U.K.higher education: Is the social mobility argument really settled?

Stop class divideLast week Ben chipped in on U.K. higher education reform. I don’t know why he avoided it until now, but I might guess it was for much the same reason that I did. The same reason I was leery of joining in the demonstrations around the tuition fee rise.

The protesters had many objections, but resistance seemed to coalesce mostly around the idea of inequality. A clear message emerged that huge tuition fees would put university education out of the reach of those from poorer backgrounds. But looking through the Browne report, along with the IFS review of the proposed legislation itself, I wasn’t so sure.

Ben, in his piece for The Sociological Imagination argues finely that the effect on inequality and social mobility will likely be minor, and that the protests should have instead focused on other aspects of the legislation which may prove even more damaging. I agree with almost everything else he has to say, but I still don’t think the fundamental question of social mobility is settled. Will this legislation, more so than the current system, make university education more unequal in favour of those from higher income backgrounds?

We can’t know for certain what will happen, but we can look at the parts of the reform that are likely to promote equality and access, and we can weigh them against the parts that will likely block or dissuade poorer school-leavers from higher education, or from more elite universities.

First the good stuff. The nature and structure of student loans seems better than the old system. There will be no up-front fees. Everything will be paid after you graduate. This makes the new system less of a gamble than the old one. Under the current system, a lower income school-leaver, seeing peers drop out before graduation with large debts, might consider university too much of a financial risk to take. This risk is completely missing from the new system.

Also if you earn less after graduation you pay back less. People in the lowest 20-25% of lifetime earnings after graduation will pay back less under the new system than they would have under the old one. This, along with the raised repayment threshold, also alleviates the risk that you will graduate and wind up with a low wage job and high monthly repayments.

There are also additional pots of money available for the poorest students. First, a government scholarship fund will provide a free third year of education for the very poorest – this seems to be an unqualified good for the few who will be eligible. Second, the first year of education will be free for the poorest students who attend universities charging over £6,000 (which may well be most of them, but will definitely include the most prestigious institutions). This will be funded by the universities themselves and would seem to ensure that school-leavers from the poorest households are not discouraged by cost from applying to higher quality universities.

From the perspective of someone from a lower income background, all of these things make university look like a better prospect than it would otherwise. Oh, that we could stop there. But no, now we get to the bad stuff.

First, the ‘free-first-year’ scheme. What from the prospective student’s point-of-view seems like a great thing is in fact a strong, systematic incentive for higher priced universities to reject poorer students. They can either accept a higher income applicant who will pay for the full cost of their course, or a poorer applicant who will only pay for two thirds. Which would you choose?

The coalition has said they will be checking to make sure application decisions are not made in this way, but there are no robust regulations written into the legislation as it stands. The government are essentially saying that they will keep an eye on universities to make sure they don’t act in their own financial self interest. I’m pretty sure I’ve heard something similar before…

The kind of systematic incentive we are talking about here is notoriously difficult to overcome, even with robust regulation. Let alone if your strongest sanction is a stern expression. So right off the bat we have a good reason for the more expensive (and presumably more prestigious) institutions to systematically favour richer applicants, without any robust means of stopping them from doing so.

Next, the addition of these scholarship funds, bursaries, loans, and maintenance grants makes the system more complex than it could otherwise be. This is exactly contrary to the recommendations of the Browne report. A less transparent system will make sure that some people are not aware of exactly what they are eligible to apply for. This especially affects poorer applicants who need these additional means of support.

Next is the plain fact that for most graduates a university education will work out to have been more expensive under the new system. For them, a university education will be a worse deal than it is now. This is particularly true for students from poorer families who, having graduated, go on to earn middling salaries. Their university repayments will be much more onerous than under the current system, without the safety net of wealthy parents available to their peers from richer backgrounds, but on similar salaries.

Finally there is the psychological impact of the massively increased headline figure for tuition fees. When the fee cap was raised to £3,000, all universities went on to charge the maximum possible rate. Given the massive loss of state funding (in the form of the block teaching grant) that all universities will suffer, it is unrealistic to expect that the majority of them will not charge upwards of £6,000. That is a student debt of between £18,000 and £27,000. For a family with few savings or assets, with their expenses just about in line with their incomes, this is not a number they’ll want to go anywhere near. Regardless of how risk-free they are told it is, or how progressive the interest rates are.

