Written evidence submitted by the Russell
Group of Universities |
is pleased to contribute evidence to the Select Committee's inquiry.
Given the remit of BIS and the Committee, we have focussed our
response primarily on evidence relating to higher education in
England. Whilst there are many similarities, the history and context
of higher education in Scotland, Wales and Northern Ireland differ
from that in England in some important respects. Therefore, the
evidence provided in this document does not necessarily reflect
in whole or in part the Russell Group's views on the future of
higher education in the Devolved Administrations.
1.2 This is a challenging
time for universities in England, with a large number of key elements
of future Government policy as yet unknown. In particular:
Government's White Paper on the future of higher education has
not yet been published;
process of submitting proposals for fee levels and access agreements
to OFFA is ongoing;
HEFCE teaching funding method from 2012-13 has yet to be developed,
and HEFCE has advised that any area of teaching or special funding
could potentially be reviewed (and the institutional allocations
for 2011-12 will only be announced on 17 March 2011); and
are significant questions to be addressed in the areas of immigration,
NHS funded-provision, and teacher training, which are all of direct
concern to Russell Group universities.
1.3 This level of uncertainty makes it difficult
to comment in some areas at the present time. However, in this
context it is as important as ever to identify the vital contribution
that is made by the UK's research-intensive universities, and
the challenges faced during a period of reform.
1.4 This document draws on previous Russell Group
publications on the future of higher education. Specifically,
it is important that this evidence is read in the context of the
more extensive evidence that we have set out in the following
Russell Group's two submissions to the Browne Review (January
and May 2010).
report Staying on top: The challenge of sustaining world-class
higher education in the UK (May 2010).
report The economic impact of research conducted in Russell
Group universities (March 2010).
2. THE NEED
2.1 The UK enjoys one of the most outstanding
higher education sectors in the world. A key strength of this
high-performing sector is the quality of its leading research-intensive
universities. Securing the financial sustainability of these institutions,
and their long-term ability to compete with other global research
universities, remains a key challenge.
2.2 It is clear that students, employers and
the national economy currently benefit enormously from the UK's
research-intensive universities. They provide an outstanding quality
of learning and student experience, resulting in highly employable
graduates in great demand with leading employers. They play a
vital role in the nation's economy and society, training the next
generation of researchers and innovators and producing high quality
skilled graduates and postgraduates who will be indispensable
to the future success
of UK business and industry. Such universities conduct pioneering
research which underpins innovation by industry, leads to new
technologies and products, and enhances the efficiency and competitiveness
of British business. They also draw in investment from major international
companies, and contribute to a vibrant local community and culture
which attracts businesses from both the UK and overseas. Attracting
large numbers of international staff and students, they bring
to this country some of the brightest minds from around the world,
as well as significant export income.
3.1 The package of reforms to higher education
funding in England implemented in 2006 had clear strengths:
introduction of variable fees helped universities to put their
learning and teaching provision on a more sustainable platform,
following a long period of under-investment. It enabled Russell
Group universities to invest more in a world-class student experience.
Examples included investment in high quality staff, improvements
to staff-student ratios, enhanced infrastructure for learning
and teaching, changes in curriculum and assessment and new systems
to support a changing student population.
introduction of variable fees in England was accompanied by an
improvement in access, with application rates increasing from
all socio-economic backgrounds, and with particularly marked improvements
in applications and admissions of those from the lowest socio-economic
backgrounds. This trend was reflected in applications and admissions
to Russell Group universities, with the number of accepted applicants
from the bottom three socio-economic groups rising by over 20%
in the period between 2005/06 and 2008/09. Experience from other
countries which have implemented graduate contribution schemes
also demonstrates that tuition fees coupled with income-contingent
loans protect access to higher education.
have invested millions of pounds into bursaries and outreach work
with schools. The real barriers to university entry are underachievement
at school, misinformation, lack of confidence and low aspirations.
Universities have contributed to addressing these challenges.
3.2 Despite the package of higher education reforms
implemented in 2006 significant challenges remained, which the
Russell Group highlighted in our submissions to the Browne Review:
countries invest far more in their universities, and this threatens
the long-term ability of the UK's leading universities to compete
with the best institutions elsewhere.
under-investment has left Russell Group universities with a significant
backlog in capital investment. Income from variable fees and dedicated
capital funding has helped to redress this to a certain extent,
but sustained investment is required if research-intensive universities
are to maintain and build on recent improvements and continue
to provide an internationally excellent learning environment.
