Category: UK Government

  • Support for action on ethnic and disability pay gaps demonstrates our commitment to our communities

    Support for action on ethnic and disability pay gaps demonstrates our commitment to our communities

    By mirroring gender pay gap reporting, which was made mandatory in 2018, the Equality (Race and Disability) Bill would introduce mandatory ethnicity and disability pay gap reporting for large employers with 250 or more employers.

    In his foreword to the consultation on introduction of the Bill, the Minister for Social Security and Disability Stephen Timms notes that the UK is far away from achieving its goal of creating a more equal society in which people can thrive whatever their background. According to the Office for National Statistics, the current ethnicity pay gap in the UK ranges from 1.9 per cent to 9.7 per cent, depending on ethnicity and if individuals were born in the UK.

    Diving into the data, we were concerned to find that no progress has been made in reducing the median gross hourly pay gap for Black, African, Caribbean or Black British employees compared to white employees, remaining “consistent since 2012”. The disability pay gap is even more pronounced, at 12.7 per cent, having remained “relatively stable since 2014.” The lack of progress in closing these pay gaps is as concerning as the lack of awareness of the problem.

    Conversely, the practice of gender pay gap reporting will have contributed to the gender pay gap declining by approximately a quarter among full-time employees over the past decade. Greater transparency helped build the foundations for positive transformation, creating a strategic imperative to root out systemic inequalities and leading to many employers developing, and proactively publishing, action plans to close the gap within their organisations.

    In pursuing the noble aim of creating a more equal – and socially cohesive – society, the same focus must now be placed on tackling racial and disability inequalities. Economic inequalities between ethnic groups are an important contributor to social unrest.

    The government should be supported in its proposed introduction of the Equality (Race and Disability) Bill and, speaking as vice chancellor of Birmingham City University (BCU), David would encourage fellow higher education leaders to join him in lending our public support to the government for this proposal.

    There are two key reasons for higher education institutions publicising their ethnicity pay gaps in particular: to build trust with their internal community, and to strengthen authentically social cohesiveness in their local communities.

    Building trust

    BCU’s new strategy articulates a clear commitment to improve the diversity of our organisation at all levels and eradicate pay gaps. The first step in this will be to publish all our pay gaps with a clear plan to close them by 2030.

    There are persistent racial inequalities in higher education. This is demonstrated most evidently in awarding gaps for ethnic minority students and Black students achieving a good honours degrees compared to white students, at 14.1 per cent and 21.6 per cent respectively in 2024. A lack of representation of ethnic minority staff in senior positions also conveys persistent inequities. Ethnic minorities now comprise one in three undergraduate students, but only one in four (20.2 per cent) of academic staff. Their representation is even lower among professors (15.1 per cent), senior managers (9.1 per cent) and executives (7 per cent).

    The picture is more concerning in terms of Black representation in higher education. One in ten undergraduate students is Black (9.6 per cent), but only one in every roughly 27 academics share their ethnic identity. Only 1.6 per cent of all professors are black and 0.7 per cent of executives.

    In contrast to the gender pay gap, information on the ethnicity pay gap in higher education is not routinely published. Combined with the lack of proportional representation of ethnic minority staff in senior positions, the lack of published data and strategy to tackle pay gaps has caused many staff to lose trust in institutional leadership and its commitment to tackle racial inequalities. The Equality (Race and Disability) Bill would bring parity with mandatory gender pay gap reporting and offer greater transparency to our communities.

    For reference, the median gender pay gap across higher education institutions, which stands at 11.9 per cent, reduced by 4.4 percentage points since reporting began in 2017.

    Community cohesion

    Universities play a crucial role in shaping their localities and are increasingly active in strengthening social cohesion – our institutions allow (mostly) young people to study in diverse settings, enable better understanding of different cultures, encourage active citizenship, and develop graduates who are more likely to show concern over racism, be more positive towards immigration, and less likely to view feminism as harmful. Our social mobility missions break cycles of poverty, research and innovation activities drive productivity, and graduates sustain vital public services.

    Working effectively with our diverse local communities necessitates trust and the transparent reporting of systemic racial inequalities is paramount. For BCU, this means better reflecting and working in partnership with a community in which no ethnic group has a majority; the 2021 census identified that Birmingham’s population is more than twice as likely to come from an ethnic minority than the overall population in England. 51.4 per cent of people living in Birmingham are from an ethnic minority group, compared to a national average in England of 19 per cent. The data is much more profound for Ladywood, the constituency in which BCU’s city centre campus is based. Here, more than three in four (76.6 per cent) come from an ethnic minority, with the greater proportions of Asian (38.6 per cent) and Black (25.9 per cent) than White (23.4 per cent) citizens.

    Birmingham’s “super-diversity” is seen as one of its biggest strengths, the city council opining that it stems from the city’s long-standing history for welcoming people from around the world. However, we must recognise that challenges persist, most notably in terms of engendering social harmony and tackling inequality. Those two challenges are interlinked: social harmony rests on our different racial and ethnic groups feeling valued and having trust in their local institutions providing equal opportunities and equitable outcomes, regardless of background.

    Our 2030 strategy sets out a clear vision to be an exemplar anchor institution by 2030. This vision was co-created with representatives from our communities, who recognise and value the crucial role that universities like ours play in their locality. Our strategy explicitly recognises the responsibility we have in strengthening social cohesion in our home city of Birmingham.

    From speaking with many vice chancellors, I know that we at BCU are not alone in championing our civic mission. Notwithstanding this, until we collective publish data on ethnicity pay gaps – alongside action plans to overcome these – our sector may find it difficult to build and sustain trust with our diverse internal and external communities. The Equality (Race and Disability) Bill offers a timely opportunity for our sector to demonstrate its commitment to racial justice.

    My fellow vice-chancellors would do well in voicing their support through this government consultation.

    The consultation on the Equality (Race and Disability) Bill closes on 10 June and can be accessed here.

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  • In an era of permacrisis, higher education needs to get better at coming up with solutions

    In an era of permacrisis, higher education needs to get better at coming up with solutions

    Readers of Wonkhe need no reintroduction to the storm surge of bad news that, wave after wave, is washing over the sector’s defences and causing the majority of UK institutions to take drastic financial evasive action.

    Given that the government’s response to the growing financial crisis in UK higher education seems to be “let’s do a ranking of vice chancellor salaries compared to graduate salaries” and “let’s introduce an international student levy that the Australian Government decided was a bad idea,” it also seems pretty clear that the sector isn’t exactly cutting through with its political affairs arguments.

    In other words, the sector has to generate our own solutions to the problems we face.

    On the back foot and retreating

    On 25 June The Venn University Leaders Forum will convene senior academic and professional service leaders from across the sector to provide them with the space, inspiration and facilitation needed to help develop these solutions.

    The Venn will feature interactive sessions focused on geopolitical scenario response, unconferences, challenges “from the vice chancellor’s desk” and perspectives from North America and from outside higher education. Most importantly it will take the conversations in the margins’ of conferences that so many of us find the most valuable part of these forums – and provide the space and format for that to happen during the main programme.

