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Student Contracts: an opportunity to streamline and reduce regulatory burden in English higher education

  • 29 January 2021
  • By Andrew Boggs

This blog was kindly contributed by Andrew. M .Boggs, Visiting Fellow at the Oxford Centre for Higher Education Policy Studies (OxCHEPs). You can find Andrew on Twitter @andrewboggs and OxCHEPs @oxcheps .

Of the dozen or so documents relating to higher education published by the Department for Education on 21 January 2021, one of the items that many may have overlooked is the 19 January strategic guidance letter from the Secretary of State for Education to the Office for Students (OfS). This letter, typically expected on an annual basis, is intended to provide the OfS with information on their fiscal responsibilities (for example, availability of high-cost teaching funding and the Government’s desired direction for that funding) along with a more general steer on regulatory issues within the statutory purview of the regulator, such as suggesting the OfS focus on degree outcome standards or new provider quality assurance.

The 19 January letter from the Secretary of State appears to focus exclusively on financial and funding questions. While this will undoubtedly have regulatory implications down the road, there is nothing in the letter addressing particular regulatory questions. I am interested in a direction that Gavin Williamson gave to the OfS in a previous strategic direction letter which appears to have drifted off the radar: the direction to consider student contracts in his letter to the OfS dated 16 September 2019.

One can easily understand why a regulatory direction 16 months old has been superseded by events and critical matters that required the OfS’s immediate attention.

However, I would argue there is great value in returning to the question of student contracts, especially during this time of crisis.

That student contracts should be central to the legal obligations of higher education providers is argued by Palfreyman and Farrington in both editions of their comprehensive ‘The Law of Higher Education’ (2006 and 2012, with a new 2021 expected shortly). Palfreyman and Farrington posit that the central legal document governing provider behaviour and student expectations can, and should, be the contract providers have with each individual student. They helpfully go even further and provide a template for student contracts free to the reader.

Student contracts could represent a tremendous opportunity for providers, students and the OfS. Firstly, the student contract could become the central, primary regulatory artefact for sector oversight. Rather than imposing multiple, and increasingly conflicting, regulatory expectations on registered higher education providers, the OfS’s focus could become reviewing student contracts. Institutions attempting to game their contracts, and students feeling their contract had been broken, could trigger OfS investigation (or review by the designated data or quality assurance providers) if in the OfS’s view the contracts are unacceptably broad, proscriptive, or if it becomes clear contracts are being breached. However, items like student protection plans, demanding reviews of institutional CMA-compliance, and other ad hoc requests from the regulator could be abandoned.

From a provider perspective, this approach could reduce pressure for delivering impossible expectations. The Competition and Markets Authority would be hard-pressed to avoid intervening in a contract that guaranteed professional employment with a minimum £60,000 starting salary. The ‘reasonableness test’ of what a provider could be expected to include in a contract would help counter-balance unrealistic political expectations on the sector or intrusions in institutional autonomy.

Contracts could include commitments on quality of provision and protections for students with unique characteristics in need of additional support. Contracts would still be defined by individual providers, to reflect their unique offer and student population, albeit with threshold expectations from the OfS. They could discourage unnecessary regulatory intervention given the bilateral nature of a contractual relationship – beyond an agreed threshold template, the privity of the contract would mean most issues would be between the provider and the student. However, it is important to note that this may also create a tension between what should fall in the remit of the regulator and what would be the exclusive domain of contract law.

The approach suggested above would help cement the role of the OfS as a market regulator, versus sector manager, as was intended at the regulator’s inception.

It could have the added benefits of reducing red tape and bureaucracy. It could encourage meaningful risk-based regulation by providing an example of good practice (i.e. the OfS articulating what is expected in a contract), providing a real baseline of expectation across the entire sector, and the building of bilateral relationships between regulator and provider.

Even if the student contract were to become the central regulatory artefact for providers, the regulator and students, it wouldn’t necessarily replace all other regulatory artefacts, such as Access and Participations Plans and regular student number reporting. However, the student contract could become the principal instrument for determining regulatory intervention in a truly risk-based way.

The current pandemic continues to breed significant and, at times, overwhelming pressures on Government, the OfS, higher education providers and, of course, students. That said, placing student contracts at the heart of regulation could result in medium and long-term positive effects.

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