key: cord-0060940-fvlg8dpz authors: Baldock, John title: The Origins of the Current ‘Crisis’ Facing British Universities: Ideology or Incrementalism date: 2020-05-08 journal: Populism and Higher Education Curriculum Development: Problem Based Learning as a Mitigating Response DOI: 10.1007/978-3-030-47376-1_4 sha: 3581676885110ba02e09128b0056c6025a6b9a44 doc_id: 60940 cord_uid: fvlg8dpz This chapter discusses claims that the UK system of higher education faces a crisis of both legitimacy and adequate resources. Competing explanations for this possible ‘crisis’ are compared and placed in the context of changes to the funding and regulation of universities. At the beginning of the 2020s British higher education, and in particular its universities, have a problem of declining incomes together with rising demand from growth in numbers aged between 18 and 24. Before the impact of Covid 19 a high proportion of institutions were in financial difficulty and were reducing staff numbers. There had been growing criticism of universities, from within for becoming too managerialist, commercial and market-focussed, and from outside for failing to meet key needs of society and the economy; such as equality of access for those from minority or disadvantaged backgrounds, and the production of graduates with the skills required by employers. Some commentators have attributed these challenges to the recent strength of right-wing and populist forces, and ideas which question the role and usefulness of higher education and support for increased government control and regulation. The chapter argues instead that the current problems of universities are not new, but have a longer history, and largely be explained by incremental changes to the funding of higher education over the last seventy years. At the start of the 2020s, before the onset of the Covid 19 pandemic and its severe impacts on recruitment and finances, indicators measuring the quality and performance of the UK higher education system suggested it was doing well. Amongst the positive measures were record student numbers and resources per student, improving recruitment from disadvantaged backgrounds, high retention rates, growing proportions of students going on to highly-paid employment and rising scores for student satisfaction. All of these were at, or close to, historic highs. However, at the same time, much discussion about universities in the popular media, and to a lesser extent in political debate, portrays a sector in crisis, failing to perform and facing significant uncertainty. Amongst the signs of this 'crisis', it was suggested that higher education was not providing value for money, failed to give students the skills they will need to succeed in a changing economy, excludes too many poorer and minority students from the elite institutions, and so is wasting talent and resources. At the time of writing, most universities are reporting deficits in their budgets and are reducing staff numbers, using both voluntary and sometimes compulsory redundancies. Less definite are the rumours surfacing wherever university managers meet: that one or another institution may be about to go bankrupt and then the question arises as to whether government will or will not step in to save it. Some commentators have explained the current challenges to higher education within a context of the increasing influence of right-and leftwing populist ideas and the attractiveness to populist leaders of instrumentalist arguments about the right role of universities within nations and their economies. There is a literature explaining the evolution of higher education policy in the UK in terms of a neo-liberal project to turn universities into uncritical and accommodating servants of national and international capitalism (Thompson 1970; Collini 2012; Brown and Carosso 2013) . Current problems can indeed be explained within such frameworks: the increasing burden of student debt; the growing 'precariat' of university teachers and researchers permanently on short-term contracts; the encouragement of lower cost and potentially lower quality 'alternative providers'; the new-managerial executives of universities that take little account of academic bodies such as senates; management by crude metrics rather than qualitative educational and research outcomes; pressure to design curricula that focus on 'employability' and technical skills rather than broader critical capacities; a preference for the sciences at the expense of the humanities. A recent report from the House of Commons Education Committee, following its inquiry into 'Value for Money in Higher Education', recommended that 'alongside a drive to improve social justice, higher education must play a more significant role in meeting this country's skills needs and preparing students for the Fourth Industrial Revolution' (HC343 2018). Others point to 'a model making universities compete following the logic of market economics, [which] has created winners and losers' (Jones 2020) . They suggest recent changes to the funding and regulation of higher education in the UK constitute growing threats to the character of universities and even to core academic freedoms. The writings, mainly about British higher education, of Stefan Collini, emeritus professor of English literature at Cambridge University, have received considerable attention within academe. He argues that increasing managerialism, together with growing emphasis on metrics and measurement, marketization and financial performance, is altering the very language with which universities are spoken of and understood, and consequently are undermining their traditional roles as the creators and transmitters of knowledge (Collini 2012 (Collini , 2017 . This chapter questions whether the challenges that UK higher education is now facing are particularly unusual, or even essentially political and ideological. Rather it is suggested that the fundamental problem is the nature and scale of public funding. Ever since the end of the First World War, when government funding and public policy became the main drivers of change in higher education, British universities have experienced regular cycles of growth followed by retrenchment. The fundamental difficulty university managers have faced has always been uncertainty about the volume and reliability of income from the state and taxpayers. At the time of writing, this has once again become an acute problem. Universities have since 2012 benefitted from a period of