The student demonstrations in London on 10 November were not on the same scale as the 1960s protest movement against the Vietnam war, or the riots against the Thatcher government’s poll tax in 1990. But the fact that some 50,000 people took to the streets to demonstrate against plans to raise college fees is a testament to growing opposition to the UK’s ruling Liberal-Conservative coalition.

Events took a sour turn when a handful of protesters resorted to violence. But now that order has been restored, discontent is still simmering about the plan to slash public funding for higher education and to compensate institutions by allowing them to triple the cost of fees to students. The economic crisis is directly responsible for the funding cuts. However, on a more general level, the conflict has highlighted a structural issue that affects every European country: who should foot the bill for increasing the level of education among young people?

Shift towards mass university education began shortly after WWII

For many years, the welfare economies were content with a limited number of graduates. Sweden, which in the 1950s was one of the richest countries on the planet, awarded relatively few degrees, and as a rule a university took less time than it does today. But times have changed. Many European countries are now faced with a situation where a third or even a half of the nation’s youth will embark on higher-level studies — a development that has been prompted by the increasing number of professions that require university diplomas, and by the democratisation of access to education which is viewed as a desirable objective. At the same time, in many European countries, it is presumed that the state should naturally be responsible for the ever-increasing costs.

In contrast to the United States, where the shift towards mass university education began shortly after WWII, most European countries did not plan on passing on all or part of the cost of tuition to students or their families. As a result, they are now caught in a situation where they have to contend with the expense of a constantly expanding system. In France, for example, this situation has led the state to invest heavily in a handful of exclusive grandes écoles, while traditional universities have been left to waste away.

State-financed higher education or market-based system?

The measures that David Cameron wants to impose will attempt to close the gap between the education system and the market. Of course, the poorest students will be entitled to grants, and their middle-class peers will be able to take out loans to be repaid in installments that vary in accordance with their future incomes. However, there is no denying that the soaring cost of going to university will be off-putting, and it will force institutions to enter into cut-throat competition in their bid to attract students.

Choosing between a state-financed but regressive higher education system and a market-based system with astronomical fees is like choosing between the plague and cholera. And in this context, the Swedish system appears to strike the correct balance. Higher education is financed by the state, but funding for universities depends on their capacity to attract students – and starting next year – on their compliance with certain quality criteria. However, the problem with this approach is that it tends to combine the disadvantages of public service and private market-oriented management.

The quest to recruit more students could lead universities to focus on courses with the most popular appeal, while state quality management could make them vulnerable to greater political control. There is no out-of-the-box solution. But it is important to cling to the ideal of a university as a place that offers optimum conditions for the quest for knowledge, freedom of thought and intellectual integrity. The real question is not how to best use higher education to reduce the budget deficit, but how to create a reliable financial mechanism that has the capacity to guarantee the independence of universities.