As previously trailed in the media the Autumn Budget was focused on demonstrating the end of austerity. There wasn’t much in the way of HE announcements, however paperwork released with the budget confirms that the Government intends to continue to freeze the maximum tuition fees at the current £9,250 level (UUK report this means £200 million less funding for the sector by 2023-24). Previously announced increases to research and development funding (£1.6 billion more) were reiterated:
- £1.1 billion through the Industrial Strategy Challenge Fund
- £120 million through Strength in Places fund
- £150 million for research fellowship schemes
- Funding for 10 university enterprise zones, and for catapult centres
Of the above £50 million is committed to Artificial Intelligence to attract and retain the world’s top talent through the Alan Turing Institute AI Fellowships. The first fellows are expected to be in place by Autumn 2019.
Additional funding for mental health was also announced. Alongside this was one-off capital investment for schools (£400 million) and £10 million to trial the regional retention of early career maths and physics teachers. On apprenticeship training contributions the Chancellor reduced the contribution SMEs have to pay to 5% (from 10%). Finally, private providers will be afforded the same VAT exempt status as public universities (source).
However, this could all change if Brexit isn’t delivered as currently intended (Research Professional call it The Phantom Budget).
In the debates Greg Clark said that the two core themes of the Budget were repairing the economy from the effects of the financial crash and preparing the country economically for Brexit. Following questions he reaffirmed the Government’s commitment to zero-emissions cars and sustainable sources of energy, including marine energy – which is currently lagging behind. Meanwhile a spokesperson for the Opposition claimed the schools funding announced was insulting and that much of the Budget’s other spending commitments were repackaged money from prior announcements. Research Professional agree with the repackaging comment stating that only £55 million of the £1.6 billion is new money:
- Perhaps Hammond wanted to avoid going into detail because it turns out that the only truly new money in his £1.6bn figure is £35 million for a national quantum computing centre and an additional £20m in 2019-20 to allow the UK Atomic Energy Authority to accelerate work on fusion technologies… read Cristina Gallardo’s breakdown of how the announced funding corresponds to existing spending commitments.
David Davies (Conservative) spoke about the University loans system, he said it had failed to deliver a market in university education, with the least valuable courses at the worst universities costing precisely the same as the most valuable course at the most prestigious university. He said the whole system needed to be revamped and turned into a proper graduate-contribution system with honest accounting, clear rules and no retrospective changes to the interest rates or other terms. Long term he felt the UK should move away from loans all together and that would have a liberating psychological impact on young people.
A contribution from one of our local MPs, Richard Drax (South Dorset), was to praise the mandatory rate relief on public toilets as a means of empowering young and old people to be more active.
This parliamentary question delves into the spending breakdown of the 2018 budget research promises.
Student Loan Sales – Research Professional say: Meanwhile, there is also confirmation in the red book that further tranches of the existing student loan book are to be sold off.
- “In December 2017 the government completed the first in its programme of sales of pre-2012 income-contingent student loans, expected to raise £12bn by 2021-22,” it says. “The sale raised £1.7bn, reducing PSND [public sector net debt], and was assessed as value for money by the National Audit Office. The government will now extend the sales programme by a further year, increasing total proceeds to £15bn.”
- When selling student loans, ministers are basically trading in an uncertain money flow for an upfront but smaller sum. The NAO may have described the first sale of the loan book as “value for money”, but plenty of others have not, because they disagree with UK government definitions of success in this area.
- Indeed, in an analysis published yesterday, the Office for Budget Responsibility says: “The sale of the first tranche of Plan 1 loans…involved the government exchanging loans with a face value of £3.5bn for £1.7bn in upfront cash.
- “Only part of the £1.8bn difference reflected the size of the expected write-offs. This does not strengthen the public finances in any meaningful sense—it is simply an alternative way to finance the budget deficit, and a relatively expensive one at that given current borrowing costs.” Not necessarily such great value, then.
- And here is the rub, as Hamlet might have said: the Office for Budget Responsibility has costed the “fiscal illusion” of the student loan book presentation in 2018-19 at a £12.3bn positive variance for the Treasury. If this were to be presented as a direct cost in the public accounts, it would all but wipe out the fiscal windfall of reduced public sector borrowing requirements, which is now covering the government’s promises on funding for the NHS, universal credit and the “end of austerity”.
