UK universities in trouble - why not add VAT to tuition?

[80smonster]

UK universities are in trouble, apparently many could close, why not charge VAT on tuition fees (for those that are financially viable)? Bridget Phillipson says they are autonomous institutions and won’t be given a public bail out - they should rely on their own resources:
https://www.theguardian.com/education/article/2024/aug/09/english-universities-face-autumn-tipping-point-as-financial-crisis-looms

YABU - don’t add the VAT
YANBU - add the VAT

A drain on the rest of the country? They are educating pupils (often to a very high standard), and producing adults who contribute hugely to society, financially and otherwise, at zero cost to the taxpayer. You might not like the concept of private education, but to say they’re a drain on the country is ludicrous.

Private schools already are paying (input) VAT. The new VAT is a tax on parents, not the schools themselves. Yet another misconception that appears again and again on these threads.

The post graduate job prospects of many are in the 80s.
Why are they a waste of money?

Senior manager in an ITP but i am a qualified teacher and have taught in state secondaries.
Like I said, the aspirations fit the local job market. Bullying is easily hidden, you just don't record it as bullying.

The Times University Ranking’s top 20 has no former polytechnics.

Wait, wasn’t Loughborough a polytechnic? It is 10th on the list.
It was a technical college until 1966.

Oh what do you record it as?

What is an ITP?

and looking at Graduate Prospects suddenly some of those waste of money unis suddenly -shock, horror - are back in the top 30 safe haven

Instead we’ll be saying goodbye to the likes of

Edinburgh;Glasgow, UEA, Lancaster, SOAS, Aberdeen and Royal Holloway.

and welcoming Suffolk Uni into the hallowed halls of acceptability.

Independent Training Provider ie Apprenticeships.

Not quite actually. One of our middle managers (so salary circa 55k) has just sent his son to a good uni in the US - on a full ride. The son, who is academically extremely bright, did the entire leg work from age 14. Researched it online, found the requirements (not just academics) and started working towards it. One of the key aspects of his application was that he set up tutoring sessions for underprivileged kids in the US online. He had to deliver these sessions at ungodly hours due to the time difference. He found grant bodies that cover tuition and board for anyone and applied and won it. These are very competitive.

He went this route as he isn't particularly sporty but there are other people I know with part scholarships to Canadian and US unis based on sports.

It is currently mainly the wealthy as they are aware of it - but the Internet is a democratising force!

Obviously you more about this than the senior civil servants at the Treasury who have been discussing this issue with the private sector.

I suggest you tell the Permanent Secretary at the Treasury that he is wrong and that his conclusions that the UK will by default become a high tax economy due to flatlining productivity is mistaken.

UK universities need to realise that they are competing on an increasingly international stage.

Hilarious ......I think we already know this!!

This and 'have you thought of recruiting students from China' are my favourite comments on this thread!

The money needs to be found and widespread increase in tax is really the only way. Starmer is focused on economic growth - and I am hopeful (cautiously hopeful) that he is committed to making that happen and taking the difficult decisions required to do so

I’ve twice posted the productivity growth chart published by the ONS.
You are the one who is saying the U.K. Gov are wrong- unless you have something more concrete than your opinion to post?

The blurb about the Secretary of the Treasury is relating to his prediction for the future, ‘Will….become’ not the past and present which you initially posted about.

Universities have never just been about "generating knowledge, intellectual exploration and academic excellence "and professional jobs have generally always required a college education regardless of whether the college was called a university, polytechnic or college of Higher Education. Do you think doctors, engineers, pharmacists, teachers etc used to all train on the job and older ones don't have a degree?

It’s clear that universities need to improve their financial situation. There are several options, including increased tuition fees, government help (perhaps funded by VAT on fees), or increasing the proportion of international students. The Labour government has suggested they prefer the latter. If universities increase the proportion of international students, that means that there will be fewer places for home students.

Tuition fees were £9k in 2012. With inflation, that should now be around £12.5k.

Or maybe it's a good thing for a few universities to close.

