Value for money in HE – denial is not an option

14.11.2018

The recent report by the House of Commons Education Committee ‘Value for money in higher education’ offers vital insight into the prevailing winds in HE, and how the concept of value for money for students is going to shape universities over the coming years.

So what is the report signalling, and what should universities be doing right now?

Here are some of the key messages in the report, and some suggestions as to how you might act now to reshape your plans for 2018/19 and beyond.

Key message 1: The post-18 education review will be used as an opportunity to reshape the sector, and the regulator will be an active force in this process.

“We encourage the post-18 education and funding review to be brave in its approach, to design a holistic funding model which supports a wider range of pathways and prioritises support for disadvantaged students. The Government must take this opportunity to signal a move away from the traditional linear approach which currently dominates. The future of higher education should be more inclusive, more skills-based and more focused on value for money for students.”

The interesting word here is ‘brave’. Institutions might want to take this concept into their senior leadership planning process and ask, “How can we be braver and bolder in what we offer to students?” Inclusivity and value for money for students should be a litmus test for all areas of university ‘business’.

*“Higher education is still not as accessible as it should be, and some institutions are failing in their efforts to admit a more diverse range of students.”

“Higher education institutions spend a vast amount of public money on access and participation. The results of this expenditure are not always clear to see. There must be transparency on what they are investing in, a greater focus on outcomes for students and a rigorous evaluation process.”*

Honesty is key here, not external spin. Are you doing enough to admit a more diverse range of students? What is really working? Are you being honest as to the results of your current Widening Participation programmes?

The reality is that unless institutions do more of their own volition they will be pushed hard to do so through the regulator and funding.

“In response to the Director of Fair Access’s new proposals we expect to see institutions focusing their efforts on value for money for the most disadvantaged students and facing penalties if sufficient progress is not made.”

Now is the time to commission a comprehensive review of your Widening Participation expenditure, the programmes you run and the true impact of those programmes. This issue ought to be on your risk register and an agenda item on your next Council meeting.

Key message 2: Funding is going to change and there is a consensus that grants and means-tested loans should be brought back.

*“The Government must urgently address the decline in part-time and mature students and re-introduce a system of maintenance grants for the most disadvantaged students.”

“Based on the overwhelming evidence we have heard during the inquiry, we recommend that the Government return to the pre-2016 system and reinstate the means-tested system of loans and maintenance grants.”*

We know that the funding model is going to change but we don’t know how. Recent leaks point to £6.5-7.5k. There has been talk and then rejection of a cap on numbers and a suggestion that, depending how the government will account for student loans, there could be funding to subsidise some subjects. Now we add into the mix means-tested loans and maintenance grants. There are many variables to model but it’s vital that finance and admissions teams model different scenarios asap. Student fees should be a flashing red light on your risk register.

Key message 3: Degree apprenticeships are vital to UK PLC and should be offered by all universities.

“Higher education must play a more significant role in meeting this country’s skills needs and preparing students for the Fourth Industrial Revolution. Degree apprenticeships are crucial to filling skills gaps and boosting this country’s productivity.”

All higher education institutions should offer degree apprenticeships, and we encourage students from all backgrounds to undertake them. We recommend that the Office for Students demonstrates its support for them by allocating a significant portion of its widening access funding to the expansion of degree apprenticeships specifically for disadvantaged students.”

Cue a review of your degree apprenticeship offer, and a clear strategy as to how you are going to grow degree apprenticeship numbers and widely publicise your offer.

Key message 4: VC and senior management pay must be constrained by the regulator.

*“Excessive salaries of Vice-Chancellors are disconnected from a value for money offer for students. The Office for Students must take a much firmer stance on senior management remuneration and not be afraid to intervene, especially when institutions pay their Vice-Chancellor more than eight times the average staff salary.”

“Unjustifiably high pay for senior management in higher education has become the norm rather than the exception and does not represent value for money for students or the taxpayer.

“The current system of self-regulation for senior management pay is totally unacceptable. We call for the Office for Students to publish strict criteria for universities on acceptable levels of pay that could be linked to average staff pay, performance and other measures that the Office for Students sees fit. The Office for Students should take swift action if this is not the case.”*

A governance review of your remuneration policies and practices is an urgent necessity. Compliance with CUC should be seen as the minimum. Going further and faster will put you in a good position on this issue. Ensure your practices go beyond VC pay as the focus has widened to include senior management. Ensure your policies and practices are transparent and that you openly report on senior pay.

Key message 5: The 3-year degree model isn’t delivering and the 2-year accelerated degree is coming up fast as an preferred option.

*“Universities must move away from a linear approach and embrace more flexible types of learning…. Only through a step away from the rigid, traditional three-year undergraduate study approach can universities ensure they are open to students from all backgrounds.”

