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Our future prosperity is at risk without major reform of HE funding system

For immediate release

University Alliance are today (6 June) announcing plans to look at fundamental reform of the higher education funding system in order to meet the future needs of the economy.

The university group has developed a framework for building a robust funding system that aims to put higher education on a sustainable and flexible footing.

The proposed funding system suggests:

  1. Re-directing government funding back into teaching, resulting in lower fees
  2. Reform of student support to target those most in need
  3. Increasing access and support for students who learn while in employment
  4. Using a progressive, income-contingent repayment system
  5. Ending the one-size fits all approach
  6. Introducing a single regulatory system
  7. A genuinely flexible, expandable and market-driven – able meet the needs of our future economy
  8. Re-establishing the Government–student contract
  9. Introducing a cost-efficient system for Government

Libby Hackett, Chief Executive of University Alliance, said:

“When you look beyond the next few years it is clear that we need a serious redesign of our funding system for higher education. So much is changing in the world around us and we know that for the UK to remain globally competitive we need more graduates in the economy. How we pay for that is the difficult question that our funding proposals will seek to tackle.

“We want to look at systems that will flip the way government funding for higher education is directed. Currently government is spending the majority of its HE budget in writing off student loans that won’t get paid back. We want to explore ways to put that money back into teaching so there is a more explicit sharing of cost between students and Government. We want to explore ways of reforming the repayment system to achieve a 5 to 10 year repayment period similar to that of Australia rather than the UK’s unpopular 26 year average repayment period. We want to remove the unpopular lifetime burden of contribution and enable Government to invest directly into teaching rather than loan subsidies. Looking at other systems around the world, this seems highly achievable.

“To put it starkly, we either need to grasp the need for more radical reform or we risk operating an expensive funding system, designed primarily around young undergraduates, constraining our ability to meet the diverse needs of individuals, society and the economy in future decades.”

Professor Steve West, Chair of University Alliance, said: 

“Our job as universities is to educate and empower individuals and create and deliver knowledge. We cannot get into a position in the UK where we are unable to afford to do this. The current system does unfortunately put us in this position.

“Evidence suggests that the current system is a potentially unsustainable and unaffordable system in the long-term. It places a cap on student numbers despite the need for more graduates in our economy. And there is a complete lack of financial support for post-graduate and second chance students, which cannot be easily resolved undercurrent loan conditions. These issues, along with others, mean we must go back to the drawing board and look at ways of reforming the system. Without a healthy and growing higher education system we will simply lose out to our international competitors.

“We owe it to future generations to consider how to create an affordable and sustainable future. This is about choices and futures. As a country we need to compete on a global stage and win. Education is a key to economic recovery and prosperity.”

Notes for editor 

Press contact: Andrew Henry | 0207 839 2757.

Our funding framework can be found here.

Over the next few months we will be holding sessions to engage as many people as possible to explore a funding system for the UK that is fit for the future. If you would like to be involved please let us know.

 

 

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