The Society for Research into Higher Education

Policy and Funding in England (April 2019)

By Rob Cuthbert, Editor, SRHE News

New Minister’s first speech gets a warm welcome
When new Universities Minister Chris Skidmore made his first major speech, at RADA on 31 January 2019, it was very well received: “ I’m not going to be a Minister who comes in and beats up or needlessly berates the sector. Instead, I want to … work in partnership with you to ensure our higher education sector remains one that works for everyone and of which we can be proud in generations to come.” He rather spoiled it by telling the Parliamentary Select Committee two weeks later he expected some universities to fail, and it would be good for the quality of teaching.

Do a degree, quick
Probably the first legislative act by the new Minister was to agree a draft Statutory Instrument (using powers conferred by the HE and Research Act 2017) on The Higher Education (Fee Limits for Accelerated Courses) (England) Regulations 2018, laid before Parliament in January 2019. It allows institutions to charge £11000 for two-year degrees, and attracted the usual ill-informed comment from the mainstream media. We’ve been here several times before, and so far the market has always decided these are attractive only to a tiny subset of potential students.

What does a subject cost, and who pays?
The Institute for Fiscal Studies Briefing Note on 4 March 2019, Where is the money going? Estimating government spending on different university degrees, was unpicked by Minto Felix and David Kernohan of WonkHE on 6 March 2019. Media comment was already alleging greater government ‘subsidies’ for arts rather than STEM subjects; Felix and Kernohan observed that: “What we are really critiquing is not a ministerial choice but the aggregate life choices of a generation of young people. … the bigger task for Augar’s report is to make a decision regarding how much agency young people have in the post-compulsory system. A planned system could have clear financial efficiencies alongside the wider benefits to the range of skills found in the future UK workforce. But such planning has to be underpinned by … predictions about the many forms of return on educational investment that are better than those delivered by the consolidated opinion of a couple of million 18 year olds each year.”

An Office for Budget Responsibility update on student loan accounting changes
Andrew McGettigan wrote on his Critical Education blog on 13 March 2019 that in the day’s Spring Statement “the real HE action was located in Annex B to the OBR’s latest Economic & Fiscal Outlook: ‘Accounting for Student Loans’. The Office for National Statistics decided in November 2018 to reclassify student loans in the national accounts. The OBR said a number of issues needed to be resolved before it could change from its own Hybrid model (published last summer): “The fundamental concepts in the two models are similar: the current fiscal illusions in the student loan accounting treatment are reduced by recording as upfront spending an estimate of the write-offs associated with the loans issued that year. At the same time, the interest accruing against loan balances is only recorded as income if it is expected to be repaid. Thus the spending on loans increases in the year they are issued and the income being generated from all extant loans is reduced. Spending goes up and income comes down leading to a large change in Public Sector Net Borrowing Requirement – the “deficit”.” Previously the OBR had estimated the impact on the deficit of implementing this new treatment at £12billion in 2018/19, rising to £17bn by 2023/24.  Their new provisional estimate is that £10billion would be added this year and £14bn in 2023/24.

DfE spent £111million refurbishing offices it won’t use
Freddie Whittaker for Schools Week on 26 January 2019 uncovered £111million spending by the DfE on the Old Admiralty Buildings in Whitehall, for an office move which will now never happen. In 2014 DfE was supposed to move to offices previously occupied by the Foreign Office, to save £19million a year, with refurbishment budgeted at £51million. The cost more than doubled, to £111million so far; DfE will not now move from its Sanctuary Buildings base – themselves subject to expensive refurbishment before DfE moved in. The Old Admiralty Buildings will be used by other civil service departments; it was earmarked Treasury money, not from DfE budgets. So that’s alright then … ?

Planning for rapid student number growth
Data wizard Mark Corver of DataHE analysed student number projections for WonkHE on 18 March 2019. The demographic dip ends in 2020, and from then on there will be rapid growth. “This growth is strong, often 3 per cent a year. And it is consistent, up year after year. This matters, as it makes the cumulative rises large and unrelenting. The five-year rate of population growth increases reaches 17 per cent in the mid-2020s.”