- The Office for Budget Responsibility says that the presentation of student loans in the public accounts would flatter the deficit to the tune of £17.1bn by 2023-24. You can see why the government is keen not to talk about this openly, preferring the euphemism of an international conference on the valuation of human capital. Never mind Brexit, the student loan book on its own has the potential to sink this budget forecast.
Boom and bust…
When the OfS was a twinkle in Jo Johnson’s eye. the then Universities Minister) was keen to show he could play hard ball and willing to let struggling universities dissolve into insolvency.
It is reported this week that the removal of the student number cap has hit some universities harder than others. There has been fiercer competition for the same pool of students, set within the backdrop of a population drop in the number of young entrants. The result has been a shift with some students on lower expected grades finding they can trade up to access medium or high tariff institutions. The Times reports that Surrey and Swansea have doubled their undergraduate numbers and Coventry, Reading and Aston have expanded above 50% growth.
The press has reported that the less successful institutions are turning to unconditional offers to increase recruitment (it’s not clear whether there is such a straightforward link between unconditional offers and “bums on seats”, despite what the Minister says, but UCAS are preparing a report on it).
Meanwhile Brexit and unwelcoming messages on immigration and the hostile environment, coupled with the removal of post-study work visas for international students are factors too.
In the last 18 months Universities have been facing challenges from MPs on issues such as quality, free speech, and graduate outcomes and have been berated (by some) for surviving and flourishing during the period of austerity. The rhetoric surrounding the current review of Post-18 funding suggests a rebalancing of funding and refocus towards technical education, refreshed apprenticeships and alternatives to the HE route – potentially further reducing the pool of young people choosing to progress to university. Meanwhile the January 2019 UCAS deadline looms…
The press has trailed several stories of unnamed universities who are struggling financially and at risk of closure (see iNews). The Daily Mail report three universities – one in the North West and two on the South Coast and cites location as a reason they are unable to attract students in high enough numbers. The article says that in 2016-17 19 English universities were in deficit, most of which are former polytechnics. There were only 7 in deficit in 2015-16. The Daily Mail’s tone is to let the struggling institution’s go bust. Wonkhe also comment on the universities in deficit stating that since the 2012 higher fees 17 universities have had a 10% decline in student numbers, and 5 universities’ recruitment intake is down by 20%. The Times suggests ‘more than a dozen’ universities are on the brink. The article goes on to name London Met (35% decline), the University of East London and Kingston University (26% decline), Southampton Solent and Cumbria (24% decline), Bedfordshire and Huddersfield (18% decline) – the declines are all measured since the introduction of higher fees.
Some media reports note the shock an area would undergo should a university close through bankruptcy. Matt Waddup, UCU said:
- “Along with schools and colleges, universities are the beating heart of their local communities and it is difficult to overstate just how important the spending power of staff and students is for local economies.” (Source.)
The Times reports Alan Palmer from MillionPlus picking up on the dire consequences for social mobility within an area:
- “Universities are vital investors in some of the most disadvantaged parts of the country, providing not just educational opportunities to people who thought higher education was out of reach for them, but research expertise to support local businesses to grow and to create new jobs.”
Vital to an institution’s acceptance on the OfS register of HE providers is a student protection plan which outlines the arrangements for students should the institution have to shut. However, iNews quote Mary Curnock Cook (previous UCAS Chief Executive) who doesn’t believe the student protection plans will adequately safeguard students, she said: “a student protection plan will do little to offer additional assurance to students”.
The BBC explore Would a university really be allowed to go bust?
- The government has to say that it would allow universities to crash – otherwise it would in effect be offering a blank cheque…But it would be a brave education minister who would let it happen, without stepping in with emergency bailouts, merger deals, property sell-offs or new management…Imagine the wrath of students and their parents if they had been allowed to start a course at a university, when the minister knew it was in serious financial trouble. There would be legal challenges, campaigns by local MPs and businesses, battles over fee refunds, and accusations about why the government didn’t act to prevent a collapse. There is a deep inherent contradiction in creating a market with the risk of financial extinction, but also keeping information away from students who are being asked to invest their future.
