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HEPI publishes a new report on the impact on demand of the Government’s White Paper on higher education

  • 3 October 2013

A copy of the full HEPI Report (62) The impact on demand of the Government’s reforms of higher education by John Thompson and Bahram Bekhradnia is available for download here.

This HEPI report (published 3 October 2013) provides an updated  assessment of the impact on demand for full-time higher education as a result of the changes in student support and fee levels introduced in England by the Coalition Government in 2012.  This latest HEPI report also provides the evidence of the impact of these White Paper changes on part-time higher education.

HEPI concludes that there is prima facie evidence that the White Paper changes led to a reduction in demand or supply or both leading to fewer part-time entrants to higher education. Given these  provisional findings,  this HEPI report describes the changes that may have led to the continuing  fall in part-time entrant numbers, considers the further questions that need to be addressed and sets out some policy options.

  • The White Paper introduced loans for part-time study, claiming that up to around 175,000 part-time students could benefit from an entitlement to tuition fee loans.     Considering all the changes to financial support for part-time students (covering grants and scholarships, employer sponsorship as well as loans), HEPI points out that only a minority of part-time students were eligible for loans, and that for those that are eligible  the benefits of access to loans may be  outweighed by the likely increase in fees.   As of 31 August 2013, 30,800 part-time students had their tuition for the academic year 2012-13 paid for by the Student Loan Company (SLC).  At this stage, it remains unclear what this figure is as a proportion of entrants eligible for loans.
  • When considering trends in part-time entrant numbers, HEPI points out that they are likely to be the result of both supply and demand factors.  For most institutions part-time study represents a small proportion of their undergraduate provision and against this backdrop they may adopt a variety of responses given the new market in which they now operate.  Part-time provision may no longer be attractive to some institutions confident of attracting “high achieving” students outside the controls.  This appears to be the case with some Russell Group institutions.
  • HEPI notes that between 2011-12 and 2012-13 the number of part-time entrants has fallen; the provision of loans to a minority of part-time students has not been sufficient to stop this decline.  But it is uncertain to what extent the increase in fees has contributed to the further decline in part-time entrant numbers.
  • Turning to young full-time undergraduate application rates, an assessment of the new UCAS data, taking into account the data from Scotland and Wales, supports HEPI’s earlier conclusion that the impact of the White Paper changes has been smaller than some have suggested, with the application rates before and after the changes in 2012 likely to be the result of temporary changes with applicants bringing forward their applications to avoid fee rises.
  • HEPI concludes that the recent decline in application rates for mature applicants to full-time courses is probably connected with fee increases.

The key policy question is how to achieve a reversal of the trend of decreasing numbers of mature, particularly mature part-time, students.  Others have called for better information about part-time provision and HEPI highlights the lack of clarity about the eligibility for loans for students with higher education qualifications.  HEPI calls on the Secretary of State for Business, Innovation and Skills to make a clear and complete set of decisions about these, and for this information to be disseminated in an understandable form.  HEPI also calls on BIS to provide more complete guidance on which qualifications are supported by loans.

As well as better information, it is necessary to ensure part-time places are available and that potential students are not discouraged.

The evidence suggests that the idea of a wider social obligation to provide part-time courses at affordable cost risks being lost, possibly because holding down fees might make justifying the full-time fees more difficult.   There is the danger that universities will scale down what they treat as a peripheral business – that is mature and particularly mature part-time recruitment – to focus on their “core” business of teaching young students on full-time courses.

HEPI argues that an extension of fee loans or even the introduction of maintenance loans would not necessarily stimulate demand, and that the cost to Government is highly uncertain.    It is therefore worth exploring whether standards and quality could be maintained and fees reduced with little or no net additional public expenditure.

It may be possible in future to reduce fees substantially and the incentive to do so may exist in the form of competition from providers using new technological developments. We may see the sharp division between traditional and the new “high tech” provision soften, which could lead to a reduction in tuition fees.

For further information please contact: Bahram Bekhradnia, HEPI Director

Email: [email protected] T: 01865 284448 M: 07709484599

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