Dr Pirie on the graduate tax

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Click here to read Dr Madsen Pirie on Telegraph.co.uk consider the graduate tax, two year degrees and choice in higher education.

Foreign students no longer required to speak English

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Foreign students will no longer be required to speak English prior to obtaining a visa to come to the United Kingdom as a result of a High Court decision issued today by Justice David Foskett. The restriction, which was issued by Labour Home Secretary Alan Johnson, was overturned on technical grounds; Mr Johnson should have submitted the changes to Parliament. The case was litigated by English language schools in the United Kingdom, which estimated that the industry contributes £1.5 billion to the British economy annually.

Apart from the absurdity of requiring students of English to have learned the language prior to coming to Britain to study it, the law would have incurred damaging economic consequences that Britain will now thankfully avoid. In addition to the money that they contribute to language schools, foreign students provide badly needed revenue for British universities, which face restricted competition and dependence on government funds for the education of home students. Universities, however, are free to charge foreign students the market price for their education, allowing them to better educate British students with the resulting revenue. Furthermore, it is in Britain’s national interest to attract the world’s most intelligent and innovative students to study, and eventually work, in the United Kingdom. Having these allows them to spend money while they study (the British Council reports that international students contribute £5.6 billion to the national economy every year), and then produce value for the British economy once they graduate and find work in the country (if they are allowed to stay).

The continuation of the ban on foreign students who do not speak English would have not only denied many students entry to the country, but may have also tarnished Britain’s reputation as a welcoming destination for foreign students. This could have deterred other qualified and productive English-speaking students from choosing Britain as a destination, giving other popular destinations for international students, such as the United States and Australia, a competitive edge in attracting talented foreigners. Parliament should refrain from resurrecting the ban, which harms educational institutions, business, and the nation as a whole.

On university endowments

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The UK universities are some of the best in the world. Yet, compared to their American counterparts (even the state universities), they have tiny endowments. Only Oxford and Cambridge operate budgets of a similar size. But larger endowments enable these institutions to expand and diversify their services, because, as non-profits, they need to make complete use of their income.

In the UK, higher education institutions are supported by government grants. This results in a system with skewed incentives: those who immediately benefit (students, professors, alums) share only a tiny fraction of the costs (for example through capped student fees), while the state bears the bulk of the burden. But there is no such thing as a free lunch, and what this scheme actually requires is an annual expenditure of 7.8 billion pounds, funded by – you guessed it – tax revenue.

Is there anything wrong with such a system? Well, such spending mostly benefits the rich (or the soon-to-be-better-off university grads) at the expense of the whole population (a great portion of which doesn’t directly benefit from the higher education sector). A much fairer mechanism would fund university operations through endowments. By gradually decreasing grants to universities, we can create a motive for these institutions to actively seek out donors, something they don’t prioritize given the status quo. They can achieve this through tried and tested methods – such as setting up designated fundraising positions within the administration and regularly sending out donation requests to alumni – that are a standard by US universities.

This would save the state a couple of billion pounds, which could be put to better use elsewhere, perhaps directly supporting needy students, or even in cutting taxes.

Charitable giving to schools

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My niece Rachel is a primary-school teacher in America, where it's said that teachers spend an average $40 a month from their own pocket to buy classroom essentials. I can well believe it, and I would guess the same sort of thing is true in the UK too. But US teachers have a way of spreading the burden, thanks to an interesting website called www.DonorsChoose.org.

Rachel was very keen for her class to have a $350 piece of basic equipment – namely a rug (though it's a bit more high-tech than that) for the young kids to sit on. So she got the sign-off from her boss and posted her project on the site, where people can make donations towards it. Now she's only $50 short. I guess that many of the donors are friends and relations like me, but then again, the site has a large readership of people willing to make donations to good educational causes, so many of the donors could be completely unknown to her.

