Should European universities follow America's lead?

Two of Europe's most senior politicians-cum-academics are sounding the alarm about the widening gap between the quality of universities in America and Europe. "By every measure, by papers cited, patents, Nobel prizes, American universities are doing much better than European ones," says Lord Patten, chancellor of the universities of Oxford and Newcastle, and former European commissioner. "And far from Europe closing the gap with America, the gap is growing. Europe is spending less than half what America spends on higher education - 1.2 per cent of the GDP as opposed to 2.6 per cent in the US."

Lord Patten and Giuliano Amato, Italy's interior minister and a part-time professor in Florence and New York, were speaking at the monastery near Siena, where every year they co-chair the celebrated Pontignano conference that brings together leading politicians, academics and industrialists to explore hot topics of the day. This year, the crisis in higher education was at the top of the agenda.

"We are falling steadily further behind," says Lord Patten. "And we are aware of the fact that competition, especially from India [the Indian Institutes of Technology] and China is hotting up. Today, they send most of their postgraduates to America, though increasing numbers are also going to Australia. But they are investing heavily in their own higher education systems, and there is no question that in a few years they will be competing with us."

The consequences for industrial competitiveness of Europe's failure to invest more in higher education are obvious, he says, given that "four-fifths of research and development is based in universities". And the proportion of graduate students who stay put in the US rather than coming home to Europe is growing alarmingly. "Ten years ago, 50 per cent of graduates came back," he says. "Today, the figure is 25 per cent."

Inadequate government expenditure on higher education is central to the problem. Reversing the trend, Lord Patten says, "is simply a matter of political will and resource allocation ... At the heart of the EU's Lisbon Strategy, agreed in 2000, was the belief that knowledge is incredibly important. It is, therefore, essential that we invest more in research and development". Yet he is realistic that this may not happen any time soon. "Higher education is not a very sexy issue," he says. "It doesn't turn the electorate on like primary and secondary education and health."

Amato adds: "We in the EU have been living for years in societies that seemed settled, that seemed at the peak of wealth and wellbeing. Why invest so much in education and innovation? Let's live more comfortably."

But if the priorities for government spending are hard to reverse and the universities wish to reverse their decline, answers are in short supply, Lord Patten says: "How can universities get more money? There are only three ways. One is government grant, another is charging fees to students and the third is private endowments."

Britain, despite fierce opposition, has made a start on charging fees, and some German states are doing likewise. But in most of the Continent, the very idea is out of the question. For one thing, university education is seen practically as a right, like primary and secondary education. For another, the quality of education, in terms of facilities, access to teachers and so on, is so low that no one would dream of paying for it. A university education in Italy, for example - with the exception of the tiny number of elite institutions - is a Darwinian exercise in the survival of the most determined.

Private endowments belong to a different mental universe: in Europe, they hardly happen. "Only two European universities would get into the list of the top 150 universities for private endowments," says Lord Patten. "In Europe, people say, 'Endowments don't belong to our culture'. But in Britain, for example, there are very generous tax breaks for endowments ... It's surprising that universities themselves haven't been quicker to respond."

As Dr Larry Siedentop put it in a paper written for the conference: "One of the remarkable things about American students is that, having often paid high fees and graduating with a considerable level of debt, they feel a gratitude to their institution which frankly is not a conspicuous feature of the European scene." Yet not all that long ago it was different, Siedentop points out: "Alexis de Tocqueville, visiting England in 1832, was astonished by the investment represented by the colleges of Oxford - and even more astonished when he was told that they were private foundations..."

But money in itself, Lord Patten and Amato say, is only part of the answer. Other lessons we can learn from America concern the different functions universities fulfil, and the way they divide labour between themselves.

There is a degree of uniformity about European universities. In Britain, the former polytechnics strain to become like the older universities, eliminating their historical disadvantages; universities everywhere aspire to become good at everything, from teaching to research. But Lord Patten and Amato believe that such uniformity is part of the larger European problem.

"Different universities have different roles to play," says Lord Patten. "Three thousand American institutions provide degrees, but only 200 have Masters and Doctoral programmes. And only 100 are serious intensive research institutions. It is a matter of different universities doing different jobs. Not every university can be at the forefront of research. It is easier to get the very best out of a student at Oxford than at Greenwich."

At present, a modest amount of state money is spread thinly across the system, points out Amato. You don't have the necessary division of labour. "Professors are defending research everywhere," he says. "If you try to challenge them it is a holy dogma; you are against research, and so on. But not every university has to be a leading one. I can find a job for every university if they limit themselves to being teachers. In Italy, there are only three schools of excellence. Americans have solved this problem by private funding: the private money goes where it is sensible to spend it."

The rise of Europe from the 11th century onwards was associated with the rise of the universities. Yet during the last half century, Europe has thrown away, "almost wantonly, what was for centuries its greatest competitive advantage - superior education," says Siedentop.

Is the decline irreversible? The European leaders who signed up to the EU's Lisbon Agenda didn't think so when they made the turnaround of higher education a priority. But as Lord Patten points out, education is less well funded than other public goals. Other things matter more to Europeans.