Examination of Witnesses (Questions 80
- 99)
WEDNESDAY 23 FEBRUARY 2005
DR JOHN
HOOD AND
SIR ALAN
WILSON
Q80 Chairman: Sir Alan, do you think
there is a danger that many students from the regions—and
you have been a distinguished vice-chancellor of Leeds University—do
you think there will be a feeling that the dice is loaded against
students from the regions when we see figures such as those published
by Cambridge yesterday?
Sir Alan Wilson: In the long run,
no. I am tempted, if you allow me, to comment as an academic geographer
which is my background. If I had to make a guess about these kinds
of statistics, they reflect as much the objectives of our widening
participation programmes as geography. In terms of students selecting
universities, there is a regional dimension and many students
for various reasons will want to go to more local universities.
There has been evidence in the past that students from poorer
backgrounds, on average, do not want to travel more than 50 or
60 miles. That is likely to be the kind of basis for these statistics.
As the widening participation programmes continue to develop,
I would expect that to rebalance.
Q81 Chairman: You were listening
to the last session. You heard what the three witnesses were saying
about the lack of government success in communicating what the
whole new structure and strategy mean. I thought it was quite
inspiring when we heard Professor Tarrant talking about what a
good deal for less well off students the new arrangements would
be. We do not hear that. There is still a great deal of ignorance
out there about what the new regime means. Do you think the department
is just failing to get its message across effectively?
Sir Alan Wilson: We do not think
so. In terms of communicating the message, we are in the process
of spending since last October something of the order of £2
million in terms of radio advertising and advertising in journals.
We have been running regional roadshows. The evidence we get in
terms of feedback and awareness from these campaigns suggests
that it is much better than we are hearing anecdotally from your
previous witnesses. On the other hand, we have to take the anecdotal
evidence seriously. The department, I believe, is working very
hard at this. I believe that our stakeholders, particularly universities,
schools and colleges, are working very hard at this. If the evidence
is that we still have much further to go, in the next few months
we must be committed to that. I certainly do not feel that the
department is in any way failing in its intention. Our measures
say that we are doing rather well. If there is other evidence,
we will seek to intensify our campaigns.
Q82 Mr Gibb: Dr Hood, you said you
supported the Higher Education Bill. Will the tuition fees result
in a significant, extra chunk of income for Oxford University?
Dr Hood: When the £3,000
fee that we have applied to charge is fully implemented, the additional
income on the current demography of the university would be about
£18.4 million. Of that, we are committed to allocating an
amount equivalent to about a third to access arrangements, to
improving access and to our bursary scheme. The net gain on the
current demography of the university would be of the order of
just over £12 million. If you would like a context for that,
using the Government's TRAC methodology on the 2003 accounts of
Oxford, we were about £68 million under-funded on research
overheads and around £30 million under-funded on the university
share of teaching costs. That is not taking account of the college
share of teaching costs. The Government's move to 80% of full
economic costing on new research contracts starting in the next
academic year will go some considerable way towards resolving
the first of those figures. If the college component and the university
component were taken into account on the teaching under-funding,
the £12 million net gain is helpful. It does leave a large
gap on the teaching side.
Q83 Mr Gibb: You hope to raise the
tuition fee above £3,000 when that is permissible?
Dr Hood: I do not think it is
that simple. The question is how might a university like Oxford
fill the gap. There is a range of different answers and the proportions
will depend on the answers to each of the elements. For example,
the Government might decide that it wishes to contribute more
of its share of teaching in high cost universities like Oxford.
We may be very successful in our philanthropic endeavours and
be able to make a significant contribution through more funded
posts, through benefactors and the like to take another chunk
of it out, but my guess is that there may well be a need ultimately
to address the fees issue again. That is the way the legislation
is framed with a review coming in 2010.
Q84 Mr Gibb: One of your proposals,
I understand, is to reduce the number of British undergraduates
by 1,000 over the next few years which is a large proportion,
given that you only recruit 3,300 students a year, and in their
place to put more overseas students. Can I ask you how that helps
Britain and, secondly, how that helps your commitment to the whole
access arena?
Dr Hood: I think there is a slightly
different question to start with. It is: does Britain wish to
have premier research universities that can stand shoulder to
shoulder with the very best research universities in the world?
If the answer to that question is yes, you have to start looking
at the anatomy of the very best research universities in the world.
If you look at a Princeton or a Harvard, you see that their undergraduate
numbers are in the 5,000 to 8,000 range, depending on which of
those institutions it is. At present, Oxford's is over 11,000.
What has happened at Oxford in recent decades is that the student/staff
ratio at undergraduate level has gone from about eight to nine
to slightly over 13. In addition, students are receiving more
tutorial time than they did several decades ago, or even a decade
ago. The tutorial teaching time has gone up; the student/staff
ratio has risen; staff are under increased workload burdens and
all of that suggests that there are quality issues that we have
to address. If you combine the fact that Britain wants to have
universities that can stand shoulder to shoulder with the best
elsewhere in the world with the fact that we have to address staff
workloads, quality of teaching and learning, there are several
variables we can play with. We could employ more staff but unfortunately
we are running at a significant loss on our teaching, so we cannot
appoint more staff because we do not have the resources to do
so. One thing, in terms of pulling quality up to match the quality
of those very best universities that we have to address, is dropping
the student numbers a little. This is consultative at the moment.