Of course, donation websites exist in many forms. The reason I wanted to mention this is because I think it could be important in the context of the UK government's ambition to clear the way for Free Schools on the Swedish model. These are schools that might be founded by parents and teachers who are fed up with the existing state system, or by voluntary and charitable bodies, by universities, or even by private companies. The state will still pay for the children's education, but such bodies will probably have to be – and will want to be – much more dependent than existing state schools on local community support and nationwide philanthropy. It struck me as the sort of mechanism that Free School founders should employ, and the government should support.

And if you like, you can support Rachel and her class here. 

Cutting down the quangos

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This week teachers will be glad to see Gove has been quango - cutting again. Following the death of Becta and the QCDA, he has announced the scrapping of the General Teaching Council for England (GTCE), a disciplinary watchdog, whose worth has long been questioned by those working in education. It’s great to see the power of so many meddlesome quangos being removed in an attempt to return some respect and autonomy back into the teaching profession.

My teacher friends can vouch for the fact that, as far as they are aware, the GTCE has done nothing to aid them in their careers or in the quality of their work. Instead over the last few years it has patronised these professionals and busybodied without aiding educational output. In 2009 they created a ‘code of conduct’, instructing teachers how they should behave both inside and outside of the classroom. It was a laughable act, which many teachers found insulting and interfering. Teachers, more than most professionals I believe, have had to face constant interference and change under the past government, which at times has made getting on with the task of providing the best education possible for each child in their care near impossible. A pruning down of the various watchdogs and educational bodies has long been overdue and this move should be a step towards the re-professionalising of the teaching profession.

These quango cuts, combined with Gove’s academies reform, signals a significant change in attitude to the education sector. The government is forging a new relationship of trust in giving schools the freedoms they have needed for so long and in responding to the calls of teachers for the end of these meddlesome quangos. And it’s clearly paying off – in the first week since Gove called on schools to apply to become academies over 1,000 have signed up. This response just goes to show that many in the education sector desperately want greater autonomy. Gove’s moves will all help to de-politicize education and allow the teachers and schools to provide the best quality education without the tight constraints of an overly-prescriptive curriculum, excessive paperwork and the patronising interference from quangos. Finally we might actually have an education system where those who know best, the headteachers and those in the classroom, have more influence than the career bureaucrats.  

No second chance

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Some universities have declared they will ignore the results of A-level resits, writes Jack Grimston in the Sunday Times. Students will have to pass them first time. Since between a third and a half of students resit papers, this will have quite an effect. The medical school at UCL and Bath University's prestigious architecture course are among those implementing this policy.

One can see their point, given the large numbers gaining 3 A-levels. How are universities to pick the most talented among so many who qualify? Other institutions are demanding the new A*, with Churchill College at Cambridge being the first to demand two A*s to qualify.

Yet there is another factor. This new policy basically tells students that they only get one chance. A-levels already subject them to immense pressures, and the new policy will only increase them. It rules out the idea that you can have another go, and puts all the eggs in the basket of your first attempt.

Not everyone does get it right first time. F1 drivers get more than one practice lap; high jumpers get more than one shot at it. Not everything in life works perfectly first time out. We learn from our mistakes and we improve on our efforts.

Some university admissions tutors tell me that they already question resit passes, asking the candidates what made them under-perform the first time. This seems reasonable, for there is often a reason. But the idea that you cannot learn and try again, and that second attempts don't count, is not a message we should be putting across.

Life itself is not like that. Sometimes you get it wrong and come back for another go, experienced now and wiser, and you make a go of it. Ask Lord Mandelson.

The market: The guarantor of social justice

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Don’t think for a minute that parents in the best state schools have not paid for their education: they have, in the extra they pay for their house. Nowhere (apart from protection from crime) does the money spent on behalf of the poor buy them so much less than money spent on behalf of the rich. The market does not discriminate in that way. Gove’s profit-seeking schools will open where demand is greatest (by definition, in the areas where dissatisfaction with local schools is the highest). As even the Swedish left accepted, the profit motive is the surest guarantor of social justice.

