Value for money in higher education Contents


50.This country is facing a serious skills deficit. Two thirds of businesses surveyed in the 2017 CBI/Pearson Education and Skills Survey said that skills gaps are a threat to the UK’s global competitiveness.57 Over half of businesses included in the survey (61%) were “not confident there will be enough people available in the future with the necessary skills to fill their high-skilled jobs”.58 Similarly, the EEF, the manufacturing and engineering trade body, told us that almost three-quarters (72%) of manufacturers are concerned with finding the skills they need for their business.59 According to the Government’s recent Employer Skills Survey, which is one of the largest employer surveys in the world:

The majority of hard-to-fill vacancies (67%) are caused, at least in part, by a lack of skills, qualifications and experience among applicants.60

51.In terms of productivity the UK lags behind most of its counterparts, with workers in the UK producing less in each hour they work than those in the US, Germany or France. According to the Office for National Statistics (ONS) “compared with the rest of the G7, the UK had below average real productivity growth in both output per hour and output per worker terms in 2016”.61 This failure to match its competitors is in part caused by persistent skills shortages.

Degree apprenticeships

52.Degree apprenticeships were introduced in 2015 by the Coalition Government. According to the Universities UK report ‘Degree Apprenticeships: Realising Opportunities’ there will be over 7,600 degree apprentices by the end of the academic year 2017–18.62 There are now over 100 higher education institutions on the register of apprenticeship training providers.

53.Degree apprenticeships are crucial to filling skills gaps and boosting the country’s productivity. Degree apprenticeships offer students the opportunity to earn whilst studying for a degree, without incurring tuition fee debt, and at the same time gaining high-quality work experience.

54.We heard positive evidence on the growth of degree apprenticeships from institutions and representative bodies. In written and oral evidence Universities UK were supportive of degree apprenticeships and positive about their growth:

The key benefits that universities have identified are enhancing partnerships with employers, meeting regional skills needs and increasing social mobility thus contributing to increasing productivity and widening participation. From initially small numbers we expect to see healthy growth in areas such as engineering, digitals skills and leadership and management, all areas of identified skill shortages.63

55.During our visit to Warwick Manufacturing Group and Warwick University in February, we saw first-hand how their degree apprenticeship programmes are bringing together the university and major local employers. The degree apprentices we met spoke enthusiastically about being able to work with companies such as Jaguar Land Rover whilst studying for a degree. They said that doing so meant that they could apply their learning directly into their everyday work and build a career which would benefit them when they graduated. Many of them had also applied for undergraduate courses but found the lack of debt and more practical approach to learning appealing. We also met degree apprentices at the Dyson Institute. Its engineering degree apprenticeship offers a tuition fee-free University of Warwick degree, a competitive salary and direct entry into employment at Dyson.

56.We are pleased that Cambridge University will be offering degree apprenticeships from this academic year. In February the University announced that it had registered as an official apprenticeship provider, and that it will initially focus on postgraduate study.64 We took evidence from other higher education institutions such as Coventry University, which is aiming to have 2,000 apprenticeship starts by 2021. The Open University stated that it wishes to be the largest provider of degree apprenticeships in the country. We are disappointed that institutions such as Oxford University are not offering degree apprenticeships, but we are pleased that more of the Russell Group will offer them in the future. We believe that the support of these universities would improve their prestige, particularly with parents.

Barriers to growth

57.Despite the positive evidence we have heard, the numbers of degree apprentices are not growing fast enough. Whilst Sir Michael Barber told us that he “would love to see the numbers grow”,65 barriers to their growth were raised both during this inquiry and our inquiry into the quality of apprenticeship and skills training.

58.In its most recent strategic guidance to the Institute, the Department instructed it to:

ensure that the approach to degree qualifications in Level 6+ apprenticeships aligns with the wider apprenticeships policy on mandatory qualifications.66

59.This means that degrees can only be included in certain cases, for example if they are a regulatory or professional registration requirement or are likely to be necessary in order to get a job (the hard sift).67 University Alliance questioned the approach of the Institute for Apprenticeships (IfA), and expressed serious concern over guidelines in their ‘Faster and Better’ document:

There are concerns about how the IfA is conducting its ‘hard sift’ outlined in its ‘Faster and better’ guidance document from earlier this year (i.e. if a few job adverts for a profession attached to a particular standard do not contain a degree requirement, that may be seen as enough evidence that a Level 6 or 7 apprenticeship standard does not require a degree in certain instances, despite concerns raised by providers and employers).68

60.The inclusion of degrees within degree apprenticeships is essential as a marker of quality for learners and employers, and to support parity of esteem between vocational and academic routes.69 Adrian Anderson, Chief Executive of the University Vocational Awards Council (UVAC), recently wrote that “there seems to be a deliberate policy through ‘Faster and Better’ to remove degrees from apprenticeship standards, unless required by a regulator or professional body, in many cases, against the wishes of employers”.70

