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Review of the year: 2014

A panel of HE professionals take a look back at the highs and lows of higher education in 2014 and give their predictions for the year ahead

CONTRIBUTORS:

Gordon Slaven, Head of Higher Education, British Council
Pam Tatlow, Chief Executive, Million+
Megan Dunn, NUS Vice President (higher education)
Sam Jones, Head of Comms, University Alliance
Alistair Jarvis, Director of Communications and External Relations, Universities UK

Q: In your opinion, what were the major developments in the UK higher education sector in 2014? 

Gordon Slaven: The lifting of the cap on places for UK students (announced at Dec 2013) has had a big effect on UK higher education across this year, as institutions attempt to prepare for the potential consequences and jockey to position themselves to the expanded market.

The announcement of the Newton Fund, a £350m five-year programme to facilitate science and innovation partnerships between the UK and developing countries is a major boost towards large-scale, sustainable and mutually beneficial research relationships between the UK and international partners.

International students make a tremendous academic, cultural and economic contribution to life in the UK, and the global competition to attract ambitious young people from around the world becomes more intense every year. There have been persistent calls from the sector, including the VC of Oxford that the government should relax visa regulations and remove students from immigration statistics – calls persistently rejected by the Home Office, despite evidence that it is impacting on the attractiveness of the UK as a study destination. The Home Office’s actions on suspending and in some cases, revoking Tier 4 Visa sponsorship licenses from some private colleges has left no doubts – home or abroad – that the Home Office is determined to clamp down on people abusing the student visa system.

Pam Tatlow: For England it would be the deregulation of student numbers – with more to come in 2015 – while in Scotland it would be the outcome of the referendum. However, all political parties have questions to answer about how they propose to fund universities and support students in the future. It seems unlikely that these questions will be resolved by the end of 2014 so we can expect them to rumble on into 2015.

Megan Dunn: It was good that the student loans crisis was exposed by numerous reports this year. A long line of disappointing revelations have consistently blown apart ministers’ claims that £9,000 fees would save public money, and confirms our long-held view that the current system was ideologically driven and costs more than what it replaced.

We also welcomed a report from the Office for Fair Trading (OFT) into the use of academic sanctions when students owe money to their institutions. As a result of NUS complaints the OFT opened an investigation in July 2013 to consider whether there were problems with these practices. Their findings are a vindication of the position NUS and students’ unions have taken. Some universities apply academic sanctions which prevent students from graduating, enrolling onto the next academic year or using university facilities if they owe money to the university in library, parking or damage fines, or arrears for accommodation
or child care services. The OFT reached the conclusion that the use of such terms would very likely be considered unfair under consumer legislation. It now recommends that universities employing these terms and conditions should review their rules and make any necessary amendments.

Sam Jones: The major development in research has of course been the development of the Science and Innovation Strategy in close consultation with the HE sector. This, in the wake of Sir Andrew Witty’s review, is helping to build a wider understanding of the vital role of UK research in innovation and in helping the economy to grow, particularly SMEs.

There has been growing pressure on the government to change current immigration policies that are having a profoundly negative impact on the UK’s ability to compete in the global higher education market – in particular the removal of the post-study work visa. The number of non-EU students at UK universities fell by 1% last year, the first decline ever recorded. Some Alliance universities have reported as much as a 50% reduction as a result of post-study work visas being removed. That’s the evidence we presented to the House of Lords Select Committee in March to illustrate the impact these changes have had on STEM courses in the UK.

Alistair Jarvis: The announcement to expanding student numbers was welcomed by many, although not all. I believe that more graduates are good for the economy, will help develop a stronger society and that a university education can improve the lives of individuals. There shouldn’t be a cap on aspiration and this announcement makes that possible in term of a university degree.

However, there does remain some questions about the sustainability of this approach in terms of long term funding commitments. It is important that expansion does not come at the cost of quality, by reducing average funding per student. The Government has said that the changes would be funded by the sale of the student loan book debt to private companies – it remains to be seen whether this will raise enough funding or is a sustainable model.

Q: Has it been a successful year? 

Gordon Slaven: From the British Council’s perspective, 2014 has seen some major highlights in higher education. We retained our role as the UK’s National Agency for the EU’s Erasmus+ programme, which will inject almost a billion euros over the next seven years into encouraging greater mobility within the EU for young people. Our new Generation UK: China programme enables students to study or work in China is proving popular, and we have extended it to India this year.