    We need a better playbook

    In adjusting to permacrisis, one of the challenges universities and the sector has as a whole is that we risk spending all our time and energy raising the shield to fend off each individual wave of issues; and wielding the sword only in a defensive, reactive measures to trim staff numbers, cut courses and reduce expenditure.

    There are two risks to this approach. First, institutions can’t “take a breath” to think about how they adapt to the new reality, leading to constant reactive churn, burnout of staff, and leadership feeling under siege. This reminds us of that moment in about February 2021 when the adrenaline of dealing with successive Covid impacts and new variants started to seriously ebb away from those within universities, and institutional leaders started to think longer term about how to turn ‘crisis-response mode’ into ‘crisis-as-usual’.

    Second, the sector misses the tsunami lurking on the horizon and fails to invest in measures that either avert or prepare for a much larger impact. Given that on almost every occasion in the last decade we’ve said, “oh, that couldn’t possibly happen” only for the Darkest Timeline to be victor – it’s now odds-on that a Farage-Badenoch ticket will sweep to victory in the next General Election. How is higher education preparing for this possibility?

    “Telling people what do” isn’t working

    When I was in the US recently as part of the CASE Global Leaders Programme, a senior representative from one of the US university associations said they had a shared bingo card with their colleagues that they used every time a university president said “we just need to tell our story better… we need a ‘Got Milk’ campaign.” But we’ve been trying versions of that for a while, and nothing has changed. It’s no longer sufficient for higher education to “tell” better. It needs to “do” better.

    For universities, the question is now no longer “how do you do more with less?” Instead, it is becoming “how do you do less with less?” – and what do you stop doing entirely? As difficult as the current situation may seem, the sector still has the resources, political capital and ingenuity to make bold, impactful choices about what it does differently. This includes new models of delivery that might change the public and political narrative, shift the dial financially and maybe even divert the worst case scenario. Critically it has the opportunity to look at what is happening around the world – most strikingly in the US – and learn what to do (and what not to do).

    This article is published in association with The Venn – find out more about The Venn and apply to attend here. Wonkhe is partnering with The Venn to create a dialogue between the event and our upcoming Festival of Higher Education on 11–12 November – early bird tickets are now on sale.

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  • Higher education can cut through the immigration debate with a focus on quality

    Higher education can cut through the immigration debate with a focus on quality

    The surge for Reform in the recent local elections in England has increased fears in the higher education sector that Labour may feel compelled to focus on driving down immigration at the expense of its other priorities and missions – James Coe has set out the risks of this approach on Wonkhe.

    Vice chancellors are understandably frustrated with the public debate on immigration and do not relish the prospect of rehearsing the same political cycle in the wake of the forthcoming white paper on legal migration. All can reel off data point after data point demonstrating the value of international student recruitment to their regions and communities, which according to the most recent London Economics calculations for the academic year 2022–23 brought £41.9bn a year in economic returns to the UK. That data is well supported by polling that suggests the public is generally pretty unfussed about international students compared to other forms of legal migration. The latest insight from British Future on the public’s attitudes to international students found:

    International students are seen to boost the UK economy, fill skills gaps, improve local economies and create job opportunities for locals and make cities and towns more vibrant and culturally diverse.

    Heads of institution also add that of all the many and varied problems and complaints that arise from engagement with their local communities and regions, international students have never once featured. The problem, they say, is not policy, it is politics. And when politics tilts towards finding any means to drive down overall migration, higher education inevitably finds itself in the position of being collateral damage, despite the economic and reputational harm done – because it’s much easier to reduce student numbers than to tackle some of the more complex and intransigent issues with immigration.

    Standing the heat

    To give the government its due, the signal it wants to send on student visas is not currently about eroding the UK’s international competitiveness as a destination for study, and much more about reducing the use of that system for purposes for which it was never designed, particularly as a route to claiming asylum. Measures proposed are likely to include additional scrutiny of those entering from Nigeria, Pakistan, and Sri Lanka, an approach that may sit uncomfortably as making broad assumptions about a whole cohort of applicants, but at least has the benefit of being risk-based. That nuance may be lost, however, in how the public conversation plays out both within the UK and in the countries where prospective international students and their governments and media pay close attention to the UK international policy landscape and associated mood music.

    The political challenge is not limited to higher education. Recognising the derailing effect of constant short-term reactive announcements in immigration policy, a number of influential think tanks including the Institute for Government, the Institute for Public Policy Research, the Centre for Policy Studies, Onward, and British Future have called on the government to create an annual migration plan. The Institute for Government’s explanation of how it envisages an annual migration plan would work sets out benefits including clarity on overall objectives for the system with the ability to plan ahead, the segmentation of analysis and objectives by route, and the integration of wider government agendas such as those on skills, or foreign policy.

    For the higher education sector, an annual planning approach could make a big difference, creating space for differentiated objectives, policy measures and monitoring of student and graduate visas – something that in many ways would be much more meaningful than removing student numbers from overall published net migration figures, or presenting them separately. It could open up a sensible discussion about what data represents a meaningful measure, what should be adopted as a target and what should be monitored. It could also open up space for a more productive conversation between higher education representatives and policymakers focused on making the most of the connections between international education, regional and national skills needs, and workforce planning.

    In the weeks and months ahead the government is also expected to publish a refreshed international education strategy, which should give the sector a strong steer about what the government wants to see from international higher education. But it will be critical for that strategy to have a clear line of sight to other government priorities on both the economy and the wider immigration picture, to prevent it being siloed and becoming dispensable.

    The fate of the last government’s international education strategy tells an instructive tale about what happens when government is not joined up in its agenda. Three years ago the sector and its champions in Westminster celebrated the achievement of a core objective of that strategy – attracting 600,000 students to the UK – eight years earlier than planned. But that rapid growth provided both unsustainable, as numbers dropped again in response to external shocks, and politically problematic, as students bringing dependents drove up overall numbers and the government responded with another shift in policy. The credibility and longevity of the refreshed strategy will depend on the government’s willingness to back it when the political heat is turned up in other parts of the immigration system.

    Quality is our watchword

    The higher education sector is justifiably proud of its international offer and keen to work with government on developing a shared plan to make the most of opportunities afforded by bringing students to the UK to study. The focus has to be on quality: attracting well-qualified and capable applicants; offering high-quality courses focused on developing career-relevant skills, particularly where there is strategic alignment with the government’s industrial strategy; and further enhancing the global employability of UK international graduates, whether it’s through securing a good job via the Graduate route, or elsewhere.

    The value of international recruitment is not always very tangible to people living in communities in terms of valuable skills and cultural capital – and that breaks down to telling stories in ways that people can connect with. As one Labour Member of Parliament suggested to us, many parts of Britain are in the process of reimagining their collective identities, and part of the job is building a compelling identity connection with the new economy rather than harkening back to an imagined past. That is work that sits somewhat apart from simply explaining the value of international students, but may also turn out to be intimately connected to it.

