Sunday, April 28, 2013

On the Funding of Higher Education from Smith’s Time to Ours (see previous post)

For some reason I remember that this wasn't so in Smith's day. Wasn't Smith paid by his students directly? When did the no fees come in for Scotland?” (A comment from Paul, a regular reader).
My response
Thank you for reminding me of the details I did not elaborate upon.
Scotland, in common with the other countries in the UK did not have government expenditures on education in the 18th century.  These costs were met from the ancient universities own resources (grants from former pupils and their estates; fees paid by parents; local charities and such like). 
Balliol College, Oxford,  (which Smith attended) was founded and paid for by the ancient Scottish Balliol family. He had won a Snell Exhibition as a promising student – it still exists and is well funded. His mother and guardians may have added something in kind (he was accompanied on the long journey by horse to Oxford). 
Local charities paid fees and living expenses, especially to students of poorer families; richer local families paid on their own account.  Over a century or two educated Scots came from a broader spectrum of classes than common in England.
Glasgow University did not pay their academics all of their annual salaries; it required students to pay some proportion of their fees direct to each of their Professors each term. Students elected to attend their classes, a requirement that Smith approved of because it tended to ensure that professors prepared their courses to high standards (lazy professors would not attract or keep students for a large proportion of their incomes and the University would react to deal with such unpopular professors to protect its reputation and their fees).
In the 20th century, direct government expenditure on universities increased, though student recruitment became more selective towards those whose families who could afford ever increasing fees, added to by the finances of well-managed bequests from the past and disbursed by the universities themselves (as in the main universities, especially Oxford and Cambridge), often competitively won by individual student pre-entry scholarship examinations from home and abroad.  Local government schemes also paid the fees and bursaries to local students if they won a place at a university.  Families could pay these fees direct if they had the resources.
With the 1960s Robbins Report, governments implemented a massive expansion in universities and in establishing new university status to long-established higher education institutions, e.g. The Royal College of Science and Technology in Glasgow became “Strathclyde” University, where I graduated BA and, later, MSc, and where yet later I was Senior Lecturer in Economics. Heriot-Watt College in Edinburgh became “Heriot-Watt” University, where I became a Professor in Edinburgh Business School (retired, 2005).  In between, I was Lecturer in Economics at the newly created Brunel University and graduated PhD in economics.   All three of these universities were founded in that new Robbins wave. 
Associated with the expansion across the UK were student fees and low annual student grants, funded and administered by the State, with contributions of fees from students (unless paid for from competitive grants, bursaries and charities).
From these new arrangements central government expenditure on higher education climbed steadily as the proportion of students in each age-cohort grew from 8% towards 50 per cent.
First, education and its funding was devolved to the separate countries in the UK.  Secondly, practices begun to vary in the UK, particularly in Scotland where state funding expanded on both students and institutions. 
I funded my undergraduate fees as a ‘mature’ student, first by small bursaries from the state, supplemented by low paid vacation employment. I funded my postgraduate education by higher paid employment from teaching in universities.
With greater devolution of state responsibilities to Scotland, the government decided to remove the veil of so-called student fees (with its substantial disparate sources) under the postwar changes to direct funding by the state of all fees to the universities.  This is the situation that continues today. 
No fees are charged to the students at any Scottish University. The situation in England is quite different, where increasingly higher fees are charged direct to each individual student, with a plethora of funding sources as before from the 18th century, when England had only two universities (Oxford and Cambridge) and Scotland had four, and Scotland always recruited university places from wider slice of the population.
I hope this answers your interesting and appropriate question.


Blogger Paul Walker said...

That does indeed answer the question very well, thanks Gavin. I like the dealing with moral hazard part of the part payment of lectures by their students. But then I was lectured by people who would have gone broke under such a scheme!

10:22 am  

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