The student as a consumer: How tuition fees have changed UK universities

The situation in British higher education changed two decades ago: in 1998, Tony Blair's Labour government introduced tuition fees. Over the years, their amount has risen dramatically, from the original £1,000 per year to £9,250 by 2019, moving a large proportion of the costs of university education to the students themselves. As the amount of money paid by students has risen remarkably, students have come to view themselves as consumers and market forces have come into play.

Here, David Palfreyman, Bursar of New College at the University of Oxford, member of the board of the Office for Students, a newly established independent public body, and author of books on higher education, discusses the consequences of these changes for students and academics, and where he sees the future of the university in general.

The views expressed by David Palfreyman in the interview are purely personal. They are not necessarily the opinions of the Office for Students.
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There is now a big debate in the UK about whether to cut tuition fees, because they are considered too high. Tuition fees were introduced in Germany and Austria and then cancelled after protests. After much discussion, they have not been introduced in the Czech Republic. What is your personal view on university fees?
It is a political hot potato and is incredibly sensitive in every country where it has been raised. Here the Labour government pushed through fees and only got through by a majority of five in the Commons, even though the government had a much bigger majority normally. As you know, Germany tried it and then backtracked. The British did it, and it has accelerated a lot since then. Initially it released an amount of protest because the middle class regard universities as a welfare state perk. Every country has to go through the same debate about why people pay taxes and then don’t go to university. Why should they pay for other people’s children to go to university and for them to get better jobs. So, it is pretty much the same in every country. But we talk about England, not Britain. Scotland and Wales have different approaches to tuition fees under devolution within the UK.

You personally think it is good to pay tuition fees?
I personally think it makes sense to charge student fees, and it is good to make them to stay in the game. I think it helps them to become consumers, it raises more questions about value for money of universities and it is good for universities to be challenged about what they do and how they do it by a paying customer rather than it being a free public good. When we get free public goods we all tend to mistreat them. So I think some level of fees, and as I said in the lecture, no one knows where to draw the line.

You said, in some form, some amount. But the price English students pay for their university education has risen dramatically, from £1,000 to £9,250. Do you think the charges are now too high?
I think that’s the politics. I mean in Berkeley, California, they charge fees of about 15,000 dollars, so it means Berkeley charges more or less the same amount as we do in the UK. But it varies tremendously across US states. And don’t forget, we have a tight system. So it is only three years, maybe four years for some degrees, you pay for undergraduate education, while at Berkeley it will be a four-year degree that may stretch to five. Usually on the continent you take a longer university education, so if you charged fees, it would be at a higher level. So to charge fees might help challenge the system to speed up, not having it so slow as it is now in some cases and some countries.

So the market does not have all the answers.
I’m not saying that the market does have all the answers and I’m not saying that everything should be a public service. In higher education, it should go to some kind of middle ground. You have to decide: Should that be a public good or should it be charged for, and once you start charging where you decide to stop.

Any suggestions where to stop?
I don’t know. It is a political question with no easy answers. Some say, as I said in the lecture, this is wicked neo-liberal stuff and is damaging a perfect idea or let’s say some ideal of free higher education delivered by dedicated academics with only the interests of the students et cetera. And the other side of that point is, delivery of public services usually means the convenience of those delivering them rather than who is receiving them. So, you just have the classic problem of how to balance in a capitalist society between the social welfare of the product and the efficiency of the delivery. Those are big questions, what is higher education about, what does society want, what does the economy need, as I mentioned before.

You studied in the 1970s when university education was free. Now you are the parent of two children who studied at the beginning of the millennium, and you had to pay for their university studies. What is your view of the whole situation from a parent’s point of view?
I got it free in a post-war world, in a welfare state where belief in education was strong, and it that was great and an easy ride. My daughter was 1,000 pounds and my son was 3,000 pounds. My son did hard experimental psychology, a hard science psychology degree, he got a lot of teaching and had many resources, so I think 3,000 was good value. My daughter, like lots of other students, did a social science/humanities degree where there was not a lot of teaching and teaching was organized for the convenience of the academics. It was all pressed into two terms, all done between October and Easter, not all year round. I think that is bad for young people pedagogically. So I resented paying 1,000 pounds for that and many parents would think like that. In England a fundamental challenge is about and why value for money, why undergraduates in certain subjects are getting no teaching in some terms, meaning, in your case, semesters. The answer is for the convenience of the professors, and that shouldn’t happen. And no wonder students complain and they complain more than when it was a free public good.

