Costs warning over student fees

THE COST of charging university tuition fees will soar to pounds 15m a year by the time the scheme is fully implemented, student leaders claim today.

Research conducted by the National Union of Students to coincide with the second reading of the Bill to introduce pounds 1,000-a-year student fees, suggests the administrative cost of the new system will be almost double government estimates.

NUS president Douglas Trainer said: "Fees will cost too much money to administer and raise no new funds for the quality of education. It is time for the Government to give up on the legislation and rethink the financial arrangements for students and for British higher education."

Ministers estimate the fees scheme will cost no more than pounds 8m out of the pounds 150m that fees are expected to yield in October. A spokeswoman for the Department for Education and Employment said money had already been made available to cover costs as part of this year's university budget settlement.

The NUS figures were based on an internal study carried out by Portsmouth University, which found fees would cost pounds 200,000 a year to collect from the year 2000, when all people in higher education will be paying towards their tuition.

Academics at Portsmouth are preparing to take on extra staff to deal with processing bills for students, dealing with local authorities and providing extra support for those who find themselves in difficulty.

Student leaders, who will deliver a 100,000-signature petition protesting at the fees to Downing Street today, are hoping to capitalise on backbench anger at the plans.

The Teaching and Higher Education Bill faces a tough passage through the Commons after peers inflicted three major defeats on the Government in the Lords. Amendments included a measure to reintroduce student grants, which are due to replaced by loans.

Vice-chancellors are also launching an offensive today to persuade ministers to plough back all the fees income into higher education.

Universities back the fees, arguing they are the only way to reinvest in a university system hit hard by cuts over the past decade. In a submission to the Government's comprehensive spending review, the Committee of Vice- Chancellors and Principals, argues that the fee income should form part of an investment package running to nearly pounds 1bn a year for three years.

Chief executive Diana Warwick said: "We need adequate public funding so we can get on with the job of expansion, maintaining quality and boosting national economic competitiveness. There will be a cost of collecting the fees, which makes it more imperative that money from fees comes to higher education."