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There is something happening in universities that no one is talking about. The coalition government’s Higher Education reforms of 2012 introduced a new system under which universities would no longer have their teaching underwritten by government grants, but would instead derive the majority of their funding from their students’ tuition fees, accordingly increased in 2012 from £3,000 to £9,000. A main aim of this reform was that increasing competition for students would give institutions stronger incentives to focus on improving quality of their degree courses, because if they were unable to attract enough students, their funding would decrease and they eventually succumb to bankruptcy and closure. Last year, market discipline was introduced at the bottom of the market via a new, uncapped student recruitment policy. Universities were able to recruit an unlimited amount of students, leaving less applicants in a position where they would need to take up a place on the least ‘competitive’ degree courses.
Degree courses which were the least competitive (those that represented the worst value for money for their graduates in terms of employment prospects, institutional reputation and student satisfaction) could be expected to do one of two things. Either they would increase their competitiveness by driving up the quality of the course; improve the standard of teaching, increase the ratio of staff to students, and try to improve the employability of their graduates – or alternatively the university would admit defeat and close the courses struggling to recruit, leaving the Higher Education marketplace leaner and better.
In many uncompetitive institutions that, thanks to uncapped recruitment, are now having their traditional applicants poached from universities higher up the pecking order though, neither of these things are happening. Why? Because there’s a secret third option for failing degree programmes, and its one that no one is talking about. When faced with closure and job losses for academics and support staff, many failing degree courses at the bottom of the league tables are instead opting to recruit large numbers of students that, by their own standards, are unsuitable for Higher Education.
To take a quick example, for six of the nine lowest-ranked Business and Management courses in England and Wales of a recent independent league table, the majority of students who enrolled on them between 2013 – 2015 were accepted with entry grades that fell below their official entry requirements, and out of the remaining three lowest ranked courses, around a third of students enrolled had been accepted with lower qualifications than the institution said they required.
Importantly, it is at this time of year, during the last gasps of the Clearing period, when the most unethical recruitment practices take place. Course leaders, terrified that they are weeks away from losing their jobs due to their courses becoming financially unviable for the university, are reluctantly ushered into clearing call centres and handed data lists that the institution has purchased directly from UCAS. They are then tasked with cold-calling to UCAS applicants who have never shown an interest in that particular university but who are currently without offers, and the academic will offer them places on their degree programmes, over the telephone there and then.
The Browne Review of 2010 that initiated the Higher Education reforms stated ‘Students are best placed to make the judgement about what they want to get from participating in higher education.’ But how easy is it for young people to make an informed, discerning judgment, when it is those universities with the worst outcomes for graduates that are the most aggressive in pursuing them?
Try to imagine how it might feel to be an 18yr old presented with the above situation. You’ve just found out you’ve performed very poorly in your A-levels and have consequently been rejected from all of your university choices. Suddenly, just when you’re at your most depressed and vulnerable, a Lecturer takes the trouble to call you and tells you that actually, you’re a perfect candidate for Higher Education! There are very limited places left on their highly exclusive course and usually the entry requirements are much higher, but you’re such a good fit, they can make an exception for you – they’ll even throw in a £1,000 bursary to sweeten the deal. You take a closer look at the university’s website and are encouraged to see that they’re not joking – usually the entry requirements for the course you’re interested in are much higher. Perhaps you don’t have too many people you can ask for advice, you might well be the first person in your family to try to access Higher Education.
So what? You might be thinking as you read this. A level grades aren’t everything, plenty of people underperform at A level, take a place at a less esteemed university and go on to achieve great things.
Unfortunately, the outcomes for many of these institutions who recruit huge numbers of students without suitable qualifications tell a different story. The dropout rate among some universities was as high as 32.5% in 2015. Publicly, these institutions continue to wring their hands over these high levels of attrition, citing factors like inadequate financial support for students. This may be true, but what they are not addressing is that academics and admissions staff, faced with the closure of their courses and staring down the barrel of the redundancy gun, will often resort to recruiting students whom they know are disproportionately likely to drop out. Why do universities allow such indiscriminate recruiting? It all comes down to money. For that university with a drop-out rate of 32.5% and approximately 11,700 undergraduates, assuming that each student drops out after only one term of study and thus pays only £3,000 in tuition fees, this adds up to £11 million in annual revenue for the university. With such financial incentives it’s not hard to understand why the majority of students on some of the lowest ranked degree courses in universities have entry grades well below what they should be – the university doesn’t care whether they stay or not – they just want a one-shot cash injection before these students drop out. One Academic at an institution I recruited for even said as much in a Senior Management Team meeting, openly despairing of the fact that there was a deliberate, unspoken policy of accepting unsuitable students on to his degree courses to get all or part of their first-year tuition fees, before kicking them out part way through their studies due to lack of attainment of lack of attendance. His remarks went unchallenged by colleagues.
For the students that do make it past the first year on these undiscriminating degree courses, they are often in for a shock when they try to gain those all-important employability skills, namely gaining work experience while they study. For many, when the time comes to apply for a placement year or summer internships, they find that their low A level grades preclude any possibility of undertaking work experience with the multi-national companies that their course’s marketing spiel made reference to. I once witnessed a dejected Course Leader in a Senior Management Team meeting remarking on this. ‘Ah!’ replied one of his colleagues ‘but we only said they would have the chance to do an internship, we never promised them anything.’ In actual fact their pre-entry qualifications had given them no chance at all. The meeting moved swiftly on.