3.3 The Russell Group's submissions to the Browne
Review showed there was a pressing need to increase funding for
the UK's research-intensive universities if they are to secure
a sustainable future and continue to compete alongside leading
universities around the world.
3.4 In preparing its submissions to the Browne
Review, the Russell Group reviewed all the options for increasing
investment. It became clear that public funding would be constrained,
and opportunities to increase income from business contributions
and to reduce costs through efficiency savings would in themselves
be insufficient to ensure sustainability. In this context the
Russell Group proposed that an increase in graduate tuition contributions
from full-time home and EU undergraduates at institutions in England
represented the only viable option for ensuring sufficient funding
for a world-class higher education system, in a manner that would
be fair, sustainable, and protect access.
4. THE BROWNE
4.1 The Browne Report set out urgent and necessary
reforms to higher education funding, recognising the concerns
raised by the Russell Group and others during the course of the
review. Some of the most important aspects of the proposals were:
UK's leading institutions compete with generously-funded universities
in other countries. Our international competitors are fuelled
with huge cash injections from their Governments and have the
freedom to ask for higher graduate contributions. The report recognised
that giving our universities access to additional investment is
vital in this internationally competitive environment.
proposals offered a good deal for students and a fair and progressive
way forward which protected low-earners. Unless graduates make
a bigger contribution, they - as well as society as a whole -
will be short-changed. Our graduates need to compete with the
best in the world, and we would be letting them down if we didn't
ensure they get the very best education.
Browne Review recommended a continuation of income-contingent
student loans. The loans proposed
by the Browne Review are a world away from conventional "debt":
there is no upfront payment for any student, and graduates are
only asked to start making repayments when their earnings reach
£21,000. Even then they would only contribute a fixed proportion
of their income (9% of income above £21,000) so their payments
should never become unmanageable.
5. THE GOVERNMENT'S
THE CSR SETTLEMENT
5.1 Given that the Government are committed to
far-reaching cuts to the funding of teaching in higher education,
lifting the fee cap to £9,000 is a welcome and necessary
reform. It should help our universities maintain and enhance their
world-class status, in the internationally competitive environment
noted above. Meanwhile Government is adopting key elements of
Browne's proposals on graduate contributions, has proposed a fair
system of interest rates protecting low earners, and has committed
to annually uplifting the repayment threshold. Graduates will
benefit from these measures.
5.2 Teaching in Russell Group universities takes
place in a research-led environment. Therefore we were pleased
that the Government appeared to have listened to our arguments
about the vital importance of research, and committed to maintaining
science spending in cash terms over the CSR period. The Chancellor
was right to say that our universities are the jewels in our economic
crown. The UK's world-class universities perform a vital role
as the engine room of economic recovery.
5.3 We recognise that during this period of ongoing
economic stringency universities should bear their fair share
of cuts. However, we remain concerned about the size of the cuts
to the rest of the higher education budget, outside the research
ring-fence. We are particularly concerned that the cuts will mean
it will be tough to maintain the high quality teaching, learning
and research environment our universities currently offer, even
with larger contributions from graduates.
5.4 Cuts in teaching funding in 2011-12, confirmed
in HEFCE's recurrent grant announcement, come ahead of increased
fees in autumn 2012. This is only the latest in a series of cuts
to university funding which have already required us to seek all
available opportunities to make savings.
5.5 We are also concerned that cuts to capital
spend will prove particularly detrimental, creating real and long-term
difficulties for UK universities. World-class infrastructure,
particularly buildings and equipment, is needed to facilitate
the very best environment for research and teaching.
