Ministers are prepared to spend as much as £450m a year to give students from the EU discounted university fees, the Guardian has learned, but only if Brussels allows the UK access to its Made in Europe industrial programme. The UK government has drawn up plans to allow students arriving from the continent pay the same fees as British students, sources say, and is willing to spend hundreds of millions of pounds compensating universities to do so. British officials insist, however, they will only make concessions on fees if the EU allows Britain entry to its proposed protectionist industrial scheme, which will impose trade restrictions on countries outside the bloc.
On Sunday the former chancellor Rachel Reeves praised the prime minister, Andy Burnham, for a willingness to think boldly about the UK’s relationship with Europe – saying she believed Britain’s future was within the EU. But in her first major intervention since leaving the Treasury when Burnham took office, she said those forging a path back towards EU membership had to make compelling arguments to the public. Ministers hope if such an agreement is reached at a Brussels summit later this month it will unlock millions of pounds’ worth of benefits for British companies looking to do business in the EU, and show that the prime minister’s attempts to forge much closer ties with the bloc are paying off.
But giving EU students cheaper access to British universities could prove controversial domestically, especially when many graduates are calling for changes to their own student loan repayment plans. One person with knowledge of the talks said: “We are willing to give the Europeans what they want on fees, but we will have to get something significant in return. The biggest prize we are pushing for right now is access to Made in Europe, so there is a deal to be done there.” A government spokesperson said: “We are building an ambitious, close relationship with the EU that will strengthen our economy, protect British industry, and create more opportunities for young people across the UK.” Negotiators have been thrashing out a series of deals for months to be finalised at the long-awaited summit on 20 November.
Burnham wants to use it to show his commitment to much closer ties with the EU and to lay out options for how the relationship could develop in the future, including full re-entry. In a speech at Harvard on Monday, Reeves will say the UK’s “economic interests, common values and basic geographical reality all point towards Europe”. Praising Burnham’s “willingness to face reality head-on”, she will say it is vital the British government can “prove to the public the benefits of a closer relationship and prove to Europe that we are serious and open to compromise”.
Before the summit, agreement is understood to have largely been reached in a number of areas, including on emissions trading, agricultural products and a youth mobility scheme, with reports suggesting up to 80,000 young Europeans could be allowed to come to Britain to work, live and study. EU member states had demanded between 100,000 and 150,000, with some arguing in favour of no quota. The two sides are also nearing agreement to allow Britain access to European biometric databases, the Guardian has learned, which could help the UK government track asylum seekers.
British access to the Made in Europe scheme, which is due to be finalised next year, and European demands for cheaper fees for students at British universities are the two remaining hurdles. EU officials say they want their students to pay fees of just over £9,000 a year rather than international fees, which can rise above £60,000. The demand briefly brought negotiations to a standstill this year, with British officials saying they had been blindsided by its inclusion in talks.
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