Use tuition fees to get the skills we need

Joe Wright, 16 April 2014

It is now conventional wisdom that the UK’s recession was exacerbated by the decline of our production base. Too many jobs and too many taxes came from ‘frothy’ industries in services: accountancy, restaurants, communications etc., things that we cannot easily sell abroad to bring money into the country. ‘How do you export a haircut?’ is the typical criticism laid at the services-based economy. The agreed solution was to re-divert young people back to studying ‘nuts and bolts’ subjects – the sciences, engineering, product design – in the hope manufacturing will eventually regain lost ground. David Goodhart of Demos defined this new thinking as ‘post-liberalism’ (Post? Neo? Post neo?…): an era where we should be less timid about gearing our economy towards what we know works best.

The fact young people put an increasing premium in education is something the UK can be very proud of. 32 per cent of all young people carry on their education past the age of 18, entering various universities, apprenticeships and colleges. This is four times the percentage that continued in 1984. Our problem is that among this third of young people, not enough study the subjects the UK needs to be productive; to be less ‘frothy’.

University technical colleges have gone some way to offering a more economically-geared education to school leavers, but (forgive the exhausted simile) the UK’s skills base is a particularly hefty tanker that takes years to turn. What will help is creating more incentives for young people to study the subjects most needed through the tuition system, such as the STEM subjects (science, technology, engineering and mathematics).

Labour have already promised they would lower the cap on tuition fees and even introduce a graduate tax (essentially renaming a spade, a spade); partly to rub salt in to Lib Dem wounds, but also in recognition of the need to overhaul university funding. But why not, with a touch of post-liberalism, go one step further and create lower thresholds for selected vocational and STEM courses? If people opt for courses that will provide an eventual greater economic benefit, then subsidising these courses to encourage more students is a clever investment.

How much and how we pay for further education matters. The argument repeatedly made during the rise in tuition fees to £9,000 was that the payments would be spread over such a long time, graduates would not notice. But the message it would cost even nominally more was heard very clearly: young people are now more aware of the long term value of the courses they choose.

Messages matter. Blair’s pronouncement ‘education, education, education’ resulted in an unprecedented spike in young people entering higher education. If the Government makes the case for vocational and STEM courses loud and clear, backing it up through the tuition system, more young people will take the option seriously. It will also help to restore the production industry’s image to the remarkable, creative industry that it is.