The future of some West Midlands universities have been put at risk following the dramatic increases in student fees, experts have warned.
While the most prestigious universities will benefit from the possible increase in tuition fees, others could struggle to raise funds from students.
Concerns are prompted partly by fears that the increase in student fees will be offset by a dramatic cut in central government funding, to be confirmed in the Comprehensive Spending Review on October 20.
It will mean that the new funding scheme does little to increase the amount of money going into the system, but amounts instead to a shift from state funding to funding by individuals.
Nigel Thrift, vice chancellor at the University of Warwick, warned that some universities would face “stark choices”, while Madeleine Atkins, vice chancellor of Coventry University, warned: “We are very worried that the eventual outcome will deter those who are less well-off from going to university.”
The Government has announced it is considering a new tuition fee level of £7,000 per year – more than double the current cap of £3,290.
It follows the publication of Lord Browne’s review of student funding, which proposes the most radical shake-up of higher education funding for years. The review called for the cap to be lifted entirely, raising the prospect that institutions could charge as much as £12,000 a year for some courses.
By pushing the concept of a market in higher education, with leading universities charging more, the policy threatens to widen the funding gap between the elite colleges and the rest, including former polytechnics.
The less prestigious universities also tend to attract students from poorer families, who will be less confident about taking on debts to pay tuition fees and unable to ask parents to pay for their studies.
Prof Thrift said he expected Warwick to do well under the new system, but other institutions would not be so lucky.
He said: “Clearly we can expect that the Comprehensive Spending Review will include deep cuts in the funding of England’s universities.
"These cuts will pose a significant challenge for our sector, particularly as it has long been accepted that the Higher Education system is actually in need of substantially more investment rather than cuts.
“Currently universities have few, if any, options available to them to cope with such a significant cut other than the option outlined in the Browne review.
"Many commentators expect that universities will have little choice but to charge an undergraduate student fee of at least £6,000 simply to cope with the expected cut in university funding.
“If that is what we face then we can expect significant changes to the higher education landscape. Many institutions will not be as able to charge a fee level that would cover their reduced funding and will face stark choices.”
Prof Atkins added: “Our main concern is for prospective students and their families. We are very worried that the eventual outcome will deter those who are less well-off from going to university, and will therefore limit their life chances and opportunities for a professional career.”
The tuition fee hike also poses a dilemma for Liberal Democrat MPs, who signed a National Union of Students pledge before the election to vote against any increase.
However, the coalition agreement signed by the Lib Dems and Conservatives only allows Lib Dems to abstain on a vote.
Lorely Burt (Lib Dem Solihull) said she was talking to the NUS about the Government’s plans and how they could be improved, but may not vote against the proposals.
She said: “The problem is that we have a big black hole in public finances.”
Meanwhile, more than 200 students voiced their anger against controversial plans to increase the cost of university education at a demonstration at the University of Birmingham.
The lively demonstration, which was organised by the Guild of Students, saw protesters march around the university’s Square clutching placards bearing the slogans including “no to higher tuition fees” and “tuition fees: to infinity and beyond”.
Among those who had turned out for the protest was economics graduate Matt Lamb, who is £22,000 in debt.
He said: “This is going to create a market in higher education where students who are academically able to study at the University of Birmingham will not be able to study here.
“It creates a barrier to education, which is why we have built a barrier here.”
Beckie Johnson, a 19-year-old theology student from Stourbridge, said: “This is barbaric. I wouldn’t be here if I had to pay £7,000 a year. The thought of that level of debt is off-putting.”
Rachael Ward, 19, from Shirley, said: “It is too expensive to ask students to pay that much , especially when you think of all the extras you have to pay for books and sports kits.”
Leah Bracha, an 18-year-old economics and history student said: “I think it is ridiculous that people should have to pay for an education. It shouldn’t be about how much you earn, it should be about your ability.”
Her classmate, 19-year-old Alice Poutnex agreed: “I think that for a society that is trying to be equal and just, this is just going to discriminate against some people because our economy is suffering.”
Alexander Ross, an 18-year-old war studies student, said young people felt they were being “punished” because of the economic situation.
He said: “It is unfair that we have to pay for the mistakes of the older generation.
“Unlike them, I felt a responsibilty to those who aren’t yet at university and I believe they should get the same quality of education for the same price.”
Ruth Burnett, a 20-year-old social policy student said the proposals could affect her family.
“My sister is three years younger than me, and this could possibly mean that she may not be able to go to university.”
Jo Robinson, a 20-year-old student from Chelmsley Wood, said: “I live at home as I couldn’t afford to go elsewhere and I was lucky there was a good university on my doorstep.”
*The cap on tuition fees should be lifted from the current £3,290, allowing universities to charge what they like - and different fees to be set for different courses.
*The Government would underwrite fees of up to £6,000. After that, universities would pay a tapered levy to cover the costs to Government of providing students with finance upfront.
*Universities charging more than £6,000 per year will keep smaller amounts of that fee, for example an institution charging £7,000 for a course, will keep 94% of the fee. The review sets out figures up to £12,000 per year - universities charging this will still keep nearly three-quarters (73%) of the fee.
*Similar to the current system, students would not have to pay fees up front. The earning threshold at which graduates would have to start repaying loans would rise from £15,000 to £21,000.
* Unpaid loans would be written off after 30 years.
* Higher-earning graduates would pay back their loans at an interest rate equal to the Government’s cost of borrowing, while those earning below the threshold would pay no real interest rate, and would just see their loans rise in line with inflation.
* Every student would be entitled to a flat-rate maintenance loan of £3,750.
* The review estimates that students taking out tuition fee loans of £6,000 per year for three years and £3,750 in maintenance loans in the same period will owe £30,000 by the time they graduate.
* It calls for student numbers to increase by 10% over the next three years, and for no restrictions on the numbers universities can recruit.
* The Government should continue investing in “priority” subjects such as science and technology, medicine, nursing and healthcare as well as “strategically important” language courses.