The Dearing Report on Higher Education was bad: tuition fees of £1,000 per year for all students. Government reaction was worse. While they threw a sop by remitting tuition fees in full if parents earn under £16,000 and in part if parents earn below £32,000, they also announced the maintenance grant would be turned into a loan.
Dearing had rejected this option on the grounds that it would redistribute money from the poor to the rich. The worse off will now have to borrow money, so repayment terms for the better off become easier. The poorest students will lose around £7,000 in grant and only save £3,000 through not paying fees - so much for Blunkett's claim to be protecting the weakest.
The Dearing Report was set up as part of a tacit deal between Labour and Conservative to bury the crisis of higher education as a political issue in the election campaign. The Tories had expanded the numbers of students in higher education while decreasing the money in real terms - by a third over the last ten years with a further 10% reduction planned over the next three years. The results were obvious: decaying buildings, under-equipped labs, overcrowded classrooms, student hardship and stagnating staff salaries. Labour might attack these in opposition but were not prepared to pay for high quality mass higher education.
Since the Dearing Commission had to work within broad Treasury limits, it could choose between admitting standards would slip and making those in higher education pay: staff on low salaries and students by losing grants and by tuition fees. New Labour's response, driven by a desire to save even more money from the exercise, was consistent with Brown's budget measures of taking proportionally more from the poor. Labour planned to get away with it by clever PR: MPs were told to concentrate on the fact that parents' contributions will not rise (true, but the burden of repayment shifts from parent to student) and the fact that students from lower income families will not pay fees (not mentioning that their grant will be withdrawn).
The significance of Labour policy was illustrated by two reports published the same week as Dearing's. First, it was shown that your chances of getting to university are 80% if you come from a professional middle class background but only 10% if you come from a manual working class background. Like all previous expansions of higher education, all that happens is that larger sections of the middle class get in. Second, it was revealed (no great shock, this) that the gap between rich and poor is larger than ever and, in large part, comes from the lack of qualifications and thus access to skilled jobs by those from poorer backgrounds.
The poor remain poor because they are excluded from the education that might improve their position. Labour's response - to make higher education massively more expensive for students - can only entrench and increase social inequality, despite Mandelson's cosmetic efforts.
There are two further reasons to oppose Labour's plan. First, it not only reinforces Tory economic policies but capitulates explicitly to Thatcherite ideology that students should pay because education is an individual resource. We get educated to become little entrepreneurs maximising our own incomes. This abandons the notion that education is a social good, undertaken to improve the general state of society and enabling people to provide a greater social contribution. Once we see education in individual terms, how long is it before there are tuition fees at sixth form - after all not everybody stays on and those that do may well end up with better incomes?
The second reason is that, for all their significance, tuition fees and loans won't raise that much money. The Dearing proposals were estimated to "save" £1.1 billion per year, the Labour plans £1.7 billion. They will require a massive bureaucracy and all the problems of chasing students, administering a means test and so on. This money could easily be raised by other means by a Labour Government with the political will to tackle inequality rather than talk about it. Graduate employment increases the national income by an estimated 8%.
The day before Dearing, NUS and AUT were arguing that business benefits from university training and that they should therefore pay a "graduate tax". But they weren't opposing tuition fees. It was left to marginal figures like Ted Short to declare that they were ashamed of Labour and were thinking of tearing up their Party card.
The issue really is that big. Labour is proposing the end of the principle of free education. It is putting a locked door between the poor and the universities. Every constituency in the country should make sure that its MP is deafened by the howls of outrage demands opposition to Blunkett's policy.