Our Going Global conference series on the internationalisation of higher education attracted more than 1,200 of the world’s higher education leaders to Miami in May, and we look forward to the next conference in London in June 2015. The government’s Newton Fund has provided much-needed support to creating stronger research links between the UK and emerging economies to tackle key global challenges. However, from a UK perspective, while UK institutions continue to over-perform in global rankings, and continue to produce world-class research, the decline in applications from international students from certain countries is a growing concern. Much work needs to be done to prevent a ‘blip’ becoming a longer-term trend.

Pam Tatlow: Universities in England have managed a huge upheaval in the funding system. Senior management teams are dealing with a great many unknowns including risks to teacher and health professional education. In spite of this, the downturn in applications from full-time students which was triggered by the 2012 fees hike has been impeded and universities should take a lot of credit for this.

However, the part-time and postgraduate markets continue to suffer from the economic downturn as well as from the uplift in fees. This suggests that any funding system needs to be holistic and focus on the needs of all students right from the start.

Megan Dunn: For NUS, it has been a very successful year. We worked with students’ unions to divert £60m from fee waivers directly into students pockets; we successfully campaigned to save the Disabled Students Allowance, stop the student loan sell-off and save the Financial Contingency Fund in Wales.

Sam Jones: One thing that shows the strength of our higher education sector is the growing demand from students to embark on a university degree despite the rising costs of tuition fees. In an unstable global economy, underpinned by technological advances and increased complexity, a degree is still by far the best preparation to succeed and make a difference in the world. I think this in turn has led to an active debate on how universities need to be delivering an improved experience for their students, particularly in stepping up to the challenge of producing job-ready graduates in the 21st century. When it comes to both the quality and the job-readiness of our graduates Alliance universities are competing with the best in the world. Our Job Ready project this year revealed how Alliance universities offer programmes that are co-designed with employers and students, where students engage in real-world practical projects alongside their academy study.

2014 finally saw the economy beginning to recover from the financial shocks of the past few years. We’ve a long way to go before we are out of the woods and that’s why we should be ensuring that the UK’s rich and diverse ecosystem of world-leading research and innovation has everything it needs to play its vital part in creating economic growth.

Our small- and medium-sized enterprises (SMEs) are a driving force of innovation in our economy and responsible for half of new jobs created. But they spend much less on R&D activities than our global competitors. Alliance universities are using their connectedness, research expertise and business collaborations to increase the innovative capacity of SMEs and investment of private funds in research and development. But this element of university work – what’s known as the ‘third mission’ – is massively underfunded. As Sir Andrew Witty’s review highlighted last year, higher educationinnovation funding (HEIF) must be increased if we are serious about supporting our small and rapidly innovating companies so that they can fulfil their potential in helping our economy to grow. HEIF also needs to be channelled to those universities who are demonstrating excellence in SME engagement by increasing the weighting for these activities during the allocation process. This would incentivise this activity more widely, maximise existing hubs of SME connectedness and recognise the larger commitment required to develop these crucial (but resource-consuming) interactions with larger numbers of SME partners.

Alistair Jarvis: Yes. In 2014 universities across the UK have continued to deliver huge impact in supporting economic growth, social mobility, creating jobs, boosting skills and creativity and innovation through research.

Encouraging application figures from UCAS provided a positive start to the year. There had been some dire predictions of students turning away from higher education following the government’s reforms in England. However, the figures for the 15 January deadline revealed an overall 4% increase in applicants compared to the previous year. A more recent UCAS report from September gave an interim assessment (four weeks after A-Level results) of how many students enrolled at university at the start of term this year and also showed a 4% increase on last year.

The publication of Universities UK’s latest analysis of higher education’s contribution to the UK economy also highlighted the sector’s success. The latest UK-wide study showed that universities now generate £73bn in output – up (24%) from £59bn when the last study was published in 2009.

Q: How will the lifting of the cap on student numbers affect the UK higher education scene in 2015? 

Gordon Slaven: We can refer to lessons from Australia which introduced a similar policy in 2012. Australia experienced a growth in HE enrolment from across the social scale, with a knock-on increase in costs to the government. The growth in numbers led to concerns about the sustainability of quality of teaching. Alternative providers have been very keen to take on some of the ‘overspill’ of capacity in the Australian system. In England, there is further concern that the lifting of the cap will allow a freer market to develop in competition for students, and that while the top-rated institutions will benefit, and lower-ranked institutions may be able to offer a cut-price alternative, middle-ranked institutions could suffer in recruitment and consequently be affected by loss of income as a result. Overall, the policy may require an increase in the higher education budget to cover the extra students, which could be a political challenge for the next government.