The new college insolvency regime
The Association of Colleges published information on 24 January 2019 about the new college insolvency regime, which came into effect from 31 January 2019. In case of an insolvency, DfE can appoint an education administrator who will have a duty to protect students as well as creditors. As the new regime took effect, Jude Burke revealed in FE Week on 31 January 2019 that North Hertfordshire College had reported a £5million deficit in 2017-2018, 20 times higher than budgeted, in a college with only £24million income. FE Commissioner Richard Atkins had agreed bailout support amounting to £2.5million in stages through Autumn 2018. The losses were attributed mainly to a slowdown in the takeup of apprenticeships. Former principal Matt Hamnett resigned abruptly in November 2017, soon after the departure of James Sowray, managing director of Hart Learning and Development. Sowray resigned after a whistleblower exposed problems at Hart, where some reported income had not been received. Hamnett was the highest paid FE principal in the country, with a salary of £294,000. Burke reported with a straight face that: “Since leaving the college Mr Hamnett has worked as a consultant and authored a study “to understand and offer some reflections on the transformation of FE colleges which are not performing to the level that their students, business customers and communities should expect.”” 

VCs expecting mergers to save troubled universities should take note of the City College Southampton saga. An earlier attempted merger with Southampton Solent University fell through, and discussions about a merger with Eastleigh College were at an advanced stage until the DfE said it would not provide any funding from the £726million Restructuring Facility, established under the new funding regime. Jessica Fino reported for FE Week on 5 March 2019.


New university centre for Scunthorpe
The University Campus North Lincolnshire (UCNL) project will welcome its first intake in September 2019, with undergraduate, postgraduate and professional development and management development provision. The university centre will be built on the existing HE students at North Lindsey College, in a partnership between the College, the University of Lincoln and North Lincolnshire Council. David Elliott and Dan Kemp for HullLive on 18 March 2019 noted that the new centre would be just across the Humber from the several HE centres in Hull.


‘First new university for 40 years’ (not)
The London Interdisciplinary School was announced in a blaze of publicity on 1 March 2019. It has applied for degree-awarding powers from the OfS. It doesn’t have any premises or students yet – it plans to recruit 120 students to start in September 2020. It won’t actually be the ‘First new university for 40 years’, of course, but that didn’t stop The Times giving it a front-page story (‘Polymaths wanted at Britain’s first new university for 40 years’), another piece on p4 and a leader all on the same day. We can’t remember such London media excitement since, oh, the New College of Humanities launched. Wonder what happened to that? (See p10 of January issues of SRHE News)

Government advice on Brexit
Government has issued guidance on no-deal preparation for leaving the EU. At the time of writing, and for the next 20 years or so, we have no idea whether this will be relevant.

The complex web of freedom of speech
Jim Dickinson blogged for WonkHE on 2 February 2019, unpicking new guidance for universities and unions on freedom of speech on campus, issued by the Equality and Human Rights Commission (EHRC) and the Department for Education (DfE). He decided things had taken a rather sinister turn.

How to present things for policymakers
HEPI’s Nick Hillman offered eight things to bear in mind when preparing data for policymakers, in his useful Times Higher Education article on 31 January 2019. Hamish Coates (Tsinghua) wrote a great editorial for the March 2019 issue of Policy Reviews in Higher Education, with “eight tactics for crafting consequential policy research papers”: pick large policy problems which your research can clarify or advance; be preoccupied about making a difference to the broader educational economy; write with people in your intended audience; use ‘policy language’ – straightforward communication; write about policy; concentrate on policy consequences; make ample references to practice; envisage your paper as an instrument of change.


What difference does policy mix make to HE system performance?
Giliberto Capano (Bologna), Andrea Pritoni (Torino) and Giulia Vicentini (Bologna) had an article in the Journal of Public Policy (online 5 March 2019) analysing 12 European HE systems and how they have applied different policy mixes in reform attempts, with a common approach but with very different results: “This article finds not only that the common template has been applied through very different national policy mixes but also that only a few instruments are regularly linked to good teaching performance, regardless of the other components of the actual policy mix.”

The Post-18 Review of Education and Funding (the Augar Review)
It was widely rumoured that the Augar Review would be delayed because of continuing uncertainties over Brexit, and almost equally widely rumoured that the report was already written, with much Kremlinological dissection of statements by Secretary of State Damian Hinds which were thought to be ‘preparing the ground’ for the report’s recommendations. For the BBC, education correspondent Sean Coughlan had decided by 1 March 2019 that Augar would recommend tuition fees of £7500 and that the report would be delayed. A Sunday Telegraph article on 3 March 2019, echoing an alleged leak from the Augar review, suggested that students with A level grades worse than DDD might be prevented from having access to student loans. Nick Hillman of HEPI was quick to point out the unworkability of the idea.

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