The Director of the Oxford Centre for Higher Education Policy Studies, David Palfreyman, has suggested that elite universities like Cambridge and Oxford could benefit from privatisation.

According to Palfreyman: “Total autonomy for world-class universities is essential, subject of course to regulation of a limited kind and to consumer law protection for students.

“Oxford and Cambridge must be on the same footing as competitors such as Harvard, Yale, and MIT, and government does not do a good job when messing with elite higher education.”

The three American universities Palfreyman mentions, as well as other academic heavyweights such as Stanford and Princeton, are all privately funded.

Recently published figures reveal the decreasing significance of state funding to elite research universities such as Cambridge, and prompt questions about the future of higher education policy.

A ‘health check’ undertaken by Times Higher Education looked into the financial position of universities over the course of 2012-2013. The University of Cambridge was outstanding for receiving only a small percentage of its income from HEFCE (the Higher Education Funding Council for England).

Cambridge was second only to the London School of Economics in this regard, with a mere 12.8% of its rev- enue depending on funding council grants. This percentage is set to decline even further as the last cohort of students who began university under the old fee regime prepare to graduate.

In a paper entitled ‘Reshaping the University to fit the Marketplace in 2020’, Palfreyman and his colleague Ted Tapper considered the choices that must be made in designing higher education policy:

“Very few nations can afford to finance mass higher education, and the stark choice becomes: taxpayer-retreat and cost-sharing as the student/family picks up the tab; or Galbraithian over-crowded public squalor as higher education systems decline with underfunding.

“The rise of the regulated market and the possible shift to a limited State voucher could mean Cambridge escaping from the fees straight-jacket and charging more for those who can afford to pay,” argues Palfreyman.

He stresses the importance of ensuring tighter consumer protection control for students if this change does take place, as well as the University’s responsibility to widen access.

However, he thinks such a move is unlikely to occur in the near future: "Why will Oxford and Cambridge not jump ship? They lack strategic ambition and managerial guts.

“There are too many dopey lefty and woolly-headed academics who are unable to see that Higher Education will become mass public squalor and mediocrity unless it escapes being a remnant of the Welfare State as a nationalised industry.”

When the University of Law became Britain’s first private and for-profit higher education institution in 2012 the move met with outrage from many academics, who were concerned that it was the beginning of a wider move towards privatisation.