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The impact of Covid-19 on university students Contents

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3Refunding tuition fees

17.University students who pay tuition fees are protected by consumer law, and are entitled to seek remedies or refunds if their university fails to provide the education they have paid for. Remedies students might be entitled to if they receive a substandard service include:

• Repeating part of the course.
• A refund, up to the full price of the course.31

In this Chapter we consider the circumstances in which students may be entitled to these remedies, and whether the current options for seeking these remedies are fit for purpose.

Current arrangements for university students to exercise consumer rights

18.While students are protected by consumer law if their university provides a substandard service, there is no clear guidance on the circumstances under which students would be entitled to a refund or to repeat part of their course. Universities UK has stated that “Where there is wide-ranging support for active and ongoing learning and progression, students should not expect any fee refund from their university.”32 The Government has expressed a similar position, stating:

Students ordinarily should not expect any fee refund if they are receiving adequate online learning and support.33

The Government has said that if institutions are unable to facilitate adequate online tuition then it would be unacceptable for students to be charged for any additional terms—effectively being charged twice.34 The Government has more recently made it clear that full tuition fees should only be charged if the quality of education is there, stating:

We only expect full tuition fees to be charged if online courses are of good quality, fit for purpose and help students progress towards their qualification. If universities want to charge full fees, they will have to ensure that the quality is there.35

The Minister acknowledged that many students would rightly feel they had not received the education they had paid for, saying:

I take on board that there are numerous students who are unhappy, and there will be circumstances where students, quite rightly, feel that they have not had the deal that they have in effect paid for.36

The Minister also accepted that some students will not have received the right quality of support.37

19.In its response to one of the petitions requesting reimbursement, the Government has described the process by which university students can complain if they are not satisfied with the education they are receiving:

In the first instance, students should speak to their provider to see if they can resolve their complaint. We expect student complaints and appeals processes to be operated flexibly, accessibly, and sympathetically by providers to resolve any concerns. If a student at a provider in England or Wales is not satisfied with their provider’s response, they can ask the Office of the Independent Adjudicator for Higher Education (OIA) to consider their complaint.

In addition to complaining to their university, and escalating to the OIA if necessary, a university student could take legal action against their university, on the basis of consumer rights law.38

20.The Minister emphasised the importance of independent consideration of whether students are entitled to a refund, telling us that “[i]t really is important that the process of examining whether they should have a fee refund, or what has gone on, should be independent,”39 and that this had to be done on a case-by-case basis. However, there is no standardised process for students to seek a refund from their university in the first instance, and it is up to individual universities to decide how to deal with any complaints or requests for reimbursement. It is only if a student chooses to escalate an unsatisfactory response to the OIA that it is reviewed independently.

21.The scale of disruption caused by the Covid-19 outbreak could mean that a significant proportion of university students have not received the education they are entitled to and are therefore entitled to a refund or other remedy. As discussed in Chapter 2 of this report, and shown by evidence from both our own engagement and that undertaken by NUS, a large number of students feel they are not receiving the standard of education they are entitled to. The Minister told us that she understood that so far there had been a very small number of complaints submitted to universities, but expected more to be made in the coming months.40 The Minister subsequently advised us that between March and late June the OfS had only received 58 notifications of concerns about the arrangements put in place by individual providers.41 The Office of the Independent Adjudicator for Higher Education has said that it has received fewer than 20 complaints relating to Covid-19 disruption, but that it is very early days and there is usually a significant time lag between the cause for complaint arising and a complaint reaching them.42

22.Given the number of students who have told us they are not satisfied with the education they are currently receiving, and do not believe it is good value for money, it does not appear that the current system—using a university’s existing complaints process, and escalating to the Office of the Independent Adjudicator for Higher Education if they do not receive a satisfactory response—is adequate, or indeed practicable, given the potential scale of take-up. In 2018 Universities UK published advice to universities on compensation and refund polices, which stated that “Where a problem has potentially affected a large number of students, such as industrial action, institutions may wish to consider the use of a separate, streamlined process for dealing with groups of complaints efficiently and consistently.”43 However it is not yet apparent that universities have done so in respect of complaints regarding the impact of the Covid-19 outbreak, or strikes.

23.Students have a right to seek a refund or to repeat part of their course if the service provided by their university is substandard, but the exact circumstances in which students should expect to receive a refund or be able to repeat part of their course are not clear. Furthermore, given the scale of the disruption that has been caused by Covid-19—in addition to the strikes earlier in the year—and the numbers of students who may feel they are entitled to some form of reimbursement, it is not acceptable to expect individual students to seek satisfaction through existing complaints procedures or the courts. A new process needs to be put in place to consider complaints arising from Covid-19, and other out-of-the-ordinary events that affect the courses of large numbers of students, including large-scale strikes. The Government should work with the Office for Students and Office of the Independent Adjudicator for Higher Education to produce guidance on the circumstances in which university students are likely to be entitled to seek a refund or to repeat part of their course, and to establish a new system which enables all students to easily seek a full or partial refund of their tuition fees, or to repeat part of their course, based on an independent and objective assessment of the quality of education they have received over the academic year.

