Pressure on available places is growing

A bulge in the population means more young people going through the system.

The head of the Higher Education Funding Council for England, Sir Howard Newby, said "a very big increase" in public funding was needed.

But he and ministers have dismissed the idea that an influx of EU students will eat into the available places.

'Pressure'

The population bulge meant universities needed an estimated 150,000 extra places in the next three or four years just to maintain the current participation rate of about 43.5%, Sir Howard said.

Talk of new EU students forcing out domestic students is an unhelpful exaggeration Alan Johnson Higher Education Minister

But the government wants to see an expansion - having set a target of 50% of young people experiencing higher education by 2010.

Sir Howard told a news conference: "We are experiencing pressure for growth following a period of stability when supply and demand were in equilibrium."

He thought the pressure would grow.

He declined to put a figure on the extra funding required.

But the group representing vice-chancellors, Universities UK, has said universities in England and Northern Ireland want �8.7bn more in the government spending review covering the three years to 2008, including one-off capital funding of �3.75bn.

That was on top of whatever they might get from variable tuition fees in England of up to �3,000 a year per student from 2006.

New EU students

Pressure on numbers is also expected to grow somewhat as more students arrive from the "accession" countries joining the European Union this year.

Sir Howard said the numbers were tiny, however - about 5,000 students this year, in a total student population of about a million, rising to 15,000 by the end of the decade.

Estimates by the Higher Education Policy Institute (Hepi) suggest higher figures: between 20,000 and 30,000 by 2010.

In a study to be published in full on Friday, Hepi says these numbers "could increase significantly".

But that would happen only if EU students were given equal access to financial support.

And the Higher Education Minister, Alan Johnson, said: "We do not anticipate large rises in EU student numbers because we do not give maintenance support to students from the EU and so coming to study in the UK will not be a cheap option."

He said: "Talk of new EU students forcing out domestic students is an unhelpful exaggeration.

"That is because the expected growth in EU numbers is negligible in terms of the overall percentage of students in this country."

Net benefits

The total cost to the government would be about �4,800 for each undergraduate EU student, Hepi calculates.

But, from their living expenses alone, each would make a net transfer to the UK economy of more than �6,000 per year - exceeding the cost by 25%.

And about a quarter were likely to stay in the UK to work - generating extra tax revenue.

A question remains however over how the government intends to collect tuition fees from those students who leave the country, once England moves to variable fees and post-graduate repayment from 2006.

"Setting up a system for collection of fees across Europe will be extremely challenging and will require a high level of co-operation with other EU governments," Hepi says.