The BBC piece goes on to dissect the ramifications for the rest of the HE sector suggesting it might lead to an overall downturn in numbers:
- The word that’s being mentioned is “contagion”. A bit like a banking collapse, a university going bust would send a shockwave through the rest of the sector, threatening confidence in other institutions. Applications to other universities might tumble, putting other places at risk and raising questions about the wider student finance system in which millions of people are borrowing and repaying. Lenders who assumed that universities were a safe bet might get nervous and reduce the credit on which other universities are relying. Those living on a deficit would find themselves in deeper water… Universities will also be deeply anxious about perception. If they’re seen to be financially at risk it would be a killer blow to recruitment and the perception would soon become a dangerous reality.
Note: the link to the Daily Mail article requires the reader to scroll down until they reach the text in the blue box entitled Unpopular universities on brink of going bust. The Daily Mail have a separate scathing comment piece on all things wrong with universities (and why they should be allowed to go bust if they can’t make the numbers add up).
Social Mobility Commission – If you’ve been following the recent parliamentary questions you will be aware that MPs have been clamouring to find out who the newly appointed Social Mobility Commissioners are. The members of the previous Commission all resigned in protest at the Government’s lack of progress and commitment to the social mobility changes they sought to achieve. Dame Martina Milburn was appointed as the Chair of the Social Mobility Commission earlier this year and she will be assisted by the 12 Commissioners announced this week:
- Alastair da Costa, Chair of Capital City College Group
- Liz Williams, Group Director of Digital Society at BT
- Farrah Storr, Editor-in-chief of Cosmopolitan
- Harvey Matthewson, Volunteer, and part-time Sales Assistant at Marks & Spencer
- Jessica Oghenegweke, Project co-ordinator at the Diana Award
- Jody Walker, Senior Vice President at TJX Europe (TK Maxx and Home Sense in the UK)
- Pippa Dunn, Founder of Broody, helping entrepreneurs and start ups
- Saeed Atcha, Founder and Chief Executive Officer of Xplode magazine
- Sam Friedman, Associate Professor in Sociology at London School of Economics
- Sammy Wright, Vice Principal of Southmoor Academy, Sunderland
- Sandra Wallace, Managing Partner UK and Joint Managing Director Europe at DLA Piper
- Steven Cooper, Outgoing Chief Executive Officer of Barclaycard Business
The Government’s news story says: Their appointments build on Dame Martina’s vision to bring greater ethnic, gender and age diversity to Commission by tapping into a diverse range of backgrounds. The Social Mobility Commission will be officially relaunched on 11 December.
On the appointments Damian Hinds, Education Secretary, said:
- This new team of commissioners brings together established business men and women, policy makers, academics and young people all with important perspectives to bring. The Social Mobility Commission will benefit from the expertise of this diverse mix of individuals, all of whom will bring their own unique stamp to what social mobility means in their lives.
Dame Martina said:
- I am delighted to welcome a record number of Social Mobility Commissioners who will work to make England a fairer society… Many of our new Commissioners had modest starts in life and know the barriers that young people must overcome to become successful. They are also individuals with the skills, resources, and energy to drive real change around the country, united by a passion for fairness and an ability to make a real difference to people’s lives.
This link describes the Social Mobility Commission’s role and responsibilities and this is the best page to use if you wish to follow the work of the Social Mobility Commission.
Education Spend – Social Economic Differences eradicated – The Institute for Fiscal Studies published a briefing note on Social Economic Differences in Total Education Spending in England. Dods say that the report finds differences in funding by social class have now vanished. Changes to the distribution of school funding, increased staying-on rates and reforms to HE funding mean that there was no difference in the amount of public money spent in total on educating the poorest and richest pupils who were taking their GCSEs in 2010. This has happened despite the facts that richer pupils remain much more likely to enrol in HE and that public subsidy for HE remains substantial.
The report also finds that, since 2010, the funding system has become even more beneficial to lower-income students relative to the better off. This is partly because of school funding reforms, partly because post-16 participation rates have risen, and partly because funding for school sixth forms (where better-off children are more likely to study) has been cut relative to funding for colleges (which are more likely to serve poorer students).