We have not said we are going to do it. We have said this is one
thing that we can address and we have put this out in the Green
Paper. If we were to drop the student numbers to pull quality
up, we do not even use a number in the Green Paper. The media
has latched onto a figure of about 10%. The international student
question is quite a different question again. It goes back to
the question of having universities that are standing shoulder
to shoulder in the first rank of global universities. If you look
at those universities, you will see that whilst they have small
undergraduate bodies they have high proportions in their undergraduate
bodies of international students because, one, they want high
quality; two, they want cultural and international diversity,
because they want a community that mirrors as best it possibly
can the sorts of communities and diversities that students will
graduate into when they go out into the wider world and to give
them the richness of that experience. That is the set of arguments
that is driving the thinking to which you refer.
Q85 Mr Gibb: What about the cost
side? Are your costs excessive? £55,800 on average to put
a student through a three year degree course? Why does it need
to cost that much? How does that compare with the other world
universities?
Dr Hood: If you take a university
like Harvard, they would probably say it costs about US$60,000
a year to educate an undergraduate student. For a three year degree,
you are talking about US$180,000, which on current exchange rates
is somewhere around £100 million. If we were to pay our staff
competitive rates, if we were to reduce our student/staff ratios
to something more comparable to those top flight US universities,
we would be up around that sort of level as well.
Q86 Mr Gibb: How do you respond to
the argument put forward by the CMU that Oxford receives £37,000
per student per year at its disposal, six times more than other
universities in this country?
Dr Hood: I do not know where you
get that figure from. I would like to see the workings. It is
certainly not what we receive for teaching undergraduates. We
are receiving on average, on our teaching grant, £4,400 per
undergraduate. If you would like to give me the analysis, I would
be delighted to read it and give a view.
Mr Gibb: This is what they claimed in
the evidence session just now.
Q87 Chairman: It is given in the
submission from the CMU.
Dr Hood: The calculations will
be flawed.
Q88 Mr Gibb: What proportion of your
students would qualify, roughly, for a bursary?
Dr Hood: Probably about 20% will
quality for some form of bursary. That is on our current view
of the demography of the university. We expect that could rise
as our access activities start to bite out there.
Q89 Mr Gibb: What kind of bursary
do you think you might be able to give to those 20%?
Dr Hood: The scheme is designed
by income bands mirroring the Government income bands. Below £16,000,
it will give £4,000 in the first year and £3,000 in
subsequent years. It is designed at that level because within
the two elements of government support a student would get £5,700
per year in that income band in support through the Government
scheme and our bursary in the second year. We estimate that the
cost of a student attending Oxford, excluding the fees that they
pay, will be when the bursary scheme starts of the order of £5,700
for a 27 week residence period each year. That is why it has been
set at that level. The reason we are paying a premium of £1,000
in the first year is because we recognise that students, particularly
from less wealthy backgrounds will have set-up and establishment
costs. They will want to buy books, computers and a bicycle or
whatever else. It is to try and help facilitate the set-up for
those students so that they have a good start in the university.
The scheme drops between 16,000 and 22,500 to £3,000 in the
first year and £2,600 in the subsequent years. From 22,500
to 33,500, it scales down from £2,500 to £1,500 linearly,
as you go out over that income range. We have taken those bands
because they are the bands that the Government works with. What
we do not know is how it will play out, so we will be assessing
this rigorously and we leave open the opportunity to recalibrate
the scheme as we move forward.
Q90 Mr Gibb: There is a move to try
and create parity of esteem between vocational qualifications
and academic qualifications. The statement later today hopefully
will talk about people taking vocational studies and using those
to get into university. Will you be making offers vocational qualifications
in the future?
Dr Hood: Would you be precise
in your definition of "vocational qualifications" so
that I can answer that question?
Q91 Mr Gibb: The established meaning
of vocational qualifications.
Dr Hood: I am not entirely clear
what it is.
Q92 Mr Gibb: Sorry?
Dr Hood: These words are used
very loosely in the modern parlance. If you want to be precise
about it, I could answer the question. Without precision, I cannot,
I am afraid.
Q93 Chairman: Sir Alan, you have
heard not only the earlier session but you have just heard what
Dr Hood said. Dr Hood's plans for the future of Oxford recently
came out and many people appeared on the media and the stories
went round in the press about how hard up Oxford was in terms
of carrying a deficit and being unable to continue meeting its
international competitors in terms of quality of their higher
education. Why do you think they have run into this difficulty?
It seems to have appeared in more recent years. Is it just because
government refuses to fund adequately the teaching in our premier,
higher education institutions?
Sir Alan Wilson: I can only answer
your questions in national terms. It is for Dr Hood to comment
on Oxford.
Q94 Chairman: It could not be generic
because the following week Cambridge came out with a very similar
story.
