07/09/2011 13:13 BST | Updated 07/11/2011 05:12 GMT

New Universities 'At Risk' As Report Predicts Entrance Rates To Drop

Universities will see a drop in entrance rates when higher tuition fees are imposed in 2012, potentially threatening less well-established institutions, a new government-sponsored report has predicted.

The paper released on Wednesday suggested newer universities may be at risk of closing as the new fees come into place next year.

"Realistically any change to a system of higher education funding which relied on more individual student fees could endanger some of the less well established institutions."

The report, titled 'The Demand for Post-compulsory Education in England and Wales', sponsored by the Department for Business, Innovation and Skills (BIS). Conducted by academics at the London School of Economics' Centre for the Economics of Education, it set out to identify the impact of the tuition fee changes on the demand for higher education from 1955 to 2008 and predicted a forecast for next year's university applications.

Universities and College Union general secretary Sally Hunt said: "Erecting punitive financial barriers is not the way to deliver a world-class higher education system and will deter the best and brightest from applying to university. Any drop in student numbers would also leave universities with a significant funding gap."

The report concludes their results suggest higher college costs will deter higher education participation and would also have a larger adverse impact on young males than young females. It advises if the cap of fees is increased to £7,000 the university entrance rate would decrease from 2008 by 5.33 per cent for boys and 2.84 per cent for girls.

NUS president Liam Burns said the report was a stark warning which the government should heed to.

"The best way the government can try to stop their sky high fees putting off vulnerable students is to make sure more money ends up in students' pockets when they need it most. The government need to act quickly to boost the bursaries available to students in 2012-13 to stop them being put off from applying for a place", he said.

A BIS spokesperson said:

"This new research comes with a large health warning - the researchers state explicitly that they have assumed no changes to grants and loans. But, in fact, we are increasing tuition loans and raising maintenance grants, as well as introducing a much more progressive repayment system. We are keeping student numbers stable over the spending review period and are expecting universities charging more than £6,000 to do more than ever before to seek out students with the most potential."