The key findings are:
- Socio-economic differences in total education funding had evaporated by 2010. Amongst pupils taking their GCSEs in Summer 2010, those in the richest and poorest socio-economic quintiles received about £73,000 in total funding across all stages of education
- School funding has become much more targeted towards poorer pupils. In 2003, there was already a £3,500 funding advantage in total school funding in favour of pupils from poorer families (looking over 12 years of schooling). As a result of various reforms to the school funding system, this grew to £9,500 by 2010, with pupils in the poorest quintile experiencing about £57,700 of school funding in total.
- Participation in 16–18 education is now near universal. In 2003, pupils from richer families were about 11 percentage points more likely to stay in post-16 education than those from poorer families. By 2010, participation was over 95% amongst all groups, reducing this gap to 2 percentage points.
- This change in participation has more than halved the socio-economic gap in post-16 funding. In 2003, pupils from richer families ended up receiving about £2,800 more in total post-16 spending than those from poorer families. For pupils taking their GCSEs in Summer 2010, this gap had shrunk to £1,200.
- Children from poorer families are much more likely to attend colleges rather than school sixth forms. Amongst those taking their GCSEs in Summer 2010, about 58% of pupils from poorer families attended a further education or sixthform college as opposed to 21% who attended a school sixth form.
- Socio-economic gaps in higher education participation narrowed over the 2000s. Amongst pupils taking their GCSEs in 2003, children from richer families were about 33 percentage points more likely to go on to higher education. The participation gap narrowed slightly to about 28 percentage points for pupils taking their GCSEs in Summer 2010.
- Pupils from richer families benefit more from long-run public subsidies to higher education. This is because they are more than twice as likely to go to higher education.
- Pupils from richer families would benefit more from the abolition of tuition fees
- Reforms since 2010 are likely to have increased total funding in favour of pupils from poorer backgrounds. Reforms to post-16 funding have tended to favour colleges, which poorer pupils are more likely to attend, rather than school sixth forms.
IFS conclude that, the shift in the pattern of total education spending by socio-economic group and phase of education fits well with the recommendations from the latest academic work on the effects of education resources. However, it is therefore disappointing that these seemingly positive changes in the distribution of education funding do not seem to have translated into big reductions in the attainment gap between richer and poorer pupils. These differences in participation remain substantial, at over 25 percentage points between pupils from richer and poorer backgrounds.
Both the Guardian and Politics Home cover this story.
Care Leavers Covenant – Last week we anticipated the launch of the Care Leavers Covenant. The Covenant is a promise made by private, public or voluntary organisations to provide support for care leavers aged 16-25 to help them to live independently. The Covenant, run by Spectra First, is part of the government’s ambition to improve care leavers’ outcomes so they go on to lead happy and successful lives. More than 50 businesses, charities and every Government department in England are reported to have signed up. In addition to the private and voluntary sector offers of support, the package of support for care leavers includes:
- 12-month internships from each Government department in Whitehall with over 100 starting in January 2019;
- Support from universities, such as bursaries and accommodation, with Cambridge, Leeds, and Manchester cited as ‘committing to supporting care leavers’. This package is in response to data stating only 6% of care leavers aged 19 to 21 go on to higher education. (Research Professional have more on the 9 universities supporting the Covenant);
- Resources and tools from Barclays Life Skills to help care leavers to manage their money better, as they often lack the safety net of financial support from their families.
The Guardian article: There’s a lot of stigma: why do so few care leavers go to university? touches on the immediate challenges facing care leavers. Sadly the article doesn’t tackle unconditional offers – which in the past were oft awarded to care leavers to provide certainties around accommodation and progression allowing them to leave prior care arrangements behind with sufficient security to access HE. It is a shame that this should be lost in the general
Student Loans Company
The Student Loans Company (SLC) has been in the spotlight since Steve Lamey left the organisation in 2017. The Education Select Committee questioned the new Chief Executive Paula Sussex this week in an accountability hearing about the organisation’s leadership and governance, fraudulent claims, overpayments and improvements made. BU readers can access a summary of the session provided by Dods political monitoring consultants here. The session didn’t shy away from recent controversy including the SLC’s use of social media to determine whether estranged student claimants really were estranged from their families. The Tab has the SLC ‘spying’ story here.
