Browne-beating university funding solution to be proposed at NUS Conference in Liverpool, 26 October

Oct. 20, 2010 - PRLog -- PRESS RELEASE

Browne-beating university funding solution to be proposed at NUS Conference in Liverpool on 26 October 2010

•   Browne Review damaging to higher education and government finances
•   Panel discussion on how best to fund higher education at NUS Higher Education Zone Conference

London, 20th October 2010 – The Browne Review combined with the Comprehensive Spending Review are jeopardising the future of higher education in the UK. Browne’s incentives will weaken confidence in the quality of a UK university education and cause a mass exodus of educated talent. But there are alternatives to save the government money, improve the quality of the university experience and guarantee the widest access. Peter Ainsworth, Managing Director of EM Applications, will be proposing the “FAIR” scheme, which combines all these characteristics, during a NUS-sponsored panel discussion in Liverpool next Tuesday, 26th October 2010.

The discussion, titled “Meeting the costs of higher education” will take place during the National Union of Students’ (NUS) Higher Education Zone Conference.  It will examine the financial implications of the Comprehensive Spending Review and the Browne Report and encourage ideas on university funding.

Amongst the panelists is Peter Ainsworth, Managing Director of EM Applications, who has drafted a white paper that outlines a radical solution to the university funding problem.  The other panelists are Professor Nick Barr, London School of Economics, and Professor Neil Shephard, University of Oxford.  The discussion will be chaired by the NUS’s Political Officer, Graeme Wise.

In his proposal, called FAIR (Funding with Affordable Income based Repayment), Peter Ainsworth suggests that students should pledge a share of their future income to the university they attend.  These pledges could then be transferred to pension investors, who would pay the university upfront in proportion to the amount they expected that university’s graduates to earn.  This directly aligns a university’s interests with the career success of its graduates, creating a powerful motivator for improved educational programmes.

Payments are not fixed, but represent a proportion of income, making a university education affordable for all.  As these agreements would be solely between the university and the student, graduates would be free to move abroad without it affecting the value of their pledge.  As tuition fees become based on success, FAIR would encourage investment in quality improvements, enabling the expansion of the higher education sector and bringing jobs and earnings into the country while simultaneously reducing the burden on the state’s finances.

Peter Ainsworth said:  “Browne creates perverse incentives for quality universities to move downmarket and for graduates to emigrate while penalising middle-income earners and constructing a big new poverty trap at £21,000. The justification is to save money, but emigration of talent is already increasing and will accelerate, making Browne’s proposals expensive. The government needs to think again so that it doesn’t encourage emigration nor be unfair to middle income earners. The FAIR scheme would save costs while ensuring that access to university is not restricted to the wealthy. The fact that it would also align universities’ income with what they deliver for their students has the potential to transform higher education in the UK to make it a world leader.”

EM Applications’ report, “An Equitable Approach to the Private Sector Funding of University Tuition Fees” is available at www.emapplications.com/fair.

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Contacts
For a copy of the report, or for interview requests, please contact Andrea Krug, tel. 07740 245 867, emapplications@krugcomms.com or Peter Ainsworth, Managing Director, EM Applications Ltd, peter.ainsworth@emapplications.com.

Notes to Editors

About EM Applications
EM Applications (www.emapplications.com) is a leading supplier of investment risk solutions to asset managers and securities firms. Asset managers rely on EM Applications’ systems to monitor and operate long-only, long-short, hedge and fund of funds strategies. Securities firms use EM Applications’ systems in proprietary trading and derivatives and to support the services they deliver to their clients. By delivering portfolio risk analytics to the fund manager’s desk in the form of a dynamic Excel workbook, EMA’s risk system is uniquely well suited to helping asset managers fully integrate risk analysis into their investment process.

About the panel discussion
The panel discussion “Meeting the costs of higher education” will take place on Tuesday, 26th October 2010, from 1.45 pm to 2.45 pm at the Adelphi Hotel, Ranelagh Place, Liverpool, Merseyside, L3 5UL. Further details about the NUS’ Higher Education Zone Conference are available at http://www.nusconnect.org.uk/events/6001/45/. For tickets or press passes, please contact Liz Williams, tel. 0207 380 6659, email: liz.williams@nus.org.uk.

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EM Applications is a leading supplier of investment risk solutions to asset managers and securities firms.