    Higher education institutions can work with employers, the regional and national policymakers concerned with skills, innovation and growth, and in local communities, to further that agenda, but they need the breathing space afforded by policy stability and a clear plan from government they can trust will be sustainable. To create that space, the sector will need to demonstrate that it has a high standard of practice and will not tolerate abuse of the system. “Abuse” is a loaded word; many of the practices that raise alarm are technically legal, but they put the system as a whole in jeopardy. The sector has a great track record on developing a shared standard of practice through instruments like the Agent Quality Framework, but it may also need to collectively think through whose job it is to call out those who fall short of those standards, to avoid the whole sector being tarred with the brush of irresponsible practice.

    While the landscape is complicated and at times disheartening, UK higher education can cut through the noise by sticking like glue to its quality message. Many universities are bigger and longer standing than Premier League football clubs – but those bastions of community pride have also had to work through challenges with their places and update their practice as the landscape has shifted. There is an opportunity with the forthcoming white paper and international education strategy to get the government and the sector on the same side when it comes to international higher education. Both parties will need to show willing to hear where the other is coming from to avoid another five years of frustration.

    This article is published in association with IDP Education. It draws on a private discussion held with policymakers and heads of institution on the theme of international higher education’s contribution to regional economic growth. The authors would like to thank all those who took part in that discussion.

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  • The UPP Foundation is launching a new inquiry into widening participation to support the government’s opportunity mission

    The UPP Foundation is launching a new inquiry into widening participation to support the government’s opportunity mission

    Twenty-five years on from Blair’s target for 50 per cent of young people to go to higher education, the Labour Party set out a new ambition to “break down barriers to opportunity.”

    The opportunity mission articulates a multi-generational challenge: to make sure that children and young people can get on, no matter what their background; to change Britain so that a child’s future earnings are no longer limited by those of their parents; and to make Britain one of the fairest countries in the OECD. It is a fundamentally important challenge, and one that will be years in the undertaking.

    Widening participation in higher education plays a huge part in this mission, and it is for that reason that the UPP Foundation has announced a major new inquiry into the future of widening participation and student success. We have launched this inquiry by publishing a short “state of the nation” summary of the key issues in 2025. Because while success in the opportunity mission would transform the shape of British society, Labour is all too aware of the differences between the optimism of Blair’s famous 50 per cent pledge and the markedly different political and economic circumstances Keir Starmer’s government finds itself in now.

    A changed landscape

    Universities and schools face significant headwinds when it comes to dismantling the gaps students face when looking to get in and get on. The HE sector is facing well-publicised and unprecedented financial challenges, with the recent rise in fees doing nothing to alleviate pressure amid rising costs. With institutions contemplating restructuring moves and the government no closer to outlining a solution for widespread mounting deficits amid heavy fiscal weather, it is hard to see universities or the government finding much bandwidth for widening participation in the near future.

    There is also no equivalent target or metric that captures the challenge in quite the same way as Blair’s. This is understandable. Part of the reason no similar metric presents itself is because widening participation is now seen as multidimensional: not just focused on access to university, but also continuation rates, graduate outcomes, and less easily quantifiable measures of success, such as student belonging and participation in the immersive elements of the student experience.

    With the number of commuter students rising to reflect different learning patterns and pathways in a diverse student population, student living arrangements are also a major part of this puzzle. As the Secretary of State alluded to prior to the general election in an address to Universities UK, modern widening participation must reach out to more of those coming from nontraditional backgrounds, and those pursuing non-linear pathways through higher education.

    A wider view of widening participation means we need a more nuanced understanding of how access to university varies along socioeconomic, geographical and other demographic lines. As today’s report outlines, the difference in progression rates to higher education between students eligible for free school meals and their peers has widened to 20.8 per cent – the highest on record. Young people in London are significantly more likely to progress to higher education than their counterparts in the North East. The continuation gap between students from the most and least advantaged backgrounds now sits at 9.4 percentage points, having increased from 7.5 in 2016–17. As one of many charities operating in this space, we come face-to-face with the scale and scope of this disadvantage gap time and again. Equality of opportunity is still some way off.

    As well as this, some are schools struggling to do as much as others to support access to HE. Polling in our new report finds that 75 per cent of teachers in London expect at least half of their class to progress to higher education, compared to just 45 per cent in the North West and Yorkshire and the North East. Similarly, 75 per cent of teachers in Ofsted Outstanding schools thought that more than half their class would progress to HE, compared to just 35 per cent in schools rated as Requires Improvement or Inadequate.

    Although the Secretary of State said in a letter to heads of institution in November 2024 that expanding access and improving outcomes for disadvantaged students was her top reform priority in HE, the long list of challenges facing this government poses the risk that widening participation becomes a footnote to the geopolitical crisis.

    What we’re doing

    Despite the difficult environment facing both universities and the government, we think this agenda is too important to be put on the back burner. We hope our inquiry will help to establish new collective goals for widening participation and student success for the years ahead.

    The current moment provides a significant opportunity to interrogate the ways in which access and participation, student finance, student experience on campus, careers guidance, and student belonging intersect. It is in the context of this opportunity that the UPP Foundation, supported by Public First, is launching this inquiry, which aims to establish a new mission for widening participation.

    Following the introductory paper, we will publish two investigations, the first focusing on the persistent widening participation problems latent in “cold spot” areas of England, and the second exploring how the university experience differs based on students’ living arrangements and economic backgrounds, with poorer students often receiving a secondary experience that contributes to lower continuation and completion rates. Cumulatively, they will shed light on what meaningful widening participation really looks like to those who need it most, and what levers can be pulled to realise this vision.

    This inquiry comes at a crucial moment. We want to help the sector, the Office for Students and the government by setting out a series of evidence-based goals, recommendations and policies which could help make the broader vision a reality, while recognising “the art of the possible” in an era of fiscal restraint. Through these recommendations we hope to see the rhetoric of the opportunity mission and the Secretary of State start to become reality.

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  • Government economic policy depends on a healthily diverse higher education ecosystem

    Government economic policy depends on a healthily diverse higher education ecosystem

    At GuildHE, we represent over 60 institutions that do not fit the traditional, large, generalist, research-intensive mould. These institutions are deeply focused on industrial readiness, employability, specialist skills and regional growth.

    They deliver vital skills in geographical areas and sectors where the UK faces acute shortages, and directly support the government’s own missions to grow, increase opportunity, develop a greener future, reduce crime levels and build a better NHS. Whether this is achieved through healthcare, the built environment, teaching, policing, agricultural innovations, law or the creative economy, the future talent pipeline to address these missions depends, in large part, on the success of these providers. However, the current funding landscape does little to protect and support them.

    The image of the large generalist, research-intensive traditional higher education institution is the model on which the funding and regulatory system in the UK is based. This model has become the DNA of our systems, which rely on assumptions about the sector as a whole: its strategic missions, delivery mechanisms and capacity. These assumptions naturally impact the incentives and levers that are built into policy frameworks.

    Policies often fail to recognise those that fall outside that image, so that smaller, specialist, and non-traditional institutions face increasing threats to their viability. Sector consolidation and investment in the historically-established HE model, as seen in other settings across the world such as Australia and the US, could undermine our global reputation, agility and responsiveness to diverse students and industries.

    Challenging these systems, and the methodologies on which they are built, will require the government to embrace innovative models of practice across education, skills and research, even if it comes with some associated risk. Indeed, it will require a brave examination of the effectiveness of the very regulatory and funding systems which are encouraging a level of homogenisation across the sector that could spell its own doom.