6.1 The Russell Group shares the Government's
commitment that every student with the qualifications, potential
and determination whatever their background has the opportunity
to gain a place at a leading university. It is therefore essential
that policies aiming to promote fair access are designed and implemented
with regard to the evidence available on the reasons why there
are a range of under-represented groups among applicants to higher
6.2 Although this point was made repeatedly during
the course of the Browne Review, it is important not to lose sight
of the evidence that the introduction of variable fees in England
has not harmed access to higher education, but has coincided with
an increase in applications and participation by all groups, including
lower socio-economic groups. As already noted, the number of accepted
applicants at Russell Group universities from the bottom three
socio-economic groups rose by over 20% in the period between 2005-06
and 2008-09. This is consistent with a strong body of evidence
from other countries - including Australia, New Zealand and Canada
- which demonstrates that tuition fees, if coupled with income-contingent
loan repayments, do not have a negative impact on access to higher
Prior academic attainment
6.3 The most important reason why too few poorer
students even apply to leading universities is that they are not
achieving the required grades at school.
By far the most effective way of increasing the number of students
from low income backgrounds at leading universities is to help
them improve their academic performance and give them better advice
and guidance. Universities can and do help but we simply cannot
solve these problems alone.
6.4 The main problem is that students who come
from low-income backgrounds and/or who have attended comprehensive
schools are much less likely to achieve the highest grades than
those who are from more advantaged backgrounds and who have been
to independent or grammar schools.
Worryingly, this gap in achievement according to socio-economic
background is getting wider. Too many students don't choose the
subjects at A-level which will give them the best chance of winning
a place on the competitive courses at leading universities. This
is why the Russell Group recently published Informed Choices,
our guide to post-16 study options, which should help improve
information about how subject choices at school can impact on
6.5 Even those students from disadvantaged backgrounds
with the necessary qualifications are less likely to apply to
the most selective universities than students from better-off
backgrounds; pupils from top independent schools make twice as
many applications to the most selective universities as their
equally well-qualified peers from the best comprehensives.
School attainment, advice and aspirations must all be dramatically
improved if we are to remove the real barriers to fair access.
Investing in access measures
6.6 Russell Group universities already invest
over £75 million per year in initiatives designed to help
the least advantaged students win a place at our universities.
Universities will continue to invest in a wide range of outreach
activities. We offer numerous summer schools, open days, special
entry routes and access programmes to give students from lower
socio-economic groups the best possible chance of winning a place
and work closely with schools.
6.7 As OFFA has set out, universities charging
the highest fees will be expected to spend a considerable proportion
of their fee income on measures to widen access and improve retention.
But it's important to keep in mind that fee income is also urgently
needed to maintain the quality of teaching and the student experience,
especially given the significant cuts we are experiencing in funding
Measuring success in improving access
6.8 Any measurement of universities' progress
in improving access must be undertaken with great care. The investment
of Russell Group institutions into outreach activities benefits
the sector as a whole, with many students being inspired to study
at other institutions as a result of our widely targeted work
with potential candidates of many ages and backgrounds. We believe
our universities have a role in helping all students to fulfil
their potential, not simply widening access to our own institutions.
6.9 Any measurement of universities' progress
in improving access must be undertaken with great care. We welcome
the fact that OFFA will be allowing universities some scope to
set their own targets and milestones for access work, noting that
"there is no single perfect measure of access performance".
The HESA Benchmarks for widening participation should not be used
as the main way of assessing progress as they provide unsuitable,
insufficient and flawed targets against which universities' progress
cannot be meaningfully measured. As Lord Browne found, the benchmarks
do not provide a sophisticated enough picture of the student population
actually qualified to meet the entry requirements of many courses.
For example, they take no account of the fact that someone with
4 A*s at A-level might have a high tariff score but would not
have a strong chance of being accepted on a Medicine course if
these A-levels are in the wrong subjects.
Moreover, financial penalties for not meeting these targets would
be unfair and unhelpful to our aim of investing in ways to help
poorer students win a place at our universities.
6.10 It is
essential that the OFFA approval and monitoring processes fully
recognise the challenges of setting targets for achievements in
outreach work, where success in terms of changes to attitudes
and aspirations can be very difficult to measure.
National Scholarship Programme
6.11 We welcome the flexibility that institutions
will have within the programme, to tailor scholarships to the
individual circumstances at their own institution. Russell Group
institutions already invest over £66million in bursaries
and scholarships for students from lower-income families, and
the NSP should become an integrated part of their wider institutional
financial aid offer.
