More universities than expected to charge top fees

The government could face a "substantial funding gap" for higher education after ministers underestimated the number of universities which will charge top fees, a report published on Tuesday said.

A government spending watchdog said more universities than expected were planning to charge the maximum £9,000 tuition fees from 2012.

As a result the government, which fund student loans to cover the fees, will face a shortfall of "several hundred million pounds", the Public Accounts Committee (PAC) said.

It warned the funding gap could lead to further cuts in higher education and more taxpayers' money being spent on encouraging students from poorer backgrounds to apply.

Committee chairman Margaret Hodge, a Labour MP, said: "At present, more universities intend to charge higher fees than the Department for Business, Education and Skills had expected.

"If the universities' plans to widen participation are approved by the Office for Fair Access, this will leave a substantial funding gap which will either require further cuts in higher education or further resources from the Treasury."

She said it was unclear whether the fees would deter people from applying for places but called for more information to enable students to make up their minds.

"Given that students will be required to spend more money on their own higher education, they will have to be able to make an informed choice about value for money offered by different institutions," she added.

The PAC report also called for more powers for the Higher Education Funding Council for England to better regulate universities when the new fees are introduced.

So far 60 out of 124 higher education institutions in England have said they intend to charge the highest fees, which are three times the current maximum.

The Guardian reported that 105 universities had declared their fees, which average £8,765, while the government modelled its plans on an average fee of £7,500.

The PAC report comes a day after the launch of the new College of Humanities, set up in London by academics including AC Grayling, which plans to charge fees of £18,000.

Sally Hunt, general secretary of the UCU lecturers' union, denounced the initiative and said it was evidence that government funding plans would "entrench inequality" in the sector.

The union on Tuesday called for an urgent review of the government proposals and backed calls for a vote of no confidence by academics at Cambridge University against universities minister David Willetts.

"The government has lost the plot when it comes to higher education and unless they pause, like they did with the NHS, they will do lasting damage to the sector," Hunt said.

"It is clear they have got their sums completely wrong and that their entire funding model is in disarray."

Downing Street described the committee's findings as "speculative", saying not all details of fees to be charged by individual universities had been revealed.

A spokesman for Prime Minister David Cameron said: "I don't think they have any evidence and I don't think they have presented any evidence of a funding gap."