exceptional growth in resourcing following the introduction of a new system for paying for undergraduate education based almost entirely on student loans and an annual tuition fee, set at a maximum of £9250 a year. Before the impact of the pandemic universities awaited a government response to the report in May 2019 of an official committee of inquiry, 'The Augar Review' into the funding and priorities of higher education (CP 117 2019). The review panel made over 70 recommendations including: that the average per-student resource should remain frozen for six years from 2017 to 2023; the maximum fee chargeable to students should be reduced from £9250 to £7500 per year; and that government should replace in full the lost fee income by increasing the direct teaching grant to universities, but leaving the average unit of funding unchanged at sector level in cash terms (ibid.: p. 206). It is the material consequences of the frozen fee, and uncertainty about its future, rather than any attempts to interfere with the academic priorities of universities (though these do exist) that explained almost all the elements of a financial 'crisis' in UK higher education which was then exacerbated by the pandemic. The new government elected in December 2019 and headed by Prime Minister Boris Johnson has been notably silent about when it will respond to the Augar Committee's report and what its views are on the future funding of higher education. Some have suggested that UK universities are at risk of the new wave of populist politics sweeping across industrial nations. However, the political interference faced by higher education in the United Kingdom remains a long way from, for example, the legal restrictions recently placed on Hungarian universities by Viktor Orbán's government. Those have included the banning of gender studies and expelling the CEU (the Central European University) which was funded by George Soros and led by Michael Ignatieff. Public research funding in Hungary is no longer determined by an independent body of academics, but by loyalist government officials. In 2019 a pro-government website asked students to submit the names of professors who espoused 'unaskedfor left-wing political opinions' (Foer 2019) . Populism has no precise definition. Amongst the more commonly perceived elements of populist values are resentment of elites, including supposed intellectual elites, suspicion of academic expertise, and expectations that universities should primarily serve national political and economic interests. However, these are all values that can be shown to have been widely held across all classes and all political parties in Britain for at least a century or more. They have deep roots in a British, largely English, culture of anti-intellectualism that values common sense, practical experience and business acumen above learning and theoretical complexity. These features of Anglo-Saxon and, to a lesser extent, American culture, have been traced by scholars to Britain's early industrialization, imperialism and the hegemony of middle-class, bourgeois, elites in economic and political life (Anderson 1992; Johnson 2009; Sowell 2009; Hofstadter 1966) . It is sometimes noted that, while the continental Europeans respect and admire their intellectuals or alternatively regard them as dangerous, the English tend either to ignore them, or to allow their views only limited influence. A crucial consequence is no British political party, and particularly neither the Labour nor the Conservative parties, is likely to champion the interests of higher education. That academics and universities might be reliable arbiters of their own functions and funding has never been a natural assumption on the part of British politicians and governments of any hue. Ever since the 1920s, when British universities became largely dependent on public funding, the success of their leaders, the vice-chancellors and their governing bodies has depended largely on their reactive skills; discerning and adjusting to sometimes quite abrupt shifts in the preferences of whoever is the current government minister responsible for the sector. In the December 2019 general election that returned the Conservative government of Boris Johnson, none of the manifestos published by political parties proposed policies that would have directly benefited universities, but what little was proposed was entirely to do with funding. The Labour Party made the abolition of student tuition fees a key policy promise, at an estimated cost of over £7 billion; expenditure that would inevitably have limited and very likely severely reduced funding available to higher education. The winning Conservative Party manifesto was notably silent on plans for universities other than to 'look at' lower interest rates on student fee and loan debts, a change that could disproportionately benefit high earners, and again which would be likely to constrain actual funding for higher education. None of the parties proposed to spend more on universities themselves despite the declining real value of the fixed student fee and the fact that the population of 19 to 24-year-olds is set to increase by over 600,000 over the next 10 years (Andrews et al. 2019) . The election manifestos confirmed a long-standing truth about the politics of higher education in the UK: policymaking and spending decisions affecting universities have always had very low political salience. Maintaining funding for universities is not an election winner. Indeed, since 1945 few of the landmark decisions affecting higher education have reached cabinet level but were determined by ministerial decision informed by assertive civil servants. An extended discussion about higher education has been very rare in the House of Commons. Detailed examination, when it does occur, takes place largely in parliamentary committees or occasionally in the House of Lords (Shattock 2012) . However, historically, and somewhat fortunately for British universities, the politicians and civil servants who do determine their futures have focussed almost entirely on the cost of higher education and to a much lesser extent on its content, such as the curriculum and teaching methods. For much of the twentieth century, until the 1970s, British universities, although largely and increasingly publicly funded institutions, were relatively insulated from wider economic pressures and from political or governmental interference. This was achieved through two 'institutions' both attributed