Fraser Nelson ‘Gove must guard against the vested interests’ The Spectator

Gove gets down to business

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Even before the coalition was announced the rainbows had been binned. Minutes into the new government being formed, the ludicrously named ‘Department for Children Families and Schools’ signs went the way of the rainbows and the ‘Department for Education’ was reborn. Despite the conservative name and lettering it spells out an era of radical education reform, one that should lead to the renewal of education in the country.

Today Michael Gove has written to the 20,000 or so state school head teachers offering them the opportunity to be unburdened from local authority control. Ofsted schools rated excellent are free to become academies straight away, giving them the freedoms from local authority control that this allows. It will be fascinating to see how many heads choose to take up the offer. Other schools not rated outstanding will have to apply to become academies.

After the summer recess parents, teachers and community groups will be free to set up new schools. Stopping local authorities vetoing new schools will enable this to happen and the New Schools Network is ready to strike. The NASUWT teachers' union is not happy with any of this, which should raise no eyebrows.

Gove’s reforms rightly go beyond the national vs. local arguments that are popular currency in contemporary political debate. Localism, Hannan and Carswell style, has a lot going for it; but better to simply take politics out of the equation entirely, leaving parents and schools to work out the details for themselves.

The next stage is, as the Adam Smith Institute has been arguing for a while, to allow private companies to set up and run new schools for a profit. This has been the key to success in Sweden and will be vital if the new government really wants to ensure that every parent has the choice to send their child to a school that is worthy of the money they put in through taxation.
 

Is 1GOAL an own goal?

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Leading up to the World Cup, the 1GOAL: Education For All campaign has been attracting global press coverage and over 8million people have already pledged support to push governments to ensure education for all. World leaders, footballers and celebrities have all signed up, while major charities including Save the Children, Unicef and ActionAid are behind the campaign. Although ‘education for all’ is a noble aim, 1GOAL is devoid of substance and is therefore of questionable value. The campaign is simply calling on governments to ensure that everyone is educated, without any indication of how this could or should be done.

Because government interventions in education provision can have unintended consequences, a campaign without direction offers no clues as to its likely success. The history of education in developed countries, in which governments directly and indirectly usurped control of education delivery, is not the only way. Driven by parental aspirations, private schools for the poor are already delivering education to many and this is a growth industry. From India, Nigeria, Ghana and China evidence is mounting showing that many of the world’s most vulnerable are already choosing to spend what little they have to send their children to private schools for the poor.

An education industry is growing in the developing world, in which entrepreneurs, school chains and brands are competing and innovating for students. As people in these countries become wealthier through technological innovation, greater access to markets as both buyers and sellers and through specialization, cooperation and the division of labour. The potential is huge. Yet crowding out, taxation and regulation pose a threat.

In many developed countries such as the UK, the government is the near-monopolistic provider of education; if developing countries take a different path and instead target their interference of education at only the poorest through vouchers that are used in the superior private schools, this will be the best way to achieve the goal of universal education without threatening the organic growth of private education for the poor. 1GOAL, and other campaigns for universal education, need to recognise this.

If left unmolested, it is likely that the entrepreneurs, school chains and brands will before long become global companies competing with UK government to run schools. Instead of focusing upon what the rest of the world can learn from us, we need to widen our gaze and see what other countries have to teach us.

On raising tuition fees

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Yesterday ASI fellow James Stanfield took part in a debate with Aaron Porter from the NUS, on BBC Radio 5 Live over taking the cap off university fees. James argued convincingly that government needs to stop blocking advances in universities, stop micromanaging and allow institutions to set their own fees.

He also discusses potential funding options for students and the necessity to allow universities to raise their incomes to maintain the quality of higher education in the UK.

You can listen to the debate here. 

(Aired on 18.05.10, with the debate starting at 13mins)