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Scotland and Northern Ireland: the UK’s surprising laboratories for unregulated fees

March 4, 2015

Further to this post, a further quirk of devolution is that there are only two places within the UK where at least some domestic students are subject to wholly unregulated fees.  They are Scotland and Northern Ireland.  This post concentrates on how Scotland got into this position, but the story and outcome are much the same in Northern Ireland.

When fees went up in 2012 in England, there were fears that Scottish universities would be “flooded” with students seeking to keep their costs down.  The Scottish government felt it needed to take action to prevent students from Scotland being crowded out.  It was in principle  a reasonable enough position and had a precedent: in 2006, fee levels had been raised so that the cross border cost difference would not be too large.  As a result, from 2006  rUK students faced a total fee bill of just over £7,000 for a four year degree, still a bit less than in England for three years (a bit over£9,000 at the time).

In response to the much steeper rise in 2012, the Scottish government decided the legal framework it had inherited wouldn’t work.  For technical reasons, had it just built on what was there already, much higher fees would have affected part-time and self-funding students from Scotland, too.  Legislating from scratch, it controversially decided  to allow Scottish universities to charge those without a “relevant connection” to Scotland a different fee from Scottish students (there are fees in Scotland, it is just that the Student Awards Agency for Scotland covers them automatically for full-time, first-time students from Scotland and the EU). International students were already outside the fee cap set for domestic students: rest of UK students were in effect removed from it too.

What’s interesting, and wasn’t inevitable from the underlying decision to have higher fees, is that when these students were taken out of the existing fee cap, no new one was put in place for them.  So there appears to be absolutely nothing in law to prevent a Scottish university charging a student from another part of the UK whatever it wishes.  It is not immediately clear whether there is even any safeguard in higher education law (as opposed to general contract or possibly even consumer law) to prevent fees being raised mid-course.

In putting the legislation forward, the then Cabinet Secretary did not simply argue  the case for increasing fees for rUK students, but set out a case in principle  for deregulating fees entirely and letting universities decide what was right:

in giving Scottish universities the flexibility to set their own fees, I have been persuaded by the arguments put forward by Universities Scotland that they should be given the flexibility that allows them to compete fairly; that is against a background of uneven patterns of demand for Scottish higher education between and across nations, subjects and institutions, and of where there are comparable degree subject programmes of equivalent length in Scotland and the rest of the UK.

Indeed, as his Northern Irish counterpart did not appear at the equivalent Committee hearing, Michael Russell may be the only government Minister from any part of the UK ever to have argued the case for fully deregulated fees for any group of UK domestic students publicly while in office.  The Education (Fees) Scotland Regulations 2011 and their Northern Irish equivalent remain, to the best of this author’s knowledge,  the sole examples of such legislation.

In Scotland, the  regulations were approved in committee by SNP, Labour and Liberal Democrat MSPs, but the Conservatives abstained.  In Belfast, the equivalent regulations were supported by the DUP, Alliance and Sinn Fein members: the Ulster Unionists voted against.

The Scottish government did consult beforehand.  Thirteen responses opposed the move to increase fees, including various local student unions (but NUS Scotland is curiously marked as neutral, although they have been critical of the higher fees rUK students pay).  Twenty-one  supported it, including eighteen universities, plus Universities Scotland. Four of the universities were from England, giving the surprising result that  the current Scottish government has on at least one occasion preferred the position of the University of Surrey to that of  various student unions, the STUC and the Equality Challenge Unit on an aspect of student funding in Scotland.

As noted in an earlier post, the SNP has been keen to stress that Labour “opened the door” to fees, by introducing them in 1999.  They have indeed sometimes pointed to calls for unregulated fees by some English vice-chancellors to illustrate the slippery slope  of fee charging.  However, the regulations in Scotland and Northern Ireland equally  “open the door” to the complete removal of fee controls.   Ah yes, it will be argued, but that’s different, it doesn’t apply to “our”students. It’s an argument: but then so would be that the 1999 fee regime didn’t apply to those from low incomes.  There is, it might be said,  an open door leading to a slippery slope in both cases: it’s an argument about which is most slippery, at best.

In practice, no Scottish or Northern Irish university has yet exceeded £9,000 and quite a few have divided, with more or less accuracy, £27,000 over four years to come up with figures below  £7,000 a year.  The combination of market disadvantage, bad PR, the behind the scenes kicking and – critically – Student Loan Company lending limits presumably mean that moving to a £10,000 or £12,000 fee is deemed not worth the trouble for now. Indeed from Scotland we now have some evidence, however localised and limited,  of some of the forces which may act on an apparently unregulated market in fees.  Any reduction in fees in England will be likely to pull Scottish fee levels down in parallel.

Update since original post (with thanks to the person who drew this to my attention):  Subsequent to their original 2011 legislation, section 4 of the Post-16 Education (Scotland) Act 2013  gave Scottish Ministers the power (but not a duty) to set a cap on any higher fees charged to rest of UK students.  The section was brought into force in March 2014, but a search of “fees” on  the legislation database does not bring up any relevant Holyrood legislation since then, so for the time being the situation appears to remain that these fees are unregulated, but with Ministers having the ability to change that quite quickly, if they wished.

Students from the rest of the UK are very small in number in Northern Ireland, but make up around 15% of UK undergraduates in Scotland,  much more at some universities.  Edinburgh University in particular has a large number, in proportion and in absolute terms.  Their recruitment is uncapped. Unexpectedly therefore, those students, and certain Scottish universities in particular, are now  technically part of the largest experiment in pure free market domestic undergraduate education undertaken in modern history anywhere in UK,  justified by its architects by the depth of their attachment to a non-marketised system of higher education  based on free tuition.  Devolution is complicated.

Footnote

Wales caps fees for all UK students at £9,000 and then reimburses its students with a fee grant, covering all the cost over a certain amount (currently £3,685).  The English fee cap is also set in legislation for all UK students at English universities.

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