to Lord Richard Haldane a former Lord Chancellor and Liberal and Labour Politician. The more significant of these was the creation in 1919 of the University Grants Committee (the UGC) which from 1919 to 1989 advised the Treasury and later the Department of Education on the allocation of funds to universities. In retrospect, it can be seen that UGC operated as an effective 'buffer' to political interference for the seventy years of its existence. The second protective institution was the 'Haldane Principle', an informal rule widely accepted by civil servants and academics as requiring that all decisions about the actual allocation of public money to academic research are made not by politicians but by committees of expert academics themselves (Owen 2006; Edgerton 2009 ). By the 1970s the UGC looked like an increasingly unaccountable and elitist arrangement. It was essentially part of the Whitehall establishment with close informal links to the top civil servants in the Treasury and an arrangement that protected higher education from political and electoral attention and ensured steady growth in resources, benefitting particularly, until the 1980s, the less than ten percent of 18-year-olds able to obtain entry to universities. Much of the rest of higher education was funded by local government in the form of technical colleges and polytechnics. In 1989 Mrs. Thatcher's conservative government, recognizing the unsustainability of a relatively small and highly selective university system, granted all the polytechnics university status and the University Grants Committee was replaced by the Higher Education Funding Councils for each of England, Scotland, Wales and Northern Ireland. These were momentous decisions, but, as was usual for higher education policy, took place largely without parliamentary scrutiny. A muchenlarged university system lost its protection within government and became much more vulnerable to political decisions, particularly in terms of funding. Higher education was subject to increasing ministerial direction in the form of annual letters to the funding councils from the relevant minister setting out the government's priorities. Michael Shattock, in his history of policy-making in UK higher education from 1945 to 2011 argues convincingly that almost all significant shifts in policy have been essentially finance driven; the product of governments' need to find ways to limit public expenditure in a context where the growing pressure of student numbers has always outstripped the more modest expansion of the national economy (Shattock 2012) . The core policy-making context was always the availability of resources to finance the system. All other decisions derived from that fundamental imperative. Shattock traces the history of policy development through changes of government, and even more frequent changes in the responsible ministers. He concludes that policy has been essentially path dependent: government departments stumbled towards successive solutions in a series of often faltering steps, each step focussed on containing public expenditure and each leading to the increased marketization of a university education. In retrospect the first step in the journey towards an entirely fee-driven system was the removal in 1979 of the subsidy for overseas students. Until 1967 overseas students had paid the same nominal fee that local authorities paid for home students. Between 1967 and 1979 the overseas fee was higher but still substantially subsidized by direct grants from the UGC; but then with the removal of the subsidy, overseas fees became a key additional cash source entirely within universities' discretion and so introduced them to the now essential activities of competitive market research, advertising, USP management and league tables. The overseas fee was the first example of government solving the public expenditure problem by alighting directly on the remedy of asking the student to pay. It became a solution that would be extended incrementally over the next 40 years until the point was reached in 2019 when 96% of the costs of undergraduate provision in England, Wales and Northern Ireland were funded directly by the student fee supported by the student loan. This is the fundamental policy change of the last half century. Except in Scotland (where the Scottish parliament has not adopted the system of student fees supported by student loans but continues to fund universities directly) the funding of higher education has moved step by step from up-front grants from central government to institutions to up-front loans to students who then pay the fee to universities. This is the fundamental change affecting British universities today: not the ideological preferences of governments or their ministers, but the overwhelming dependency on loanbased student fees. All the challenges and uncertainties faced by universities flow from this fundamental shift in the funding mechanisms, which has crept up on the sector incrementally over many years. This journey from direct grants to student fees has not been an even one for university managers. There is a long history of bumps in the road as income per student has risen and fallen many times. In an analysis of the real value of the unit of student resource over the 30 years from 1990 to 2019, the economists of the IFS point out there was a steady decline until 1998, when the home student fee was first introduced, followed by subsequent fee increases in 2006, 2012 and 2017 which produced intermittent 'boosts to university income, followed by subsequent flat lining or declines in funding. This has resulted in extremely high variation in funding per student over the past 30 years, which is unlikely to be optimal' (Belfield et al. 2017 ). In fact, as Michael Shattock's account shows, the pattern of substantial variation in the resource per student has an even longer history. After 1945, funding allocated by the UGC grew steadily in real terms, particularly during the 1960s, dipped sharply in the four years following the oil price crisis of 1973-4, declined again for some five years after the Conservative government spending cuts of 1981, and again as the UK faced the sterling crises of the early 1990s (Shattock 2012 ). Since being set at a peak of £9000 a year in 2012, the real value of the fee fell each year until 2017 when it was raised to £9250, in order to adjust to inflation, but has fallen significantly in real terms since. The successful vice-chancellors and management