Sure enough the much needed House of Lords Industry and Regulators Committee inquiry into the workings of the Office for Students has moved on since the end of April. For the OfS, April may have seemed the cruellest month, but now its May and they might think they are in a ‘rats’ alley’ in a wasteland. If so, it’s one of their own making. The quality and reputation of higher educations seems to be secondary in the deliberations. There seems to be a somewhat illogical assumption that quality can be upheld in the face of ever decreasing unit costs. This is facile and naïve.
On the 2nd of May the committee quizzed finance directors, administrators and more students (watch here). High on the agenda was financial stability followed by how students viewed value for money. Notable were the observations from Nicola Owen, Chair at Association of Heads of University Administration, who said that,
“The model does need to change. It is increasing the level of risk in the sector, and we will see more instability overall. Therefore, unless something changes, we will see more institutions getting into much more trouble”.
She ought to know and that summed up the position well.
Next up on the 9th of May were Susan Lapworth, Chief Executive at Office for Students and David Wharton (aka Lord Wharton of Yarm) the Chair at Office for Students. Their challenge was not to appear out of touch with the reality expressed in earlier evidence. It seems this might have failed.
When asked, “Is there a growing crisis in the finances of higher education providers?” Wharton replied,
“We would not use the word “crisis”. Overall, the sector’s finances are in good shape. That does not mean that there are not significant pressures, and we see significant variation with some individual providers in less robust shape than others.”
Hear no evil, see no evil.
Having moved on from his earlier position as chair of the education committee, Robert Halfon appears to have strayed further into the political undergrowth and ‘gone native’. He offered his evidence earlier this week on the 16th of May, as the Minister for Skills, Apprenticeships, and Higher Education, alongside Anne Spinali, Director of Higher Education Reform and Funding at Department for Education.
Halfon immediately appeared to endorse the OfS position that all was fine. Although then admitting that only 75% of universities were in a “good financial condition” and the finances of thirty of them were under review by the OfS. That was hardly an endorsement of the reality. He also criticised some universities for becoming over reliant on foreign students while indicating that university managements may be at fault for financial problems. Maybe they and the students might (metaphorically) stop eating ‘cheese sandwiches’.
His position was acted upon today with reports of a letter from the OfS to some of the miscreant universities urging them to prepare for cuts to foreign student numbers, particularly those from China. Its harsh to blame managements for sharp braking and turns in government policy.
Financial uncertainty.
This is a bad smell in the air around many public services and universities are certainly not immune. To imply that universities are in a better position than other services, when all are in a bad state is facile. Its akin to saying ‘don’t worry about starvation, everyone is starving’. The idea that standards and quality can be maintained with fewer resources is naïve and these qualities will take a hit.
Updated today, the OfS projections are not entirely bathed in such optimism when looking at the details (‘Financial sustainability of higher education providers in England’ (pdf). Under ‘A challenging environment’ we see multiple risk factors catalogued and that “The financial environment remains challenging in the medium to long-term”. Indeed, data from the Higher Education Statistics Agency (HESA) shows that 55 per cent of higher education institutions recorded a deficit in 2021-22.
A major factor stressing university managements and finances includes a rising staff cost. Delving into the OfS forecast data to 2025/26, it appears staff costs are projected without pension adjustments. This is despite accepting in the report that “Further fluctuations in scheme valuations could increase this cost pressure further”. Its not ‘rocket surgery’, to mix well-worn metaphors, to put a projection in place; unless pension reform is hiding in the wings. Higher staff costs are projected alongside expanding student numbers over the same period. However, assuming more staff are hired, it seems they might not expect to be paid more.
The full burden of responsibility is placed upon the shoulders of universities while the government hides from the consequences. Some of their optimism does not add up.
Original post from 28th April 2023
There is a major crisis emerging in the relationship between universities, their students, and the regulator. The House of Lords Industry and Regulators Committee launched an inquiry into the Office for Students (OfS), the regulator of the higher education sector in England, at the start of March. It was planned with a very short turnaround and evidence to be submitted by the 7th of April 2023. The hearings are progressing at pace and some worrying evidence is seeping out. The schedule of oral evidence sessions is here. There is more to come when the committee quiz the OfS Chief Executive, Susan Lapworth, on the 9th of May 2023. Expect an update then.
Meanwhile the government has a ‘nudge unit’ (aka Behavioural insights team) that continues to deploy ‘nudge theory’ in their incessant attacks on university degrees, despite their policies creating the situation in the first place.
Earlier this week, Oxford PPE graduate and journalist, Simon Jenkins, wrote in the Guardian, ‘Young people are wising up to the Great British student rip-off – and they’re voting with their feet’. He refers to “pointless exams” and degree courses that “would be regarded as a scam”, while students “sit idle, doing odd jobs or studying on their own”. Expect more of this.
Rising discontent.
