Private UK university students to get state 'voucher' support

British students will be able to spend their loans and grants on fees at private universities from 2006.

Kim Howells, the new higher and further education minister, has written to private university vice-chancellors advising them that their students will be eligible for support from the government from 2006 when top-up fees are introduced, the Guardian has reported.

The voucher-like scheme has led to conjecture that the UK's top state universities may drop out of the state system and go private in a British "ivy league".

Though Oxford's new vice-chancellor, New Zealander John Hood, has told the Times Higher Education Supplement that privatisation is not on the horizon, his colleagues have suggested otherwise.

Chancellor Chris Patten has told the Guardian that Oxford and other leading universities could go private. Mr Patten said there was disquiet over the government's attempts to interfere with the kind of students they are allowed to admit.

Oxford's Trinity College head Michael Beloff has said the university will be private in 20 years and last month called for the government to "take its tanks off Oxford's lawns".

Dr Hood, who became Oxford vice-chancellor last month, said though he was not looking at privatisation he had concerns over increasing regulation.

He said that as the proportion of state funding had fallen the level of compliance had risen and there was a risk compliance demands compromised an institution's autonomy.

Dr Hood told the Guardian that the university needed to increase its income from both private and public sources.

The Guardian story on the 'voucher' scheme.

The Guardian story on Dr Hood.