English fee cut ‘could torpedo Welsh funding settlement’

Wales’ post-Diamond review funding settlement could be sabotaged by a cut to tuition fees in England, experts have warned.

Last autumn, Wales replaced its old system of tuition fee grants with loans, and used the savings to provide means-tested maintenance grants. The model has been praised for its progressiveness because, under it, the poorest graduate with the smallest debts – in England, the reverse is true.

However, some commentators have questioned whether the generous maintenance package is sustainable. The poorest Welsh students – those whose parents earn less than £18,370 a year – are entitled to an £8,100 maintenance grant and a £900 maintenance loan. The balance between these two payments operates on a sliding scale all the way up to students whose parents earn more than £60,000, who receive a £1,000 grant and an £8,000 loan.

Funding experts said that questions about the system’s future could come to a head much sooner than expected if England’s review of post-18 funding recommends a cut in tuition fees to £7,500, as is expected.

Given the large cross-border student flows between the two countries, and the comparatively small size of the Welsh sector, it is thought likely that Wales would have to follow suit in cutting fees.

Gavan Conlon, a partner at the London Economics consultancy, said that the Cardiff government would struggle to make up the value of the lost fees while spending so much on maintenance grants.

“To pay for this, some of the core components of the Diamond review may have to be revisited,” Dr Conlon told Times Higher Education, namely “the generous maintenance grants”.

Dr Conlon, who sat on the Welsh review panel chaired by former University of Aberdeen principal Sir Ian Diamond, said that the expected changes in England “could have serious implications for the Diamond review recommendations and reverse the very significant positive impacts that it has already had”.

According to Nick Hillman, director of the Higher Education Policy Institute, Wales faces a “financial double bind”. “It’s politically unlikely that fees in Labour-led Wales can stay higher than in Tory-led England,” he explained. “The other risk is that, if England chooses to spend less on higher education, there is a knock-on impact on Wales’ public spending.”

A host of additional factors, including outstanding graduate loan debt being reclassified as public debt this year, make the Welsh system “look unsustainable”, he said. “Wales has to decide whether to hit universities or other areas of public spending. The former is more likely…it may be that students lose financial support.”

While the tuition fee cap in the two sectors is about the same at the moment – up to £9,000 a year in Wales, and £9,250 in England – it would be impractical if “Welsh students studying in Wales faced a higher tuition fee than English students sitting alongside them”, Dr Conlon said. Of 11,250 students who started degrees at Cardiff University in 2017, for example, about 5,100 came from the English school system, he said.

Amanda Wilkinson, director of Universities Wales, said that the Diamond settlement had helped to improve access to higher education and that it was therefore “essential [that] Wales’ continued ability to deliver on Diamond should be maintained”.

The representative body has been conducting a review of the impact of the English review, led by Philip Augar, on the UK’s devolved nations. This report, and the Augar review itself, was expected to be published later this month.

rachael.pells@timeshighereducation.com