There has been rising discontent in the university sector regulator since last year. They have been steadily increasing their demands on universities who are creaking from a lack of funding and rising inflation. This culminated in a letter to the Education Committee on the 12th January 2023 signed by all of the university mission groups. They complained of,
“continuing imposition of what we believe is unnecessary regulatory burden, which is diverting student funding resource away from universities’ missions to provide a high-quality education for students”.
An agreed letter from across the whole sector outside of Universities UK was unusual and the concerns were deep and serious. They were seeking a review of the workings of the OfS by the committee. Eventually a review was agreed but relegated to the House of Lords and its Industry and Regulators Committee. This was an unusual decision that allows the more influential Education Committee to duck the problem. However, the crossbench Committee chaired by Labour’s Ann Taylor (aka baroness Taylor of Bolton) is likely to be clinical in their inquisition.
The review in context.
The backdrop to the current review has been regularly reported by TEFS as a widening gap between the sector and the OfS that was alarming. Last April the writing was on the wall with, ‘The cracks between the government and universities are widening’. The current developments are therefore of no surprise.
Add to the mix direct government intervention in universities outside of the OfS, with threats to stop ‘wokery’, surely undermined the regulator (TEFS 7th July 2022 ‘Airbrushing Advance HE’ and only inflamed the situation.
Appointing a politician, who retained the Conservative whip in the Lords, to the OfS chair in 2021 was controversial and immediately put the independence of the regulator under the spotlight. Then following this up by appointing a director and bypassing the commissioner for public appointments flew in the face of impartiality. (TEFS20th February 2022 ‘New OfS Director to be appointed: But no role for the Commissioner for Public Appointments’).
Questions raised.
The Lords committee boiled down its review into twelve key questions. Here are four that illustrate the rift that has opened between the sector and the regulator. The fact these questions are needed at all illustrates the seriousness of a deteriorating regulation framework. There must be reform and a rethink.
On students it asks, “How does the OfS engage with students? To what extent does input from students drive the OfS’ view of their interests and its regulatory actions to protect those interests?”
On universities the question is, “What is the nature of the OfS’ relationship with universities? Does the OfS strike the right balance between working collaboratively with universities and providing robust challenge?”
On financial stability there are also answers needed for, “To what extent is the financial sustainability of providers determined by government policy and funding rather than the OfS’ regulation? Is there a need for policy change or further clarity to ensure the sustainability of the sector?”
On quality assurance the questions are very concerning, “Does the OfS have sufficient powers, resources, and expertise to meet its duties? How has its expertise been affected by the Quality Assurance Agency for Higher Education’s decision not to continue as the OfS’ Designated Quality Body?”
Student concerns.
Former chair of the student panel and former OfS Board member, Martha Longdon, and former panel member Francesco Masala were quizzed in depth by the committee. Longdon was in a particularly difficult position as the only student on the OfS board trying to convey the concerns of all students in England. What she and her fellow panel member had to say is of pivotal significance.
Student panellist, Francesco Masala, was somewhat outspoken and critical with,
“People at senior levels of the OfS, including board members, were all part of the meetings, so we were definitely listened to. As to how the issues that we raised were taken up, that is a completely different question. Even just by looking at some of the minutes of the panel meetings, you can see that some issues are repeated again and again and do not end up in any wider work, which I think is an issue, because it creates a potential lack of confidence from the student panellists themselves and from any wider member of the student population across the country. If they look at the student panel thinking they can effectively raise issues on behalf of students and then look at the actual outputs from the OfS and see nothing, that creates a lack of confidence, broadly speaking”.
Ouch!
Then Martha Longdon agreed with more revelations of a lack of consultation and transparency,
“I am going to refer, if it is okay— please stop me if I am not allowed to—to the OfS written submission, 6 which I appreciate has not been published but that I have had sight of. I was not part of its drafting. Several activities relating to student engagement are outlined in it, which I feel as chair of the panel and as a board member I never had proper sight of either. I am aware that the polling of 3,000 students goes ahead annually. I have never seen an example of where that has been used in the organisation. I have never seen that data. That is quite an important resource that we could have used to make impact, but we have not. I am aware, certainly in the earlier years of my tenure, that the CEO and the chair would meet NUS representatives. Again, I do not know any of the content of those meetings. That was never communicated more widely”.
She follows with an observation of meetings between the OfS and the NUS that she was not aware of until the last few days,
“only when I read that written submission a couple of days ago. Prior to that, I did not have the opportunity because I did not know it was there”.
Asked if she had asked to attend such meetings, her response was,
“I had suggested it once and the response was quite ambiguous. I took it to mean that I was not particularly welcome, so I did not raise it again”.
Student hardship as a major issue.
This was not discussed in any detail at the committee. Yet, the issue of student finances, accommodation costs and hardship must surely be near the top of the agenda for students and universities at this time.