Looking at graduate employment outcomes for the nine lowest ranked Business and Management courses (arguably a subject whose students highly value employment prospects) in England and Wales, we can see that the majority of students (50.2%) of those that are in work six months after graduating, are not in graduate-level jobs (UNISTATS website), compared to just 6.5% of graduates from the nine top ranked Business and Management courses. The average graduate salary for those from the lowest ranked courses is £18,000 – well below the average salary across graduates from all institutions in the UK after taking a similar course (£24,000) and far less than the £27,000 graduate salary that those from the nine top ranked courses enjoy. The only outcome that is uniform among these degree courses is the level of debt that students can expect to amass during their studies – the Business and Management courses with the best and the worst graduate outcomes all charge at least £9,000 in tuition fees per year.
The leaders of degree courses with the most flouted entry requirements and the worst graduate outcomes often argue that their mission is to open up Higher Education provision to those with a background of disadvantaged socio-economic status, who have not previously been able to enjoy its benefits. But at what point does provision become exploitation? A degree course for whom the majority of its students are not able to access graduate-level jobs upon completion, and with which many of its students are unsatisfied, but nonetheless burdens them with up to £50,000 worth of debt, is still failing to provide these benefits. Instead, many of those from disadvantaged backgrounds are being provided with what Andrew McGettigan, in his book The Great University Gamble: Money, Markets and the Future of Higher Education refers to as ‘sub-prime degrees’ – similar to the phenomenon of ‘sub-prime mortgages’ being offered in the United States before the financial crisis, in that like the mortgages, these degrees are sold to communities that are relatively unfamiliar with the product, saddling huge numbers of people from the least advantaged sections of society with massive debts and little else to show for it. Perhaps this explains why, in a recent survey, more than a third of recent graduates said that they regretted their decision to go to university and half said that they could have landed their current jobs without a degree.
So where is the State in all of this? Within this new marketization, if the universities are to play the role of the service provider, the student that of the informed customer, and the government takes the part of the regulator, why aren’t institutions and degree courses with atrocious graduate employment outcomes, low levels of student satisfaction and sky-high tuition fees being held accountable by the State to the students they are supposed to be ‘serving.’ Students today have all the responsibilities of a consumer but absolutely none of the rights. If I buy a brand new car for £50,000 to take me on an important journey, and it breaks down half way there and can’t get me to my destination, then I as a consumer would have some recourse to complaint – I could rely on government legislation to uphold my statutory rights. So where is the legal protection for students who will spend the same amount of money on a university degree, and find that the journey they were promised it would take them on hasn’t materialised? Is it crass to equate higher education with buying a car? Absolutely. But this is the transactional territory that the government itself has dragged the sector onto, it is they themselves that said that the ultimate measure of quality for degree courses would be student satisfaction, that the value of a bachelor degree was to be judged in terms of its ‘employment returns’ and that the reforms would make the universities ‘accountable to the students they serve.’ So where is the recourse for action for those young people who have been failed by their institution, who have come out of courses that they were unethically persuaded to sign up for in the first place, burdened with £50,000 of debt, and who find that they are still deemed unqualified by employers to access graduate-level jobs?
Under the current reforms, it is only the students themselves and the taxpayer, not the universities, that are held accountable for poor standards of higher education provision. Students who are unable to find graduate-level jobs will be held accountable for the pointless debts they have racked up for thirty years after they graduate – during which time many will find that the monthly repayments they make will not even be enough to cover the interest accrued on the outstanding balance. The tax-payer will also pay for the financial fall-out from these sub-standard degrees, in that graduates are required to pay back their loans broadly according to how much benefit they have received from their degree, indicated by the size of their subsequent salary. If the enhanced employment outcomes that a degree was meant to provide don’t materialise, then the loan will not be repaid. After thirty years, any outstanding debt will be written off and it will be the tax-payer alone that shoulders the failure of Higher Education to deliver according to the government’s own measure of quality. Accounts published from the Department of Business, Skills and Innovation (BIS) in July 2014 reported that although student and graduate borrowers owed £54 billion to the government, it expected to receive only £33 billion in repayments, and for new loans issued in 2014-2015, BIS expects to lose forty pence on every pound loaned. In an era when part of the last Chancellor’s ‘fiscal mandate’ was to see national debt fall as a percentage of GDP – it is now thought that the new higher education funding system will add more than £100 billion to the National Debt before the mid-2030s. At that point, the Office for Budget Responsibility thinks, the borrowing to create student loans could constitute one fifth of National Debt. This doesn’t sound like the sustainable financial future for Higher Education that we were told these reforms wold achieve.
So what needs to be done? At the very least, universities should stop lying about the qualifications needed to gain entry on to their degree course. If the majority of those enrolled for a particular degree of study fall well below the stated entry requirements, than those entry requirements need to be called out for what they are – utterly fictitious and merely a cheap trick to deliberately misguide prospective applicants about the standard of education on offer. Take them off the website and replace them with the genuine, median qualifications of the current cohort. At least this way students can make a more informed decision about what is really being offered to them.
In the long-term though, what is really needed is better state regulation of degree courses, so that there is accountability assigned to those that charge the maximum tuition fees and boast low teaching quality, poor staff to student ratios and abysmal graduate prospects. If the government is going to allow young people to amass such large debts before the age of 21, they should at least safeguard them by providing some quality assurance as to what universities must provide in return for such massive borrowings.
Finally, it is time we opened our eyes to the uncomfortable truth that just because record-numbers of students from lower socioeconomic backgrounds are gaining access to Higher Education, it does not follow that there is anything close to parity in the quality of education on offer to these sections of society and that which is available to those from more privileged groups with better A level grades. Equally, those who were in favour of the recent reforms should stop pretending that the marketization of Higher Education in Britain, without any regulation of degree courses, will significantly reduce the State’s financing of Higher Education in the future. Because in the unregulated Wild West of Higher Education provision, it is both students and the Taxpayer that suffer.