Young people are being mis-sold a product and promised something that doesn't exist. The job market is over saturated.

Bring back apprenticeships and learning on the job, it would reduce the number of disillusioned young people.

I've sat in the rooms where they have discussed this issue. They are not referring to the past. This a 20 year trend and there is information out there about it.

Clearly you disagree with Treasury and obviously you know more than they do about UK productivity.

A lot of people think university is a luxury. About 60% of people don’t go. If you believe in taxing education, why not universities? It is logical to support both or neither. Like with schools, it will only be the smaller less prestigious institutions that go under.

There are very few US unis that offer a full ride- about 3 if you’re not sporty ( MIT etc) everybody around the world wants the free ride. I know somebody with 4 x4* Alevels who didn’t get into MIT.

There are massive additional costs too- like flights etc.

It’s laughable if you think uni in the USA is viable but for a tiny fraction of the population.

"They can't just increase class sizes if the classrooms aren't big enough. Private schools don't need big classrooms as they are usually under 20 per class. You can't just shoehorn in another 5 desks if the physical space won't allow it.
Why the hell are we aiming for current levels of state funding when that is woefully inadequate?
The argument is always "well state schools cope on less funding" when the reality is that they aren't coping! The funding per pupil in state needs raising to 10K+ per child. The issue is that noone wants their taxes increasing to enable this to happen."

There are lots of state schools doing a brilliant job and the pupils go on to great destinations. This includes value added metrics. This is becoming harder, since austerity, but class sizes of 30 and basic buildings and facilities don't prevent this.

I didn't suggest all private schools should aim to match current state school funding. If there was a desire to create more affordable private schools, this is an option, through having more basic buildings and facilities and larger class sizes. I am saying this in response to the claim that if you live in an area with really poor state schools, this could be offered.

Obviously, if a school building doesn't lend itself to this, it can't offer this. It's an odd counter argument to make against the substantive points being made!

VAT policy isn't widespread taxation, it is extremely narrow and only tinkering around the edges
The only wat of properly funding state education is through income tax. As most people benefit from state education then they shouldn't mind paying more towards it.

No it is about entirely sensible answer to the oft quoted statement of "private schools should just increase class sizes". The reality is that in many cases it isn't possible to just increase class sizes.

Young people are being mis-sold a product and promised something that doesn't exist. The job market is over saturated.

Where is the data to support this? Because it is not my understanding of the graduate labour market.

That’s not the case at all. There is often generous funding. Students are looking beyond the USA as well. Studying in the EU can cost around the same, or less, as attending a UK university.

I don’t disagree with the Treasury, I am disagreeing with you because what you have posted does not match either what the Treasury or the ONS have published. Even the bit you paraphrased from the Treasury doesn’t relate to the past & present, but is a prediction for the future and furthermore doesn’t say productivity has declined, but that it may “flatline”- flatlining is net zero growth/zero decline.

You stated that productivity has declined, and thus universities are a failure implying this had been going on for years if not decades.

Productivity has not declined, no one has said it has, not ONS, not the Treasury.

Apart from covid lockdowns causing a temporary declune, which is an anomaly and data outlier, there has been no lasting decline in U.K. productivity. There has only been slowing growth in productivity that dates to 2008.

The U.K. isn’t the only country that has experienced a slower growth in productivity. In a lot of ways, this is not unexpected as productivity growth was boosted to a much higher level due the spread of AI and automation into many industries. We have reached saturation for the most part, so productivity gains are diminishing until we hit the next tech breakthrough, and to do that we need a better economy that can invest into R&D.

I will spell it out again to help you understand. There is a difference between full ride scholarship from the university and grant awarding bodies that cover uni fees and board. The latter exist as well and yes, they are competitive but not as competitive as you think.

It also helps that you and most think they don't exist - makes them even less competitive

Sport is also an option

These will not cover education for the whole of the UK! But it will help some. Canada also have options, some European countries too. The UK needs to sit up

My family have a scholarship that covers tuition fees for medical students from under-represented backgrounds in the UK to a particular university. So few apply each year....likely for the same reason