This is rather the point, competition benefits the consumer, even at universities

An interesting little example of producers complaining that we're all being blue meanies by insisting that they compete with each other:

The Russell Group has complained that leading universities are “forced to compete” with eachother to recruit from a “small pool” of bright but disadvantaged students.

In a submission to the Office for Students (OFS), the group criticised the regulator’s approach to boosting diversity, arguing that universities should not have to report back to the regulator annually on their plans.

Setting targets that “demand a consistent increase in the intake of students from disadvantaged backgrounds” risk discouraging leading universities from working together, the Russell Group said.

Instead, it means that the country’s top universities are “forced to compete for a small pool of suitably qualified applicants from these groups”.

Under the current fees system, any English university wishing to charge tuition fees of over around £6,000 must have an “access agreement” approved by the new higher education regulator.

We can't say that we're entirely in favour of everything about the current university dispensation. The insistence that 50% of the age cohort are suitable for, will even benefit from, an academic education looks more than a tad suspect to us. However, we're all in favour of the useful and bracing effects of competition.

Note who benefits here - those disadvantaged. The more those better universities have to compete for their custom the better the offers will be to those disadvantaged. Which is  precisely what we're after of course. Well, maybe we should be and maybe we shouldn't but we are.

Note what the universities themselves are arguing. They should be allowed to cooperate - form a cartel - so that they don't have to so compete and thus don't have to so benefit the consumer.

Aye up, as ever, competition benefits the consumer and the producer group would very much prefer it didn't. All of which is why markets do indeed work, isn't it?