No, not a greeting to an Irish popstar. Thanks to my state-sponsored Latin A Level, I know it means ‘Who benefits?’. Up there with ‘Why?’ when it comes to being a good question – and often a closely related question. It’s certainly one that’s made student fees a hot topic whether or not you’re stood near a bonfire in the middle of Whitehall. It’s evoking some heated responses on both sides, but it’s a more complex issue than it appears and one that has interesting implications for other principles when it comes to who pays for whose development.
Most of the temperature raising has been around what we’ve already recognised as being this year’s ‘f’ word: fairness. To nutshell for brevity (much as it goes against the grain), graduates will earn more over the course of their lives, the government’s run out of money, so it’s fair that students pay back the cost of their higher education. The detail goes off into exploration of fee caps, amounts to be earned before repayment kicks in, retaining access for the less wealthy. You will have already either read it endlessly or stopped caring. Part of the heat is being generated by a sense of broken promises – not just by LibDem MPs, but a more tacit promise that graduation would lead to an easier future (which my colleague The Graduate commented on recently).
But, sat at the back of class, I’d like to raise my hand and try to make an urgent point. Actually, it’s the same point a student made last night on BBC 3’s Young Voters Question Time: students aren’t the only beneficiaries from their education. Their employers benefit from an educated workforce: if they don’t, insisting on degrees as prerequisites make no sense other than way to keep application numbers down (in which case, you can argue they should be a better job of advertising more accurately, or of creating sufficient opportunities to match demand). And the nation collectively benefits too: a country with no new graduates will quickly become uncompetitive.
No matter how fairly the balances are calibrated, starting your working life with a debt of £40,000 is going to be daunting for many. (Especially in a current climate where the message “debt = bad” is being made so forcibly; “debt = bad so acquire some, it’s for your own good” is as puzzling a mixed message as I can imagine from the comfort of being so ancient my degree cost me nothing beyond hangovers and the occasional bruise.) It’s certainly going to make our earlier question – What are you reading for? – a more pressing one for the students of the coming years. And from the perspective not just of an old fart from a relatively poor family with a free degree but someone who worked in universities for many years, including on programmes to improve educational access, there are some seemingly contradictory principles at play here.
One of these I was reminded of by the contestants on The News Quiz on Radio 4 a couple of weeks back. As they pointed out, plenty of people other than students benefit personally from things gained from the public purse. Having paid our former Prime Ministers to serve us, will we now claim back their salaries out of the royalties from their books, speaking engagements and directorships? We did, after all, pay for the experience on which they are now trading. (I know Tony Blair has donated his memoir royalties to charity, but I could also make remarks about icebergs.) What about those future graduates who work in the public sector? (OK, it might be a while before there are many opportunities.) Aren’t we paying them to pay us back, and paying someone else to work out the tax implications? Cross-charging doesn’t come free.
Development is also an investment. It’s not a popular thing to say, but investments are a form of gambling: you don’t always get the return. While I recognise that the repayment mechanism is established so that repayments are made over a lifetime, and remaining debts wiped out after 30 years where the conditions forcing repayment aren’t met, I also recognise that – to go back to the point the student made on BBC 3 – it’s the student who lives the debt in the meantime. If I opt to take a second degree, I can go forward with the assurance I can stop making repayments when I’m 84. Talk about dangling a carrot … Education isn’t a house: I can sell my learning without it leaving me. But I don’t control the labour market, and I can’t guarantee the return will cover the existing debt: where there is negative equity, I either carry it with me until I can pay it off or pass it back to the taxpayer unfulfilled. I won’t have benefited personally, even if employers and society have, yet the taxpayer will still be out of pocket. I can remember enough school boy Latin to know the reductio is often followed by ad absurdam.
So, an awkward question. If employers are prepared to invest in staff development, why not in the development of a labour force for the future? As Flip Chart Fairytales pointed out recently, ‘people are our greatest asset’ isn’t just a phrase. A general contribution from business to HE is complex: there’s no guarantee graduates will want to work for you, although that is your problem rather than theirs. But the ‘unfair’ complaint that would howl out could be argued as being disingenuous too: if there is no benefit from or need for graduates, why recruit them until now? And without a long term benefit to graduation from the job opportunities that can be offered, how will young people be tempted into higher education in the future? “Can’t Pay, Won’t Pay!” is an emotional reaction. A future attitude to higher education that moves closer to “Can’t Use, Won’t Bother” isn’t in anybody’s interest.
I’m being provocative, of course, but mainly in the hope it will make people think in slightly more detail. Here are a selection of arguments from a blog by Mark Harrison, Professor of Economics at the University of Warwick and the comments he received:
- Just to be clear, I would never argue that money is the only thing that matters. But, along with other factors, money should matter, because higher education costs money and someone has to pay. Add up the costs on one side, and the benefits on the other, and you should choose to study at university if the benefit exceeds the cost. Of course, not everyone tots it up in two columns and a common currency, like an accountant. Consciously or unconsciously, however, that’s what is implied when we say that a young person should reflect on whether going to university is worth it or not.
