Potentially dangerous topic as there are usually many personal opinions that are somewhat entrenched and can rarely be changed, but here are my thoughts.
Governments have wanted to increase the number of pupils at university. The more skilled the work force the more large corporations will be attracted to offer jobs in the UK and also the more entrpreneurs and business folk to create wealth. BUT I know that there are thousands of school-leavers to milionaires stories. There are even more of those who do very very well and never went to university. However, there are also plenty of people who did go to university and have done extremely well. For example, those that create new medicines, those that save lives, those that engineer building structures, those that create new drilling techniques to discover/refine oil, advancement of computer chips, etc etc - some may not have been to university but I'm guessing a lot would have. These are extremely important roles that help the country advance.
There are definitely benefits to going to university dependant on what you study and how you use it. Likewise, it can also be a waste of time and money. It is entirely dependant on what that person does at university and what they do afterwards.
There is certainly not a rule that one is better than the other.
However, why the Universities are in trouble is a mixture of things. They need to provide cutting edge sports, computer, medical, engineering, science, etc facilities that costs money. These need to be updated year on year. They need to have excellent teachers, they cost money too. Unversity teachers can be the encyclopedias of certain subjects, their opinions can change the law, they may have invent new products, discovered advancements in science to cure illnesses etc. They don't come cheap and other universities will want them to work for them as well. On top all regular costs, the universities are then forced to accept a huge number of UK students as the government has forced a policy that they want more students at university. But where's the funding for the added pupils? The government and local authority payments are not enough. The top up fees aren't enough. And universities are limited on numbers of foreign students they can take on. Yet the universities still want to remain at the top of their field.
The solution I think is to change the government policy. Those that are studying pointless subjects are wasting their time, their money, the government's money, the local authority's money, and the university's money by attending.
If the government want to challenge China and other countries producing more engineers then they should push maths in school and then make engineering degrees cheaper, not just push people into random degrees at uni.
Anyway...I'll stop there!