Price wars or priced out?

Bedford college has charged higher fees than neighbouring FE colleges for more than a decade. But Ian Pryce, the principal, fears that the Government's proposals to raise fees will tip the balance and hit enrolment.

Since 1993 the college's governors have set part-time fees at the highest possible rate, but brought in the increases gradually. "Our governors have always been strong on not being too dependent on government funding sources," said Mr Pryce.

"There was a view that you can get into a vicious cycle with other colleges of just cutting fees. But colleges end up with less income."

He wants a national minimum fee for each course to stop college price wars.

"Our fear is that once someone in financial trouble reduces their fees, you end up with a price war where everybody loses."

He also fears the level 2 (GCSE-equivalent) entitlement will hit Bedford and that many who pay fees now will not have to pay in future, but the college will not be compensated. "Most of our work is at level 2 or below, so it reduces the number of students we can charge," he said.

Student fees bring in a sizeable proportion of the college's income: it has 15,000 students, 12,000 of whom are over 19. A reduction in fees for access-course students led to an immediate 10 per cent increase in demand.

In some areas of construction, increased fees had no effect on demand, but the college found a 40 per cent difference in levels of recruitment between one computing centre that charged modest tuition fees and one that charged a much lower exam fee.

Mr Pryce worries about students in their 20s. "They haven't been out of the education system for long." he said. "Should we really be charging those people pound;600 or pound;700 for a full-time course when they wouldn't have had to pay anything if they had come to us straight from school."

Greenwich community college in south-east London serves many adults - the average age of its students is 34. The area is being regenerated, but has a shortage of people with higher-level skills.

Principal Geoff Pine fears that higher fees will discourage low-earners. He said: "In the adult and community market, where we have people participating for the first time or re-engaging with education, they have often been used to not having to pay much, and they might have to pay more.

"One could envisage a scenario in which the more disadvantaged areas of our community would be put off. The benefits would be going to white, middle-class and wealthier people."

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