You mean that being a student consumer pays off for the system in the end?
Yes, because those students are more demanding. Of course, it is not perfect by any means. There is more to be done, and on the OxCheps website there is a very challenging paper that I have written about the need for a student contract, which will pin universities down.

Students should be seen as consumers, but on the other hand, with massification it is not easy for teachers and universities to maintain a high-quality service. The number of students has risen enormously in recent years.
But massification is unavoidable. You just have to work out what kind of tertiary education you want to provide. You have to decide if there is any point in sending all of these people to do traditional degrees in very academic universities, how many philosophers the state needs and how many plumbers it needs. You have to ask all good questions if there are too many courses which are not useful et cetera and we should get a better balanced system with some version of technical universities. All that debate used to be held and is going on in the UK and goes on in most countries decade after decade. And not many countries get it right.

With the student as a consumer model, isn’t there a risk of imbalance given by what students want to study? Meaning: “I want to get back the money I invested in my studies, so I’m not going to study anything that doesn’t make that money for me.” So everybody ends up with management, law or medicine?
Yes, you have that risk. But it is not a tremendous problem. There is a good argument that a good education in liberal arts and humanities is good preparation for work and life. There is a risk that vocational subjects prepare you for yesterday’s jobs, they are out of date and better would be a proper higher education where you learn to think and learn how to be adaptable and flexible in what you are learning and deliver it in most subjects. But yes, there is risk that people say I want to do accountancy and management but I don’t want to do philosophy because that doesn’t seem to get me a job.

So should the state or a public authority regulate the number of fields of studies at universities?
No, I’m against Stalinist planning statements like: You produce too few or too many philosophers and you don’t do it efficiently. Moreover, there is a big question mark over if you can even plan an employment market.

You are a member of the board of a new body, the Office for Students. What are the new challenges for universities in relation to the Office?
As legislation says, to ensure they are efficient and effective and delivering higher education to the student as a customer. Moreover, a range of issues have been flagged up, and the Board has to grapple with them. Payment of managers in higher education, degree grade inflation, something called unconditional offers [If a student receives an unconditional offer from a university, then he has already met the entry requirements for a college or university; the place is his if he wants it. Ed.] as a marketing device to recruit, involving risk of low entry grades, with the applicant more relaxed about getting good or better A-level grades, whether it is distortion for 17-year-olds. Whether or not to rescue a university that goes bankrupt. But there are again political questions.

You mean that managers are paid too much?
Some higher education managers and especially some Vice-Chancellors (Rectors) have become egregiously over-paid, with salaries of £400k and more; there has been a media furore about it and it seems matters are getting more sensible in that some very recent replacements of certain very highly paid VCs have reduced pay by £150-200k. The nonsense has been to claim that University leaders must be paid vast salaries to be competitive with the business world when the reality is that such people in HE are rarely recruited from the commercial world and even more rarely will they be ‘stolen’ by the commercial world if not paid enough in HE - HE leaders do not go off to run Aldi or Renault if not paid over £400k to stay at their University; their skills are not transferable.

Have you taken on new quality assurance procedures because of the Office for Students at New College, University of Oxford, for instance?
No, we are doing much the same stuff. And I am very cynical about quality in higher education. I think most of us in the university world couldn’t touch on or articulate what quality of university is. We end up with a lot of agencies with acronyms, and the definition of what quality is constantly changes. There is a big industry called quality assurance. We have it at national level and European and global level and almost across-the-galaxy level. And you think, what is this actually all about? Does it actually affect the quality of teaching on the average degree course in a Tuesday afternoon seminar?

Do you think academics in the UK like the idea of the student as consumer?
Of course they don’t.

