That's what the Oxbridge-educated Minister for Universities thinks - as though there will be a market, and that 18-year-olds are rational consumers in this ideal market.
Wrong. Firstly, every university will have to charge very near the maximum just to replace the 80% cut in the teaching grant (so students will pay triple what their older siblings paid for a slightly worse education). Secondly, if there's a range of fees, hard-nosed consumers will ask what's wrong with the discounted ones. Who wants to be the Aldi of Education?
(Willetts wrote The Pinch: How The Baby Boomers Stole Their Children's Future, a book about how his generation snaffled the good housing, free education, top pensions, healthcare, benefits etc. and denied the same to the current generation. Then he voted for benefit cuts, pension cuts, pay cuts, mass redundancies, tuition fees, EMA abolition, NHS cuts and on and on and on. Who says the Tories have no sense of irony?).