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£9000 Fees – never knowingly undersold

March 7, 2011


The University of Exeter’s decision to set fees at £9000 announced last Wednesday ( makes the choice facing university managers in other research-intensive universities straightforward. Game theory would suggest a petrol station price promise or a tag of ‘never knowingly undersold’ is a price signal to competitors, so Exeter’s £9000 is a signal to the rest of the Russell Group and 1994 Group to follow suit. The cap fits nicely and many universities will wear it. Not so David Willetts apparently, who at the Dearing conference in Nottingham reiterated his threat (since much repeated) that he had no appetite for the sector to cluster at the top of the fee regime and any clustering would mean the government would have to find further savings in the HE budget. This is a punitive action well within the style and appetite of this government. A £9000 fee also comes with strings, in the form of action to support social mobility. Call me cynical, but I genuinely believe that universities are good at jumping through quality and administrative hoops, so one more form from OFFA or Simon Hughes will not be beyond them. On a more uplifting note, who is to say that universities are not doing everything in their (not inconsiderable) power to pursue a policy that creates a diverse student body? Universities can call the government’s bluff on this one; well some of them can, as the UCU analysis in December aptly demonstrates

However, I think this is a phoney war at the moment. I can’t help feeling that the government will tolerate £9000 fees provided there is price differentiation in the sector, based largely upon university ‘type’. After all Vince Cable and his colleagues having gone to universities like Cambridge, ‘tend to forget what universities like [in this case Teesside] are doing.’ So the interesting fee setting will come from the post 1992 universities, particularly those nearer the top of the league table, such as Oxford Brookes, Bournemouth, Sunderland, Nottingham Trent and Sheffield Hallam.  The odds are fees below the level set by research-intensive universities, except on a handful of the most popular courses, particularly courses that show to a prospective student a direct correlation between investment and graduate employment prospects. If one of the top ten post 1992s does set blanket fees at £9000 or £9000 on too many courses at that level, then we’re in for a round of rum rhetoric from BIS, budget reductions and may be even statutory measures.

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