Should government dictate maximum University tuition fees?

It could be argued that it is in fact the opposite of this. Only those that go on to have careers with high salaries will ever pay off the loan. Those with low or average salaries will have the loan cancelled after 30 years, so will never pay the tax. 

I just mean that due to higher fees than previous times coupled with high interest rates applied to the loans,  in many cases the principal owed by the student starts to significantly increase rather than be paid off. As a result, the money they do pay is for most of the rest of their working lives is at a designated % rate, currently 9% over £25k, i.e. kinda like a tax.

Although, yes, acknowledged that it's eventually written off after 30 years. Still, if you manage to get on a high salary in your 30's/40's, you're definitely going to feel a pinch.

As per the article  here , govt were quite keen on graduate tax around 2003-04 before "it became tangled up in the Blair-Brown rupture that so damaged Labour in office".

I don't really feel strongly one way or another about the financing of it all, although these new 2 year courses sound like potentially a good idea to me.

The problem is that the current UK system is resulting in fewer and fewer bright-but-poor kids getting into top unis. Yes, 20-25 years ago someone like myself from a comp, with parents who had no qualifications and did low-paid jobs could get into Oxbridge. It's clearly still possible but the hurdle rate is getting higher each year. I'm sceptical I would now get in given the much higher level of preparation needed and massively increased competition for each place from a global candidate set. Instead, what actually happens is that I pay for my children to go to the right private school; one that can pretty much guarantee Oxbridge entrance (success rate for applications is around 95%). These schools make sure all the boxes are ticked, coach them thoroughly for interviews and STEP entrance exams etc. So the system is already very biased against those from poor backgrounds.

Counter-intuitively I actually think we need to allow our elite unis (probably 5, max 10) to go completely private and charge much higher fees, more comparable to Ivy League US univs (say $50k per year, with another $20k for living costs). First, the purpose of top universities is not teaching, but to do research. These unis need to allow staff to focus on research without too much distraction from lecturing. The obsessive focus on teaching quality and "value for money" has to stop; these are not businesses - they are meant to be ivory towers! Students that need to be "taught" really aren't good enough to be at top uni. Second, the US elite uni system works surprisingly well for the truly gifted since the large fees and alumni donatives have allowed these unis to build huge endowments. Those endowments mean that virtually nobody with ability actually pays more than 15% of the top-line fee number. Of course, if you're not gifted, you have to pay full whack. Essentially, mediocre rich kids (or their parents) pay for the smart poor kids to go to university.

The government is providing the funding for fees through student loans. The maximum loan available to students needs to be able to cover fees and living costs for the 3/4 years of a degree.

If they don't cap maximum fees, what is to stop a university offering a degree with fees of £1,000,000/year but you get a free Ferrari with your course? Sounds a good deal if you are planning to take advantage of the loan write-off after 30 years.