Tuitions Fees: social engineering for the 'knowledge economy'
Alan Finlayson Teaches Politics at The University of Wales, Swansea and will be speaking at the SOTT seminar in February.
24 January 2003

It is now clear that the Blairite faction in New Labour has won its battle to transform the funding of British Higher Education by increasing the fees paid by students and allowing universities to charge differential amounts depending on the cost of the course and the competition for places. This is not simply an extension of the present policy of charging all students the same amount for attending university. It is a major revision of it. The misgivings of Gordon Brown and Clare Short aside, within a decade British students will decide which university they would like to go to, and what course they want to take, not only by weighing up the general attractions of various institutions but by balancing the advantages with the costs they will bear. When we choose a car to buy we may trade off a degree of comfort and longevity in return for spending a little less. Soon, prospective students will make similar cost-benefit calculations trying to balance desirability and affordability.

That New Labour should be prepared to countenance this extension of their policy may have enraged their core supporters but it should be no surprise. Since it was suggested by Keith Joseph, when he was still Margaret Thatcher's pet intellectual, the charging of tuition fees has been demanded by the more prosperous universities and considered in endless funding reviews. It has also been advocated by numerous think-tanks of the right and of the left. In 1998 The Young Fabians published a pamphlet proposing differential tuition fees and the transformation of students into consumers with the ironic title Students as Citizens. This is a policy that has been a long-time in the making.

Instinct suggests that we ought to oppose this outright. It automatically appears as a simple attack on the egalitarian and universal principles of the welfare state and public services. But let's suppress our instinct for a moment and think about this a bit more carefully. Universities certainly need better funding. However much we may wish things were otherwise, increasing direct taxation to pay for it is not much of an option. The problem lies not in the government but in our fellow citizens who are hostile to large tax increases and who, understandably, would prefer any extra money to be spent on hospitals, schools and police forces. So where, realistically, can an increase in funding come from?

There is also a justifiable rationale to passing costs onto the student. The case can even be made on egalitarian grounds as Margaret Hodge has tried to do. Why, she asked, should the dustman pay for someone else to become a high salary doctor? One socialist answer is, of course, that society as a whole needs doctors and so society as a whole should pay for them. But then, not all doctors are socially minded; many do get paid quite a lot of money and a fair number use their publicly funded education to secure private employment. If this case can be made with regard to doctors how much greater is it with students of economics or law or business management?

There may be a case for devising a system of funding that preserves but reorients the relationship between public and private activity and provision. A core principle of socialism is 'from each according to their ability, to each according to their needs' and (as Marx pointed out very clearly in The Critique of the Gotha Programme) that does not mean expecting the same from everyone or giving everyone the same thing. Socialists recognise and celebrate the inevitable inter-dependence of all people. One way of reflecting that in policy is re-distributive taxation. Government takes from the collective purse and gives to the student and the university. But that is not the only way of reflecting socialist principles. There is nothing intrinsically non-socialist in asking people who will receive private benefits from a public service to put something back into the collective purse on which they have drawn. Asking people who do attain high-paid employment as a result of their higher education to put something back in when they have it could be a fair and equitable policy.

For such a policy to work there would need to be a very different set of arrangements than at present. Firstly, it would require a widely and easily accessible system of low or no interest loans to be repaid on a differential basis according to means when available. It would also require different ways of paying back one's loans. Instead of a system based solely on cash transfer people could pay back the costs of their funding in kind - by agreeing to work for a time where the public services require it most such as in legal aid offices or in the more difficult schools or hospitals. In return for taking work where it is not always popular their debt could be reduced or cancelled. Such mechanisms would re-state and reinvigorate the connection between the individual and the collective and not only for the student but for their university teacher as well. The simple truth is that for a long time people have thought of university education as free when it has been nothing of the sort. The costs have simply been hidden from the direct view of both teacher and student. Socialists do not believe in the getting of something for nothing. Our critique of capitalism is based on a challenge to the idea that someone can get something for nothing: that one can get and stay rich by living off the exploited labour of others. That is why there is nothing intrinsically non-socialist about students paying something towards the true costs of their higher education.

There is, then, good reason to think a little more deeply and a little more openly about ways of funding the universities. However, this is not what the current government proposals are concerned to do. They are not about renewing and reasserting the relationship of the individual to the collective of which they are a part. They are not even about generating the cash needed to support chronically under-funded universities. The most important aspect of the proposals currently being debated is not the increase in the amount the student will pay. Rather, it is the fact that universities will be able to charge differing amounts. It is one thing to reconsider ways of funding universities with a view to renewing the sense of mutual commitment and obligation. It is quite another to transform the universities themselves by allowing differential charging of tuition fees. Allowing universities to set their own price is a different policy with a different rationale. That its motivation is not purely economic is surely evidenced by the fact that, for once, the Treasury has been cautious about what might otherwise appear to be an excellent way of reducing public spending. The truth is that the charging of differential fees is not simply about reducing public spending nor is it about renegotiating the 'contract' between society and citizen. It is, however, a singular expression of the general philosophy of Blairism.

