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Cuts loom after decade-long surge in education spending Cuts loom after decade-long surge in education spending
(about 13 hours later)
Cuts of up to £2bn from the education budget in Wednesday's spending review would wipe out the UK's decade-long rise up international league tables for investment in education, according to data published by the OECD. Cuts of up to £2bn from the education budget in Wednesday's spending review would wipe out Britain's decade-long rise up international league tables for investment in education, according to data published by the Organisation for Economic Co-operation and Development (OECD).
The Paris-based club of industrialised nations found that the UK's level of public spending on education weathered the worst of the financial storms and subsequent recession, outstripping that of the US and major European rivals even as overall spending growth slowed. The Paris-based club of industrialised nations found that Britain's level of public spending on education had weathered the worst of the financial storms and subsequent recession, outstripping that of the US and major European rivals even as overall spending growth slowed.
Government spending grew by 3% between 2008 and 2010, when the financial crisis took hold, while spending on education alone shot up by 12% – the third largest increase among OECD countries. Spending grew by 3% between 2008 and 2010, when the financial crisis took hold, while spending on education alone shot up by 12%, in the third largest increase among OECD countries.
But that improvement could be reversed if the mooted cuts of £2bn from education and a further £1bn from the Department for Business, Innovation and Skills budgets come to pass when the government's spending review is unveiled by George Osborne on Wednesday. But that improvement could be reversed if mooted cuts, of £2bn from education and a further £1bn from the Department for Business, Innovation and Skills, come to pass when George Osborne unveils the government's spending review.
The OECD data shows that the monetary returns for earning a university degree in the UK remain high, even after the introduction of tuition fees.The OECD data shows that the monetary returns for earning a university degree in the UK remain high, even after the introduction of tuition fees.
A graduate's earnings from employment were 57% higher than those of an individual with A-levels and GCSEs alone, and 129% above those without GCSEs – a trend that remained stable despite the recession and financial crisis. A graduate's earnings from employment were 57% higher than those of an individual with A-levels and GCSEs alone, and 129% above those of people without GCSEs. The trend has remained stable despite the recession and financial crisis.
The figures come from the OECD's latest edition of its Education At A Glance compendium of international data. The figures come from the OECD's latest edition of its Education at a Glance compendium of international data.
The prospect of higher incomes seems to be successfully luring young people into higher education, with today's 25- to 34-year-olds having the highest educational attainment rates of any age group in the UK. The prospect of higher incomes seems to be luring young people into higher education, with today's 25- to 34-year-olds having the highest educational attainment rates of any age group in the UK.
Andreas Schleicher, of the OECD's education directorate, said there was still room for further growth in student numbers in UK higher education.Andreas Schleicher, of the OECD's education directorate, said there was still room for further growth in student numbers in UK higher education.
"It seems that we are not operating in a zero-sum game. So far it seems that the demand for better skilled workers is still rising faster than the supply," Schleicher said. "It seems that we are not operating in a zero-sum game," he said. "So far, it seems that the demand for better-skilled workers is still rising faster than the supply."
Even the advent of £9,000-a-year tuition fees did not appear to deter young people from going to university, despite the loans they will have to repay. Even the advent of £9,000-a-year tuition fees had not appeared to deter young people from going to university, despite the loans they would have to repay.
"There's a lot of debate in the UK today about how the post-2012 system is going to wipe out all of the returns to individuals. I haven't seen any evidence suggesting this," Schleicher argued. "The direct costs for higher education in the UK are still going to be small compared to the opportunity cost" of potential income, he said. "There's a lot of debate in the UK today about how the post-2012 system is going to wipe out all of the returns to individuals. I haven't seen any evidence suggesting this," Schleicher argued. "The direct costs for higher education in the UK are still going to be small compared to the opportunity cost [of potential income]."
The OECD figures show that the surge in education spending under the Labour administration transformed the UK's international position after it lagged behind its industrialised peers in the late 1990s and early 2000s. The figures show that the increase in education spending under Labour transformed the UK's international position after it lagged behind its industrialised peers in the late 1990s and early 2000s.
