The Green Paper’s level playing field risks becoming a morass

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The Green Paper Fulfilling our Potential: Teaching Excellence, Social Mobility and Student Choice is a consultation document by the Department of Business, Innovation and Skills (BIS) that sets out plans for a radical shake-up of English universities. One of its many goals is to encourage ‘alternative providers’, aka private higher education institutions (HEIs), into the system.

The rationale behind this move has four elements:

Widening access: The need to widen access to higher education is a central plank of the Green Paper. New providers are seen as part of this: they “can offer programmes that are attractive to hard-to-reach communities and to groups of people that are not currently well-served.”

Equipping students for the world of work:  As I have argued elsewhere, the Green Paper is rather disingenuous in creating the impression that businesses are unhappy with the quality of university graduates.  Nevertheless, there is a shortage of STEM graduates and there is scope for different approaches, one of which is the ‘Degree Apprenticeship’, announced by BIS in March 2015, where the student “will be employed throughout and so have the opportunity to develop employability skills that employers value.” One can see that these apprenticeships would be appealing to those on a low income (and to many others as well!) as the cost of course fees is shared between government and employers.

Competition: For a conservative government, competition is a key driver for improving the world. We are told that: “Widening the range of high quality higher education providers stimulates competition and innovation, increases choice for students, and can help to deliver better value for money.”

Fairness:  Since students are now paying full fees, it seems unfair to allow traditional universities to have a monopoly on the higher education market. According to the Green Paper:  “More providers entered the sector in the last five years than at any time since the last major expansion in 1992, but it’s still too difficult to set up a new institution. We want to see a level playing field for all providers and a faster route to becoming a university.”  

I knew very little about the “alternative providers” that BIS is so keen to encourage, so I had a dig around on the internet. I found a HEFCE Register of Providers but this contained only 12 institutions with degree-awarding powers, and it did not have historical data. I also wondered about accuracy, as the register did not include the New College of the Humanities*. It did include an assortment of religious institutions (e.g., Assemblies of God Incorporated, Elim Foursquare Gospel Alliance, Salvation Army) and those offering training in various therapies (British School of Osteopathy, the College of Integrated Chinese Medicine), but of these only the British School of Osteopathy was a recognised HEI with degree-awarding powers. An email to HEFCE confirmed that the register was set up only in 2014. They gave me a contact for the department of Business, Innovation and Skills (BIS), but an email to them requesting a source for the claim “More providers entered the sector in the last five years than at any time since the last major expansion in 1992” has so far not elicited a response.

Further digging around established that in January 2015, plans were announced to form an Independent Universities Group (IUG) representing private institutions with degree-awarding powers or university title. The goal was to establish a kind of “Russell Group” of independent providers, who could be clearly distinguished from what the Times Higher Education called “dodgy for-profit colleges”. However, discussions between these institutions seem to have been derailed by the election and the IUG has not so far been formed.

I looked at the courses on offer at this “high-quality” end of the sector, to see how far they meet the four goals outlined above.

• The website of Ashridge Business School takes you to Hult International Business School, a global organisation with campuses around the world. They offer one undergraduate degree, a Bachelor of Business Administration, for a tuition fee of £23,580 per annum.
• BPP University (owned by the US Apollo Group) offers undergraduate courses in Accountancy and Finance, Law, Business and Management, and Health. “Health” may be something of a misnomer, given that it includes an “Integrated Undergraduate Masters in Chiropractic (MChiro)” (see this article). Fees for undergraduate degrees are £6K per annum for a 3-year course and £9K per annum for a 2-year course.
• The University of Buckingham was founded in 1973 and is the private university in the UK operating under a Royal Charter. It runs a range of degrees in arts and humanities, and offer a more intensive 2-year degree curriculum, at a fee of just over £9K per annum. In 2015, they expanded to offer a medical degree at a cost of just over £35K per annum for a 4.5 year course.
• The College of Estate Management offers part-time online courses in areas such as building surveying and estate management, at a cost of around £5.5K per annum.
• The University of Law (owned by Montagu Private Equity), as its name suggests, offers a range of undergraduate and postgraduate law courses, and charges £9K per annum for a 2-year undergraduate LLB or £6K per annum for a 3-year degree.
• Regent’s University London offers undergraduate degrees in a wide range of subjects in arts and humanities, charging just under £16K per annum.
• RDI (a subsidiary of US firm Capella Education Company) partners with various UK Universities to offer distance learning courses. You can, for instance, take a Psychology degree at Anglia Ruskin University through RDI. The nature of the course gives flexibility in duration of study, with a total cost of just over £12K.
• Richmond, the American International University in London, offers a range of undergraduate courses, mostly in business and finance, with an annual fee of £9K.