    To that end, we propose an approach to spending in the next period that focuses on reforms to encourage investment and rethinking the system to make it work smarter.

    Invest in the talent pipeline and protect student choice

    As part of this government’s vision to expand opportunity, we have seen the beginnings of multiple new strategies and administrative initiatives, including proposals for a new Industrial Strategy, a Get Britain Working strategy, a new ten-year plan for the NHS, reform of higher education and the introduction of Skills England. These new arrivals aim to improve economic growth, encourage efficiency in public services, produce a future skills pipeline and build an investment environment for UK business.

    Higher education drives the transformative forces required to raise levels of productivity and improve economic growth. Institutions do this by stimulating the higher-level skills needed in industry, providing lifelong opportunities to retrain and upskill, and expanding opportunities for all to do so. They also do it by cultivating ideas and new knowledge; a cornerstone of productivity and growth.

    Alongside these contributions, we need to protect student choice by preserving a variety of institutional types and locations across the country. Doing so is vital to ensuring the widest range of students can access the transformative power of higher education; a power that yields both individual improvements in life chances and direct improvements to employability, our public services and our economy. Furthermore, a system that boasts a diverse range of institutions and provision types is a healthy one that can deliver to local economies and communities across the country and thereby demonstrate ways in which higher education institutions are vital to those beyond us.

    Balancing government growth and skills priorities with student choice is not mutually exclusive. Models of higher education that prioritise industry practice, employer needs, innovation impacts and workplace experience can achieve these priorities. The capability to develop high-level specialist skills dynamically in a way which also builds the social resilience required to respond effectively to new, advancing technologies is quickly becoming a standard requirement of our graduates. We need reformed spending to achieve it.

    Do things differently, get different results

    Minister of State for Skills Jacqui Smith has said that the government is ready to review the education system and develop a way forward that “challenges the status quo.” To genuinely fulfil this ambition, we need fundamental change to the foundational regulatory and funding systems so that diversity in terms of institution, student, and pedagogical approach can survive into the future. If this government is serious about its ambitions to grow and future-proof education and skills, the following reforms are needed.

    Reform teaching funding to support priorities

    Government should establish funding streams for specific outreach programmes in priority subject areas like creative arts, teaching, healthcare, construction and agriculture. Doing so would acknowledge failures in the prevailing market ideology that implied industrial need for qualified graduates would shape applications into relevant programmes. Identified subject areas required by both our industrial sectors and broader society could provide a clearer rationale for funding allocations than student numbers across current Office for Students bandings.

    The Strategic Priorities Grant for 2024–25 has been used to support “work on high-cost subjects, student mental health, degree apprenticeships, equality of opportunity, technical qualifications and a range of other priorities.” It is hard to see how smaller and smaller block grant funding allocations have delivered to myriad priorities and we have yet to see an evaluation of the effectiveness of that funding to support them.

    Given the existing financial pressures within the sector, which some suggest should be addressed by increasing tuition fees (presumably within the same funding methodologies), we suggest a more ambitious review of the funding system is needed to drive support to where it is most needed to preserve a healthy, dynamic and diverse sector that can deliver to a wide range of students across a wide range of locations, especially where there are limited routes into and through higher education.

    Revise funding for skills, research and innovation to drive growth

    The Growth and Skills Levy needs reforming. It needs to better support SMEs, which comprise 99 per cent of all UK employers and account for 61 per cent of total employment. SMEs are critical to most sectors, but they make up the majority of some identified as crucial sectors in the government’s Industrial Strategy, including life sciences, advanced manufacturing and the creative industries. Data from the Department for Culture, Media and Sport suggests that the vast majority of businesses in the creative industries are micro-businesses. To meet the government’s own industrial ambitions, it must not only reconsider how funding can be delivered through and to those SMEs, but also how investment in training could be flexed.

    Recent announcements by the government indicating plans to defund all Level 7 apprenticeships feel tone-deaf for those working in construction, healthcare, engineering and data science fields. To our minds, more technical skills training in fields meant to drive economic growth, which includes a wide range of skills at different levels, is not only a good thing, but is a necessary investment if those ambitions are to be realised. This is not to say we should fund L7 at the expense of lower level apprenticeships. Rather, we are advocating for investment in apprenticeships at all levels indicated as necessary by employers in those sectors where critical skills shortages have been identified as key barriers to economic growth and improvements in our public services.

    But it’s not just about skills training via apprenticeships. It’s also about generating new ideas and innovations to help us work more productively and unlock our abilities to deliver more with fewer tangible resources. To deliver that ambition, both research and innovation funding streams need reform. Higher Education Innovation Fund (HEIF) thresholds should be lowered to remove systemic biases that disadvantage smaller and specialist institutions. Research funding should be adjusted to provide reasonable minimum levels of allocation to all institutions where excellent research is being generated. Doing so would dramatically broaden the UK’s research base rather than deepen it by funnelling greater levels of funding to points where research is already established, thereby expanding research and development capabilities by widening the pool of contributors.

    Doing so would support a regional growth strategy. It would spread money to areas where infrastructure still needs development and could provide incentives in geographical areas where ERDF funding has been lost. Local authorities in non-mayoral regions should also have a clear role in shaping research and innovation policies, with greater collaboration and knowledge-sharing between them and MCA regions to create a more balanced and inclusive approach to regional development.

    A call for an inclusive funding model

    Higher education in the UK is built on a long history of tradition, prestige, and excellence. However, in a time of economic uncertainty and shifting international alliances, we must now innovate to maintain our position on the world stage. While large, generalist institutions continue to play a critical role in advancing knowledge and global competitiveness, they are just one part of the type of healthy higher education ecosystem needed to support 21st century democracies to deliver economically and socially for their citizens. Smaller-scale, specialist and non-traditional institutions with expertise in vocational, professional programmes are equally vital.

    The government has already acknowledged the importance of skills development, regional growth, and public sector workforce expansion in words, but these priorities must be reflected in its spending decisions, policy frameworks and implementation plans. The coming fiscal choices will contribute to whether the UK’s higher education system remains diverse, dynamic, and globally competitive—or whether it risks stagnation.

    Policymakers face a critical choice: will they promote a more balanced and inclusive approach to funding that embraces risk to boost excellence in research, innovation, and skills development? The future of our sector, the UK’s ability to meet its domestic goals, and the growing need for clear, strong and sustainable geopolitical values, depend on it.

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  • Edward Peck’s performance at the Education Committee

    Edward Peck’s performance at the Education Committee

    There’s something wonderfully postmodern about Edward Peck’s committee hearing ahead of his likely appointment as the next chair of the Office for Students.

    While the first chair of the regulator, Michael Barber, arrived with a fully documented quasi-academic theory of delivery – and while the second, James Wharton, brought a certain kind of political cunning – Edward Peck has a fully fledged multi-disciplinary research-informed theory of leadership as performance.

    How should we understand leadership as performance?

