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Alternative providers … or challenger institutions?

  • 10 July 2015

Today’s Productivity paper from HM Treasury provides yet more evidence, if any were needed, that the Conservative-majority Government is doing things differently to the Conservative-led Coalition.

The 2010 to 2015 Government made one early decision that transformed the finances of some alternative higher education providers (known as APs) when allowing their home/EU students to borrow up to £6,000 for tuition. At a stroke, this meant the absence of income from Hefce (the defining feature of an AP) became less important.

But the single regulatory system promised in the 2011 higher education white paper never materialised and, in the later days of the Coalition, official support for APs calmed down. There were serious concerns about where some of the money had gone, as well as close interest by the National Audit Office and Public Accounts Committee.

Today’s paper lays down a new path. It does not ignore the concerns about quality but the focus is on simplifying the obstacle course that legitimate APs have to complete.

The key extract is reprinted below. It suggests that if you are an AP that is believed to be of good quality, then you could:

  • face lower barriers to entry;
  • lower barriers to growth;
  • less bureaucratic quality assurance procedures;
  • quicker access to degree-awarding powers; and
  • the ability to offer degrees not validated by another institution even before you formally achieve degree-awarding powers and extra places.

That goes beyond anything David Willetts proposed and is a big agenda that will have strong support and strong opposition. It also explains why APs are coming to be known by some of their supporters as challenger institutions.

Opening the market to new and alternative providers

4.9 Widening the range of high quality higher education providers can stimulate competition and innovation, increase choice for students, and deliver better value for money. The government will remove barriers preventing alternative providers from entering and growing in the market, and adopt a risk-based approach that safeguards quality.

4.10 To enable the best new providers to compete on a level playing field with established universities, the government will introduce a clearer and faster route to degree awarding powers for those assessed to offer the best quality education. As part of the review of validation arrangements, the government will explore options to allow the best providers to offer degrees independently of existing institutions before they obtain degree awarding powers.

4.11 The government will also free up student number controls for the best alternative providers by introducing a performance pool of places from 2016-17, which will allocate additional student places to the best providers. The government will continue to monitor the quality of courses offered by providers and will impose sanctions on those where quality is not high enough.

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