I’ve shied away from using this argument in the past because it has an obvious counter. “If these families could be sufficiently well informed about how safe the loan system is, then social mobility would be unaffected”. This argument also has an uglier follow-on. “If they aren’t smart enough to figure out that this won’t be ‘real’ debt, then maybe they shouldn’t be going to university in the first place”.

This line of argument is based on a lack of understanding of the experience of living on a low income, of being in a position where a single financial shock (like sudden unemployment) can be disastrous. This experience promotes a deep-seated aversion to things that would make this even worse. Things like large expenditures or debt. This aversion cannot be educated or informed away. It would take a very strong-minded and determined 17 year old to override their parents’ fears in this.

This adds once more pre-condition for university education for children of poorer families that does not exist for children of richer ones. Poor kids must be persuasive experts in money and debt to go to university, but richer kids can remain blissfully ignorant and still go.

So what is the conclusion? Will this legislation promote social mobility or arrest it? The answer to this question depends on how much of an effect each one of these factors will have. Ben points out that the last increase in the fee-cap did not seem to dissuade poorer school-leavers from applying to university. So the psychological impact may be less important than I have made it seem. Or possibly £18-27,000 of debt may cross some internal threshold that £9,000 did not.

The truth is that we don’t know what will happen. But for me this legislation represents an enormous gamble to take. In the U.K. social mobility has stagnated, and the impact of the recession means it has many more factors working to slow it still further. I think now is a time when we should be taking university education, one of the weapons we know can help social mobility, and aiming it directly at this problem. Instead, because of this government’s rabid focus on ill-thought through cost-saving measures, we are forced to seriously worry about whether it will make things worse.

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About Robert de Vries

I'm an Early Career Research Fellow in the Sociology department at the University of Oxford. I'm mainly interested in how people are affected by concerns about their social status; how it colours the way they think, feel, and behave. I try and contribute here regularly, but my addiction to writing excessively long posts keeps getting in the way.
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6 Responses to U.K.higher education: Is the social mobility argument really settled?

  1. Frank Popham says:

    Interesting post, thanks Robert.

    It raises the wider question of whether social mobility has declined in the UK in recent years? Economists comparing inter-generational income reckon so, as in the paper you cite. Results using social class are less gloomy and there is some debate between the disciplines as to why there is a difference.

    http://onlinelibrary.wiley.com/doi/10.1111/j.1468-4446.2010.01310.x/abstract
    http://www.bristol.ac.uk/cmpo/publications/papers/2010/wp230.pdf

    • mel bartley says:

      Many thanks for the update on social mobility debates.

      I think the reason there is a discrepancy between the research that looks for movement between social classes and differences between parents and children in income is that income differences can be measured on quite a small scale. So lets say your mother has been a highly paid lawyer. If you are a low paid lawyer you have been downwardly mobile. But it you are any kind of lawyer you are in the same social class (class is based on occupation). Lets say your parents are actors. If you call yourself an actor too, even if you hardly earn anything, you have not been downwardly mobile. But if you mother was Meryl Streep and you are mostly between jobs, you are downwardly mobile in terms of income (in a big way). If you get an apprenticeship and become a well paid plumber and your father was an academic, you might be upwardly mobile in income but downwardly in social class. I think things are changing in the UK quite fast as the privileges of the middle classes are eroded by neo-liberal policies. Thatcher and Blair did not seem to understand this. The welfare state does not only benefit those who get welfare payments. It also massively benefits the people who work in it. NHS guaranteed income for doctors. Welfare state created large numbers of jobs. And so on.

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  3. Robert de Vries says:

    Just as a quick update to this – here is an interesting article from Michael Tomasky’s Guardian blog on higher education in the U.S.

    The U.S. have obviously had variable course fees for ages. The coalition have claimed that it will drive up teaching quality but, as the article Tomasky cites points out, teaching quality is very hard to measure…

    • Ben Baumberg says:

      It’s a really good link, thanks Rob. It reminded me of the current discussion in the UK about using students’ satisfaction ratings as indicators of quality – see the critique of this here.

      Like you, I’m puzzled as to why anyone thinks a market will be successful where quality is almost unobservable…

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