- If you care about social justice, put taxpayers’ money into nursery care and primary and secondary schools, which have far more power to re-engineer society than do universities. It is nurseries and schools that truly enable the talented to rise and make good citizens out of all of us and our children. And let those that will reap the benefit pay for their own university education.
- If I’m the government and I know that for every student I fund to go through university (costing approx £30k), I will get £50k back in extra taxation income, then (even ignoring the other significant benefits that arise from a well-educated population) surely I should be investing in every student who is capable of fulfilling their side of this excellent deal for the taxpayer?
- It is fairly obvious to me that students themselves benefit significantly from higher education, but that society does also (and not only through a higher tax take). After all, the general benefits to society which accrue from HE was the explicit rationale behind Labour’s 50% participation target. Having a service where both the individual user and society as a whole benefits is not at all unusual: the NHS would fall into the same category. Does your argument for income contingent loans for HE also apply to, say, cancer treatment? Having some kind of repayment system for cancer treatment would still represent an excellent deal for the patient if it were set at a level not to dissuade those with lower incomes.
- If one took the view that historically, over time and over countries, a strong middle class has generally been good for the economic and political system, and if one saw higher education as an industry that helps to produce tomorrow’s middle class, then a case for a general subsidy of higher education would be a possible implication.
- I assume that at some point in your career you have been in some kind of senior admin role, perhaps HoD or on some faculty committee? If you have been, you will be aware of the general principle that for an academic department teaching makes a profit and research makes a loss. This is why, of course, there are so few non-teaching research institutes (especially in the arts and social sciences). When the tax-payer funds a significant proportion of the cost of teaching, this arrangement seems quite equitable: the fee-subsidy which the government provides can be seen as just another way that they support research. But if the student were to be expected to provide all of this money themselves this arrangement suddenly becomes entirely unreasonable. Why should I expect my undergraduates to personally pay for my research time?
- Student loans can have quite a dramatic effect on your ability to get a mortgage even if you have a good job after you graduate. The monthly amount you pay towards the student loan reduces the income that lenders will take into account when they calculate how much they are willing to lend you. Also as there are now so many people who are going to university, is it still the case that you will earn more over your lifetime if you have a degree. I believe the statistics that show that you would earn more were calculated based on the situation before the large increase in university attendance.
The selection does the debate – and Mark Harrison’s blog will be just one of many – an injustice, and those taking part should probably be thanked for flushing out so many interesting arguments. If you’re not totally tired of the subject by now, there’s another article that you might want to read: a London Review of Books review of the preceding Browne Report by Stefan Collini, a professor of English at Cambridge. It also triggered some thought-provoking comments:
- Since young people are being asked to invest in themselves, they should be given the same tax benefits as small business owners. A small business start-up is allowed to deduct 50 per cent of the cost against profits. Investors in education will not be given the same benefit.
- Collini describes Browne’s vision of a system in which university courses live or die according to the level of ‘student satisfaction’. All other things being equal, a student who achieves high marks will feel more ‘satisfied’ with his or her course than one whose marks are low. The pressure on tutors to inflate grades – already very considerable – will, under Browne’s system, be all the greater when jobs might depend on students’ ‘satisfaction’: to award low marks or even a fail – an assessment that the present system has contrived to make a near impossibility in most institutions – would be in effect to fail your own course and to deter your own potential consumers. It isn’t difficult to see why universities might want to make their courses less and less demanding, with predictable results: poorly qualified graduates who are less likely to be valuable to employers and to the economy.
- Collini presents us with two options: either we continue to understand universities as having an important ‘public cultural role’ or we redefine them ‘in terms of a purely economistic calculation of value’. This is to take entirely on its own terms the neoliberal view that the economy operates independently of culture. Those of us who have a serious concern with the direction educational (and other) policy is taking must find ways to preserve a public cultural role for universities not in contravention of economistic calculations but as a result of these calculations.
The question certainly isn’t as simple as ‘why should we pay for them to read books, drink beer and start bonfires in Whitehall?’. Nor, if we are honest, can it be boiled down to pure economics: we are talking about people, about a future skills base, the viability of the future workforce to enable our economy to remain competitive and much more: even the most skilful spreadsheet is the wrong vehicle. (And in any case, most businesses are keen to start with a mission statement and a set of values: given that they don’t mean the values that start with ‘£’, I’m not convinced a debate about skilling the next generation to ensure economic as well as national sustainability should do either.)
‘Cui bono’ remains a damn fine question. Good – and educational – enough that I can’t help but wonder if government and business alike shouldn’t be doing their best to give it some detailed thinking.