In 2000 the UK spent 4.9% of GDP on education, while the OECD average was 5.4%. A decade later, the OECD figures show, the UK figure was 6.5% and the OECD average was 6.3% In 2000 the UK spent 4.9% of GDP on education, while the OECD average was 5.4%. A decade later, the OECD figures show, the UK figure was 6.5% and the OECD average was 6.3%
Most of the UK's growth came from increased spending on primary, secondary and non-tertiary schooling, which soared to 4.8% as a share of national income, a figure exceeded only by Iceland among the OECD members, and well above the OECD average of 3.9% in 2010. Most of the UK's growth came from increased spending on primary, secondary and non-tertiary schooling, which rose to 4.8% as a share of national income, a figure exceeded only by Iceland among the OECD members, and well above the OECD average of 3.9% in 2010.
But the UK's overall performance was dragged down by relatively low levels of 1.4% of GDP spent on all higher or tertiary-level education. The US spent double the proportion on its higher education sector, while the overall OECD average was 1.6%. But the UK's overall performance was dragged down by a relatively low level, of 1.4% of GDP, spent on all higher or tertiary education. The US spent double that on its higher education sector, while the overall OECD average was 1.6%.
In 2010 the UK had the lowest share of public spending on higher and tertiary education of any OECD economy other than Chile, and that could fall further after the spending review, with higher education sitting outside the budget areas that are ringfenced from government cuts.In 2010 the UK had the lowest share of public spending on higher and tertiary education of any OECD economy other than Chile, and that could fall further after the spending review, with higher education sitting outside the budget areas that are ringfenced from government cuts.
Nicola Dandridge, of the lobbying group Universities UK, said: "While we have one of the top university systems in the world, competitor countries have overtaken us in terms of how much they invest in higher education. That suggests we have a very efficient sector, but we have to make sure that long-term our universities are sustainably funded. Nicola Dandridge, of the lobbying group Universities UK, said: "While we have one of the top university systems in the world, competitor countries have overtaken us in terms of how much they invest in higher education. That suggests we have a very efficient sector but we have to make sure that, long term, our universities are sustainably funded.
"As the government announces the latest round of spending cuts, this is further evidence that the UK must invest more in higher education and research if we are to increase growth and stay internationally competitive." "As the government announces the latest round of spending cuts, this is further evidence that the UK must invest more in higher education and research."
The OECD found that while Britain had made some progress in reducing the proportion of young people classified as Neets – those not in education, employment or training – it still had an enduring problem, especially for those Schleicher described as lacking "baseline qualifications". The OECD found that while Britain had made progress in reducing the proportion of so-called Neets – young people not in education, employment or training – too many in the UK still had very low skills, especially for those Schleicher described as lacking "baseline qualifications".
"When we talk about wage differential, there's always the gap between the better end and the low end, and that's growing. So people at the top end win and people at the low end lose," Schleicher said. "It's a more polarised labour market, which actually reflects the structure of the workforce today. This is basically what we see, an increase in highly skilled work and a decrease in work for very low skills.""When we talk about wage differential, there's always the gap between the better end and the low end, and that's growing. So people at the top end win and people at the low end lose," Schleicher said. "It's a more polarised labour market, which actually reflects the structure of the workforce today. This is basically what we see, an increase in highly skilled work and a decrease in work for very low skills."
For the UK the broader picture was "big strengths at the high end but also at the low end still a relatively large share of people without strong enough foundation skills to have a decent labour market return".For the UK the broader picture was "big strengths at the high end but also at the low end still a relatively large share of people without strong enough foundation skills to have a decent labour market return".
Schleicher said the problem may not be solved by raising the age for young people to remain in education or training of some form. "You are extending compulsory education next year and the year after, and that might change the picture slightly. But don't take that too lightly, because locking people up in school isn't necessarily leading to better skills," he said.Schleicher said the problem may not be solved by raising the age for young people to remain in education or training of some form. "You are extending compulsory education next year and the year after, and that might change the picture slightly. But don't take that too lightly, because locking people up in school isn't necessarily leading to better skills," he said.