    The idea of performativity – broadly speaking that the descriptive language we use in a given situation has a direct impact on the situation itself – has informed a conceptualisation of leadership as a performance that interrelates both with the wider ideas of what it is to be a leader and the narrower immediate context as a particular leadership “act”. This shifts the focus on leadership from a kind of all-powerful “strongman” (with the consequent cod-psychological popular literature on essential attributes of successful leaders available at an airport near you) to something more subtle around relationships, language, and behavior across multiple settings as shaping experiences of leadership.

    Leaders – in other words – are sensemakers, both in terms of explaining (and thus shaping) reality for those around them, and in collaboratively situating activities carried out by an organisation within this negotiated reality. Sometimes these acts can be almost ritualistic (“is” performance) like in representing the university at a graduation ceremony where roles and norms are predetermined.

    At other points these are more spontaneous (“as” performance) a narrative (a pre-existing conceptualisation of an experience or situation) enacted to an audience in response to an everyday stimulus – something like a discussion of university finances during a spontaneous conversation with a member of staff on campus).

    Not an actual theatre

    This isn’t a literal assertion that leadership is theatre – that it is a kind of scripted reality that lacks authenticity – but the idea that the actions of leaders reiterate (and thus endorse) organisational norms and organisational cultures. So when Peck repeatedly qualified his responses to the education committee with reference to what the OfS had learned in eight years of regulatory activity, and in his need to understand the way in which the legal framework in which regulation takes place has been interpreted he is situating himself as a part of an ongoing story rather than attempting to begin telling a new one.

    This is likely to be important to those who might think a return to a HEFCE-like situation in which leaders were former vice chancellors and things were, apparently, nicer (they weren’t nicer, but this is the story some like to tell) – Peck is entering the stage in the middle of the play and is clearly looking to be an evolutionary rather than a revolutionary chair.

    What he does seem to want to do, in narrative terms, is to use more of the language that institutional leaders themselves use within regulation. In Peck’s performativity theory – these linguistic shifts are important in that they themselves have an impact on the collective understanding of what is going on.

    Usually about six

    The best example of this was, inevitably, about university finances. To Peck there are “usually about six” things that universities do to balance income with expenditure in times of financial constriction – he didn’t name the six, but the impression he was looking to give is that these are well-known and familiar interventions among those who run universities. With this frame, he was able to put the onus on universities rather than regulators to act (“a lot of institutions are still on this journey”), allowing him the appeal to accepted wisdom in being clear that it was not for the Office for Students to bail out universities, and to go further to suggest that if there was a credible route to sustainable business it would be visible to banks (and, I guess, other lenders) and it should not be for the government to create a “moral hazard” by stepping in.

    Committee member Manuela Perteghella pushed him on what he had specifically learned from what Nottingham Trent University had done to stave off financial problems (NTU ran a £9.5m surplus last year, but saw around a 10 per cent reduction in student numbers this year). The first example he reached for can again be traced back to the way he has written about leadership in the past – he made much of the need to “be clear with colleagues” about the problems that the university was facing and do so regularly and openly (there is a quarterly town hall meeting).

    As a leader you do have the chance to control the narrative – and this shapes the way problems are understood. Peck noted the problems that other providers had faced in submitting unrealistic income or recruitment projections to the Office for Students – grand (if broad) plans that made any subsequent need for economy harder to sell internally. He was able to sell a 10 per cent reduction in staff numbers at NTU on the basis of needing less staff to teach less students (based on historical precedent) – and being clear about recruitment problems early allowed him to say that all these job losses would be voluntary.

    The historical precedent – an appeal to a quantifiable and shared memory within the organisation – also made it easier to make the case for a lower staff headcount maintaining the quality of education. If, after all, we could teach this number of students at an acceptable level a few years back with this number of staff, why can’t it be done in 2025?

    Independence day

    One of the stories that has become accepted fact about the Office for Students is that it is too close to the government – reverse regulatory capture, if you like. The Behan report (and to a lesser extent the House of Lords Industry and Regulators Committee report) undermined this assumption a little – there are examples of places where OfS pushed back against the department, although the very nature of the beast means that such independence is rarely visible in public.

    As chair Peck would clearly need to work with government on the underpinning policy framework – hinting at a “new” policy under development for release in the summer, most likely the much-heralded “HE reform” package – but emphasised that “operational” decisions would be independent, and that his network of contacts across the sector would help OfS build better relationships with institutions.

    Again, this isn’t new – or even particularly notable – but it’s another pointer to his explanatory mode of leadership. It suggests that the problem is one of communication, and he even suggests his own ability to communicate as the solution. Virtuoso performance as leadership. When we get to the actual structural changes there’s a sense that OfS has been on the right track recently – revamped student panels, more student surveys. The only novelty is a promised re-engagement with NUS.

    Curtain call

    There’s a lot of stuff that would remain in a Peck-led OfS: he’s keen on B3 as driving value for money, keen to get stuck in on regulating modular provision, feel like we are in the right place on freedom of speech given recent changes, pleased with TEF and access and participation plan (though he asked a fascinating question around what happens to those who register with UCAS – he is interim chair there, currently – but are not placed by the end of the cycle).

    For much of this, regulation is a matter of establishing codes of practice and ensuring that the actions of universities are within these bounds – Peck’s government work on student mental health should have provided the clue there. The codes themselves set the stage, the universities act within those boundaries. You could argue this as legalism, but it makes more sense as freedom within set parameters, something which universities (and indeed academics) will find comfortingly familiar.

    In their 2009 book, “Performing Leadership” Peck and Helen Dickinson (now a professor at the University of New South Wales) cite one compelling example (an unpublished conference paper by Druckett from 2007) of the way the performance of a particular style of management has an impact on lived experience of university staff.

    the case study… illustrates that the assertion, arguably the over-assertion, of the hierarchical and individualist ways of organising by senior management is generating negative feedback from the academics in the organisation. The consequences of not allowing the isolate and enclave approaches to contribute adequately to the organisational settlement may be having, or have in future, significant detrimental consequences for the university.

    The classic postmodernist understanding of the organisation, in contrast, is one of multiple narratives within a common framework. If you feel that OfS has been too deterministic – too rules based rather than risk based – within the first eight years, the way in which Peck (and whoever he chooses as a senior executive team) allows other voices to fill the stage will be fascinating to watch.

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  • Policy change can help manage the demand for graduate knowledge and skills

    Policy change can help manage the demand for graduate knowledge and skills

    “Our universities have a paramount place in an economy driven by knowledge and ideas.”

    These are the opening words of the 2016 white paper Success as a Knowledge Economy, which created the funding and regulatory architecture governing English higher education today. The arrangements are founded on a broad faith in the economic benefits of generating and communicating knowledge.

    This vision assumes that an increasing supply of university graduates and research, coupled with open markets that reward enterprise, leads to endogenous economic growth. That can happen anywhere because ideas are boundless and non-rivalrous, but particularly in England because our universities are among the best in the knowledge business.

    English higher education has grown by integrating the development of specific skills for the workplace alongside universally applicable knowledge. This is clear from the progress of most English universities from institutes established for professional and technical training towards university status, the absorption of training for an increasing range of professions within higher education, and the way in which universities can now articulate the workplace capabilities of all graduates, regardless of their discipline.