Pam Tatlow: Expanding opportunities for people to enter higher education is welcome in principle but a big question mark hangs over funding. The Chancellor of the Exchequer, George Osborne, originally said that this expansion would be funded by the sale of the student loan book but that is clearly not going to happen any time soon because the market conditions for such a sale are currently poor.  Vice-Chancellors and students are entitled to know how the circle of deregulation will be squared with funding and to receive assurances that the axe will not fall again on the Student Opportunity Allocation fund.

Megan Dunn: We are already seeing concerning trends as a result of the raising of the cap over the past years, and this year there are many universities who have significantly over-recruited. This has left many students being housed in caravans, bunk-beds and sometimes not even in the city that their university is in! In addition, I have big concerns about how this over recruitment will affect the quality of the learning experience students will have. We are seeing students sitting on stairways in lecture theatres, compulsory teaching on Saturdays (when many students have child care or work responsibilities) and seminars of 30–40 people. I can only see these problems being exacerbated when the cap comes off in 2015.

Sam Jones: Removing the student numbers cap is a great move towards creating opportunities for those currently locked out of higher education because of this arbitrary limit. But not all institutions will want to grow. Some will focus on creating an excellent student experience over and above growing their student numbers. Others, including alternative providers and new entrants to the market, will want to grow their undergraduate numbers.

However removing the cap will place great pressure on the higher education funding system. We need smarter, sustainable funding for UK higher education to ensure strategic investment and to prevent cuts to student places or underinvestment in high-quality programmes. I think it’s totally unsustainable that for every £1 given out in student loans, only 55p will ever get paid back – it’s a public spending black hole that needs plugging. That’s why University Alliance developed our higher education loan programme (HELP) proposal. It offers a possible solution to sustainable funding – a lifetime loan allocation so people can go back to study and retrain throughout their lives.

Most crucially it offers a real financial solution for postgraduates who cannot access student loans – they are a vital pipeline to secure the future of our world-leading research base and to encourage the transfer of knowledge into innovation that helps our economy and society to thrive.

Q: How do you think the outcome of the general election will affect HE in 2015? 

Gordon Slaven: Higher education policy is unlikely to feature as a key battleground for the UK general election. Currently, it’s hard to make a confident prediction on the effect of the general election, as party policies for the next five years are unpublished. However, whoever forms the next government will have to work hard to support the sector to address the major challenges. Sustaining funding will be vital and allowing the sector to grow greater international partnerships and attract top flight research students and early post-docs will be crucial for the UK to remain at the heart of international innovation and research, and our young people to have the access to and skills to succeed in the global knowledge economy.

Pam Tatlow: There is no doubt that the future is uncertain but politicians would be unwise to think that the question of fees has gone away just because a record number of younger students have applied to university.

The next government must offer a funding solution which delivers sustainability and which promotes a world-class university system that can respond to the diversity of today’s students and the demands of a knowledge economy. Whoever is elected the next government should review the visa regulations which apply to international students and the compliance regimes which are being applied by the UK Visa and Immigration service. These are a cause of huge concern both to universities and students. The risk to the UK’s international higher education reputation which has been built up over many years is immense and needs to be halted.

Megan Dunn: We cannot speculate what will happen until we receive the party manifestos and see who wins next May. What we do know is that students are the force to be reckoned with at the ballot box. Our ‘new deal’ manifesto covers education, work, and community because students are not single-issue voters because we do not have single issues. Students endure financial hardships and future debt unimaginable even to the students of 10 years ago, and we stand to suffer far worse prospects than our parents. We need a new deal for the next generation of students. They hold the key to the next general election, and we will be making sure they use it.

Sam Jones: I think it is pretty unlikely we will get huge amounts of detail on higher education generally in election manifestos. Best-case scenario is a set of principles that recognise the important role universities play in driving economic growth and a healthy society. Worst-case scenario would be a set of rigid policies that put the long-term sustainability of the sector in jeopardy. However, I think the more significant issue facing the UK is the current discourse and focus on immigration, and not just the impact this has on international students.

At a time when Britain should be considering its place in the world and how we secure that in the future, it is deeply worrying that the focus should be so narrowly and internally focused. Universities need to ensure that they remain globally focused despite the current immigration debate and the view of the world that springs from.

Alistair Jarvis: There will be major decisions on public funding for universities to be made as part of a tough spending review expected shortly after a general election. Whoever forms the next government will have to decide where university and research funding lies in their list of funding priorities.

Student funding and fees could yet become a hot topic in the general election campaign. Any policy changes would have an impact on universities and students following the election. There are some differences in the major political parties’ views on international students and immigration. Policy change in this area could have a major impact on UK universities’ success in attracting international students.

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