Consultation, Consultation, Consultation: The OfS rides again

The Office for Students (OfS) closed its latest ‘Consultation on OfS strategy for 2022-25’ on Thursday. It is critically important for anyone interested in seeing the direction of travel in how our universities will be regulated.  The consultation took place with the incumbent CEO, Nicola Dandridge leaving in April and no replacement in the wings. It was also completed in the vacuum of no response from the government to the Augar recommendations on universities that go back to 2019. This uncertainty nullifies planning and effective risk management in institutions. Especially important would be the prospect of tightening of income through minimum entry requirements or a reduction in fees. Many observers such as TEFS delayed their response in anticipation of more clarity on these issues. It turns out this was more in hope than anticipation.

Priorities.

The OfS strategy is emerging against the backdrop of increasing government panic about the economic and health impacts of Covid that will take a generation to resolve. Although the two main priorities are now ‘quality and standards’, and ‘equality of opportunity’, there is at least some passing reference to Covid and acknowledgement that they will “Continue to work in close collaboration with the DfE and UKRI on financial sustainability”. Although included in the strategy, many might think the very top priority of a regulator is to consider the viability and solvency of the institutions in its care. After all, it could turn out to be the main challenge in the coming months, especially if lower fees and minimum entry requirements impacting income. Students would expect their institution to remain open during their studies at the very least.

Background to the consultation.

The government set out its plans for the regulation of higher education, in its white paper ‘Success as a Knowledge Economy: Teaching Excellence, Social Mobility and Student Choice’ in 2016. The Higher Education and Research Act 2017 (HERA)  received Royal Assent on 27 April 2017 and created the Office for Students (OfS) and a new regulatory system. The clear priorities of students at university included: “having more hours of teaching”, “reducing the size of teaching groups” and “better training for lecturers”. That is why they introduced “the TEF, and for the first time, bring sector-wide rigour to the assessment of teaching excellence”.

The ‘Consultation on OfS strategy for 2022-25’  is the latest in a series of consultations.  The ‘Consultation on quality and standards conditions’ was last summer and the ongoing ‘Consultation on Data Futures and data collection’ closes in February. The OfS itself is an executive non-departmental public body, sponsored by the Department for Education. Although it has a degree of autonomy in formulation of its own strategy, it is still answerable to the Education Secretary, Nadhim Zahawi.  Appointments to the OfS are also controlled by the government, as evidenced by James Wharton (aka Lord Wharton of Yarm) taking over as chair. His lack of experience in education hints at the possibility he is merely a political ‘commissar’.

The proposals.

These were billed as a “step change”, but in effect they build upon the earlier  ‘Office for Students Strategy 2018 to 2021’.  This is not surprising since the ‘Framework’ is HERA that was only updated in March 2021 in case some universities were to “cease the provision of higher education”.  These were all presented to Parliament and the subject of scrutiny. 

There is no clear reasoning behind the new strategy that resembles the older strategy in most aspects. The alternatives of “extending the existing strategy or having no strategy for the next three years” are somewhat puzzling. It is incredible that the OfS considered there was an alternative of having no strategy for three years. No person at OfS would be comfortable with this.

Unfortunately, some important terms are not adequately defined. Whilst ‘access’ and ‘success’ in achieving a qualification are tacitly understood ‘participation’ is vague. ‘Equality’ is also not defined. For example, in the context of for equality of opportunity to be meaningful, the higher education provision in question must be high quality”, the two do not logically follow each other. Also, equality of ‘participation’ is not considered only that of ‘opportunity’.  That leaves the door open to only telling students they have an ‘opportunity’ to participate.

It was interesting that the OfS chair, James Wharton referred to, “This consultation proposes a framework for our work over the next three years”.  This seems ambiguous and implies that the intention is to use the ‘Strategy’ to replace the established ‘Regulatory Framework’.  There is a further hint of this approach with a proposal to add a new paragraph to the HERA. The modified Framework text would then read:

“15. The OfS’s regulatory approach also seeks to deliver social and policy objectives in areas where market mechanisms may not succeed. For example, the improvements in access and participation that students and society require will not be delivered by the market alone. This means that the OfS will take direct regulatory action to drive improvement in this area, beyond that necessary to preserve a minimum baseline”.

With the addition,

“For more information about our priorities in a particular strategic period, please consult our current strategy, which can be found at www.officeforstudents.org.uk/about/our-strategy/.”

It is therefore assumed that this modification will be presented to Parliament for scrutiny. However, there are pitfalls to this approach with the possibility of additions being made to the ‘Framework’ through a link that is not under scrutiny by Parliament. Both paragraph 15, and its proposed addition, highlight what is in effect a ‘back door’ being left unlocked to substantial OfS-directed changes to legislation in the sphere of ‘social and policy objectives’ without scrutiny in Parliament.

Political direction.

The Secretary of State for Education and Minister of State for Higher and Further Education together issued new guidance for ‘access and participation’ to coincide with the announcement of John Blake as the new Director for Fair Access in November. He started this month and was probably involved. The headline demand in November was that there should be “a focus on the findings of the white working-class boys report, which identified that they are one of the groups least likely to attend university” (SEE TEFS  6th December 2021 ‘White working-class boys and university access: aspiration or desperation? What is going wrong?’). Also “Students from disadvantaged backgrounds are being let down” by courses that do not lead to “graduate employment or further study”.

The new strategy emerged from the demand, “We would like to see the OfS rewrite the national targets to better align with this new focus, and renegotiate A&P plans with providers to meet these new priorities” and “focus on the findings of the white working-class boys report”. This  idea came from the Education Committee in their Committee inquiry from June 2021, ‘Left behind white pupils from disadvantaged’ backgrounds’.

