Student numbers could be cut to cover spiralling cost of loans
Ministers underestimated how many universities would charge £9,000 fees – and now face huge bill to fund student loansPolly Curtis and Jeevan Vasagar
The Guardian, Tuesday 7 June 2011
Tough quotas on student numbers may have to be introduced to avoid the creation of a spending black hole under plans to raise tuition fees at English universities to a maximum of £9,000, a powerful committee of MPs has warned.
Ministers underestimated how many universities would charge the maximum fee and now face an annual bill to fund the interest-free student loans that is "several hundred million pounds" higher than anticipated, the Public Accounts Committee (PAC) reports.
The current balance of outstanding loans – £24bn – is expected to rise to £70bn by 2015-16, the report says.
Margaret Hodge, the chair of the committee, said: "At present, more universities intend to charge higher fees than the department had expected. If the universities' plans to widen participation are approved by the Office for Fair Access, this will leave a substantial funding gap which will either require further cuts in higher education or further resources from the Treasury." ............(more)
The complete piece is at:
http://www.guardian.co.uk/education/2011/jun/07/student-loan-demand-may-force-cuts