Memorandum 96
Submission from the Thames Valley University
EXECUTIVE SUMMARY
1.1 The ELQ policy puts at risk the progress
of Lifelong Learning in professional skills.
1.2 The way that HEFCE propose to implement
the ELQ policy means that even if institutions act quickly and
decisively to shift provision from ELQ students to non-ELQ students,
their mainstream teaching funding will still be cut for 2008-09.
1.3 The exemptions proposed by HEFCE are
welcome but there are areas of provision valuable to the UK economy
that are not covered by the exemptions.
1.4 Students with and without ELQs will
be affected because some areas of provision will become unsustainable.
1.5 A cash-terms safety net is better than
no safety net but it means a real-terms funding decrease. Mainstream
teaching grant forms a significant percentage of the total income
for teaching-focused institutions like TVU and a real-terms decrease
in funding will be problematic when costs continue to rise.
THAMES VALLEY
UNIVERSITY
2.1 Thames Valley University (TVU) is one
of the UK's largest and most diverse Universities with more than
33,750 students from 117 countries.
2.2 Achieving university status in 1992,
TVU has over 140 years experience in delivering technical and
vocational education. TVU merged with Reading College and School
of Arts and Design in 2004 to form one of the largest institutions
of its type in Europe.
2.3 The University is based on four campuses:
Ealing and Brentford in west London and at Reading and Slough
in Berkshire. The University offers a wide range of vocational
and academic courses for students aged between 14 to 84 years
old and delivers Further, Higher and postgraduate education programmes
as well as professional and short courses. The University is the
largest provider of education in Hospitality, Healthcare and Music
& related disciplines in the UK.
SUBMISSION
3. Arguments against the Government's decision
to phase out support to institutions for students studying ELQs
3.1 The contradiction of the ELQ proposals
with the wider Lifelong Learning agenda is clear. Up-skilling
and re-skilling in professional areas will fall foul of the ELQ
policy even though it is in the interest of the UK economy.
3.2 Co-funding by employers is not always
the answer: there are known issues in the creative industries
where employers are often very small businesses. In addition,
across all sectors individuals will sometimes wish to re-skill
without the knowledge of, or financial input from, their current
employer.
4. The timing of the decision and of the
implementation of the change
4.1 The Secretary of State said in a speech
to the Open University on 13 December 2007, "Assuming that
OU students continue to study part-time at about the same intensity
as now, it [the OU] will be able to recoup what it might lose,
and more, by attracting another 3,000 or so first-time students
in each of the next three years." This is not the case. HEFCE's
proposed implementation does not make ELQ students unfunded but
allow institutions to retain their teaching grant (T grant) by
recruiting alternative fundable (non-ELQ) students. Instead it
pulls from institutions funding related to ELQ students assumed
to be studying at institutions (based on 2005-06 data). HEFCE
is proposing to use historic data in order to ensure that institutional
behaviour cannot affect HEFCE's ability to save the £100m
requested by DIUS. However the flip side of this is that institutions
cannot protect their funding even if they act in accordance with
the incentives DIUS want to encourage.
4.2 To give an extreme example, if TVU did
not recruit a single new ELQ student in 2008-09 but instead recruited
a balancing number of non-ELQ and/or Foundation Degree students,
TVU would still be subject to a cash terms T grant funding freeze
(ie a real terms decrease) for 2008-09 because our T grant will
be adjusted in relation to the ELQs for 2005-06 (as in the HEFCE
modelling). The only way that TVU could regain funding for student
FTEs is via new Additional Student Numbers (ASNs) from HEFCE—and
it is not realistic to suggest that we can apply for and receive
the significant numbers of ASNs required in that timeframe, even
if HEFCE were to make the ASNs available.
5. The exemptions from the withdrawal of
funding proposed by HEFCE
5.1 Foundation degrees
5.1.1 We support the objective of providing
a mechanism by which students can continue to access public funding
to support them in studying for a qualification which may assist
them to acquire skills required by employers and thus welcome
the exemption for Foundation Degrees. However there are other
well-established qualifications of a professional nature which
are not being exempted although they are acknowledged to meet
employers' skills requirements (eg qualifications in Accountancy,
Purchasing and Supply and Project Management). The removal of
funding for the substantial numbers of students on these courses
may make them non-viable, putting at risk whole areas of taught
provision. Those areas of taught provision are ones which are
important not only for the students actually on professional qualifications
but also for students on other types of course who may access
these subject areas for smaller parts of their course. Learning
experiences in business-related skills for such students can make
a real difference to their employability.