OfS Commitment to (good) Mental Health – Nicola Dandridge spoke at the all-party parliamentary group for students this week focussing on supporting students’ mental health. She said mental health is a priority for the OfS and they will work to improve support for students by:
- challenging registered providers to improve their support for their students’ mental health, for example through access and participation plans
- funding activities that directly support students, including a guide to help universities prevent student suicides, and the £6 million Challenge Competition for innovative projects to combat the rise in student mental health issues
- delivering a £1.5 million collaboration with Research England that will support postgraduate research students
- working in partnership with providers, charities and other organisations to encourage good practice through the University Mental Health Charter and the Universities UK Mental Health in HE Advisory Group
- improving the data and evidence around what the problems are, what causes them and what works best to address them, such as new analysis published today that shows how different characteristics impact on graduates’ anxiety, life satisfaction and happiness.
- “All students deserve to get the support they need to cope with times of mental ill health and distress. But there are times when that support does not get to where it is needed, when it is needed. Every time I meet with groups of students and student unions, the challenge of mental health is raised, and the members of the OfS Student Panel have also raised it as a priority. I know many universities and colleges are already working hard to improve their support services for mental health and wellbeing, but all have a responsibility to provide the right support for mental health and wellbeing. Mental health and wellbeing are complex issues, but universities are full of people who excel at working with complexity. So I believe that – with the challenge and support provided by the OfS – higher education providers can and will address these issues, so as to enable their students to flourish and unlock their potential.“
OfS blog: Work effectively with partners to support students’ mental health, regulator tells universities.
Wellbeing – the latest – A new blog on student and graduate subjective wellbeing this week considers how it will be measured in future iterations of the Graduate Outcomes survey. The blog talks of actions universities can take and how the Graduate Outcomes data can be combined and compared with other sources.
Also this week Guild HE published Wellbeing in HE which describes what member institutions are doing to support student wellbeing:
- the research finds that approaches to supporting long-term well-being are variable, with both areas of good practice, and capacity for improvement It…highlights the importance of developing holistic strategies, which support students throughout higher education, from their academic experiences to their accommodation and social opportunities.
Mental Health APPG – Psychology Graduates – The all-party parliamentary group for Mental Health met this week to debate the APPG’s recent report: Five Year Forward View for Mental Health. They welcomed the £2billion funding for mental health announced in the Budget. Graduates featured twice in the debate as a potential solution to the workforce crisis via the creation of new roles and routes into mental health employment.
Jeff Smith (Labour) said:
- Health Education England’s plan commits to 19,000 more people working in mental health by 2021, but between March 2017 and March 2018 the number of mental health staff in the NHS increased by just 915 people. That does not look like progress is on target…There is a huge interest in mental health among young adults. Until we undertook the report, I did not realise that psychology was the third most popular undergraduate course for students starting university in 2016. We should make it easier for those capable, ambitious and keen graduates to work in NHS mental health services. …[Dr Poulter] made the point earlier that recruiting more psychologists for specific therapies, such as dialectical behaviour therapy or cognitive analytic therapy, would mean that people had a wider choice about the type of therapy they received, instead of, as often happens, just being prescribed cognitive behavioural therapy—if they are able to get a prescription at all—because it is the only therapy available.
Helen Whately (Conservative) said:
- Secondly, the question of workforce came up time and again as the biggest barrier to achieving the ambitions of the five year forward view for mental health. There is a desperate need to train, recruit and retain more staff at every level. We simply cannot make meaningful improvements to services without the staff to deliver them; there must be new routes into the NHS workforce, making use of psychology graduates—as has been mentioned—and psychotherapists, and bringing in more people with lived experience of mental illness, who do valuable work.
There are not any open consultations and inquiries relevant to BU at the moment. You can view the current consultation tracker and email us on firstname.lastname@example.org if you’d like to discuss anything related to consultations and inquiries.
Forthcoming: The Education Select Committee’s report following their inquiry into Value for Money will be issued on Monday 5th November. Leaked content suggests it’ll be an interesting read with features on fees transparency and degree apprenticeships possibly creating a big bang!
