Today saw the government finally surface on the plight of students and universities. The Education Secretary, Bridget Phillipson was interviewed on the BBC Today programme and the Minister for Skills, Further and Higher Education, Jacqui Smith (aka Baroness Smith of Malvern) was interviewed by Sophy Ridge on Sky News. It appears they are not on a rescue mission and will lay the blame on the previous government. Instead, they are on another bigger secret operation and have yet to reveal their full aims and tactics.
The government surfaced today for the first time on a crisis for universities and students. With universities suffering frostbite from frozen fees and students struggling to support themselves, the hope was that there was rescue on the way. Instead, it seems the Department for Education (DfE) is on another more strategic mission.
As TEFS expected, the government is letting universities drift and sort themselves out with significant restructuring that can be blamed on the Conservatives. The King’s speech was particularly disappointing in failing to address students (see TEFS 16th July 2024 ‘King’s speech; don’t forget the students’). It left universities and students fearful that the status quo would persist for some time; they were not wrong.
First out of the blocks.
Education Secretary, Bridget Philipson kicked off with the news that there was to be no bailout of universities that are in financial trouble. However, there was a much more positive tone on universities in general and a promise of a more sustainable future. But in the meantime,
“Universities are independent institutions that have responsibilities in terms of how they manage their budgets,”
Some of the interview is here.
This came after the CEO of Universities UK, Vivenne Stern, had indicated the “majority of the sector is in trouble” on the same programme. She indicated that seventy universities cutting costs were now engaging in cost-saving exercises and expected nearly all to be doing the same by the end of the year. The solution is obvious in that fees must be linked to inflation, however,
“It’s not going to fix the whole problem…I personally also believe the government needs to, over time, put more public funding in.”
This seems a long way off and a reform of university finances might take much longer to achieve
Consistent messaging.
The Minister for Skills, Further and Higher Education, Jacqui Smith (aka Baroness Smith of Malvern) emphasised the same message. Again, no short-term assistance will emerge, and the mantra is one of ‘efficiency’. She also did not rule out university closures and this will focus the minds of university managements.
An excerpt from Phillipson’s interview is here that provides more clarification.
Restructuring can only mean course closures, mergers and staff redundancies. The TEFS view that there will be a need for emergency assistance to avoid sudden collapses due to critical cash flow failure (see TEFS 19th July 2024 ‘Universities and students; HERR we go again UPDATE: Times they are a-changin’).
Regulation storm coming.
The focus of the Education Secretary in her interview was on the Office for Students (OfS) and international students in securing higher education’s finances. She promised on regulation,
“The initial steps that we’ll be setting out later this week around regulation, where it comes to the OfS, because we need to see a sharper focus on the regulation of our sector to make sure that universities are on a firm footing,”
An interim OfS chair will be announced soon after Conservative peer James Wharton (aka Lord Wharton of Yarm) resigned as OfS Chair when Labour came to power. This is long overdue. It is obvious that the OfS has lost the confidence of universities. Dealing with the finances and restructuring of the sector will be in sharper focus and become the priority. Staff will find themselves under even greater pressure with managements pressing down even harder on them to achieve greater ‘efficiency’. Students will also be affected and there is a real danger both will be side-lined in the changes.
It is also likely that the OfS will be the subject of a major overhaul in time. Defining a new regulator with a new mission, and with a new name, would trigger a need for renewed leadership. This might be the only way to restore confidence. TEFS has said previously,
“The OfS is abolished, and a new body created from scratch. This would reset the system in a radical way that might not be met kindly by the ‘elite’ universities. However, it is probably long overdue”.
Something combining the regulation of Skills and Further Education with Universities might lead to better joined up thinking. The launch of ‘Skills England’ today introduced the role of universities as part of its remit.
“It will bring businesses together with trade unions, mayors, universities, colleges and training providers to give us a complete picture of skills gaps nationwide”.
This is to be welcomed and it has a good chance of dovetailing with the policy of ‘articulation’ in collaborations between colleges and universities in Scotland. This enables able students to transfer from colleges to university and opens up more opportunity through a less traditional route.
The name ‘Office for Colleges, Universities, and Students’ as OFCUS (a play on FOCUS) might be something to consider.
Long term sustainability objectives.
The only way to ensure stability of the sector is sustained funding that tracks inflation. There is no other way out unless USA style ‘privatisation’ starts to creep in (see TEFS 26th September 2021 ‘Privatisation storm looms for universities’). That could be disastrous.
There must also be better funding for students and restoration of maintenance grants. This would be better if it were applied to the whole of the UK.
The challenge is to deliver this while sticking to the chancellor’s strict fiscal rule. It appears this is possible if a major change in approach is made. TEFS has consistently argued for some time that those who benefit the most should pay for university. This means costs shared between graduates, their employers and the wider public through general taxation. Although this would take more time to negotiate, TEFS has favoured a Graduate National Insurance Levy that could be applied to graduate employees and their employers across the UK (Funding students and Universities: a graduate National Insurance Levy is gaining traction). It may only come to a 1 to 2 percent increase in National Insurance and would offer a long-term solution. It avoids fees and loans but does require graduates and their employers to share the costs and pay back in time. With the payments tied to graduate pay inflation, it would be a better way to ensure longer term stability.
With the SNP government in Scotland in retreat, there may also be a window of opportunity for a scheme that is more acceptable as it has no overt fees attached to it.
In the meantime, universities will need to become much more efficient and work with less. That may well be the shorter-term government plan but there is a danger that students are left out in the cold. We must also not forget the students.
The author, Mike Larkin, retired from Queen’s University Belfast after 37 years teaching Microbiology, Biochemistry and Genetics. He remains optimistic and loves mixed metaphors.