    Notwithstanding this, the reforms proposed in 2016 emphasised knowledge more than skills. By that time, most of the cost of teaching in English universities had been transferred to student tuition fees backed by income-contingent loans. So, the reforms mostly focused on providing confidence for the investments made by students and the risks carried by the exchequer. This would be delivered through regulation focused on issues important to students and the government, whilst positioning students as the pivotal influence on provision through competition for their choices.

    Universities would compete to increase and improve the supply of graduates. This would then enhance the capacity of businesses and public services to capitalise on innovation and new technologies, which would yield improved productivity and jobs requiring graduates. That is a crude characterisation, but it provides a starting point for understanding the new imperatives for higher education policy, which are influenced by challenges to this vision of nearly a decade ago.

    From market theory to experience in practice

    Despite an expansion of university graduates, the UK has had slow productivity growth since the recession of 2008–09. Rather than the economy growing alongside and absorbing a more highly educated workforce, there are declining returns for some courses compared with other options and concerns that AI technologies will replace roles previously reliant on graduates. Employers report sustained gaps and mismatches between the attributes they need and those embodied in the domestic workforce. Alongside this, ministers appear to be more concerned about people that do not go to university, who are shaping politics in the USA and Europe as well as the UK.

    These are common challenges for countries experiencing increasing higher education participation. The shift from elite to mass higher education is often associated with a “breakdown of consensus” and “permanent state of tension” because established assumptions are challenged by the scale and range of people encountering universities. This is particularly the case when governments place reliance on market forces, which leads to misalignment between the private choices made by individuals and the public expectations for which ministers are held to account. Universities are expected to embody historically elite modes of higher education reflected in media narratives and rankings, whilst also catering for the more diverse circumstances and practical skills needed by a broader population.

    In England, the government has told universities that it wants them to improve access, quality and efficiency, whilst also becoming more closely aligned with the needs of the economy and civil society in their local areas. These priorities may be associated with tensions that have arisen due to the drivers of university behaviour in a mass market.

    In a system driven by demand from young people, there has been improved but unequal access reflecting attainment gaps in schools. This might not be such a problem if increasing participation had been accompanied by a growing economy that improves opportunities for everyone. But governments have relied on market signals, rather than sustained industrial strategies, to align an increasing supply of graduates with the capabilities necessary to capitalise on them in the workplace. This has yielded anaemic growth since the 2007 banking crash, together with suggestions that higher education expansion diminishes the prospects of people and places without universities.

    In a competitive environment, universities may be perceived to focus on recruiting students, rather than providing them with adequate support, and to invest in non-academic services, rather than the quality of teaching. These conditions may also encourage universities to seek global measures of esteem recognised by league tables, rather than serving local people and communities through the civic mission for which most were established.

    Market forces were expected to increase the diversity of provision as universities compete to serve the needs of an expanding student population. But higher education does not work like other markets, even when the price is not controlled as for undergraduates in England. Competition yields convergence around established courses and modes of learning that are understood by potential students, rather than those that may be more efficient or strategically important for the nation as a whole.

    Navigating the new policy environment

    After more than a decade of reforms encouraging competition and choice, there appears to be less faith in well-regulated market forces positioning knowledgeable graduates to drive growth. Universities are now expected to become embedded within local and national growth plans and industrial strategy sectors, which prioritise skills that can be deployed in specific settings ahead of broadly applicable knowledge. This asks universities to consider the particular needs of industry, public services and communities in their local areas, rather than demand from students alone.

    Despite these different imperatives, English higher education will continue to be financed mostly by students’ tuition fees and governed by regulatory powers designed to provide confidence for their choices. We suggest four ingredients for navigating this, which are concerned with strategy, architecture, regulation and funding.

    The government has promised a single strategy for post-16 education and a new body, Skills England, to oversee it. A more unified approach across the different parts of post-compulsory education should encourage pathways between different types of learning, and a more coherent offer for both learners and employers. But it also needs to align factors that influence the demand for graduates, such as research and innovation, with decisions that influence their supply. That requires a new mindset for education policy, which has tended to prioritise national rules ahead of local responsiveness, or indeed coherence with other sectors and parts of government.

    Delivery of a unified strategy is hampered by the fragmented and complex architecture governing post-16 education. Skills England will provide underpinning evidence, both influencing and drawing on Local Skills Improvement Plans (LSIPs), but it remains uncertain how this will be translated into measures that influence provision, particularly in universities. A unified strategy demands structures for convening universities, colleges, employers and local authorities to deliver it in local areas across the country.

    That could be addressed by extending the remit of LSIPs beyond a shopping list of skills requirements and enhancing the role of universities within them. Universities have the expertise to diagnose needs and broker responses, aligning innovation that shapes products and services with the skills needed to work with them. They will, though, only engage this full capability if local structures are accompanied by national regulatory and funding incentives, so there is a unified local body responsible for skills and innovation within a national framework.

    Regulation remains essential for providing confidence to students and taxpayers, but there could be a re-balancing of regulatory duties, so they have regard to place and promote coherence, rather than competition for individual students alone. This could influence regulatory decisions affecting neighbouring universities and colleges, as well as the ways in which university performance is measured in relation to issues such as quality and access. A clear typology of civic impact, together with indicators for measuring it, could shift the incentives for universities, particularly if there is a joined-up approach across the funding and regulation of teaching, research and knowledge exchange.

    Regulation creates the conditions for activity, but funding shapes it. Higher education tends to be a lower priority than schools within the Department for Education, and research will now be balanced alongside digital technologies within the Department for Science, Innovation and Technology. A new Lifelong Learning Entitlement and reformed Growth and Skills Levy may provide new opportunities for some universities, but any headroom for higher education spending is likely to be tied to specific goals. This will include place and industry-oriented research and innovation programmes and single-pot allocations for some MSAs, alongside the substantial public and private income universities will continue to generate in sectors such as health and defence. In this context, aligning universities with the post-16 education strategy relies on pooling different sources of finance around common goals.

    Closer alignment of this kind should not undermine the importance of knowledge or indeed create divisions with skills that are inconsistent with the character and development of English higher education to date. The shift in emphasis from knowledge towards skills reframes how the contributions of universities are articulated and valued in policy and public debate, but it need not fundamentally change their responsibility for knowledge creation and intellectual development.

    This appears to have been recognised by ministers, given the statements they have made about the positioning of foundational knowledge within strategies for schools, research and the economy. We have, though, entered a new era, which requires greater consideration of the demand for and take-up of graduates and ideas locally and nationally, and a different approach from universities in response to this.

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  • Eight critical questions for the new chief executive of UKRI

    Eight critical questions for the new chief executive of UKRI

    The appointment of a new chief executive for UK Research and Innovation (UKRI) could not happen at a more crucial time.

    With public finances under strain, the case for public investment in R&D needs to be made cogently and needs to focus both on addressing the UK’s five government missions and on sustaining the fantastic research asset which the UK university sector represents. The list of issues for the new appointee will no doubt be lengthy, but we put forward the following as a possible shortlist of priorities.