“More flexible approaches to higher education should be supplemented by the option for undergraduates of studying for two-year accelerated degrees alongside the traditional three-year model. The post-18 review should investigate potential funding models to clarify the benefits and costs of accelerated degrees, taking into account fees, living costs and post-study earnings.”*

“The introduction of two-year degrees must not create a two-tier system where students from disadvantaged backgrounds are encouraged to take them on the basis of cost. The Government’s review of higher education should include an impact assessment of how accelerated degrees will affect disadvantaged students.”

The signals are clear. If you are not currently modelling a 2-year degree offer now is the time to do so. Also it’s vital to be clear as the value of your 3-year model and what it can offer over and above a 2-year model – see comments below on work experience for example.

Key message 6: TEF should more directly inform student choice and preparation for work should be a focus.

*“We look forward to the independent review of TEF and recommend that it focuses on how the exercise is used by students to inform and improve choice. The review must include an assessment of how TEF is used in post-16 careers advice. For the TEF to improve value for money for students it must play a more significant role in the decision-making process of applicants.”

“There should also be a greater focus on the extent to which universities prepare their students for work in the TEF criteria.”*

To some degree this is a ‘wait and see what the outcomes of the TEF review are’. However, there are some obvious actions you can take now. This includes the information you provide on TEF to prospective students and the information you offer in terms of how you prepare your students for the work – see comments below on work experience and labour market returns.

Key message 7: T-levels and BTECs must be accepted and more support offered to students with these qualifications.

“The implementation of T-Level qualifications from 2020 could offer improved access to university for students from disadvantaged backgrounds. The Government should engage with universities and UCAS in order to determine an appropriate tariff weighting prior to the introduction of T-levels. We also encourage universities to continue to accept BTECs and put in place additional academic and pastoral support to these students throughout their studies.”

How well do BTEC students progress at your institution? Are you doing enough to support them? The Transforming Transitions project at the University of Exeter offers helpful insight into BTEC progression and the support requirements of such students.

Key message 8: Work experience must be the norm.

“We recommend that universities look to include significant periods of work experience within undergraduate degree courses. This could be a year in industry, or shorter placements with local employers. We believe that practical experience of the workplace must become the norm in degrees and an integral part of making students ‘work ready’.”

How many of your students have access to work placements? How can you increase that %? Are you building it into courses? How can you build relationships with employers to provide a wider range of options? Do you have the staffing and resources needed to increase the focus on this area? Are your teaching staff well-informed as to where their students go on to work? Do they have relationships with employers? A work experience action plan should be in place to answer these questions and clear information provided to prospective and current students.

Key message 9: Universities must be clear as to the ‘labour market returns’ for their courses.

“Better information on graduate outcomes must lead to a greater focus in higher education on outputs and outcomes. Higher education institutions must be more transparent about the labour market returns of their courses. This is not simply a measure of graduate earnings but of appropriate professional graduate-level and skilled employment destinations. We recommend that the Office for Students instructs all providers to be transparent about levels of graduate employment and secure this through funding agreements.”

Review your graduate employability and earnings data by course. Understand what gaps you have and put in place a plan to improve the quality of your employability data. Consider how best to communicate employability information by subject area. Review how this will be interpreted by applicants and consider how you can contextualise that information. Whatever you do, don’t hide from reality and don’t mislead students.

Key message 10: The days of using unconditional offers to fill places are over.

“The Office for Students must clamp down on the rise in unconditional offers. Their steep increase is detrimental to the interests of students and undermines the higher education system as a whole.”

Urgently review your policies relating to unconditional offers. Determine if, when and how you will use them, and publicise this information clearly. Be ready to justify your policies to the regulator. Consider carefully how a change in policy will affect your student numbers and model the financial consequences.

St Mary’s announced that they will no longer use conditional offers. Others are considering doing likewise. If you continue to use unconditional offers, transparency as to your policies and practices will be key.

Key message 11: Students are getting woeful information and advice and are not making informed decisions.

*“Decisions to take on a financial burden lasting most of a working lifetime are often made by students without adequate information or advice. The long-term implications of an adverse choice can leave students in a vulnerable position.”

“Student choice is central to the debate over value for money in higher education. Our inquiry found a woeful lack of pre-application and career information, advice and guidance, particularly awareness of degree apprenticeships. The Government’s current post-18 review must look at routes into higher education, and the quality of careers advice which students receive.”*

What can you do to improve the quality of advice and information you make available to prospective students? How can you partner with schools and FE colleges to provide better information and advice? The more you can show you are doing on this one the better. Have you reviewed your school outreach programmes recently? Now may be the time to increase the budget for school outreach.

Halpin Partnership is a management consultancy specialising in higher education. For more information please email get in touch.

Article Name
Value for money in HE – denial is not an option
Author
Susie Hills
Publisher name
Halpin Partnership
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