Free Speech: And just because we couldn’t bring you a policy update without mentioning free speech Vice have an article highlighting Sam Gyimah’s claims that haven’t been substantiated and suggesting that seeing universities as a ‘marketplace of ideas’ ironically serves right wing political aims.
Sam’s Apps and Gender Gaps: Earlier this year Sam Gyimah launched a £125,000 competition for companies to develop apps and digital tools to help prospective students make better decisions about which institution to study at, through the LEO (graduate outcomes) data. The Minister has unveiled the final five prototype apps and websites from his competition but not yet announced the two finalists will receive an additional £150,000 each to develop their design into a final product. The media covering the apps include: ITV and the Independent. Sam was inspired to create his app competition by the IFS research which revealed particular sets of graduates have poor economic employment outcomes.
Sam’s competition has been criticised by some within the HE sector because it fails to recognise the non-HE dependant factors which influence the LEO data. Adding to this is a new report out by LSE which predicts a widening of the gender pay gap gulf:
- Girls born in 2000 are aspiring to do jobs that are paid 31 per cent lower than males…on the other hand, [boys] have higher aspirations than previous male generations in terms of income, to the point where the gender pay gap could actually become larger than it is at present if these aspirations are fulfilled.
- The study concludes that a persistent lack of women in highly paid jobs in areas such as science, technology, engineering, finance and politics is due to girls internalising social norms, rather than a result of their innate preferences. This conclusion emerges from the researchers finding that time, rather than childhood factors, is what has altered the tendency for males and females to choose different types of jobs. Social movements or campaigns are essential to encourage girls to aim higher, it suggests.
- Boys’ current aspirations, from those born in 2000, are increasingly geared towards jobs with “significantly higher levels of competitiveness and larger incomes” compared to previous generations and their current female peers.
The paper’s author, Dr Grace Lordan of LSE’s Psychological and Behavioural Science Department, said:
- “More and more we actively encourage our girls to pursue occupations that are currently dominated by males. However, boys are rarely encouraged to pursue occupations where females have had higher shares. The asymmetry of the gender revolution needs to be considered. This becomes more important given that we expect jobs that are traditionally female to expand over the next decades – for example, the nursing and caring professions.”
Source: Dods report on – Cross Cohort Evidence on Gendered Sorting Patterns in the UK: The Importance of Societal Movements versus Childhood Variables by Grace Lordan of LSE ‘s Psychological and Behavioural Science Department LSE ‘s Centre for Economic Performance and IZA and Warn N.Lekfuangfu of Chulalongkorn University, Bangkok is a working paper published by IZA Institute of Economics.
Board diversity: Wonkhe report on Advance HE release of two new frameworks to support diversity in higher education providers’ board level recruitment.
- The Board Recruitment Framework is designed to support institutions in recruiting board members, with guidance on best practice in producing inclusive materials that encourage a diverse range of applicants and don’t inadvertently exclude people.
- The Diversity Principles Framework offers guidance for higher education providers and executive search firms working together on board appointments. It’s one of the outputs from the 2017-18 board diversification project funded by HEFCE and others. The push for recruiters to support diversity came from 2017 research by Simonetta Manfredi.
Gap Years: An unusual parliamentary question on gap years:
Q – Grahame Morris: To ask the Secretary of State for Education, what assessment his Department has made of the effectiveness of gap years in improving educational outcomes for students.
A – Sam Gyimah: The department has not made any recent assessment of the effectiveness of gap years in improving educational outcomes for students. In 2012, we published a study that examined the characteristics of gap-year takers, their motivations, what they did and what effect it had on their longer-term outcomes: LINK
ESRC new appointees: Research Professional report on the two senior professors from University College London and the University of Sussex will be in charge of strategy and research at the Economic and Social Research Council.
Immigration: Research Professional investigate the proposed Tier 2 visa changes and find thousands of university staff would have been ineligible to work in Britain on the minimum salary threshold criterion.
To subscribe to the weekly policy update simply email email@example.com
JANE FORSTER | SARAH CARTER
Policy Advisor Policy & Public Affairs Officer
Follow: @PolicyBU on Twitter | firstname.lastname@example.org