The central pillar of New Labour's political philosophy is the belief that the 'knowledge economy' has irreversibly changed every aspect of social relations. In his 1998 pamphlet on the third way Blair argued that the main political challenge of the day was 'to engage fully with the implications of that change'. Labour had to aim for a 'dynamic knowledge-based economy founded on individual empowerment and opportunity, where governments enable, not command, and the power of the market is harnessed to serve the public interest'. Where the political right was prepared to let individuals fall victim to the cold winds of economic restructuring, Blair's New Labour thinks it can promote such change by equipping individuals to adjust to it. The task of government is to encourage autonomy, to be an enabling state. Anthony Giddens, Blair's Keith Joseph, calls this 'generative politics': fostering the individualism and entrepreneurial lifestyle that will ensure people are not merely accommodated to the brave new information world but able to prosper in it. By spreading the virtues of the entrepreneur Blairites believe an old circle will be squared and social justice finally united with economic efficiency.

This requires nothing less than a change in our culture; one that makes us conscious of our true identity as risk-takers and consumers and expands our limited aspirations. Blairites are quite explicit about what some of them have called 'governing through culture'. Reforms to public services are designed to change the outlook and values of those who use those services. They are intended to make us more 'autonomous' and 'responsible', willing and able to take on the burdens of our own pension provision and healthcare, eager to tool ourselves up for a competitive market filled with eager, self-employed, entrepreneurs. New Labour's public service reforms not only change systems of accountability (by making services market and consumer driven) but change the experience of users, inducing them to be entrepreneurial in taking responsibility for themselves. Blair argued in his recent Fabian pamphlet, The Courage of Our Convictions, that welfare services must be more personalised. Care must be packaged to the individual who, instead of being given a service will be given the capacity to choose one, taking the risks of such choice on themselves.

This is where the charging of differential fees comes in. Under such a regime, would-be students gain experience in full-fledged consumer choice, perusing the league tables and balancing quality with affordability as they take on their own purchasing risk. Not only will the courses on offer be marketed as offering nothing other than job-skills training: the very form of such education and its acquisition will be part of that training. In exercising 'consumer' choice over their education, students will learn how to be good purchasers and sound investors in their own human capital. They will come to see education as the Blairites see it: as an investment in the enhancement of individualised physical and mental 'capital'. To purchase knowledge will be to obtain a consumer durable that can later be traded in for a cash return. The Guardian recently reported that, faced by people convinced they could not go to university if it entailed running up huge debts in fees, Higher Education secretary Margaret Hodge simply declared 'we'll just have to change your family cultures'. That is exactly what this policy is intended to do.

To ask whether or not this will improve the quality of our universities, or the graduates they produce, is to miss the point. To criticise its possible effects on equal access is to judge the effectiveness of the policy in an area with which it is not concerned. Instead of giving us more or less of something we already have, it will bring us something different. Universities have been spaces where, moderately protected from consumerist pressures, people can reflect upon themselves, learn about their cultural tradition or find out how properly to challenge it. Under Blairite reforms they will become, even more than they already are, prime sites for the manufacture of people skilled not only at their own consumption but at offering up their well-marketed minds and bodies for consumption by the owners of the knowledge economy. This is the culture that Blairism seeks to create.

Where some governments try to manage economies and others seek to mediate between competing interests, New Labour's objective is quite different. According to them the twenty-first century nation needs a dynamic, 'modernised' knowledge economy. How do we get it? As Blair has said in a number of speeches 'The answer is people. The future is people'. The public services, from social security to schools and universities, are being remodelled to manufacture them. That is what the proposal to allow differential fees means. It is not merely a way of tinkering with funding mechanisms but a method by which the culture and outlook of the country can be 're-engineered'.

It is fashionable now for politicians and pundits to claim that governments cannot now do very much; that their power has diminished in the face of globalisation and the greater, more flexible, demands of increasingly variegated populations. This is nonsense. In setting targets and shaping citizens' experience of key social institutions governments can have a profound long-term effect on social values and beliefs. The Blairites, keen students of Thatcherite cultural 'hegemony' know this well. Co-opting the universities into their project will be a glittering prize indeed. And it is on this basis that the left must oppose these iniquitous proposals.

By Alan Finlayson