Sir Alan Wilson: If you look at
the Funding Council's analysis of university accounts, in general,
universities are functioning in a well balanced way in revenue
terms and they are obviously managing themselves. In terms of
arguments about under-funding in the past, you could almost say
that they are too well managed in that they do manage themselves
very well. They do not run with large deficits. It makes under-funding
difficult to calculate. Universities UK had a view about that.
That was part of the evidence during all the debate on the Bill.
What emerged in the Bill debate and then the Act was a cap on
variable fees which is intended to, and will, address a large
chunk of that under-funding problem. As Dr Hood has said, there
are different routes for universities to attract more funding
in. In terms of the overall, national picture, it has been recognised
in the past by the Government that there was a funding gap. The
measures for 2006/7 and onwards will go a long way towards filling
that. There are other things that universities can do for themselves.
Another part of the argument which was part of a question to Dr
Hood which I could comment on in national terms is the extent
to which universities might seek, as some might put it, to solve
any funding problems through recruitment of international students.
The evidence in that case is that most of the places for certainly
non-EU international students are in general not competing with
places for home and EU students. They are typically additional
places. That will contribute income. I personally do not believe
it contributes enormous additional income. By the time you take
Funding Council units of resource and even present fee levels
and future fee levels, the home and EU income is not hugely different
from the fees for international students. It does give and has
given universities tremendous opportunities for income earning.
I would also echo something else that Dr Hood said which is that
I do not think that is the primary reason for recruiting international
students. UK universities, English universities, are international
institutions and they are much better for being international.
They are better for English graduates in an international environment.
From that point of view, it is win win for everybody. I think
universities have been well managed in financial terms. There
has been acknowledged under-funding. The new scheme will go a
long way to contributing to that. International students will
be one of the other ways in which universities can earn income
to fill that gap.
Q95 Chairman: The one thing that
puzzled me particularly about that answer was your view that the
international student did not bring that much funding in and is
not that useful.
Sir Alan Wilson: I said it did
not bring enormously more than a combination of the Funding Council
unit of resource and the fees that are to come.
Q96 Chairman: Is that right, Dr Hood?
Dr Hood: When I answered the question
a moment ago, I was very careful to say that Oxford is looking
at or discussing in its community the idea of gradually increasing
its proportion of international students from about 7%, very gradually,
maybe by 5% over 5-10 years, which would still leave it well below
the levels of most international research universities. If we
did go up by 5% over that period and those places were taking
the places of otherwise British students, the addition to our
revenues would be well less than 1%. There is no economic argument
on the current funding base that says you should do this, for
Oxford anyway, for economic reasons. This is an academic argument
in our case. Sir Alan may well be right that other universities
which are looking for leverage by taking more students at the
margin from international students can get quite a large lift
by so doing.
Q97 Chairman: Oxford cannot?
Dr Hood: We do not intend further
to exacerbate our student/staff ratio problems, thank you.
Sir Alan Wilson: I am trying to
get some very rough figures into my head. If we say that a typical
overseas student fee might be something of the order of £7,000/£7,500
a year, the Funding Council unit of resource will be 45,000 a
year.[3]
If you have a £3,000 fee, for the sake of argument, the total
unit of resource for the university for the different kinds of
students is very broadly equivalent. That is really the point
that I was making.
Q98 Chairman: What about European
students? It is European students that worry many people who give
evidence to this Committee or come in contact with this Committee.
In principle, we could have an increasing number of EU students.
We already have a large number. The figures that this Committee
received in relation to the expansion of the EU to 25 are quite
remarkable. Look at the expansion of Polish students in one year.
That does not bring any new income into the university, does it?
How do we get our money from EU students who do not have to pay
anything up front but will pay back later? None of the arrangements
that I have heard of satisfactorily meets that problem.
Sir Alan Wilson: On the first
question, you are absolutely right to say that EU students count
as home students and in that case there could be some substitution.
I think you asked questions about the impact of the accession
states, the ten new states in the EU, on home student numbers.
Some very large percentages have been quoted but the numbers of
students are relatively small. From the 10 accession states—again,
I am talking in round terms—the numbers coming in as overseas
students before they were members of the EU from the ten states
were around 1,000 a year. This year the numbers are around 2,000.[4]
It is a relatively modest increase against an intake into the
system of something of the order of 350,000. In terms of EU students
as a whole, if my memory serves me correctly, the incoming total
is of the order of 40,000 into English HEIs. If you like, it is
the price of our being good Europeans. What we want to do is to
build adequate exchanges between this country and other EU states.
Granted, at the moment there is an imbalance and there are more
EU students coming into this country than UK students going into
Europe.
Q99 Chairman: What is the proportion?
3:1?
Sir Alan Wilson: It is 3:1/4:1.[5]
3 Note by Witness: The Funding Council unit
of resource will be £4,000-£5,000 a year, not £45,000. Back
4
Note by Witness: This year the numbers are around 2,400,
not 2,000, as indicated during the evidence session. Back
5
Note by Witness: It is 8:1, not 3:1/4 as indicated during
the evidence session. Back
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