Newton Emerson: Raising student fees is the only practical solution

Newton Emerson

Newton Emerson

Newton Emerson writes a twice-weekly column for The Irish News and is a regular commentator on current affairs on radio and television.

The cap on university places is acting as a “handbrake” on the north's economy, according to Westminster’s Northern Ireland Affairs Committee. Photo: Chris Ison/PA Wire
The cap on university places is acting as a “handbrake” on the north's economy, according to Westminster’s Northern Ireland Affairs Committee. Photo: Chris Ison/PA Wire

The cap on student numbers is a “handbrake” on our economy, Westminster’s Northern Ireland Affairs Committee has declared.

But MPs on the committee, including members from the DUP, SDLP and Alliance, stopped short of recommending the only practical solution: raising tuition fees.

Fees in Northern Ireland are half the £9,000 rate in England because Stormont subsidises the difference, at a cost of £200 million a year. To keep this subsidy under control, undergraduate places for young people from Northern Ireland are capped at around 7,000 a year. This stops our universities growing, drives a quarter of students away and hampers creation of the high-quality jobs that would bring those young people back and keep local graduates here. All of this has ruinous economic consequences.

Although the problem is well known, every Stormont party baulks at tackling it. Lower fees are seen as the sort of giveaway it is politically impossible to reverse. In 2020, after the New Decade, New Approach deal turned out to be less generous than expected, DUP leader Arlene Foster suggested re-examining the tuition fee subsidy. The immediate backlash, including from parts of her own party, soon shot the idea down.

In July this year, DUP economy minister Gordon Lyons told another Westminster committee the cap could be lifted through higher fees or finding more subsidy funding from elsewhere in Stormont’s budget. However, this was a mere observation from the minister - no action followed.

At last weekend’s ard fheis, Sinn Féin confirmed it wants the economy portfolio if and when devolution is restored, putting the decision on tuition fees in its hands. That might seem to make an increase even less likely, yet there are progressive arguments Sinn Féin could deploy.

For a start, there will be no serious university expansion in Derry under the existing system. Ulster University is not going to take undergraduate places in Belfast, where it has a guaranteed choice of applicants, and transfer that part of its cap to Magee, where it lacks confidence places will be filled. The proposal for a completely new university in Derry is not politically viable as it would have to be given places taken off Ulster and Queen’s. The best way to foster a new university would be to eliminate the subsidy and cap entirely, freeing all institutions to grow in line with demand.

The most progressive argument for raising fees is that they are a form of progressive taxation, in the technical economic sense. Fees are usually repaid via loans, at a maximum rate of 9 per cent of earnings over £21,000, with any balance written off after 25 years.

It is as if the railway line to Derry could be upgraded through extra ticket revenue but only adults under 46 with good jobs had to pay for a ticket.

Northern Ireland’s universities have a strong record attracting students from low-income backgrounds. This has its own economic benefits and there is some evidence higher fees discourage it, which is why Stormont spends £100 million a year on student support.

If the fee subsidy was eliminated and its £200 million budget switched to student support, the cap could be removed and help for low-income students would be tripled at an overall cost of zero. More support would not have to be considered until universities had tripled in size, by which point the economy and Stormont’s finances should be transformed. It is extraordinary political cowardice to ignore this policy option, which promises limitless potential with no downsides, simply to maintain a flat-rate giveaway at horrendous cost to us all.

Most students are not from disadvantaged backgrounds, of course, and would not be deterred by higher fees. The boom in purpose-built student accommodation in Belfast, with rents starting at £150 a week, is a revealing commercial judgment on modern expectations and financial attitudes. We are not in the world of The Young Ones any more.

The number of students with cars is what always impresses upon me how much things have changed. At the posh English university I attended 30 years ago I knew one person with a car - his mother’s old Vauxhall Astra. His father was a director of IBM. Any young person reading that might consider me a relic but it is people my age who are sending our children to university and would prefer them not to have to leave Northern Ireland, either to study or to find a graduate job.

Is there no political party that dares sell us the policy required?