61.University Alliance, as well as Million Plus and Universities UK, have criticised the Department, the Education Skills Funding Agency (ESFA) and the IfA for their role in the expansion of degree apprenticeships.71 Million Plus called on the Department and ESFA to “engage more actively with higher education providers”, and increase their “knowledge and understanding of the sector”.72

62.A letter from the University of Essex echoed these concerns and detailed the “bureaucratic hurdles” which providers are facing in the delivery of degree apprenticeships.73 The letter also described the reluctance of some employers to become involved in higher and degree apprenticeships due to financial burdens and very slow approval rates. In written evidence to our apprenticeships inquiry the UVAC also voiced strong criticism of the ESFA:

ESFA is still a further education organisation with a further education ethos and focus. It has limited understanding of higher education and many of its systems are incompatible with higher education and act as substantial barriers to the engagement of HEIs and the delivery of the Higher and Degree Apprenticeships employers have developed through the Trailblazer process.74

63.In reply to such criticisms Sir Gerry Berragan, Chief Executive of the IfA, told us in oral evidence:

The institute is completely agnostic about the level of apprenticeships. Some people accuse us of making it hard for degree apprenticeships; others accuse us of favouring them. Neither of those things is true. We are agnostic. We respond to employers who come forward with proposals for apprenticeships at different levels, and we treat all of those apprenticeship proposals equally. We attempt to deal with them as quickly as we possibly can.75

64.In response to concerns over the new guidance and the removal of ‘degree’ in degree apprenticeships, Sir Gerry said that there has not been a policy change and that “there is no bias against degree apprenticeships here”.76 He stated that they had simply made their approach more consistent by applying the same policy on qualifications to degree apprenticeships.77

65.As stated in our recent report into apprenticeships, the Institute cannot afford to be “agnostic” about degree apprenticeships. They should be championed by both the Government and Office for Students and made a strategic priority for the Institute.78 The Secretary of State assured us on 27 June he has “no current plans to change the name of degree apprenticeships”.79 He added:

I take the challenge on the speed of approval of standards. It has improved. In the last six months the rates of approval have got faster, and there is a commitment for those that are still working their way through the system to clear in short time. Obviously, operationally, we need to keep an eye on that. Based on what you have just said, I will make sure I pay particular attention to what is going on in degree level apprenticeships.80

66.We are extremely disappointed by the response from the Institute for Apprenticeships to widespread concerns from the higher education sector on the future of degree apprenticeships.

67.We urge the Institute to make the growth of degree apprenticeships a strategic priority. Degree qualifications must be retained in apprenticeship standards, and the Institute must remove the bureaucratic hurdles which universities are facing. The Institute and the Education and Skills Funding Agency must engage much more actively with the higher education sector and take better account of their expertise.

Disadvantaged students

68.In terms of value for money for the student, one of the main advantages of a degree apprenticeship is the ability to gain a degree without paying tuition fees. Degree apprenticeships offer the opportunity to study without the barrier and burden of debt. In a Universities UK survey of universities “social mobility, widening and diversifying participation” was rated as the second most important benefit of offering degree apprenticeships.81 Aaron Oreschnick, a degree apprentice from Manchester Metropolitan University, described why he chose the route:

As a degree apprentice, I have no university fees. Everything for my education is paid for by my employer and the levies. In terms of value for money for me, that is great.82

69.Recent analysis of degree apprenticeships by the Office for Students found that young degree apprentices are more likely to come from the areas of the country with high participation in higher education (28%), than areas of low participation (13%).83 Just over half of young degree apprenticeship entrants are from areas with high educational advantage. The research also found that those areas with the lowest participation levels in HE have a similar proportion of degree apprentices to other types of HE students.84 The North West and North East of England have the highest proportion of degree apprenticeship entrants.

70.For academic year 2018–19 the Office for Students is spending a total of £337 million on activities to widen access and support successful student outcomes.85 This includes £60 million for The National Collaborative Outreach Programme (NCOP) which brings together 29 partnerships of universities, colleges, schools and other local agencies to deliver programmes of higher education outreach with young people in Years 9 to 13. The figure also includes £165 million to support successful student outcomes for full-time undergraduates.

71.Degree apprenticeships are crucial to boosting the productivity of this country, providing another legitimate route to higher education qualifications and bringing more students from disadvantaged backgrounds into higher education. We believe some of the money which is currently allocated by the Office for Students for widening access could be better spent on the development and promotion of degree apprenticeships and support for degree apprentices to climb the ladder of opportunity.

