Wednesday, 29 June 2011

The White Paper in six bullet points

Once you have stripped out the rhetoric and the ritual gestures - yet another pledge to 'examine' post-qual admissions for instance - the policy meat in the White Paper can be boiled down to six bullet points. And they are these:

  • Under the core/margin model, a proportion of all institutions' student numbers will be removed by formula and reallocated through a bidding process controlled by HEFCE. In the first instance only cheap institutions (primarily FECs) will be allowed to bid. As I said earlier, this is a decisive rejection of the market model. Student numbers will be planned and controlled centrally by a Government agency, and popular institutions will not be allowed to expand unless Government wishes to let them, whilst unpopular institutions will be sustained.
  • Charity or employer-sponsored students who make no claim on the public purse will be exempt from student number controls. Whilst the attention so far has focused on employers, I think there is real scope for charities to do something interesting here.
  • VAT on shared services is finally going to be addressed. This will make it radically more cost-effective for institutions to share backroom services, which is big news for those of us who work in the back rooms of universities.
  • Degree Awarding Powers and University Title are to be liberalised, and it is to be made easier for institutions to change their corporate form (e.g. from a charted corporation to a limited company). On the other hand new powers will be sought to suspend or withdraw degree awarding powers. I've said before that DAPs are a side-issue for new providers, but this will be a big issue for existing providers, and the scope to change corporate forms will make it much easier for the often-talked about privatisation of a current university to happen at some future time.
  • Deregulation. Like most, the current White Paper shows no understanding of what makes regulations expensive for institutions to comply with. Here's a hint. having less certainty when QAA will turn up, but knowing that they have more power to do nasty things to you when they do is not going to help Vice Chancellors sleep at night.
  • HEFCE. From 2013 onwards, HEFCE are going to regulate all existing and new providers, and fund all not-for-profits. Many of the existing 'private' providers are not-for-profit and will become eligible for HEFCE funding. All will be able (subject to OFFA agreement) to charge up to £9k from 2013. All will be subject to student number caps in future. HEFCE will have a dual mandate to regulate but also to fund and, through funding, to pursue a specific Government agenda. The move away from a block-grant (in public HEIs) or a direct commercial relationship with students (in privates) to an ever-increasing 'margin' of student numbers allocated through annual competitive bids to HEFCE places HEFCE very firmly in the driving seat of the sector from now on.

In the immediate future, growing private provision will itself be a government priority, so private providers should be able to get reasonable allocations of 'margin' places in the first few years. In the middle-to-long term, however, HEFCE will come to constitute a key obstacle to their growth plans (just as HEFCE is a key obstacle to my current employer's growth plans) and they will therefore require a high level of expertise in HEFCE-management to overcome this obstacle, or at least to mitigate the impact. I think it's fair to say that 'students at the centre' was the wrong title for this White Paper.

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