The guidance stated that there have been “some successes” in this area but goes on to outline only marginal improvements since 2010. As a result, the government wants to “refocus” to benefit students, but importantly “provide direct benefits to higher education providers”. This means cutting the “burden of producing long and bureaucratic A&P plans”.  This is astounding ‘double speak’ since there are existing ‘Access and Participation plans’ in place with the intention to run from 2020-21 to 2024-25. Now they must ‘renegotiate’ them early on and presumably there will be input sought from students on each one as previously done in the ‘Student submissions 2019-20‘.

This hardly reduces the bureaucratic burden.  Add to this the likely data requirements coming soon, with demands to guarantee resources for students inherent in the  ‘Consultation on quality and standards conditions’ from last year, and this increases the burden more.  Then there is the demand that universities must “support schools to drive up academic standards”. But they must also stop seeing links with schools as recruitment drives and “shift away from marketing activities”.

Privatisation and risk management.

Despite the tight regulatory mechanisms emerging, there still seems to be a ‘whiff’ of privatisation in the air. Of course, a private sector would need to be regulated well to minimise risk to the consumers. It is the regulation of a classic consumer-provider relationship that is being prepared. However, one of the drivers for reducing regulator demands would be to attract outside investors interesting in the assets and running a ‘private university’ (see TEFS 26th September 2021 ‘Privatisation storm looms for universities’).  The intention may be there, so we might expect to see current access and participation plans stripped to their bare bones in time. 

The business sector is also wedded to the idea of a ’risk based’ approach to regulation.  This idea underpins regulation of banks and the financial sector in the UK. Although it is debatable if it was effective in detecting failing banks early enough.  The approach is seen by many to cut the costs of regulation by focussing on the highest risks first before moving to others perceived as a lesser risk. Unfortunately, it’s only as good as the risks identified first.

The idea was inherent in HERA 2017 consultations as “The OfS will introduce the new regulatory framework: a risk-based approach to higher education with an unflinching focus on the student”. However, it was not a new idea and has been around since 2000 in the Higher Education Funding Council for England (HEFCE) mandatory framework of risk management for institutions.

Setting a minimum standard.

This appears to be the goal of the OfS in minimising the burden on universities. However, they are seeking to use risk management as the main tool to secure the lowest standard. This is itself a risky approach.  The idea of setting only a minimum ‘regulatory baseline’ is vague without any idea of what this will mean in practice. On ‘Conditions of Registration’ it is assumed throughout that all institutions already meet a baseline requirement. If the risk management approach is used to simply ensure a ‘minimum standard’ then these will have to be very clearly defined in advance and be the same for all institutions.

Setting targets for access and participation is needed urgently.

In managing risk, one might expect the OfS to set the minimum targets to be achieved. However, there is no reference to meeting performance targets, implying there will be none above the minimum. Also, there are significant gaps at this point and setting a ‘minimum performance’ baseline implies this will be all that is expected from institutions. 

It is notable that some of the current ‘Participation Performance Measures’ have no targets although it is acknowledged that “We will keep our approach to access and participation plans under review, including our national targets”. 

The current ‘Key performance measure 1: Gap in participation between most and least represented groups’ notes that this is currently at 28.9% and no target is set to improve this. However, ‘Key performance measure 2: Gap in participation at higher-tariff providers between the most and least represented groups’ is currently at 19.2%. Yet the target to eliminate the gap is set to be achieved by 2038-39. This shows a lack of will and ambition and the new strategy must strive to move more quickly. A ‘strategy’ should make it clear that there WILL be targets that WILL be pursued within the timeline of the strategy.

The UCAS Multiple Equality measure or the more focussed Index of Multiple Deprivation (IMD) data are probably a better measure for setting targets than the widely used POLAR measures based upon broader area postcodes and participation. They indicate that the gaps could be getting wider last year (UCAS end of cycle report 2021).

The risk cascade effect.

People involved are various levels in universities are familiar with a risk-based approach to assessing progress. This works as a cascade with the likelihood of consequences beyond those intended. These span individuals, identifying priorities and risks to their own survival and career, to department heads looking at student numbers, grant income and student surveys.  Higher at the institutional level, the managements are concerned with financial stability and reputational damage. Securing income is high on the list of risks.  When government imposes changes to income arrangements, from research grants to student fees, then the whole game changes right down to the individual academic. Add funding attached to Research Excellence Framework (REF) outputs and it becomes a battle ground of performance management and seeking more grant overheads and better REF scores.  The latest REF 2021 results are due in May 2022.

Back in 2009, Christian Huber of the Copenhagen Business School looked at the approach that started in the UK and was now spreading across the EU ( ’Risks and Risk‐Based Regulation in Higher Education Institutions’ Tertiary Education and Management 15(2):83-95 2009).  He observed that a higher education institution changes when a framework of risk-based regulation is adopted.  No matter how much the regulator asks the university to provide “a complete picture of risk exposure – and how much effort an organisation puts in fulfilling this demand – the everyday life in a university can always pose yet another unforeseen challenge”.

Bearing this in mind, the risks clearly become magnified as we look further up the cascade of regulation. Who then manages the risk of the OfS failing?  This must fall to the government who set the framework agenda. However, to minimise risk to themselves, they routinely pass the blame down the chain. Putting all the burden of access and participation onto institutions is a prime example of this ‘shifting blame’. It’s crude and will not work (TEFS  27th November 2021 ‘More pressure on universities. Targets for access and participation: Passing the buck’).

This becomes the crude endgame of a wider plan to shift all responsibility to a wider market driven sector.

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