72.All higher education institutions should offer degree apprenticeships, and we encourage students from all backgrounds to undertake them. We recommend that the Office for Students demonstrates its support for them by allocating a significant portion of its widening access funding to the expansion of degree apprenticeships specifically for disadvantaged students.

BTECs and T-levels

73.UCAS figures show that the proportion of students entering university with applied general qualifications has grown.86 The numbers applying with BTECs grew by 50% proportionately between 2011 and 2016.87 This increase has led to more students from disadvantaged backgrounds entering university.88 Professor Peck discussed the numbers of students with BTEC qualifications at Nottingham Trent University:

About 34% of the undergraduate students who came to us this autumn had a BTEC qualification as well as A-levels; some just had BTEC qualifications. They were more likely to be students from poorer schools and disadvantaged backgrounds. We have to make sure that BTECs carry on being part of the mix and that T-level qualifications also enable students to get to university when they are 18 if they have had to go down a mixed academic-technical route.89

74.Despite higher entry rates, a report by the Higher Education Policy Institute (HEPI) last year showed that only 15 BTEC students were accepted at the four most selective universities in 2015, and under two-thirds of students with BTECs at Russell Group universities go on to complete their course.90

Given the growth in the number of university students with applied backgrounds, academics need to be aware that an increasing proportion of their students have not followed an exclusively academic path. Universities should consider ways of meeting the needs of students with applied backgrounds, particularly when they are transitioning to more theoretical, exam-assessed study.91

75.The Government’s recent T-levels consultation response stated that “respondents said that allocating UCAS Tariff points to T-Levels would support progression. We recognise this and therefore we are working with UCAS to explore this option”.92 During our session with Vice-Chancellors we received a mixed response to the question of whether their universities would accept T-levels:93

James Frith: From a T-level point of view—initially yes or no answers, and then I will come in—are you planning to accept applicants with T-level qualifications?

Professor Husbands: Yes.

Peter Horrocks: Yes, because we accept any. We do not have any qualification requirements.

James Frith: We appreciate that, thank you.

Professor Dame Janet Beer: It seems likely.

Professor Richardson: We will wait and see.

Professor Peck: Yes.

Chair: What does wait and see mean?

Professor Richardson: We have said we are open to them. I am a social scientist. We will wait and see what the data says. What we need to know is whether kids have the background to do well with us.

76.Professor Richardson continued to say that as an academic institution, the University of Oxford would need to be convinced that T-levels provide students with the necessary skills to thrive in that type of environment.94 Scepticism about T-levels has also been voiced by Imperial College London and University College London.95

77.The implementation of T-Level qualifications from 2020 could offer improved access to university for students from disadvantaged backgrounds. The Government should engage with universities and UCAS in order to determine an appropriate tariff weighting prior to the introduction of T-levels. We also encourage universities to continue to accept BTECs and put in place additional academic and pastoral support to these students throughout their studies.

Work placements

78.In order to best prepare students for work and equip them with the necessary skills for the changing economy, universities must create strong relationships with employers. One of the best ways for students to engage with employers is for them to undertake work placements as part of their degree. We heard compelling evidence from several providers who place a strong emphasis on work placements, including Nottingham Trent. In oral evidence Professor Peck told us that from this year all their students must do a work placement as part of their degree.96 He added that 25% of their students complete a year in industry and that 90% of these students “come out with a graduate-level job or graduate-level training regardless of their social background”.97

79.We recommend that universities look to include significant periods of work experience within undergraduate degree courses. This could be a year in industry, or shorter placements with local employers. We believe that practical experience of the workplace must become the norm in degrees and an integral part of making students ‘work ready’. There should also be a greater focus on the extent to which universities prepare their students for work in the TEF criteria.

58 Ibid, p 11

59 EEF (VAL 10) para 3

60 DfE, Employer skills survey 2017, August 2018, p 13

62 Universities UK, Degree Apprenticeships: Realising Opportunities, March 2017, p 2

63 Universities UK (VAL 63) para 11

68 University Alliance (QUA 98) para 5

69 Ibid, para 6

71 University Alliance (QUA 98); MillionPlus (QUA 37)

72 MillionPlus (QUA 37) para 13

73 University of Essex (VAL 82) para 7

74 UVAC (QUA 36) para 6

77 Ibid

78 Education Committee, Sixth Report of Session 2017–19, The apprenticeships ladder of opportunity: quality not quantity, HC 344, paras 20–23

81 Universities UK, Degree Apprenticeships: Realising Opportunities, March 2017, p 19

82 Q3

83 OfS, ‘Analysis of degree apprenticeships’, accessed October 2018

84 Ibid

85 OfS, Guide to funding 2018–19, May 2018, p 26

86 UCAS, Progression Pathways, January 2016

87 Ibid

91 Ibid, p 31

Published: 5 November 2018