By Rob Cuthbert

How does government think Britain’s higher education can be improved? The government legislated in 2017 to expand competition in a statutory higher education market. We may think this is a consistent policy narrative for public services, but consider the experience of transport. How does government think Britain’s transport system can be improved? After years of debate the government finally announced in October 2016 that it would expand Heathrow rather than Gatwick. And in recent months government has considered reopening some railway lines closed in the Beeching cuts 50 years ago. These policy choices in HE and transport differ considerably in how they have been framed.

50 years ago government set up the Roskill Commission to examine alternatives for London’s third airport; it relied heavily on an economic perspective. Peter Self’s (LSE) famous article in Political Quarterly in 1970 said: ‘Nonsense on stilts … Bentham’s unfair description of natural rights, is a phrase which might more fairly be used of the gigantic cost-benefit exercise which is currently being carried out by the Roskill Commission’ It was academic economists who helped to dismantle the primacy of economic arguments. In 2017-2018 the government is consulting on proposals for the third runway at Heathrow, with new legal objections coming from the local councils around the airport. Politicians losing the political argument are resorting to law. Economics no longer frames the argument.

50 years ago drastic cuts in the rail network followed the ‘notorious’ Beeching report: ‘ … wholesale route closures in an attempt to concentrate resources on the core routes … an overly-simplistic analysis of the economics of the routes, failing to recognise how the branches contributed traffic to the core network … led to the belated recognition that the railways serve a social role which should be financially acknowledged.’ The economic perspective persisted through privatisation, but calling passengers ‘customers’ could not disguise their disenfranchisement in the new ‘market’. Now the political force of ‘customers’ is making market competition seem much less attractive, as government bails out the East Coast line franchise to save private providers from their own contractual commitments. Arrival-on-time and average-fare-increase metrics cannot rescue a ‘Rail Excellence Framework’: it is not economics but the politics of discontent which frame the narrative.

50 years ago the government set up the Robbins Review to examine alternatives for the future development of higher education. Robbins embraced many disciplines, but economics counted for little in an expansionary era, as the Robbins Report articulated the purposes of higher education in broad and inspirational terms. Things changed. When the coalition government introduced £9000 annual fees for undergraduate students it sealed the dominance of a narrowly economic perspective on HE. In 2017-2018 there is merely ‘consultation’ on how the market should work, in terms of regulation by the Office for Students, and fine tuning for the Teaching Excellence Framework.

So, for HE policy, economics still frames the argument, achieving its unduly privileged place with the connivance of academic economists who still see the solution as more and better metrics for the HE market. Gervas Huxley and Mike Peacey (both New College of the Humanities) wrote for The Impact Blog about their article (with Jennifer Mayo (Michigan) and Maddy Richardson (Bristol)) ‘Class size at university’ in Fiscal Studies. They argue for a Total Equivalent Adjusted Contact Hours (TEACH) metric to: ‘…  capture some of the dimensions of quality that truly matter in higher education and … directly address the balance between teaching and research. The TEF can only succeed if it addresses this misallocation of resources and the inevitable consequences for the time academics allocate between teaching and research.’ A variation of TEACH, the Gross Teaching Quotient (GTQ), is being piloted for the TEF. In Teaching Excellence Framework: Subject-level pilot specification the DfE says:

“The methods that we are piloting consider not just contact hours, but also class size, staff-student ratios, placements and field work to build up a more rounded picture of the nature, as well as the amount, of the teaching  … Excellent teaching provides contact with high student engagement, leading to productive independent study and strong outcomes. This fits with for example Gibb’s commentary that “The number of class contact hours has very little to do with educational quality, independently of what happens in those hours, what the pedagogical model is, and what the consequences are for the quantity and quality of independent study hours.” Whilst … our models do not capture all elements of what encapsulates excellent teaching … we consider this a helpful first step …”

But elevating economic analysis – more of the same – will not restore teaching to its rightful place in academic practice, and claiming the authority of Graham Gibbs for such a proposal is a crass non sequitur. Measurement and transparency are essential, but the crucial part of workload allocation for staff lies in the skill of timetablers, their tacit knowledge of the people and the work really involved, and whether the timetablers are trusted to be fair. For students, no measure of teaching intensity has much ‘to do with educational quality, independently of what happens in those hours, what the pedagogical model is, and what the consequences are for the quantity and quality of independent study hours’, as Gibbs put it. And that is before we even get into a discussion of what counts as teaching and what counts as research. The economists have interpreted the world; the point, however, is to understand that the economic version of the academic world, taken to this level, is ‘nonsense on stilts’.