6.12 Although A-level and equivalent qualifications
are a key source of information about academic ability, Russell
Group universities already take a range of factors and information
into account to ensure that we can identify the candidates with
the most potential to excel on our courses, whatever their social
or educational background. The vast majority of Russell Group
universities, for example, use personal statements and references
when assessing candidates, while some interview candidates or
ask them to sit additional tests. Our universities often take
into account any particular barriers the candidate may have faced
during their education such as spending time in care; academic
qualifications are considered in a broader context. But admission
to university is and should be based on merit, and any decisions
about admissions must also respect the autonomy of institutions
and maintain high academic standards.
7. FEE LEVELS
7.1 Proposals on the level of fees that universities
wish to charge are a matter for each individual university to
consider. Those wishing to charge more than £6,000 will also
need to seek approval their Access Agreement by OFFA. At the time
of writing, most individual Russell Group universities have not
yet finalised their plans for fees in 2012-13.
7.2 In setting their fees for 2012-13, Russell
Group universities will have to consider:
likely reduction to their HEFCE funding for teaching from 2012-13.
investment they will need to make in future to maintain a world-class
student experience, with excellent employment outcomes for graduates,
and high levels of student satisfaction.
costs of providing a research-led learning experience, with state
of the art facilities, world-class academic staff, and low student-staff
investment they will be making in outreach activities, the NSP
and other financial support aimed at increasing access to the
university from students from under-represented groups.
8.1 In recent years, Russell Group universities
have continued to perform extremely well in the international
sphere despite a disparity in resources between them and many
of their global competitors. They are extremely efficient in international
terms. With 3% of global R&D investment, the UK publishes
14.4% of the world's highly-cited publications, and it is the
most efficient country in the G8 in terms of the ratio of citations
to public funding for research.
Russell Group universities graduate students in much shorter
time than the OECD average, whilst maintaining some of the highest
graduate earnings premiums.
They also demonstrate high levels of student satisfaction.
8.2 Universities have a strong track record in
increasing cost-effectiveness and Russell Group universities are
actively pursuing innovative ways in which to deliver greater
efficiency and higher levels of productivity. For example, our
universities have been examining all their business processes
including procurement, and overhead expenditure, to identify further
opportunities to reduce costs and improve efficiency.
8.3 In research, Russell Group universities are
continuing to make significant progress towards financial sustainability,
and recognise efficiency savings are crucial in a tough financial
climate. However, the Wakeham Review's recommendations on indirect
cost rates will be very challenging for universities to achieve,
with real reductions of 5% proposed and institutions with indirect
rates at the higher end to reduce their costs at an even faster
rate. While Russell Group universities are committed to continuing
to drive forward efforts in efficiency savings and cost-effectiveness,
it is absolutely essential that the full economic cost of our
research is appropriately covered.
8.4 Russell Group universities have been engaged
in negotiations with staff about changes to the USS pension scheme.
At the current time, in order for universities to be able to minimise
the impact of cost reductions on their staff whilst delivering
a high quality experience to their students, it is essential that
USS pension costs can be controlled and the level of risk greatly
reduced. Negotiations over this important issue have been difficult
and protracted, but we remain committed to creating an attractive
defined benefit pension scheme which is affordable and sustainable
into the future.
8.5 The Government has said that it is considering
the benefits of moving to a system of post-qualification admissions
(PQA) for undergraduate courses. Universities are always keen
to engage in any initiative that has the potential to improve
the system of applications and admissions, to make it more efficient
and responsive to students' needs. However, the costs of PQA significantly
outweigh any potential benefits. Moreover, it is unclear which
problem a PQA system is trying to solve.
9. RAISING INCOME
9.1 Russell Group institutions have also been
both proactive and successful in diversifying their sources of
income and in attracting investment through philanthropy and from
the private sector.
9.2 Endowment funds, and the annual investment
returns which they generate, can be an important source of additional
income to universities. Russell Group universities have been growing
their income from this source, and a recent report showed that
they are attaching increasing importance to engaging with their
alumni in an effort to raise the level of charitable donations
and increase their endowments.
However, the report also highlighted that income from all philanthropic
sources still represents an extremely small proportion of income
(less than 2% of total income, on average) for Russell Group universities.
In consequence, though endowments may become more significant
in the future, they are far from being a solution to the immediate
and substantial funding difficulties which universities now face.
