“Graduate tax a disaster for university fundraising”

by Stephen Tall on September 10, 2010

There’s much that’s controversial about university finance, but one aspect most politicians agree on is that the higher education sector has to become more self-reliant, for example by establishing Ivy League-style professional fundraising here in the UK.

In the 2007 Lib Dem leadership contest, for example, better fundraising was the chief answer Chris Huhne offered in answer to my question about whether if elected he would seek to drop the party’s commitment to opposing tuition and top-up fees.

But there’s an explicit tension here. Part of the reason US higher education fundraising works so well is because everyone knows university teaching finance is not the government’s/taxpayers’ job (though government does play a major role in research funding, just as it does in the UK and the rest of Europe). There is a clear expectation, therefore, that individuals who have benefited from their education will help the next generation — so while tuition fees at Harvard are an eye-watering $36k per annum, 60% of their students qualify for financial aid.

I was interested, therefore, to read the comments of Joanna Motion, vice-president of international relations for the Council for the Advancement and Support of Education (CASE), who is clear in her view that any move to a graduate tax could set back the progress made by university fundraising departments in the UK (which last year succeeded in raising more than £500m):

“It would be a disaster for philanthropic support of universities,” she told Civil Society. “It would be very frustrating for good staff doing a good job in development offices.”

Motion said that the sector had been working to combat the idea that university funding was “government’s job” for years, “but you impose a tax and it immediately becomes government’s business again”.

There is much in that.

It’s clear the Lib Dems will continue to press for the abolition of tuition fees in one form or another: and that’s a perfectly honourable, though in my view mis-guided, approach.

But in doing so the party needs to recognise there’s a trade-off. You cannot expect US-style fundraising success if you reject a US-style higher education system.

That’s not to say the US higher education system is by any means perfect — but there are a higher percentage of young adults holding university degrees than in the UK, and the US spends twice the proportion of GDP that the UK does on higher education. So we’re not in the best position to dismiss its success lightly, either.