Won by a narrow margin, the House of Commons vote to allow tuition fees at English universities to rise dramatically from 2012 came as little surprise after months of debate. Fiona Leney reports on the implications this decision has for families, particularly expatriates.

Under the new proposals, universities will be permitted raise their fees – currently capped at £3,290 – to £6,000, and, in “exceptional circumstances” (for this read Oxbridge and other highly-regarded universities), to £9,000.

Students will still not have to pay fees up front. Instead, they can take out loans and pay them back when they graduate and are earning £21,000 or more. At the moment, graduates start repaying when they are earning £15,000.

Of course, for many families, who don’t want their children to be burdened with loans long into adulthood, giving them the money to pay off the debt immediately is a real option, albeit one which won’t gain them any reduction in the fees they have to pay.

What it is likely to do, especially for mobile expatriates whose families are less tied to the UK than many, is raise the question of whether a university abroad may offer better value.

The hike in tuition fees suddenly makes English universities less competitive on cost alone, if nothing else, when compared, for example, to their US competitors. Admittedly, it costs much more to attend a US university if no subsidies are applicable, but many institutions do offer 100% bursaries to bright students – and even moderately well-off British parents may find their children qualify for some grant.

Families that are internationally mobile, faced with a potential bill from an English university (depending on how much they want to help their children with fees) of up to £9,000 a year before living costs, may find it worth considering the US. Some top US universities have, for a few years now, been using recruitment agencies to entice the brightest UK students.

According to a study published by the US-based Institute of International Education last year, the top destinations for British students were Harvard, Central Florida, New York University, Columbia and the University of Pennsylvania.

Andrew Halls, head of King’s College School, Wimbledon, has been one of the voices calling for a rise in higher education tuition fees in order to allow tertiary institutions to improve teaching and compete with foreign universities.

In a recent interview, Mr Halls said that a “crisis of confidence” in the higher education system had been pushing many British teenagers overseas. His comments highlight a danger that the rise in fees may not dispel – that a clear division will emerge between the elite universities – roughly those in the ‘Russell Group’, such as Oxford, Cambridge, Durham and Bristol – who will charge the maximum amount, and second-tier institutions, who will try and keep costs below £8,000 a year, or even £6,000, by shortening the length of their degrees to two years.

Those institutions which charge the maximum amount will have to show they are actively trying to attract poorer students by selection criteria and by offering more bursaries. It follows, if they do, that there will be even more intense pressure on places for middle-class, middle- and upper-income students.

These – and the very brightest – are the ones who may be tempted away by US universities.

Some top independent schools have reported a doubling in the number of students attracted to the US in recent years. St Paul’s School, west London, sent 28 school leavers to US universities in 2009, up from 20 in 2008. Numbers have also grown at St Paul’s Girls’ School, Cheltenham Ladies’ College, King's College School and Wellington College, Berkshire.

A recent report from the Organisation for Economic Co-operation and Development (OECD) shows that the UK is falling behind other countries when it comes to producing graduates. It has fallen from third to 15th in the league table of top industrialised nations, and is now ranked lower than Portugal, Iceland, Slovakia and Poland.

The report concludes that this is not the right time to make cuts in higher-education investment.