By Rick Holden
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Extra info for 50th Anniversary Commemorative Issue
Sample text
The 1992 Higher and Further Education Act ended the funding distinction between the polytechnics and universities. The former were given degree awarding powers and central government funding from the Department of Education to all institutions of higher education was now to be allocated via the Higher Education Funding Councils. Although the binary divide disappeared, principals within the system responded by creating other distinctions, for example between the “old” (established pre-1992) and the “new” (or “modern”) (established as a consequence of the 1992 legislation).
That the market fails to address these externalities is the economic justification for market intervention on the part of the state. What became increasingly apparent during the 1990s were the private returns to be got from a degree. Human capital theory posits that investment in education enhances productivity, and that this enhanced productivity generates an earnings premium in the labour market, relative that is to the equivalent individual who has not elected to make the investment. Early estimates suggested average rates of return of between 12 and 15 per cent for males and between 20 and 25 per cent for females.
Originality/value – This paper is one of a series commissioned by the journal on its 50th anniversary. Its originality stems from the personal view of the author. Keywords Education, Workplace learning, Skills, Careers Paper type Viewpoint Education þ Training Vol. 50 No. 1, 2008 pp. 1108/00400910810855478 Fifty years ago, I was still at school, a somewhat academic institution where the emphasis was on getting your “O” and “A” levels, which must have counted for something, despite the fact that only a very few of my peers went on to university.
