Research vouchers for graduate students

In today’s Toronto Star, Ross Finnie and Alex Usher propose a voucher program to promote quality graduate research. I haven’t formed an opinion yet, but at very least it seems much better than the current system of government-to-institution transfers.

How to expand graduate education in Canada, by Ross Finnie and Alex Usher. Toronto Star (Feb 22):

On the supply side, new money needs to flow in ways that will foster the twin goals of expansion and quality.
Traditional measures, such as increasing government-to-government or government-to-institution transfers, or putting more money into research, would help, but offer limited guarantees that the money will promote expansion of graduate education where we need it most.
An alternative approach would be to attach funding to students directly, varying the amounts with the assessed standing of the student, based on grades, exams and other criteria.
Such a voucher-type system would encourage institutions to improve the quality of their programs as they compete for students, while also giving them the means to expand.
Channelling money through students would incorporate the much-vaunted benefits of the "single-payer" approach that generates efficiencies for our publicly funded health system, while opening up the "market" for graduate education.
In short, an intelligently structured set of transfers to universities based on the number of highly qualified graduate students they enrol would strengthen incentives to offer high-quality postgraduate education. The new resources these transfers brought to institutions would allow expansion of the system precisely where quality was best.
Students, who naturally want to enrol in the best programs they can, would themselves direct the funds toward the higher-quality programs. It is a market-type solution, with market-type efficiencies, though financed entirely with public money.