    1. The interface (pipeline) between research councils and Innovate UK

    One of the main goals in establishing UKRI was to ensure a smooth pipeline from the research undertaken by the individual research councils to the industrial/end user base thereby bringing both economic and societal benefit. However, despite years of intent this pipeline seems as obstructed as ever. The fundamental question remains: to what extent is the role of Innovate UK to aid the transition of the outcomes resulting from research council funding versus simply supporting UK-based enterprises in their own research?

    Currently there are disconnects between the research priorities, often defined by government and implemented by the research councils, and the Innovate UK funding mechanism to ensure they are exploited. There are some exceptions here of course: the Creative Industries Clusters was a good example of a joint initiative between AHRC and Innovate UK which did integrate industry demand to local research strengths.

    A key priority for the new chief executive is to join up the pipeline more effectively across the whole range of industry sectors and ensure a very clear role for Innovate UK in partnership with the research councils and the subsequent interface to the National Wealth Fund or British Business Bank.

    2. Articulating and agreeing the balance between UKRI spend on government priorities and investment in the research base of the future

    As we have argued elsewhere on Wonkhe, the nation needs UKRI to fund both the research required by current government priorities relating to industrial strategies or societal challenges, and invest in the broader research base that, in the words of science minister Patrick Vallance, will feed the “goose that lays the golden egg” of our research base and the opportunities of tomorrow.

    Currently, this balance is, at best, hidden from view, suiting neither the needs of government nor the future aspirations of the sector. We urge UKRI to quantify this balance historically and to articulate a proposal to government for moving forward. We also require balance between the budget committed in the long-term to institutes, infrastructure, international subscriptions, and facilities vs. the shorter-term funding into the wider research and innovation community. Balancing these priorities requires a strengthening of the relationship, and open discussion, between UKRI, DSIT and wider government.

    3. Ensuring UKRI is relevant to the government’s regional economic development agenda

    As part of the government’s economic agenda, driving productivity growth in the tier-2 cities outside the South-East and the wealthier places in the UK is key to executing its growth mission. There is a clear tension here in UKRI acting as the key funding agency for public R&D spending driven solely by excellence, and a regional economic development mission, for which additional criteria apply. This tension must be addressed and not ignored.

    The creation of innovation accelerators in which additional funding was provided by government, but UKRI was involved in evaluating the merit of proposals, is a good example of how UKRI can drive change. As the government develops new levers to address and fund regional economic development, UKRI should play a key role in ensuring that this dovetails with the research and innovation base of the nation.

    4. Creating a highly skilled workforce

    As is becoming clear, the number of doctoral students supported by UKRI continues to fall – an issue highlighted, for example, by Cambridge vice chancellor Deborah Prentice in a recent Guardian interview. This is particularly clear in areas which have traditionally relied upon UKRI funding, such as the engineering and physical sciences. The corresponding research effort is in part bolstered by an increase in the number of fee-paying overseas students, but this does little to create the UK-based workforce industry needs.

    UKRI needs to prioritise funding and work with government to find new ways of addressing the skills the nation needs if we are to drive a productive knowledge-based economy. The skills required extend beyond doctoral degrees to include technical professionals and engineers.

    5. Sector confidence around REF as a rigorous, fair process, supportive of excellence

    The HE sector is in financial turmoil, manifested in the unprecedented number of UK higher education institutions currently implementing severance schemes. Ongoing uncertainties over the REF process, from the portability of outputs and the lack of an essential mechanism to ensure a diversity of authors (current proposals have no cap on the number of outputs that can be submitted from any one individual) to the absence of clarity on the people, culture and environment template’s support for excellence need resolution.

    This resolution is required, firstly so that research strategies institutions put in place prior to any census date have time to drive the changes required given that REF is meant to be formative as well as summative; and secondly so that institutions can efficiently deliver their REF returns to a standard and detail a government should expect to provide assurance over the future quality related (QR) spend.

    6. The importance and accountability of QR

    Virtually everyone in the sector embraces the notion that QR is central to the agility and sustainability of the UK research base. This certainty is matched with uncertainty within government as to the value for money this investment provides. If we are to maintain this level of trust in the sector’s ability to derive benefit from this investment, collectively we need to do a better job at showing how QR is central to the agility of our investment in the research outcomes of tomorrow and not simply a plugging of other, non-research related, financial holes. As both assessor and funder UKRI can lead and co-ordinate this response.

    7. Completion of the new funding service (the software needs to work!)

    The joint electronic submission system (Je-S) was outdated and potentially no longer supportable. Its back room equivalent, Siebel, even worse. Their replacement, the new funding service is an acceptable portal to applicants but seemingly still provides inadequate assurances for a system from which to make financial commitments. This shortcoming seems almost incomprehensible given it was an in-house development.

    Moving beyond the essential financial controls it seems to offer little by way of the AI assistance in the identification of reviewers that the software behind the submission systems for many of our research publications has offered for decades. Whether we lack the skills or investment to solve these issues is unclear, but the inefficiency of the current situation is wasteful of perhaps an even more precious resource, namely the time of UKRI staff to add human value to our research landscape. This seeming lack of skills and the systems we require is worrying too to the future REF exercise, even once the framework is known.

    8. Evidencing the effects of change

    Of course the world should and must move on. As a funder of research, it is appropriate that UKRI experiments with better ways of funding, becoming an expert in metascience. Changes inspired by ideology are fine, but it is essential that these changes are then assessed to see if the outcomes are those we desired.

    One example is the narrative CV, a well-meaning initiative to recognise a wider definition of excellence and an equality of opportunity. Is this what it achieved? Do we acknowledge the risks associated with AI or the unintended consequence of favouring the confident individual with English as their first language? While not advocating a return to the tradition of lists CV, we urge a formal reporting of outcomes achieved through the narrative CV using both quantitative and qualitative data and an evidenced based plan to move forward.

    Looking to the future

    We realise that criticism is easy and solutions are hard to find. So in case of doubt, we would like to finish with a call out to UKRI’s greatest resource, namely at all levels its committed and highly professional staff. We know at first hand the dedication of its workforce which is committed to fairly supporting the community, the research they do and the impact it creates.

    The role of chief executive of UKRI provides vital leadership not just to UKRI but to the sector as a whole, and the sector must unite to stand behind the new incumbent in solving the challenges that lie ahead.

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  • New UK government video targets international students

    New UK government video targets international students

    Secretary of state for education, Bridget Phillipson, addressed students considering studying abroad, highlighting the benefits of a UK education and promoting the country’s post-study work opportunities.

    “In the new academic year, we will welcome thousands of international students who will be starting courses in our universities and I hope to see many more in the future,” Phillipson said in the video shared by the UK Council for International Student Affairs (UKCISA).

    “The UK is a wonderful and safe place to study. Our country is home to some of the very best universities in the world – four of the world’s top 10 can be found right here in the UK.

    “An education from a British university has been the springboard for success for so many global trailblazers, from politics to business, from the arts to the sciences, in fact dozens of current and recent world leaders studied here in the UK and our universities have driven some of the most exciting and valuable research anywhere in the world.

    “You could be part of the next groundbreaking wave of research and join a new generation of inspiring leaders,” she told prospective students.

    Phillipson went on to describe some of the ways in which UK universities support their international students through pastoral support, work experience, scholarships and bursaries.

