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Post High School Roadblock? The UK’s Great University Gamble

Thursday, August 1, 2013

Equinox Summit: Learning 2030 focuses on the future of high school education, a future that will be influenced by the wider landscape of education issues; from informal to formal education, primary to post-secondary.

In this Learning 2030 Blog entry, explore the post-graduation roadblocks encountered by high school students in the UK as their opportunities in higher education change, rapidly. 

by Andrew McGettigan, Learning 2030 Blog Contributor

In 2010, the general election in the United Kingdom brought together the Conservative party and the Liberal Democrats in a coalition government. 

At that point, I had already become concerned about changes in the way money was moving around the English higher education system.

The reforms proposed by this new government soon changed those circuits radically.

Could you pay three times more tuition?

One such reform would see the maximum tuition fee for an EU student increased from £3400 per year to £9000 per year for undergraduate study at English universities, starting in 2012.  Education is a ‘devolved’ issue in the UK, meaning that it is controlled by regional administrations. Thus, the maximum tuition policy differs in Northern Ireland, Wales and Scotland (where there are still no tuition fees for Scottish students).

This headline-making transformation garnered the attention and drove the protests that culminated with the Parliamentary vote taken in December 2010, but the more significant move was that the higher fees were designed to replace massive cuts to the direct grants universities and colleges received from the government.
(Image 
© Matt_Baldry)                                                                    

The new model

So, for those starting university since 2012 who choose to study arts, humanities, social sciences, law, business, etc. (i.e. ‘classroom subjects’), student fees are the only income the host institution receives.

The chief effect of this move was to create a ‘level playing field’ for new ‘market entrants’: commercial providers who cannot receive public grants. 

This market reform was explained by David Willetts, the Minister for Universities and Science, in February 2011:

“Currently, one of the main barriers to alternative providers is the teaching grant we pay to publicly-funded HEIs [higher education institutions]. This enables HEIs to charge fees at a level that private providers could not match, and so gives publicly-funded HEIs a significant advantage. Our funding reforms will remove this barrier, because all HEIs will – in future – receive most of their income from students via fees. This reform, of itself, opens up the system.”

Students as consumers

Now, new competitive pressures are combining with the promotion of students as consumers to create a new culture of higher education: one that is meant to reform teaching. 

Quality is now meant to be determined by the vector: consumer-university manager-regulator/ombudsman…

This demand-led dynamic replaces the ‘vested producer interests’ of academics.

Can they survive?

I’m now attempting to monitor what happens to established universities when faced with this new terrain and how they are emulating the private providers. 

I’m also attempting to outline what privatization might mean when we are discussing institutions such as universities, which are already independent charities, rather than state-owned entities. 

This includes transformations in borrowing, off-balance sheet activity and investment strategies. In particular, recent moves on the capital markets as English universities take the first steps into public bond issuance for several years. 
(Image 
© martie1swart)

 

What this might mean for other countries…

From an international perspective, what may be of most interest are the income contingent repayment loans used to finance undergraduate study in the UK. 

These have been touted as the solution to the graduate debt crisis in the US – ‘smart loans’ – since monthly repayments are determined by earnings not by the amount borrowed. 

One of the things I continue to look at and hope to examine in greater depth is why these loans are not the technocratic dream solution that many envision.

Andrew McGettigan (andrewmcgettigan.org) has taught at Middlesex University and the University of Westminster. He is the author of 'The Great University Gamble: Money, Markets and the Future of Higher Education' (Pluto, April 2013) and writes frequently on higher education for The Guardian.