Dr. Aed?n Doris:

I will speak about option 1 first, which is no fees and full public funding. It is regressive because, basically, what that mean is that it is not free; it comes from the taxpayer, and taxpayers are made up of lots of people, including low-income individuals who have had no opportunity or who have not gone to university. It is their taxes, as well as the taxes of the better off, that are going to fund an education system that they have never benefitted from, so in that sense it is regressive. All taxes are being used to fund higher education, which is an unusual good from an economic point of view. It is both a public and a private good in economic terms. What that means is that the public sector derives significant benefit. As Professor Rogers mentioned, the return on investment at a public level is substantial, but it is also substantial at a private level. The return on a higher education is substantial to the individual. Because people are paid more, they pay more taxes, but that does not fully compensate for it. From an economic point of view, it makes sense that the cost should be shared by both the individual private beneficiary and by the State. Even the most libertarian economist in the world would not argue that it should be privately funded. Nobody would argue that. If you try to fund a higher education system entirely privately, you get substantial underfunding and inadequate access. It is not an efficient way to do things, so it makes sense for there to be a substantial public sector investment. Option 3 in the Cassells report, the income-contingent loan system, and option 2 both involve both private and public contributions. They are preferable from an economic point of view.