American system studied
A report to the Dearing Committee will outline a range of mechanisms used in the United States to inject private money into HE funding, together with a recommendation that UK higher education should become less dependent on government cash.
A key challenge for the committee, due to report next year, is the issue of funding an HE system which must continue to expand if the UK is to meet education and training targets.
The US study, based on a visit to East Coast states last month by a four-strong team including FEFC chief inspector Dr Terry Melia, also highlights how community colleges - broadly the American equivalent of further education colleges - work with universities to provide the first two years of four-year degree courses.
The Dearing Committee is understood to be examining the so-called two-plus-two system, which according to the Melia-led study dramatically cuts the cost of a four-year bachelor degree programme in the US. Students normally live at home while attending a local community college, then move away if they choose to take a full degree.
The team's report reveals how some American universities have entered into articulation agreements with community colleges, ensuring students completing a two-year course can transfer with full credit into the university's third year.
In those states which have legislated to enshrine the right of transfer, the size of the third year in the four-year institution is doubled by entrants from the community college. The figure is much lower where transfer is merely encouraged.
The report notes that the American HE system has managed to frustrate government attempts to make it more cost-effective, partly because of the public willingness to contribute privately. However, it suggests a backlash is on the way, with some states capping tuition fee increases.
Among the solutions tried in the US to ease the growing financial burden of HE is the use of state lottery funds in Florida to fund recurrent costs. The same state has also imposed a regular tax on utilities to fund education capital building programmes.
Such ideas are likely to prove too radical for consideration by the Dearing Committee, but they do demonstrate the scope of the inquiry.
Some states have also launched savings schemes to help parents meet the expense of their children's tuition fees. The cost of fees, room and board can reach approaching $7,000 (Pounds 4,000) in public four-year institutions and almost $17,000 (Pounds 10,000) in their private equivalents.
The report also stresses that, if tuition fees are introduced in the UK, the introduction of a range of flexible student aid arrangements will be essential. However, it suggests Britain should seek to avoid the complexity of the American grant and loan system, which is split between state, federal and private sources.