There was more ‘nonsense’ in HEPI Report 100, How much is too much? Cross-subsidies from teaching to research in British universities, by Vicky Olive (an MPhil student in Economics at Oxford). The Report called on the Chancellor of the Exchequer to boost research and development funding in the Budget, purporting to demonstrate:

• a research deficit of £3.3 billion – 37% of research income
• a surplus from fees of £1.3 billion (28% of non-publicly-funded teaching income)
• the surplus from teaching funds 13% of UK university research (around £1 in £7)
• each international student contributes (on average) £8,000 to British research
• unless research funding increases, the UK’s regional capacity will suffer badly
• the Conservatives’ target of spending 3% of GDP on R&D needs £24.8 billion more

Olive’s naïve and well-meaning argument for more research funding offers up deceptively accurate numbers, already being misrepresented by those with other political axes to grind. Her report adopts what, following the Railways Archive, we might call an ‘overly-simplistic analysis of the economics of the sector, failing to recognise how the teaching and research branches of the whole HE sector contribute to the whole system’. Perhaps Olive wanted only to argue for more research funding. Perhaps Huxley et al wanted only to argue for better recognition of teaching. Unfortunately, they only perpetuate the distortions which flow from an unduly narrow economic perspective.

How long will it take for proper recognition that HE serves ‘a social role which should be financially acknowledged’? Perhaps sooner than expected, if the National Audit Office (NAO) has anything to do with it. The NAO issued a damning report on 7 December 2017 on The higher education market. It said that, if HE had been a financial product, they would be complaining of mis-selling by universities. But the NAO’s deeper criticism was of the idea that HE could be treated as a market at all, with the report listing all the ways that the market and its regulation fell short of what was necessary and desirable. The NAO recommendations focused on the Office for Students, suggesting an independent review of the new regulatory system once it had had time to bed in. HEPI’s Nick Hillman was quick to defend the policy he worked hard to introduce as adviser to David Willetts, with his comments on HEPI’s website on 8 December: ‘it is wrong to think higher education will ever resemble other markets very closely … Of course, mis-selling can happen … But it is an inherently difficult thing to assess because no one knows how they will change as a person as a result of their education. Straight comparisons between regular markets and educational markets don’t actually make much sense.’

To put it another way, regular markets make sense from an economic perspective, but educational markets don’t actually make much sense at all. For the airports, government accepted more than 50 years ago that economic analysis and market choice are not sufficient for political acceptability. For the railways, the inadequacies of economic analysis and pseudo-market choices have become more and more apparent. Higher education is an even more complex business, yet the 2017 Higher Education and Research Act institutionalised the economic idea that markets and regulation are the answer to effective performance of the whole HE sector. ‘Putting students at the heart of the system’ turns out to mean a regulator with unprecedented powers – the ‘Office for Students’ – whose Board has no room for a representative of the National Union of Students, no room for teachers, but room – if only for a few days – for Toby Young, who called students at Oxford from a less privileged background than himself ‘stains’ on the university system.

SRHE vice-president Roger Brown blogged for *Research on 4 December 2017 asking: ‘When will reality dawn on the Office for Students?’. He pointed out, once again, how market competition can never deliver quality improvements, and how ‘It will only take the failure of one university in a marginal Parliamentary constituency for the OfS or the Department for Education to stop the rhetoric about only protecting the interests of students (assuming that these can be easily identified) and act to protect the wider public interest.’ The excessively economic framing of HE policy is ‘nonsense on stilts’, and it will sooner or later collapse under the weight of its own absurdity.

SRHE News Editor:  Professor Rob Cuthbert
rob.cuthbert@uwe.ac.uk  (00 44) 1275 392919

Rob Cuthbert is Emeritus Professor of Higher Education Management, University of the West of England and Joint Managing Partner, Practical Academics rob.cuthbert@btinternet.com.