A cash crisis is threatening the collegiate system. Ilsa Godlovitch reports. Financial pressures may in 20 years' time force a change on the whole ethos of Oxford University life. There may be little in future to separate an Oxford undergraduate from any other undergraduate, or the university from any other good research university.

Oxford's glamour has long been built round the privileges of the undergraduate - the twice-weekly tutorials with world authorities, the leisure of relative freedom from lectures and the college system that for almost 1,000 years has cosseted, housed, fed and educated students throughout their university years. But it is an expensive system and many academics are saying that it cannot, and maybe should not, survive into the next century.

For five years the special grant paid by the government to the Oxford colleges to help meet the extra costs of the collegiate system has not increased with inflation, decreasing by 3 per cent in real terms, a trend that is likely to continue. And the Labour Party says it would get rid of it altogether.

Another important source of revenue for colleges is income from their endowment funds. Many poorer colleges have not been able to maintain their funds and balances have finally run into deficit after a dramatic decline over several years. (see table below).

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Robert Stevens, the master of Pembroke, was forced to raise student rents at his college last month to offset the threat of bankruptcy. The long-term future for his and other colleges is still uncertain. "We have no choice about raising our charges if we are going to stay in business," he says. "Richer colleges could absorb it for a much longer period but ultimately they too couldn't go on absorbing it . . . Oxford will be able to survive if it gets rid of the tutorial system and has halls of residence. It could be like any other university, and could probably limp by on the present funding structure for higher education in England."

But the funding structure shows few signs of moving in Oxford's favour, and a commission of inquiry set up by vice chancellor Peter North is looking at how the teaching systems and collegiate structure might be altered. North says there are three solutions: to carry on as before but do it less well, to change and hopefully keep up standards, and to find money from elsewhere. The first is unpalatable. The third has been tried successfully, but to gain the complete independence Oxford may require, economists say it would need a further Pounds 2,000 million-worth of capital.

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Meanwhile, without waiting for the commission's recommendations, the Oxford of the future is already beginning to emerge in its new slimline form, looking increasingly like a place with little room for the luxury of tutorials and college life.

The Conference of Colleges, at which all the college heads are represented, recently received a report that recommended undergraduates be taught in larger groups and that colleges be prevented from "overteaching" to boost exam results. The natural continuation is for a class and lecture system that would not be out of place at any other university, and some believe that is the way Oxford must go.

E. C. Zeeman, principal of Hertford, thinks Oxford could be well rid of its bureaucracy and, as the pioneer of a groundbreaking "no cost" tutorial system at Warwick where undergraduates are taught primarily by postgraduates, his views hold some weight. "Particularly on the arts side, there's an awful lot of waste to basic teaching. In subjects that are a discipline there is a core of knowledge that is universal and can be conveyed primarily in lectures. What happens at Oxford is this wasteful system of nobody going to lectures and the core teaching being done by the tutors."

Undergraduates at present are an endangered species. They require one or two individual tutorials each week, prevent fellows from spending more time on research that is increasingly becoming the target of government and industrial funding and rely on the support of sometimes cash-strapped colleges for their livelihood.

In the future they may have to give up some of the expensive privileges to which they have become accustomed. The emphasis will be more on research, and the university is already making steps towards it. The number of postgraduates has increased markedly while that of undergraduates has remained stable. The university has adopted a policy of appointing more fellows to professorships to improve its international status and research image. Both changes signal a shift away from the colleges and towards a central university.

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The colleges are already making plans to standarise teaching at a lower level and, according to one Oxford economist, they will no longer be able to provide teaching fellows in all the subjects they offer currently.

Oxford will be a different university in the next century. Whether it is a good one is forthe next generation to find out.

Ilsa Godlovitch isa recent graduate of Wadham College, Oxford.

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"There are certainly those who read the agenda of the commission as being an agenda to move the university away from teaching and further towards research. Oxford's great strength is its collegiate system, and if this is destroyed Oxford will be a much less interesting and a much less good university. There are really in a sense two Oxfords. It makes a great deal of difference - although some pretend it doesn't - which college somebody is appointed to"

Robert Stevens, master of Pembroke

"I would expect Oxford to be somewhat conservative in relation to its syllabus. I would expect the pressures to be such that there would be an increase in the relative importance of research activities compared with the undergraduate teaching, which even if the role of the colleges in relation to the graduates is enhanced will almost certainly mean a shift towards the university"

John Flemming, warden of Wadham andan economist

"Oxford is an extraordinarily robust place. The best model for it is an elastic band. If you push it, it will spring back again, and if you push it past a certain point it will zip rapidly into a new equilibrium. I don't think Oxford can be justified in requiring 5 per cent extra funding to support it. That's under attack, and egalitarians could well say it's not fair that Oxford should have that"

E. C. Zeeman, principal of Hertford

"I have no doubt that one of the things Oxford does very well is teaching at the first degree level. Nobody is going to throw the baby out with the bath water"

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Peter North, vice chancellor