5.1.2 Furthermore, there are often instances
in which the qualifications that currently meet employers' skills
requirements are less substantial than a foundation degree. These
qualifications will not be exempt from the ELQ policy, setting
up a potential perverse incentive for students to be driven towards
courses which are longer (and thus more expensive in terms of
HEFCE funding) than they need.
5.1.3 A foundation degree is not always
going to be the best way of providing students with new skills,
particularly in the enterprise/entrepreneurship areas. In these
and other areas smaller units of learning (which might combine
over time into a larger qualification) are more accessible both
in terms of time and money for individuals developing their own
SMEs or developing skills which may be required not by their current
employer but for a future career move.
5.2 Co-funded ASNs
5.2.1 We support the objective of providing
a mechanism by which students can continue to access public funding
to support them in studying for a qualification which may assist
them to acquire skills required by employers and thus welcome
the exemption of co-funded ASNs. However we do not welcome the
fact that institutions will essentially have to re-bid, through
a bureaucratic process, for funding they were previously entitled
to; and that furthermore, that funding will be then considerably
less flexible than it has been before, because co-funded ASN allocations
are outside the teaching grant contract range.
5.3 Strategically important and vulnerable
subjects (SIVS)
5.3.1 We support the exemption of SIVS from
the ELQ policy but do not agree with the proposal to do this via
a targeted allocation outside the tolerance band. This will only
protect historical levels of provision in these subject areas
rather than support any expanded provision, even though expanded
provision may be in the public interest.
5.3.2 An institution that was active in
a SIVS area in 2005-06 but is not in future will receive an allocation,
while an institution that was not, but now is, would not. The
proposal to push funding through a separate static allocation
will mean that institutions, particularly in growing areas, will
need to charge higher fees to all ELQ students (as no specific
students would be fundable). This would potentially disincentivise
students from joining courses in SIVS areas of study.
6. The impact upon students
6.1 There will clearly be a financial impact
upon students with ELQs in all instances where institutions decide
to charge higher fees for ELQ students (in order to maintain resource
levels).
6.2 Where programmes cater particularly
to ELQ students—examples for TVU include professional qualifications
in Accountancy, Purchasing and Supply and Project Management—then
it is likely that some programmes will become unviable. Institutions
will have little choice but to cease to offer these programmes,
affecting non-ELQ students as well.
6.3 Where institutions charge higher fees
to students who are not fundable because of their previous qualifications,
it is apparent that there will be a disincentive for potential
students to declare their prior qualifications. This will reduce
the ability of institutions to respond as appropriately as they
would wish to the prior knowledge and experience of their students,
meaning the student experience will not be as positive as it might
otherwise be.
7. The impact of the change upon institutions
7.1 Much has been made of the fact that
in HEFCE's proposals institutions are protected by a cash-terms
safety net. However a cash-terms safety net is scant protection
for an institution like Thames Valley University, the mission
of which is strongly teaching-focused and whose income is therefore
more concentrated (and smaller) than that of the research-intensive
institutions. In 2006-07 HEFCE's mainstream teaching grant (not
including WP funding) formed 27% of our TVU's total income and
42% of TVU's non-LSC or NHS income. To have this funding stream
entirely frozen in cash terms when our costs are not frozen will
have significant effects on the institution's sustainability.
7.2 While a safety net is clearly preferable
to no safety net, a real terms decrease in funding which will
begin in less than one year's time and continue across the planning
horizon will place some institutions in positions of substantial
financial risk. It is now January 2008 and we are still not sure
if our budget the year starting on 1 August 2008 will be cut (in
real terms) or not: the implementation of this decision has been
too hurried to allow institutions to plan effectively for managing
the impact of the funding implications.
7.3 We are particularly concerned about
the impact of a real terms decrease in funding for 2008-09. A
planned decrease in 2009-10 but not 2008-09 would give those institutions
which are hardest hit a little more time to develop plans both
in terms of assuring additional fee income from ELQ students,
and in terms of changing the nature of provision offered to target
students who remain HEFCE-fundable. A real terms funding cut for
2008-09 will be very difficult to manage without a significant
impact on the student experience, and this will be most keenly
felt in those institutions which are doing most to reach out to
those who need to be drawn into HE both to meet the Government's
50% participation target and the wider Leitch agenda.
7.4 The institutions most heavily affected
(including TVU) are those who have made great efforts to reach
out to employers and to employees by providing flexible (part-time)
and professionally-orientated provision. These same institutions
are those who have fewer other major sources of income (especially
research funding) with which to sustain themselves over a difficult
period of transition.
January 2008
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