24.While it appears that to date relatively few students have raised formal complaints with their universities or taken individual action to seek a refund of their tuition fees, many students are not happy with how university courses are being delivered. It is essential that all students are made aware of their rights, and how to raise a complaint and seek a refund if they are not satisfied with the education they are receiving. The Government should work with universities and the Office for Students to ensure that all students are advised of their consumer rights and are given clear guidance on how to avail themselves of these if they feel their university has failed to provide an adequate standard of education. This should include details of how to access any new system which is developed in response to our previous recommendation.

How refunds should be paid for

25.Petitions calling for students to have their tuition fees refunded have variously called for universities to be required to refund the fees themselves, or for the Government to reimburse students who have been affected. Under consumer law, it would fall to universities—as the service provider—to refund tuition fees if they fail to provide the quality of education students are contractually entitled to.44 The Government’s responses to petitions on this, and the oral evidence from the Minister, was that the Government regard any refund as a matter for individual universities, as “autonomous institutions”.45

26.However, while the Minister was right when she told us that the current situation “was not of the universities’ making nor of the Government’s making”,46 it is the Government that determined the restrictions that apply during the outbreak, and it is these restrictions that have required universities to change the way they deliver courses. This has led to hundreds of thousands of students signing petitions calling for tuition fees and other costs to be reimbursed. The Government also has a responsibility to consider the impact of Covid-19, and the social distancing restrictions it has put in place in response to the pandemic, on the higher education sector, just as it has done in providing its wide-ranging package of support for businesses.

27.In 2018/19 universities received just under £20 billion in tuition fees and education contracts, accounting for almost half of all income for the higher education sector.47 If even a significant minority of students were successful in seeking refunds from their universities this could have a significant impact on university finances. The proportion of university income made up by tuition fees varies hugely across the sector, so the impact of being required to refund tuition fees to a large number of students could have significantly different impacts on different universities.48 Universities are also facing the prospect of reduced income in the next academic year. Research by London Economics, produced for the UCU, showed that Covid-19 could lead to over 200,000 fewer first-year students attending university this autumn, which could cost universities £2.5 billion.49 Universities are therefore potentially facing obligations to reimburse students for past fees at the same time as future income could fall.

28.The Chief Executive of Universities UK, Alistair Jarvis, has said the Government “must take urgent action to provide the support which can ensure universities are able to weather these very serious challenges, and to protect students, maintain research, and retain our capacity to drive the recovery of the economy and communities”.50 The UCU has called for a “clear and coherent plan” from the Government to ensure universities and colleges can retain academic capacity now and help build for the future.51 This call has been supported by the NUS.52 The Government has announced a range of measures to protect students and the higher education sector from the impact of Covid-19,53 which the Minister told us included £700 million in financial support,54 but is silent on the matter of student refunds.

29.When pressed on whether the Government would shoulder the financial burden that could be involved in reimbursing students who have received a substandard education, the Minister for Universities told us:

We need to be realistic in terms of what we have just been through and the asks of our Treasury. Commitments have already been made to every sector of the economy in terms of what can be delivered.

When we look at what has happened with students, we have managed to have a situation in this country—which has not been the case in every country—where we have not closed universities. Students have still continued to get an education. There has not been a gap or disruption in their educational provision, unlike other sectors of our own education system in this country. They have still continued to get their maintenance loans. We have enhanced their hardship funding. If there is a problem in their individual cases, there is a process in place to get those refunds.55

30.If a university has failed to provide the education a student has paid for, the student is entitled to a refund from that university. However, given the likely impact of Covid-19 on universities—which could cost them around £2.5 billion in fees and teaching grant income alone—there is a risk that a large number of students requesting and being entitled to a refund could have a serious and detrimental effect on the sustainability of the higher education sector. That is not, however, a reason to prevent students from receiving any refunds to which they are entitled.

31.The Government has put in place unprecedented financial support measures to respond to Covid-19, paying the salaries of hundreds of thousands of employees nationally, and funding grants and loans for a huge number of businesses and industries. These are exceptional actions, in exceptional circumstances. Given the importance of the higher education sector to the UK economy, and the exceptional circumstances facing both universities and university students, the Government should consider providing additional funding to universities to enable them to pay any refunds university students are entitled to as a result of the Covid-19 outbreak. The Government could also consider alternative means for reimbursing students, where an independent process has found that they are entitled to a refund, such as reducing student loans of students who are entitled to a refund.

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