APPENDIX 3
Supplementary memorandum submitted by The Council for Industry and Higher Education (CIHE)
The NAO report on Widening Participation does not fully address the conundrum that lies at the heart of Government policy in this area. The Government's target that 50 per cent of young people should have some experience of higher education through a widening of current participation relies on the performance of Further Education colleges and certain Higher Education institutions. It is those with current high intakes from non-traditional backgrounds that offer the environment, support, courses and processes of learning that are most likely to appeal to such students. Yet it is also those institutions that are currently most financially vulnerable. Without changes in the financial support regime they will have to curtail their current activities. Further expansion would be most unlikely, especially if capabilities in certain disciplines or geographical locations were lost.
It is understandable that those institutions running deficits should not be cross-subsidised indefinitely by the rest of the sector. A central issue is how improved efficiency can be combined with the effectiveness such institutions have at delivering the widening participation agenda.
Funding methodologies are at the heart of this issue. First, there are high costs in reaching out and attracting those from non-traditional backgrounds into higher education. Secondly, there are higher costs in providing the education and personal support needed to enable such students to be retained and progress through their learning. Current funding methodologies do not offer long-term differentiated solutions at levels high enough to meet those costs. Certain "city challenge" initiatives are neither universal nor mainstream, while "5 per cent postcode premium" is inadequate and badly targeted.
Thirdly, the removal of maintenance grants and their replacement by income contingent loans with a low repayment threshold, plus a myriad of confusing bursaries, leads to student debt, the spectre of debt and often excessive term-time paid work. Since employers appear not to value as much people from non-traditional backgrounds, the risk/reward equation is not so favourable for them. Their decision not to stay on at school and progress to higher education may well be perfectly rational. The returns to higher education are not evenly spread across social groups.
Finally, lower retention is the flip-side of the widening participation coin. People from non-tradition backgrounds suffer a variety of personal, financial and other pressures. A London university with high non-retention rates surveyed students and found that only 4 per cent left for academic reasons. A recent IES report noted that many students change institutions and courses while others return (sometimes years later) to complete their studies. The Funding Councils' policy of seeking to claw-back funds where students have not completed the course on which they embarked, takes no account of this. It can affect the financial fortunes of precisely those institutions whose very survival and growth are central to the widening participation agenda. In further education, institutions received funding for those students in place at three census points in a year. This recognises, supports and rewards those institutions that have helped individuals take steps along the road. In higher education individuals could interrupt their studies, having completed a semester and gained academic credits, but be considered a drop out, leaving the institution having to repay all the funds. One London institution may have £2.5 million clawed back resulting in serious implications for its ability to deliver its widening participation mission. A closer alignment of the funding approaches would benefit institutions, students and help the Government achieve its widening participation and growth targets for higher education.
We would make one other argument to expand a point made earlier: unless employers send signals that they value equally people from all backgrounds and can show evidence that they put this into practice, then many people from non-traditional backgrounds will continue (rightly) to be sceptical about the value of a degree. The risk/reward equation is weighted against them and no amount of exhortation or raising awareness about the higher education experience will change that. All links in the chain have to be considered and worked on. A focus on the HE/FE or HE/school interface (while important) is insufficient.
Mr Richard A Brown,
Chief Executive
The Council for Industry and Higher Education
January 2002
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