9.3 Figures from the higher education business
community interaction survey demonstrate the success which Russell
Group universities have enjoyed in expanding their engagement
with and income from business in recent years. However, it is
important to note that in the aftermath of a recession, funding
from this source is likely to be constrained, in parallel with
that from the public purse. Despite recent success, funding from
the private sector in many areas remains a relatively small proportion
of university income.
Moreover, commercially-funded research in many cases continues
to be funded at less than the full economic costs,
contributing to an overall shortfall and backlog of investment
9.4 Income from the sale or licensing of intellectual
property does represent a source of genuine additional and non-hypothecated
income for universities. Yet it currently constitutes only a very
small proportion of total income (on average just a quarter of
commercialisation of research can take many years, is unpredictable,
and cannot be relied upon to provide regular income to universities.
More importantly there is a danger that undue focus on income
from this source could jeopardise the sector's wider mission to
generate and disseminate new knowledge. Engagement with business
will clearly become more and more important to universities as
they seek to secure a more sustainable balance of public and private
income sources in the future, but it is by no means a panacea
to their current funding shortfall.
9.5 Income from fees paid by overseas students
has become an increasingly important revenue source in recent
years, making up, on average, 8% of total income to Russell Group
institutions. Universities have also sought to internationalise
their educational activities by expanding international provision
and engaging in trans-national education, with some establishing
international campuses. Although the recruitment of international
students has provided an important income stream for Russell Group
institutions, it by no means represents an inexhaustible source
of future revenue. While income from this source may grow in the
short term, overall growth in international students is unlikely
to be sustained in the longer term, as other countries such as
India and China invest in developing their own higher education
sectors rather than in educating their students abroad. Growth
in overseas student numbers therefore cannot be relied upon as
a sustainable solution to the future funding of universities.
10. THE FUTURE
10.1 The Coalition Government's future policies
for the funding of higher education must take full account of
the enormous benefits that universities generate for students,
employers and the national economy.
Research and innovation funding
10.2 To ensure that the country benefits from
sustained, long-term investment in curiosity-driven research,
it is essential that universities receive adequate public funding
to support such research.
10.3 It is also essential that research funding
is concentrated to support world-class universities. Both QR and
Research Council funding need to be focused on rewarding excellence,
and to support of a multidisciplinary approach to research, to
enable the critical mass of expertise across disciplines to be
efficiently mobilised. Funding should ensure that the next generation
of researchers receives world-class training and support. Resources
should be directed towards those institutions most capable of
delivering excellent provision, to maximise the UK's competitiveness
in the global market. This view was shared by the 2010 review
of postgraduate education, where Professor Adrian Smith recommended
that to get best value from public investment in postgraduate
research degrees, funding should be targeted in areas of excellence.
10.4 It far more efficient and effective to build
the capacity of major centres of both research and knowledge transfer
activity. Smaller and less research-intensive institutions should
be encouraged to access the expertise within the larger universities,
rather than building their own capacity and expertise with few
economies of scale. Therefore funding for knowledge transfer and
exchange should be concentrated to support world-class universities
collaborate with industry and the public sector, both domestically
as well as internationally.
Funding to support undergraduate teaching
10.5 As set out in our submission to Lord Browne's
review, a fair system of funding for higher education should involve
a balance between public investment, contributions by graduates
and some support from business.
10.6 In addition to increased contributions from
graduates, there remains a strong case for direct public funding
for teaching in universities, to ensure that higher education
delivers maximum benefits to the wider economy and society, as
well as to individual students themselves.
10.7 Given the very significant reduction in
public funding directly to universities, the Government will need
to make sure remaining funding from HEFCE is targeted towards
the most important priorities, for example:
the upper fee cap of £9,000 for full-time Home/EU undergraduates,
it will be essential for universities to be able to access public
funding to cover the costs of higher-cost provision STEM provision
where the maximum fee will not cover the full costs of teaching.
10.8 Given the relatively high level of public
subsidy available to students through the new student support
system, it is very likely that the Government will want to continue
to limit the total number of Home/EU students in the sector (including
all students with access to Government student loans). The only
alternative - reducing the amount of fee income and/or HEFCE funding
available to universities would pose a serious threat to the quality
of teaching at our leading universities. Maintaining the quality
of the student experience and the reputation of UK degrees must
be a greater priority than expanding the number of places.
