you can get quite envious responses.
"But turn it around and they are at the moment the two best universities in the UK and as such they are competing internationally now. They are competing particularly with the US, with [its] vastly better funded institutions ... much better infrastructure. So yes, in that kind of environment, they are cash-strapped just like the rest of us."
In his five-day, three-state visit to Australia last week, during which he attended the Innovative Research Universities Australia senior staff forum in Melbourne, Eastwood held several social functions for UEA alumni. Crowds were small: about 30 former students gathered in Sydney, and fewer in Adelaide and Melbourne.
Eastwood says fostering good relationships with alumni is vital for all universities and should not be about simply chasing the dollar. Universities can be unrealistic about the income that will be generated from alumni donations: in Britain and Australia, there is no hope of approaching the vast sums collected in the US. Nevertheless, investing in a solid database and promoting contact with students beyond graduation is beneficial.
"Some universities do get this relationship spectacularly wrong," Eastwood says. "They think they're going to make lots of money out of it and so forth, but that's not the reason – not the principal reason – for doing it. If they remember you with affection, then they can give you the best PR . . . that is extremely important."
Established in 1963 with 115 students, the University of East Anglia now boasts 13,000 students and 70,000 alumni. When Eastwood took over as vice-chancellor in 2002, he was the youngest vice-chancellor in Britain; now 46, he retains that distinction.
He has been a vocal supporter of the Blair Government's controversial "top-up fees" policy. From 2006, universities may charge up to £3000 a year for courses. This represents a significant rise in tuition costs for students, who now pay £1200 a year in upfront fees. But the British Government has introduced a HECS-style loans system, so payment can be deferred. "Yes, I support fees and I supported the principle of variability, although there won't be much variability initially," Eastwood says.
He believes the pound stg. 3000 must – and will – be lifted if universities are expected to vary their charges. "If you are in a market, then you can't have a cap or you have to put the cap very high," he says. "You've got to put the cap well above the rate that the market would stand for most institutions, otherwise it becomes a going rate."
Australian universities have responded similarly to higher education reforms. Permitted to raise HECS fees 25 per cent above existing rates from this year, most universities have opted for the maximum increase.
But unlike Australia, British universities must explain how the extra revenue will be spent. As part of its higher education reforms, the Blair Government set up the Office For Fair Access. British universities seeking to increase fees must seek permission from OFFA, explaining how much they will spend on bursaries, scholarships and other equity measures. Universities will begin to hear about the fate of their applications in March. There is an unwritten "going rate", Eastwood says, which means that universities are expected to spend 20 per cent of the estimated extra income on equity measures.
He says while most vice-chancellors in Britain supported the fee increases, they did so for various reasons. "Some supported it because they believed in variability but most supported it because their institutions needed the resource and this was the only game in town. But there were also a number of us who supported it partly because we believe in the principle, and also the other rather important element in the scheme was it removed the upfront fee and made repayment income-contingent."
He says he agrees with the principle that those who demonstrably benefit from their higher education make contributions towards it. "If you don't, you go back into a regressive system where the majority who still don't go to university end up funding the minority who are benefiting," he says.
"But at the same time [in Britain] you are putting in place a reasonable maintenance package for students from poorer backgrounds . . . so in essence the many of us who supported it believe that in principle this was the balance to justify the package."
Source : The Australian
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