It is interesting what the OfS (minutes of 26th January 2023) conveyed to the students on the panel, “The Department for Education (DfE) has allocated £15 million in hardship funding that the OfS will distribute to providers in the coming weeks.”
In response, concern from the students that there, “might be students who are on the precipice of dropping out” was met with a response from the OfS Leadership Development Officer, Sarah Matthews, “that in an ideal world, it would be valuable to be able to speak to the same research participants in two years’ time” . She then left the meeting. This was hardly an action that would help anyone at this time. It is another example that illustrates the ongoing frustrations felt by the student panel members.
Interestingly, the panel appear to have missed that the letter outlining the ‘Additional student hardship funding for academic year 2022-23’ in January was another sleight of hand. The ‘additional’ £15 million was in fact a redistribution of £10 million from the support intended for preparation for the Lifelong Loan Entitlement (LLE) and £5million from recurrent funding for emerging priorities. Forensic questioning of that might have rattled the OfS cage more. However, the suspicion is that some concerns are being buried along the way.
Relationships with universities.
This is clearly problematical and the government must shoulder most of the blame for the OfS being driven into conflict with the sector.
The CEO of Universities UK, Vivienne Stern (aka baroness Stern), was particularly strident with,
“From the university sector, there is a feeling that you can express a view but it will not be listened to. We have to get beyond that.”
Then the idea of a ‘mutual understanding’ was demolished with,
“My strong view is that a good OfS in which the sector has confidence, and in which there is public and political confidence, is in all our interests. It is right that parents, students and taxpayers should ask searching questions about whether what happens inside universities can be trusted. Our answer has to be, “Yes, and this is the mechanism that is in place to protect it”. The sunlit uplands of the OfS being held up as the answer to those questions, or our progress towards it, has been somewhat frustrated by the character of the relationship between the sector and the OfS, which is characterised by an absence of trust. There is a mutual lack of understanding.”
Former Hull University Vice Chancellor, Susan Lea, raised the inconsistency in government policy on key social issues, projected via the OfS, with,
“We are all working to the same agenda. We want a strong higher education sector for our country to deliver skills, research and innovation. Sometimes it feels to me and others I have spoken to that the focus or emphasis of policy as it comes through the OfS can shift and change in a way that is not necessarily linked to that core strategy. Levelling up is a good example. It is important. We know about the inequalities in our society and the importance of addressing them, yet in fact the OfS cut funding to a programme called Uni Connect. That came through the changes. The Government have a policy on economic disadvantage and social mobility but the Uni Connect funding was cut by a third”.
Implied in these exchanges is the independence of the OfS as a regulator that is projecting government policy at every turn. As far as TEFS is concerned, this is only the tip of the iceberg.
OfS investigations and financial stability.
The idea that the OfS could mount an investigation, and then levy a fee for doing this, seems to grate with universities. The Universities UK response to the OfS Consultation on payment of fees for investigations – Office for Students in March 2023 illustrated the confusion. It seems the fees are one issue, but the universities want to know something more fundamental such as, “We are therefore asking the OfS to set out a clearer definition of what counts as an investigation and at what point an institution will incur fees”. It seems both parties are singing from a different hymn sheet. This feeds into general dissatisfaction surrounding the relationship with the regulator.
Quality control is descending into a quagmire.
The question on the OfS approach on quality assurance is of profound concern for the universities. It should also raise alarm bells with students. Indeed, the letter from the mission groups was scathing on this matter with,
“There is mounting concern across the sector that the OfS could become the Designated Quality Body (DQB) on a permanent basis. The need for an independent body to assess quality and standards was stressed by the Lords during the passage of HERA”.
HERA is the Higher Education and Research Act 2017 (HERA) that received Royal Assent on 27 April 2017 and created the Office for Students (OfS). Back in January 2022, the Ofs started making proposals that came into conflict with the original framework and set some alarm bells ringing (TEFS 9th January 2022 ‘Consultation, Consultation, Consultation: The OfS rides again’).
It was astounding that the OfS decided interfere with the working of the Quality Assurance Agency (QAA), who were the Designated Quality Body (DQB). Essentially the QAA decided they could no longer assure quality in universities in England to accepted international standards from March 2023 as they were being undermined.
Most people would expect all higher education institutions in England to be quality assured to accepted international standards. Certainly, QAA sets out to comply through their registration on the European Quality Assurance Register for Higher Education (EQAR). They are therefore brave to pull away citing the OfS as the problem. Meanwhile the OfS is planning to do their own inspections of universities using a “a large pool of academic assessors “. Shades of Ofsted with an added spice of political direction.
There is no doubt that the OfS is driving forward with an agenda that can only lead to a crisis in our universities. They are acting as agents of the government who are rationing resources and preparing for financial failures. It all points towards pushing universities over the precipice and into a privatisation revolution. But that is a story for another day.
The author, Mike Larkin, retired from Queen’s University Belfast after 37 years teaching Microbiology, Biochemistry and Genetics.