If government is to spend less on higher education, should business foot the bill? And should commerce thus have a say in what universities do?
Business benefits from good graduates but it also pays for this supply of talent by offering high wages. The graduates also thus gain from having degrees. And the country benefits from an educated elite that can expand the economy.
In the past the country mainly paid the cost of education though in recent years students have borne more of the cost, but they pay with cheap loans provided by the state. And the state gets its money from future taxes on the students’ higher earnings (or current taxes on past students’ pay) and on taxes on business.
Commerce is thus already paying part of the cost of higher education. But with ministers now accepting budget cuts are inevitable, the financial mix must change and more of the burden may fall on business, directly or indirectly. According to the Treasury budget report for 2009, UK education spending has soared by £10bn in two years to £88bn.
The Confederation of British Industry (CBI) has spent a year considering how higher education is financed and is proposing some business solutions for this state-controlled sector. The most sensible proposal is to halt the growth by suspending the government’s target of forcing half of school-leavers to take degrees.
The CBI doesn’t say it, but this grand-sounding ambition has become a way of postponing unemployment and making many students spend money for three years when they could be earning before leaving with a devalued degree to take the same job they could have had with good A-levels.
The employers also suggest ending the subsidy on student loans, cutting grants and raising tuition fees –- all measures likely to make students think whether a degree really is worth taking. With the official review of fees likely to recommend a big rise and the LibDems admitting their promise to cut fees is currently impractical, the CBI is clearly swimming with the flow.
But the employers also question the subjects taught. While student numbers have risen 35 per cent in a decade, the proportion taking maths, science or technology is down 20 per cent.
That is a long-term trend and an old complaint, but if universities become more reliant on industry for sponsorship and offering internships as well as commercial co-operation, then this is the corporate sector’s chance to force change. The academics’ antipathy to commercial pressure is no longer sustainable.
As important however, students forced to spend more to obtain degrees should be looking to obtain qualifications that help them secure well-paid jobs. If graduates really are the country’s cleverest people they ought be able to work out that when supply exceeds demand they have to offer something employers want. A degree of commercial reality is no bad thing for Britain’s publicly-funded academic institutions –- from vice-chancellors to students.
