CHANCELLOR’S AUTUMN STATEMENT ANNOUNCES CAP ON STUDENT NUMBERS TO BE LIFTED
The BBC News’ Education Correspondent has reported that in his Autumn Statement 2013, George Osborne has announced that the cap, which limits the number of students English universities can admit, will be lifted in 2015.
The Chancellor told MPs that: ‘Next year we will provide 30,000 more student places, and the year after we will abolish the cap on student numbers altogether’
The announcement has met with a mixed response. Whilst the Chief Executive of Universities UK was reported by BBC News to have welcomed the lifting of the cap, saying that ‘More graduates is good for the economy, developing a strong society and improving the lives of individuals’, she also said that there is a need to ‘understand how this is sustainable in the long term, given that this policy is being funded in coming years by the asset sales*.’
However, the Russell Group [of which Nottingham University is a member] is concerned that such an expansion may make it difficult to maintain quality.
The Institute For Fiscal Studies (IFS) has commented that ‘in his speech the Chancellor claimed that the additional cost of student loans arising from lifting the cap on the numbver of students in higher education would be “financed by selling the old student loan book”. This may work in the near-term fiscal numbers, but economically it makes little sense. Selling the loan book will be broadly fiscally neutral in the long run, bringing in more money now at the expense of less money later on. Lifting the cap on numbers will cost money every year.’
It should be remembered that, as the Chancellor remarked: ‘This year is also the fiftieth anniversary of the Robbins Report, which challenged the nonsense that university was only suitable for a small few.
‘In 1963, Robbins said that courses of higher education should be available for all those who are qualified by ability and attainment to pursue them and who wish to do so.
"That was true then, I believe it should remain true today.’
*Asset sales: the BBC News report explained that ‘the government has already sold what is known as the old student loan book.
It recently announced the sale of the remaining 17% of mortgage-style loans taken out by students between 1990 and 1998.
This involved £890m of student loans being sold to a debt management consortium for £160m.
New student loans, linked to the higher fees up to a maximum of £9,000 a year, have not been affected.’