Higher education is now a market, so allow the worst universities to go bust

standards as universities lower entry requirements and hand out excessive numbers of firsts to attract custom. The loan system is a mess, loading financial obligations on to taxpayers because a huge number of students will never pay them back.

Rather than cutting fees, as a Government review looks set to recommend, which would require universities to compete instead for state subsidy, it would be better to reform the system so that graduates pay the university directly, as a proportion of their future earnings, to create a proper incentive for the institution to make them employable.

The failure of a university, while deeply upsetting for those affected, would be the system working as it should. The “contagion” the BBC frets over would be thousands of young people reassessing the value of various universities. It could encourage applicants to look harder for evidence that the course they are being given an unconditional place on is really worth the time, money and risk. Or is it a too-good-to-be-true offer from a troubled business looking to put bums on seats? You might see the emergence of the equivalent of debt ratings agencies for higher education, to provide independent information where currently there is none.

In any case, the alternative – a bail-out – is unpalatable. It would be a reward for failure for universities that have grown arrogant off the back of the 50 per cent graduate target. And it would signal to students that higher education is a right that the Government will always ensure is met, rather than a choice to be balanced against alternatives. If we are to have a market in education, let it work freely. Let bad universities go bust.