Poorer students risk losing out to 'middle-class bias', says university tsar
"It recognises there may well be additional costs for taking on students from disadvantaged backgrounds," he said. "Those costs are in outreach, or there may be gaps in pastoral education that it is important to fill. But most importantly, non-traditional students are more likely to discontinue their education.
"They may well come from financially challenged backgrounds, and financial challenge is one of the reasons why students drop out of their courses. "To put it bluntly, if you really want to maximise the income of your university, then you take kids from a good middle-class background whose parents can ensure they don't fall into financial difficulty. I think the student opportunities allocation is extremely important because, while it may only cover half to a third of the additional costs of such students, it is some kind of compensation to those universities."
Official figures released last week show that two-thirds of A-level students from the independent sector went on to Britain's leading institutions in 2010-11 compared with less than a quarter of those from the state sector. It also emerged that teenagers from the poorest families – those who are eligible for free school meals – were half as likely to progress to a higher education course as their more affluent peers.
Ebdon said it was clear that Britain was "missing a lot of excellence". However, he said that universities, encouraged by Offa, had done more outreach work than ever before in recent years to encourage disadvantaged children and there were now signs for optimism. In 2004, 18-year-olds in affluent areas were six times more likely to apply to the most selective institutions than those from disadvantaged areas. This year, Ebdon said, the ratio had reduced so that those from affluent areas were just 4.3 times more likely to apply to the most selective institutions, including Oxford and Cambridge.
He said: "So I think we are being able to see some impact now for all the work that universities are doing to widen access. We have been pushing them very hard to engage in outreach activity. "This is further evidence that our original attempts through bursaries and financial inducements to students have not worked as well as outreach programmes."
Ebdon revealed that Offa's latest strategy paper, to be submitted to ministers shortly, will be to target the parents of disadvantaged children to encourage them to believe that a university education is relevant to their offspring. "Very often you can get a kid really turned on to it and they go home and the family say: 'No, university isn't for the likes of us, you won't be going'," he said. "You have to engage with a whole family, indeed a whole community, [to encourage them] into believing university is a realistic option for everyone."
A Russell Group spokesman said: "Funding decisions are for the government. As we said at the time of the spending review, when the Higher Education Funding Council for England allocates their budget to universities in 2015-16 it is vital they increase funding for teaching science and engineering subjects, which play a crucial role in underpinning future growth."
But Professor Andrew Wathey, vice-chancellor of Northumbria University, said the student opportunity allocation was the "key to seeking excellent students across the broadest possible social spectrum".