Because students don’t/can´t know what they are buying?
Yes, that’s a weakness and one of the problems. How do I know what I want from university if I only ever go to it once, at the age of 18? And probably that’s why you need some kind of external agency or some internal body. But academics do not like being managed either. They do not want the consumer to tell them anything. They don’t want any inspection of their teaching going on, they just expect that we trust them. And that is the big issue. In modern society, we don’t trust doctors, dentists, lawyers. We have regulatory regimes, because we don’t believe in the profession. I mean, Samuel Johnson, the famous 18th-century essayist, said every profession becomes a conspiracy against the laity, give them a chance. Normally, if I’m free to run things as I want to for my convenience and I’m sent lots of money, there is a huge danger I’m going to get lazy and flabby and unimaginative. I’m not going to bother to put much effort into anything. I’m sure there are dedicated academics, perfect teachers, working hard. It is all about the balance of how you ensure that a professional group doesn’t slip into cosy ways. And maybe charging fees introduces an element of challenge. In the 18th century, Adam Smith said that students should pay for their lectures as they go along. Read Adam Smith´s Wealth of Nations. It is very inspiring in the idea that students should pay. He also criticises 18th-century Oxford and Cambridge. But of course, this is all complicated, there are no easy answers to it all, but it is the same issue you have about the quality of hospitals, healthcare, the efficiency of railways, the police force and so on. It is just normal stuff to balance in a free society.

The Czech government has recently announced that the state will provide more money for Czech research, which is also done at universities. You talked about a rising tension between research and teaching at universities. Could you say more about it?
Also in the UK, the strategy is to spend more and more of your money on your research. Your performance as a university in the world rankings is all about your research. Your brand is established on your research output. Academics prefer doing research to teaching. They get career progression from research. They are rarely promoted because they are dedicated teachers. Universities get money for research from various sources, but none of them are willing to pay the FEC. In the UK it is subsidised from the profit of international student fees. Everything points towards a pressure on research, and it means you probably steal resources from undergraduate teaching. The business model of universities looks like that. Thus, we pretend that all universities are research and teaching and all academics are researchers and teachers. But the reality is, most universities are not research focused and most academics are not research active. In the UK, half of the research money goes to 12 universities, such as Oxford, Cambridge, University College London, and half a percent, really only a half a percent, goes to the bottom 12 universities, which are teaching-only universities.

So do you think there should be greater focus on teaching and more money for teaching than for research?
Yes, and more pedagogy understanding how young people learn, more effort put into teaching efficiently and looking for productivity gains in teaching. And a pride in good teaching and career progression for good teaching. It tends to be swamped by our doubling numbers on research. Which is fine for about fifty to a hundred institutions in the world which are serious big, global, competitive, research-focused universities.

So there is no shame in being a teaching-only university?
No, nor to being promoted for being a good and committed teacher. Nor in heads of department being interested in making sure that teaching is good. Seminars are lively, interesting and entertaining and the seminar leader hasn’t gone to asleep for always delivering the same boring old stuff they have been doing for the last twenty years.

So what should universities focus on? The student as consumer?
If the Czech government over-stresses research so that universities neglect teaching, as we in England have done with the RAE/REF since 1987 – then as now we are trying to do it via the Office for Students with the TEF – there will eventually be a need to get universities to refocus on teaching, especially if tuition fees are introduced and the Czech student becomes consumerist.

Do you believe there is still a future for ‘real’ universities? With old campuses and ‘real’ teachers? Or should they be replaced by the Google university without a brick campus and personal contact with a teacher you talked about in your lecture? You are speaking on the phone from your office in Oxford, which was built in the 14th century and is still there.
For many campuses of second- and third-rate universities, a Google university, or Amazon or EasyUni, would be a real challenge. I would rather have a degree in marketing from Amazon than a degree in marketing from an unknown university in an unknown country, it is more portable. As to elite universities like this one, as I said in the lecture, we will still be here in our bubble in 2050, and we will still be as smug as we are now, and we will still have students coming. Whether what Clayton Christensen calls disruptive innovation will apply in higher education in the way applied in the media industry or in the car industry to some extent, remains to be seen. It maybe also remains for universities to just embrace the change to our advantage and they will remain in control and escape change by making sure they can hang on to credentialisation. And in the end Amazon, Google or whoever will not want to enter this strange industry and we maybe renew the challenges most industries encounter. Honestly, I don’t know – we were not able to give an answer in the last chapter of our little book (Universities and Colleges: A Very Short Introduction – Ed.). We just raised the questions and flagged the possibilities.

David Palfreyman gave a lecture at a conference on quality in higher education. The conference was held at Masaryk University, Czech Republic on 16 and 17 May 2019.