Creating a level playing field not as easy as it looks

Alex Proudfoot, Chief Executive of Independent Higher Education, the new representative group of alternative providers, recently called Jo Johnson an “ally to independent providers”, and so he certainly appears to be.

Having accused the rest of the sector of acting like ‘bouncers’ at the higher education door, Johnson’s Higher Education and Research Bill is introducing reforms that claim to open the market to new providers and ‘level the playing field’. On the face of it, this seems like good news for the new providers, with fresh options for entry to the sector through a ‘single gateway’, no longer guarded by the established university bouncers. What’s to dislike?

Yet after spending a day with delegates at the annual Independent Higher Education (IHE) conference, there is no popping of champagne corks in the independent sector, at least not yet. In fact, for new providers just getting their foot in the door, the Bill appears to open up as many new questions as it does provide answers.

All change?

The Bill states that the new Office for Students will have a register with three types of providers: registered, approved, and approved (fee cap). Those in the latter category will get access to research and teaching grants, so long as their fees are capped at the ‘higher amount’ (currently £9,000). Yet, in the current regime, private providers who want access to research and teaching grants have to register with HEFCE and accept government fee caps. Is there much difference between the old and new systems?

The major new innovation would appear to be the ability to attain probationary degree awarding powers (DAPs) in both the ‘approved’ and ‘approved (fee caps)’ categories. Private providers can apply for DAPs from day one, subject to “strong quality checks and close monitoring” that test their proposals for delivery rather than a track record of delivery. For providers who already hold DAPs in the sector, many of whom had to spend a lot of time and money attaining them, there us considerable concern about the impact this will have on quality and the sector’s collective reputation.

However, Proudfoot recently stated that probationary DAPs would probably only “be attractive mainly to those whose courses that already [have] inherent value even without a degree attached”. These might include providers and courses with extensive experience, overseas providers, and subject specialists. Many IHE members still view DAPs attainment as an unnecessary burden that carries too much process and bureaucracy. The Bill’s reforms might make attaining DAPs quicker, but not necessarily easier.

On the other hand, private providers who have struggled with validation may be considering these probationary DAPs. For many, finding good partners, managing the cost of validation, protecting intellectual property, and duplication of QA requirements have created a  difficult route into the sector. Yet it remains unclear how the aforementioned ‘proposal tests’ for probationary DAPs will work if you are completely new to delivering higher education. The recent announcement that Dyson will establish an Institute of Technology has been heralded by Jo Johnson as taking “advantage of our reforms […], which will give high-quality institutions a direct route to degree awarding powers and university status in their own right.” Yet, Dyson’s course is being delivered in partnership with the University of Warwick, suggesting validation still remains the preferable option, despite all its shortcomings in the view of many new providers.

So where next for validation? Clause 47 of the Bill gives the OfS the power to act as a validator – known commonly as the ‘validator of last resort’ – for those who can’t get validation from existing DAPs. Yet a degree awarded by the OfS not only presents an obvious conflict of interest (regulator vs. validator), it doesn’t seem like a particularly attractive option for students, future employers, and therefore private providers themselves – no one wants to be awarded the ‘degree of last resort’.

Rather than fall back on the OfS validation option, IHE are working towards ensuring validation services from established providers with DAPs – particularly the Open University – can be available to new providers. The option to have existing DAPs act as central validating bodies was proposed back in last year’s Green Paper, but doesn’t feature as strongly in the White Paper, which instead proposed to support ‘exemplar validators’ and edit Chapter B10 of the Quality Code (on managing validation and partnership arrangements) instead.

Provisional TEF

Although not technically part of the Bill, the new Teaching Excellence Framework comes hand in hand with its legislative reforms. The exercise appears to have been poorly setup to encourage new providers’ participation.

A heavily metric-focused exercise like the TEF requires significant amounts of data. The TEF guidance outlines that the metrics must cover a three year period and those who do not have the suitable metrics will be prevented from receiving a rating. With most private providers only just entering HESA data returns for the first time this year, and IHE suggesting reliable data won’t be available until 2020, there are only handful of new providers that can actually enter the TEF. Those who can’t produce the data have been given the option of ‘provisional TEF’, but this will have no Bronze, Silver or Gold award, and no accompanying ability to raise capped fees in line with inflation.

A missed opportunity?

On top of this, there are many representatives of new providers who feel that the Bill is a missed opportunity to deliver alternative styles of higher education that the minister appears to aspire to create. Many private providers are interested in new delivery models such as accelerated degrees, non-traditional learning times, and modular based learning, are still lacking the student finance system required to enable them. Student finance will continue to be based upon length of time studied rather than credits achieved. Yet, the call for evidence for both credit transfer and accelerated degrees sits outside the Bill, and it isn’t clear how or if the two will align.

To cap things off, many new providers are discovering that a lack of VAT exemption is proving a big financial constraint. As VAT is charged on private providers’ tuition fees, they lose 20% of the fee to the government unlike more established providers – a significant disadvantage. IHE is currently stuck in exceptionally complicated discussions with government officials about getting around this thorny issue.

Much has been made of the new new regulatory landscape and ‘single gateway’ into higher education, both by the its advocates and opponents. Yet on the ground, the signs are that there will be just as many challenges for new providers after the Bill as there were before.