10.9 The Government has said that it wishes to
increase competition between institutions within the higher education
sector, and to increase the influence of student choice. We would
support this aspiration. However, it will be important that any
policies designed to achieve this support the expansion of degree
programmes which are best able to demonstrate high quality teaching,
and high levels of student demand from well-qualified applicants.
Government policy should not simply encourage the growth of courses
likely to charge the lowest fees.
Funding for postgraduate study
10.10 We welcome the decision by the Coalition
to ask Sir Adrian Smith to revisit his report on postgraduate
education, in the light of recent developments. We are concerned
that the new fees regime for undergraduate study may have a negative
impact on the propensity for Home/EU students to pursue postgraduate
study in the future, particularly given that most postgraduate
students are required to pay tuition fees upfront, and do not
have access to the student support system. Moreover, if HEFCE
funding to universities for high-cost postgraduate taught courses
cannot be maintained from 2012, there will be serious questions
about the financial sustainability of some of these very valuable
courses in STEM subjects.
11.1 The UK can be justly proud of its higher
education sector which, at the current time, comes second only
to the US. There are major challenges ahead for UK higher education,
with significant questions of policy still to be resolved, in
Westminster, and in the devolved administrations. But concluding
this period of reform successfully is important not just for universities
themselves: perhaps more importantly these debates are crucial
for students, for employers, and for the future growth of our
national economy, which all depend upon the success of UK higher
education to realise their full potential. A key strength of UK
higher education is the quality of its leading research-intensive
universities. Securing their financial sustainability is vital
to secure their international competitiveness.
16 March 2011
114 Russell Group member institutions are: University
of Birmingham, University of Bristol, University of Cambridge,
Cardiff University, University of Edinburgh, University of Glasgow,
Imperial College London, King's College London, University of
Leeds, University of Liverpool, London School of Economics and
Political Science, University of Manchester, Newcastle University,
University of Nottingham, Queen's University Belfast, University
of Oxford, University of Sheffield, University of Southampton,
University College London and University of Warwick. Back
The Russell Group's two submissions to the Browne Review are available
The Russell Group's two submissions to the Browne Review are available
See Russell Group first submission to the Browne Review for further
information, pp.18-19. Back
In the last 15 years the proportion of A-level students at comprehensive
schools achieving 3As or more at A-level has risen from 4.2% to
8.2%, while the proportion at independent schools has risen from
15.1% to 32.3% (source DfE). Back
29.92% of all students who got 3A*-As at A-level in 2009-10 were
at comprehensive schools. This was 10,237 students, which is 8.2%
of the total taking A-levels at comprehensives. Comprehensives
accounted for 46.7% of all A-level students. By comparison, 11,386
candidates got 3A*-As at independent schools, which is 33.27%
of all 3A candidates in all schools, and 32.3% of those taking
A-levels at independent schools. Independent schools accounted
for only 13.2% of all A-level candidates.
In 2009, only 232 (or 4.1%) of students
in maintained mainstream schools and known to be eligible for
free school meals achieved 3 or more A grades at A-level. (See:
See http://www.russellgroup.ac.uk/russell-group-latest-news/137-2011/4746-new-guidance-on-post16-study-choices/ Back
See The Sutton Trust and BIS, Applications, Offers and Admissions
to Research Led Universities, August 2009. Back
Source: OFFA. The figure of £75m is the total "OFFA-countable"
expenditure on access, funded from additional fee income. Initiatives
undertaken in our universities that are funded from other sources,
including donation and endowment income, are not included. Back
Browne Review, p49. Back
Evidence Ltd, International Benchmarking Study of UK Research
Performance 2009 Back
OECD, Education at a Glance, 2010 Back
Ross-Case Survey 2008-09 (May 2010) Back
Funding from the private sector constitutes an average of 2.8%
of total income within Russell Group universities (Source: HESA
Finance 2007-08; Finance Returns - Income Analysed by Source) Back
See RCUK/UUK Review of the Impact of Full Economic Costing
on the UK HE Sector (April 2009), section 8.2 Back
Source: HESA Finance 2007-08; Finance Returns - Income Analysed
by Source Back
For more information about universities' collaborations with business,
and the commercialisation of research, see: The Russell Group,
The economic impact of research conducted in Russell Group
universities (March 2010). Back
The Russell Group, The economic impact of research conducted
in Russell Group universities (March 2010). Back