The COUNCIL beg leave to report to the University as follows:
1. The recent Higher Education Act permits universities to charge home and EU undergraduates higher ('variable') fees (which will not be paid 'up front' by students: the UK Government will pay these fees to the universities, then reclaim them from former students, effectively at zero-interest, after certain income thresholds had been reached). Charging these fees will be subject to approval of an access agreement by the Director of the new Office for Fair Access (OFFA). Significant changes to other aspects of student support are also made in the Act. If Cambridge adopted the new national scheme, a significant benefit for our home and EU undergraduates would be that the present 'up front' fee would no longer be payable for new students from 2006.
2. At present the home and EU University composition fee for undergraduates is £1,150 (2004-05). This accrues to the Chest. If the University decides to charge the higher fee indicated by the Government - £3,000 is the present rate proposed, to be up-rated annually by inflation - a significant element of additional income would come to the University. In Cambridge, this would be allocated through the approval of the annual Allocations Report. The Council expect that this additional income would be allocated partly to the University element of the significantly enhanced undergraduate bursary provision, financed jointly with the Colleges, and that the remainder would be available for general purposes (including salaries, stipends, and other expenditure in Faculties and Departments) financed from the University Chest.
3. The Council believe that it is in the interests of the University and of Cambridge students that the government's fee scheme is implemented. As the Allocations Report for 2004-05 indicates (Reporter, p. 716), the Chest is subject to more calls for expenditure than its income can presently support, with the result that the University's freedom to develop and compete internationally is severely constrained. In the view of the Council, with which the General Board concur, it is important, given the present circumstances, that the University should gain the limited extra fee income which the new national fee scheme proposes. It would be wrong, however, to believe that this new income would in itself be sufficient to provide a complete solution to the University's financial difficulties, because the rate of fee chargeable is limited. Income from other existing and new streams will therefore be essential to support the future of the University. The Government has its own significant part to play in relation to the HEFCE grant for teaching and research. So does the Cambridge campaign for the University's octocentenary.
4. Work is well advanced on the enhanced undergraduate bursary scheme for home and EU undergraduates. The final details cannot be confirmed until the Government has established its new student support arrangements, but the Council, in co-operation with the Colleges and the Isaac Newton Trust which administers the present scheme, intend that the full Cambridge bursary scheme, to be implemented in 2006-07 (subject to the approval of any University contribution in the Allocations Report 2005), should be announced in good time for intending students to plan.
5. The Cambridge bursary scheme, to be financed jointly by the University and the Colleges, will be devised to meet the needs of potential students, rather than narrowly to meet the expected requirements of the Office for Fair Access. The Council believe, therefore, that the Cambridge scheme will satisfy the requirements of OFFA.
6. Applicants for admission for undergraduate courses in 2006 need to know in advance what the University's fee arrangements will then be. In particular, they will wish to know whether the University adopts the new scheme. As the new scheme is in several ways advantageous to Cambridge students, during their time as students, especially combined with the new Cambridge bursary scheme, it is in the interests of both potential students and of the University as an institution, that the University now takes a decision to implement the new scheme. The Council therefore propose Cambridge fee legislation accordingly.
7. The final national fee levels for 2006-07 which the Government will support financially are not yet known, and they will be adjusted annually in later years. The Council therefore propose that the Cambridge legislative provision for fees paid by home and EU undergraduates beginning courses from 2006-07 should be in the form set out in the Act.
8. The Council, with the agreement of the General Board, also propose that a standard rate should continue for the undergraduate home and EU student fee, without differentiation by subject, as is the case at present, in order that the choice of Tripos is not governed by the fee charged. The total resource per student available from the additional fee and HEFCE 'T' income will not in any event cover the estimated cost of teaching.
9. Students already on undergraduate courses before 2006-07 would continue to pay the existing up front undergraduate fee which will be up-rated until the termination of their course, expected to be 2007-08 for three-year undergraduate courses or 2008-09 for four-year courses. A Grace will be put forward later to make transitional provision required by Section 25 of the Act (for some students offered a place before 1 August 2005 to be taken up in 2006-07).
10. The Council therefore recommend as follows:
That from 1 August 2006 the regulations for University Composition Fees (Statutes and Ordinances, p. 160) be amended as follows:
(1) Regulation 11.
By replacing the words 'Subject to the provisions of Regulation 12' by the words 'Subject to the provisions of Regulations 12 and 13'
(2) By adding the following new Regulation 13:
13. With effect from 1 August 2006, the rate of University Composition Fee charged to students beginning courses on or after that date in categories A-C and N of the Schedule, shall be the amount determined by the Secretary of State for Education and Skills as the higher amount under Part 3 of the Higher Education Act 2004, subject to the approval of the Director of the Office for Fair Access; failing which the basic amount determined under the Act.
| 9 August 2004 | | ALISON RICHARD, Vice-Chancellor | | A. M. LONSDALE | | MARTIN REES |
| R. J. ANDERSON | D. LOWTHER | G. A. REID | ||||
| Z. BARANSKI | D. W. B. MACDONALD | LIBA TAUB | ||||
| RICHARD BARNES | JAMES MATHESON | JOAN M. WHITEHEAD | ||||
| IAN LESLIE | ||||||
I do not agree with this Report. The implementation of the new fee arrangements set out in the Higher Education Act is not in the interest of potential students, particularly those from non-traditional backgrounds. A generous bursary scheme will do much to alleviate student hardship but little to remove the significant barrier the anticipation of debt creates for students from the lower socio-economic backgrounds. Before the University celebrates the passing of the Higher Education Act it might pause to consider whether a funding system that does not solve its funding crisis and reinforces barriers to widening participation was really due the support it received from certain quarters.
W. P. W. STREETING