The claim
“Filling a hole of half a billion pounds by cutting university places could mean over 30,000 fewer young people going to university.”
Labour Leader Ed Miliband, press conference, April 19, 2011
The analysis
Less than a year ago, university spaces hit a record high, and the Coalition Government was boasting that it had created an extra 10,000 student slots.
We FactChecked it; the number of available spaces rocketed up to 365,000 for the current academic year, according to the Higher Education Funding Council for England (HEFCE).
But then came the vote to allow universities to hike tuition fees by as much as three times, to a maximum of £9,000 per year.
The Government was expecting universities to announce average charges of £7,500, with the maximum £9,000 only being demanded in “exceptional circumstances”.
However, we now know that up to 75 per cent plan to charge the max – which will see students borrowing more money than the Government has budgeted for.
With the National Union of Students describing the system as “increasingly a mess”, FactCheck investigates.
Ed Miliband has made various projections as to the cost of this bloated student borrowing. Earlier this month the Labour leader put it at £1bn, which Vince Cable branded “rather hysterical”.
Mr Miliband duly returned to the drawing board and today said the rise in fees will blow a £450m black hole in the Government’s higher education budget by 2014/15.
This is more like it. Firstly, the research is done by the House of Commons Library, which analyses the Government’s own statistics.
Plus, it falls broadly into line with independent research by the Institute for Fiscal Studies (IFS).
The IFS actually rounds the figure up to £525m – but it told FactCheck that it doesn’t take into account data from the Student Loans Company, and it assumes that everyone finishes university and everyone borrows the full amount.
To plug this shortfall, according to Labour, Vince Cable has “threatened to reduce the number of students attending university”.
Pointing to further analysis by the House of Commons Library, Labour says this could see as many as 36,000 fewer students a year attending university.
The Conservatives told FactCheck Labour has made “huge assumptions based on dodgy maths”.
And with the greatest respect to the House of Commons Library, while the maths is fine – it is based on rather a lot of guesswork.
It assumes that the average fee will be £8,500 – but this is an average of the maxima that universities are planning to charge.
Some universities have set a high maximum but will not charge that for every course.
Plus, as the Universities Minister David Willetts writes in The Guardian, fee waivers and bursaries will cut some students’ bills down to £4,500.
Indeed, Leeds University says that a third of all its undergrads should qualify for some form of financial assistance from its pot of £16m – which it has doubled in order to offset setting its tuition fees at the maximum £9,000.
The IFS told FactCheck: “The average fee will depend on what universities charge for every course and how many go for the courses – which we won’t know until 2012.”
To balance the shortfall, Labour says student numbers could be cut by 11 per cent. But the biggest problem with this is that there’s no evidenceyet that the coalition plans to do this.
The verdict
Students and taxpayers alike are already under no illusion that, for the most part, university fees are set to run riot.
The jury is still out as to how much it will cost us in the end, but as for the government threatening to now cut university places too – does Mr Cable deserve this latest charge?
FactCheck scanned his original speech. He did say that cutting student numbers could be one way of dealing with “collective over-pricing” from universities.
But after the furore around fees this looks unlikely. The IFS said crisply that it was an “unsavoury option”.
HEFCE is already under Government orders to police student numbers rigorously – or face a cut in its teaching grant – by imposing a limit on extra places.
Mr Cable has said: “The agreed spending envelope will remain as it is” for our universities.
He may be hoping then, that Mr Miliband’s warning this time will again turn out to be “hysterical”.
By Emma Thelwell
