Prompted by university chancellors across the United Kingdom, the government’s business secretary launched a review aimed at increasing the amount that universities can assess their students.

Telegraph – Lord Mandelson launches tuition fee review

Undergraduates may ultimately pay as much as £7,000-a-year – more than double the existing rate – following the start of the long-awaited inquiry.

The National Union of Students warned that the shake-up could create a “market” in higher education, with top universities charging the most and poorer teenagers being consigned to “bargin basement” institutions.

The comments came as the Government unveiled the scope of a major review of the currnet system of student fees, grants and loans on Monday.

Lord Mandelson, the Business Secretary, said the review team would examine the “balance of contributions to universities by taxpayers, students, graduates and employers”.

It is also being asked to assess the impact of fees – currently set at £3,225 a year – on the drive to widen access to courses among poor students. The move could raise the prospect that any increase in fees would be conditional on improving teaching and meeting targets to increase the number of teenagers from the most deprived backgrounds. The current system of heavily-subsidised student loans could also be axed in favour of loans set at commercial interest rates.

Launching the review, Lord Mandelson insisted that the introduction of higher fees in 2006 had not hit student recruitment.

“Variable tuition fees provide institutions with a secure income stream worth £1.3bn, helping to sustain the long-term financial health and viability of the sector,” he said. “Since they were introduced student numbers have continued to rise, along with the numbers coming from lower-income backgrounds.”

The review’s final recommendations are not expected to be published until next summer.

Pressure is already mounting on Labour and the Conservatives to sanction a significant increase in tuition fees. A report earlier this year from Universities UK, which represents vice-chancellors, said fees could increase to £5,000 without harming student recruitment, while other universities have called for a rise closer to £7,000.

Sir Roy Anderson, rector of Imperial College London, said the current cap on tuition fees should be “relaxed” altogether to allow universities to charge as much as £12,000.

Wes Streeting, president of the National Union of Students, said: “There is a real danger that this review will pave the way for higher fees and a market in prices that would see poorer students priced out of more prestigious universities and other students and universities consigned to the ‘bargain basement’.

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