    “You’ll also get have the chance to join Alumni UK – a global group of people from around the world who have studied here. It’s a fantastic professional network that you can tap into to get great advice and guidance.”

    Phillipson went on to promote the UK’s Graduate Route, describing the opportunity which lets graduates “work, live and contribute” in the UK.

    International students forge international friendships so by studying abroad, you can help build bridges between our countries, and these connections help make the world a better, brighter place.

    Bridget Phillipson, UK secretary of state for education

    “Studying in the UK sets you up for success in your career, but it’s more than that. International students forge international friendships so by studying abroad, you can help build bridges between our countries, and these connections help make the world a better, brighter place.”

    Phillipson previously addressed international students in a video not long after stepping into the role in July 2024.

    On the release of the latest video, Anne Marie Graham, UKCISA chief executive, said she was “encouraged” to see the continuing messages of welcome and support from the UK’s education secretary.

    “Current and prospective students will also welcome the secretary of state’s ongoing support for the graduate visa and her reflections on the mutual benefits of a UK education – not just the contributions that international students make to the UK, but the positive impact on their own careers and ambitions,” she told The PIE.

    “We look forward to continuing to work with the UK government to ensure international students are welcomed and supported, from pre-arrival visas to post-graduation work opportunities, so that all international students have a positive experience studying here.”

    Pedram Bani Asadi, chair of the UKCISA’s Student Advisory Group commented: “I welcome the support from this government for international students’ hopes and dreams, and recognition of all the contributions we make to both UK culture and the economy.

    “Having access to the Graduate Route has been absolutely essential for me to be able to reinforce the skills I learnt in my studies and contribute to the UK. I appreciate all the friends and experiences I’ve had here and look forward to continuing my role as a #WeAreInternational student ambassador, and working with the UK government to support my fellow international students to have a positive experience.”

    Since Labour took came into power, sector stakeholders have noted the government’s more welcoming tone toward international students, a marked contrast to the rhetoric of the previous Conservative government.

    Despite a change in rhetoric, the Labour government has shown no intention of reversing the Conservative’s decision to ban international students on UK taught master’s courses from bringing dependants with them to the UK.

    “While the new government has said many positive things about international students, the focus on immigration remains acute,” said Jamie Arrowsmith, director of Universities UK International in an update to sector earlier this month.

    The UK’s international educations strategy is currently under review, and the rollout of the new approach is set for April.

    Sector leaders gathered at the QS Reimagine Education summit in London late last year to discuss priorities for the UK’s international education sector going forward, giving suggestions for a refreshed strategy, which included improved post-study work rights.

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  • Higher education in England needs a special administration regime

    Higher education in England needs a special administration regime

    Extra government funding for the higher education sector in England means the debate about the prospect of an HE provider facing insolvency and a special administration regime has gone away, right?

    Unfortunately not. There is no additional government funding; in fact the additional financial support facilitated by the new Labour government so far is an increase to tuition fees for the next academic year for those students that universities can apply this to. It is estimated that the tuition cost per student is in excess of £14K per year, so the funding gap has not been closed. Add in increased National Insurance contributions and many HE providers will find themselves back where they are right now.

    It is a problem that there is no viable insolvency process for universities. But a special administration regime is not solely about “universities going bust.” In fact, such a regime, based on the existing FE special administration legislation, is much more about providing legal clarity for providers, stakeholders and students, than it is about an insolvency process for universities.

    Managing insolvency and market exit

    The vast majority of HE providers are not companies. This means that there is a lack of clarity as to whether current Companies and Insolvency legislation applies to those providers. For providers, that means that they cannot avail themselves of many insolvency processes that companies can, namely administration, company voluntary arrangements and voluntary liquidation. It is debatable whether they can propose a restructuring plan or be wound up by the court, but a fixed charge holder can appoint receivers over assets.

    Of these processes, the one most likely to assist a provider is administration, as it allows insolvency practitioners to trade an entity to maximise recoveries from creditors, usually through a business and asset sale.

    At best therefore, an HE provider might be able to be wound up by the court or have receivers appointed over its buildings. Neither of these two processes allows continued trading. Unlike administration, neither of these processes provides moratorium protection against creditor enforcement either. They are not therefore conducive to a distressed merger, teach out or transfer of students on an orderly basis.

    Whilst it is unlikely that special administration would enable survival of an institution, due to adverse PR in the market, it would provide a structure for a more orderly market exit, that does not currently exist for most providers.

    Protections for lenders

    In addition to there being no viable insolvency process for the majority of HE providers, there is also no viable enforcement route for secured lenders. That is a bad thing because if secured lenders have no route to recovering their money, then they are not going to be incentivised to lend more into the sector.

    If government funding is insufficient to plug funding gaps, providers will need alternative sources of finance. The most logical starting point is to ask their existing lenders. Yes, giving lenders more enforcement rights could lead to more enforcements, but those high street lenders in the sector are broadly supportive of the sector, and giving lenders the right to do something is empowering and does not necessarily mean that they will action this right.

    Lenders are not courting the negative press that would be generated by enforcing against a provider and most probably forcing a disorderly market exit. They are however looking for a clearer line to recovery, which, in turn, will hopefully result in a clearer line to funding for providers.

    Protections for students

    Students are obviously what HE providers are all about, but, if you are short of sleep and scour the Companies and Insolvency legislation, you will find no mention of them. If an HE provider gets into financial distress, then our advice is that the trustees should act in the best interest of all creditors. Students may well be creditors in respect of claims relating to potential termination of courses and/or having to move to another provider, potentially missing a year and waiting longer to enter the job market.

    However, the duty is to all creditors, not just some, and under the insolvency legislation, students have no better protection than any other creditor. Special administration would change that. The regime in the FE sector specifically provides for a predominant duty to act in the best interest of students and would enable the trustees to put students at the forefront of their minds in a time of financial distress.

    A special administration regime would therefore help trustees focus on the interest of students in a financially distressed situation, aligning them with the purposes of the OfS and charitable objects, where relevant.

    Protections for trustees

    Lastly, and probably most forcefully, a special administration regime would assist trustees of an HE provider in navigating a path for their institution in financial distress. As touched on above, it is not clear, for the vast majority of HE providers, whether the Companies and Insolvency legislation applies.

    It is possible that a university could be wound up by the court as an unregistered company. If it were, then the Companies and Insolvency legislation would apply. In those circumstances, the trustees could be personally liable if they fail to act in the best interest of creditors and/or do not have a reasonable belief that the HE provider could avoid an insolvency process.

    Joining a meeting of trustees to tell them that they could be personally liable, but it is not legally clear, is a very unsatisfactory experience; trust me, this is not a message they want to hear from their advisors.

    A special administration regime, applying the Companies and Insolvency legislation to all HE providers, regardless of their constitution or whether they are incorporated, would allow trustees to have a much clearer idea of the risks that they are taking and the approach that they should follow to protect stakeholders.

    In the event a special administration was to be brought in, we would hope it would not need to be applied to a market exit situation. Its real value, however, is in bringing greater legal clarity for lenders and trustees and more protection for students, in the current financial circumstances that HE providers find themselves in.

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