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Higher education 2014-2016 Competition vs collaboration Pam Tatlow Chief Executive Million+

A university think tank working to shape public policy and funding for universal access to quality education. Advocacy, research reports, and international partnerships drive social mobility and global innovation.

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Higher education 2014-2016 Competition vs collaboration Pam Tatlow Chief Executive Million+

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  1. Higher education 2014-2016 Competition vs collaboration Pam Tatlow Chief Executive Million+

  2. million+ Our role: a university think-tank Our mission: To shape public policy and funding regimes on a non-party basis so that they enable: • people from every walk of life to benefit from access to universities that excel in teaching, research and knowledge transfer • business, the NHS, not-for-profit sectors and Government to benefit from the full potential of all universities

  3. What we do Advocacy • Ministers • Opposition Parties • MPs • Government and funding council officials • Evidence to Parliamentary Select Committees • Media and press Partnerships • With university affiliates, students and other stakeholders

  4. What we do Evidence – Policy and Research Reports: • Who should train the teachers? • Behind the headlines: What’s the value of a UK degree? • Student Opportunity Funding: why it counts

  5. UK HEIs and world-rankings 162 HEIs 6/7 in top 50/60 world university rankings 18 HEIs 4 HEIs 130 HEIs 10 HEIs

  6. 1997 – 2010 Labour Government • Investment in early years, primary and secondary education • Target: 50% of 18-30 years olds to access HE • Expansion of funded numbers

  7. 2004 HE Act (England) • Universities entitled to levy GB £3000pa tuition fee per full-time student (2006) • £3000 = additional income • Backed by • State student loan system (full-time) • Reintroduction of maintenance grants • £100m p.a. to promote participation (AimHigher) • Focus on widening participation by social class • Leitch Report ‘ Prosperity for all in the Global Economy: World Class Skills’ – goals for 2020 (adult access)

  8. HE funding devolved • Scotland • 2007 Scottish Government abolishes fees for full-time students who reside and study in Scotland Wales • No top-up fees for full-time students who reside and study in Wales; Welsh Assembly pays additional fees for students in England BUT review of funding in Wales (2015-16) & HE fees an issue in Scottish independence referendum (Sept 2014)

  9. EU • EU students study for free in Scotland / access fee loans in England • UK universities successful in winning EU research funding

  10. Research • Science & Innovation Investment Framework 2004-2014 • Higher Education Innovation Fund (£150m p.a)

  11. International • Trans-National Education (TNE) partnerships • Prime Minister’s Initiative 1 & 2

  12. 1994-95 2011-12* FT UG 1,231,988 1,928,140 PG 335,325 568,505 UK Outcomes • *Part-time UG & PG decline post-2008 • By 2010 one in three UGs are over 21 the first time they enter university • Source: HESA 2013

  13. International

  14. Universities • Flexibility of provision and often work / professionally focused e.g first business courses • Significant contribution to: • Social mobility in the UK • Newer industries e.g creative, digital • Multi-disciplinary but also world-leading research • International higher education partnerships throughout the world

  15. Some Universities • High levels of recruitment from state schools and colleges • Older graduates – one in three undergraduates enter higher education when over 21 • Majority of black and ethnic minority students who enter HE • Opportunities for ‘first-in-family’ students to study at university

  16. 2010 Coalition Government (Westminster) • Teaching grant cut by 80% • Fee cap increased to £9k for English universities • Deregulation of full-time student numbers linked with high grades • Emphasis on market + alternative providers • Research funding : ‘cash protected’

  17. Part-time • Course grants scrapped • Fee but not maintenance loans • Repayment after 4 years of study if £21k+ salary • Positive real rate of interest on loans • RAB charge:  – 7.5%  (HMT saving) • Part-time loan budget of £120m reduced to £30m

  18. Breakdown of teaching related income from 2009-10 to 2014-15 Sir Alan Langlands, Higher Education Funding Council for England, 18 April 2013

  19. Research 2011-12 • ‘Quality-related’ = £1.93bn • 25% to 5 HEIs • 50% to 14 HEIs • 75% to 33 HEIs • Research Councils = £1.51bn • 25% to 4 HEIs • 50% to 11 HEIs • 75% to 24 HEIs

  20. Change Since 2009-10 Source: million+ analysis of HESA Finances of HEIs 2011-12

  21. Share by HEI Type Source: million+ analysis of HESA Finances of HEIs 2011-12

  22. Public vs private expenditure on HE (2009)

  23. Gross domestic expenditure on R&D as % of GDP (2011) • UK: 1.77% • Canada: 1.74% • Sweden: 3.37% • Source: OECD 2013

  24. Conclusions: 2012/13 • Enhanced earnings, employment outcomes, tax receipts • Positive spill-over effects for companies / employers • UK degree: remains exceptionally good individual & Treasury (HMT) investment • BUT 30,000 fewer first-time FT students (2012): aggregate long-term cost at least £6.6bn

  25. Graduate gender and distributional effects • Men • RAB increases from 19.5% to 22.5% • Average repayment period increases by 11 years • Women • RAB increases from 31.6% to 53.8% • Majority of women will never repay • Total of £2.798bn loans (fee + maintenance) written-off

  26. Indirect effects • Increase in fees = + 0.24% on headline inflation • e.g. CPI of 2.5% increases to 2.74% & continues for 3 cohorts • Impact on consumers • Rail fares, water bills, repayment of student loans • Impact on Treasury • Non-working age welfare benefits • Interest repayments on index-linked gilts • (£655m additional HMT payments) • Combined effects of increasing tuition fees 6.5 x more than Treasury savings

  27. 2012/13 cf. 2010/11 • £9,000 fee cf. £3,290 fee • £3.93bn extra in loans provided by HMT • Of these additional loans, RAB charge of 62% (only a third recouped)

  28. Resource Accounting Budgeting (RAB) • 2010/11 • RAB of 26.1% on £6.42bn of maintenance and fee loans • Govt. would recoup 73.9% (£4.74bn) over 25 years • 2012/13 • Positive real rate of interest, repayment period 30 years • BUT increase in fee cap and loans • RAB of 39.6% on £10.35bn loan book for smaller cohort • For every £1,000 only £604 recouped over 30 years

  29. Alternative options: • Annual tuition fee capped at £6000 • Graduate tax

  30. Medium-Term Challenges • Deregulation of student numbers 2015-16 • Sale of student loan book • A Ponzi system of finance and funding ? • Research funding ? • Impact of a general election and a post-election spending review (2015-16)? £9k £?k £9k Sir Alan Langlands, Higher Education Funding Council for England, 18 April 2013

  31. www.millionplus.ac.uk The university think-tank working to solve complex problems in higher education follow us on @million_plus

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