My overall impression is that these institutions introduce some innovative practices that could help achieve the goal of widening access. In particular, we see places offering shorter, more intensive degrees, part-time degrees, and distance learning. Some of them are competing with public universities in terms of cost, because there is currently a lower ceiling on allowable fees, but many of them offer a restricted range of courses. There is little evidence that these alternative providers will do a better job than other HEIs in catering to the needs of employers. STEM subjects are expensive to teach and are barely represented in courses offered by alternative providers. The medical degree offered by the University of Buckingham is an exception, but it is priced out of the reach of all but the most wealthy. Only one of the private institutions described above, BPP University, features on a list of providers of Degree Apprenticeships: in general, it is HEFCE-funded institutions that have introduced these apprenticeships.  

Of course, it could be argued that a more diverse set of alternative providers would be seen if we could free them from the regulatory barriers that the Green Paper complains of. However, the regulation is there for good reason. The fact that the IUG group want to distance themselves from others in this sector should sound a note of caution about the potential downsides of the alternative provider market. It is noteworthy that most of the alternative providers from the IUG list offer courses that are eligible for loans from Student Finance England.  Only a year ago, Christopher Banks, Chairman of the Quality Assurance Agency was complaining that money was being squandered on loans to students attending dubious for-profit colleges.  Some institutions would encourage students to take out loans to cover their fees, but then offer inadequate courses associated with high drop-out rates.  Mr Banks was quoted as saying: “I would like to make sure we quickly respond and reinforce the need for consistent quality in higher education, because there is a danger, otherwise, that [the growth of private providers] will tarnish the reputation of the sector.”

We can also learn lessons from the USA, where the behaviour of some for-profit colleges in recruiting students to pay for worthless degrees is nothing short of a scandal. We should not forget that, only four years ago, the Apollo Group, who own BPP University, was investigated by the US Government for misleading students.

It is telling that the Green Paper recognises the potential problems of a marketised higher education sector, noting that students need protection from the consequences when their institutions fail. This has not previously been recognised as a risk, for the good reason that English universities have not failed. More recently, we have seen considerable hardship inflicted on overseas students when institutions have had their licences to sponsor overseas students revoked. In future, we may find students suffering, even after completing their course, if their degree comes from an institution that no longer exists. It is frankly surprising that anyone should be talking about reducing regulation of the private higher education sector and speeding up approvals when there is already evidence of unprecedented risks associated with the entrance of new providers.

There are many students who might benefit from having a wider range of options in higher education; I doubt that private HEIs are going to ‘drive up standards’ through competition, but they could potentially make a difference by complementing what is currently on offer. But if experience here, and in the USA, has taught us anything, it is that, in order to work well, alternative providers need to be carefully regulated and accredited only after establishing a solid track record.  

*Correction: 24th December 2015; David Sweeney of HEFCE pointed out that the New College of Humanities is on the directory and can be found via the web interface. On the .csv file that I downloaded it is included under an alternative name, i.e. Tertiary Education Services Ltd.
PS, 3rd January 2016: The relationship between Tertiary Education Service and New College of the Humanities is discussed further here.