teams have been those that timed their expansion and consolidation plans to fit this somewhat unpredictable cycle. The less successful were caught out and either failed to expand when they should, or began to do so just as the unit of resource was declining and found themselves facing significant deficits and having to contract. The introduction and expansion of the student fee and loan system since 1998 simply added layers of unexpected complications to this fundamental pattern. Now in 2020, funding per student having reached an historic peak in real terms in the academic year 2018-19, it seems likely that the value of the unit of resource will decline for much of the next decade as governments avoid the political costs of raising the fee to match inflation. While it may be the case that direct political intrusion by politicians and their particular ideologies into the running of British universities has been of little significance compared to the effects of the variations in public funding, it is true that the current vulnerability of universities to declines in funding has been exacerbated by other changes in higher education policy. Two developments have been of particular importance: the lifting of the student number controls from the beginning of the academic year 2015-16 and the establishment from April 2018 of the Office for Students as the key intermediary between government and the universities. These two innovations, operating together with the growing indebtedness of the graduate population as a result of the student loan system, have created a whole set of unexpected and sometimes perverse pressures on universities. The public, and particularly the electorate, have little knowledge or interest in what goes on in universities. But that going to university now can lead to the accumulation of substantial debt has become common knowledge. The Institute for Fiscal Studies has calculated that students from the poorest backgrounds will accrue debts of £57,000 from a threeyear degree (Belfield et al. 2017 ). This figure is well understood by the electorate, and the Labour Party's promise in the 2019 election to abolish both fees and loans was clearly popular amongst students and parents of children likely to go to university. The Conservative Party was able to question how a Labour government would finance the debt relief, but did not commit to doing so itself. It is now clear that raising the student fee from its current maximum of £9250 a year will be politically very difficult for any government. At current rates the annual cash value of loans to students is expected to rise to nearly £20 billion a year by 2022-3 and the value of unpaid loans in the national debt has been estimated by the Office of Budget Responsibility projections to peak of 11% of GDP by 2040 on the assumption that 47% of loans will remain unpaid (Office of Budget Responsibility 2017; Bolton 2019). These are huge sums and generate significant political constraints. The initial introduction of the student fee in 1998 (at £1000 a year) was vigorously lobbied for by the Committee of Vice-Chancellors as a solution to the then declining unit of resource. But instead of rescuing universities, and particularly their managers, from the uncertainties of government expenditure decision-making, and smoothing out the effects of inflation as it was expected to do, the tuition fee has exposed university funding to the full blast of political debate for the first time in a hundred years. It was a solution that worked well initially, raising university resources per student from a low of under £15,000 a year in 1997-8 to £28,000 in 2017-18 at 2017 prices (Belfield et al. 2017, fig. 4.1) . This was a huge boost to university incomes, allowed university managements to appear very competent and is probably a significant reason for the growth in vice-chancellors' salaries over that period. However, like all earlier 'solutions' to the funding problem, this one turned into a trap and not an escape. The combination of student-loan-based funding and the removal of the number controls (the 'cap') led government, almost inevitably, to the shift from using the funding councils as the intermediary between the state and universities, and their replacement, in England (and to lesser extent in Wales and Northern Ireland), with a regulator modeled on those designed to oversee the utilities or the transport industries. With little prospect of increased resources from the student loan system, indeed facing the almost inevitable prospect of real declines for a decade or more, university managers are now forced into brutal internal competition between institutions within the higher education system, and with little defence against constant additions and tweaks to the compliance requirements by the regulator and ministers within the Department of Education. Funding universities through the student fee combined with a guaranteed loan and subsequently the removal of the numbers cap led to a wide range of unintended and unexpected consequences. An early miscalculation was made by David Cameron's coalition government when it raised the fee to a maximum of £9000 a year in 2012. It was expected that this would produce price competition between universities; that some would compete for students at a lower fee for all programmes, or would price the cheaper-to-deliver humanities and social science courses at a lesser fee. That did not happen. Except for a few instances, quickly abandoned, all universities from the newest to the most prestigious chose to charge the full fee for everything, particularly when it became clear that potential students were likely to consider a lower fee as a sign of lower quality or a less-valued qualification (Brown and Carosso 2013) . A further paradoxical outcome of the high student fee was that it created incentives to expand arts and humanities courses at the expense of technical and science subjects. In order to encourage clinical subjects such as medicine and dentistry, as well as those requiring laboratory and fieldwork elements, such as physics, chemistry and engineering, the government has historically funded those subjects more generously and, after 2012, continued to add substantial elements of direct funding (£10,180 and £1527 per year) to the student fee. However, the net effect of the single student fee across all degree programmes was to increase proportionately funding for arts and humanities the most: by 47% for arts and humanities but by only 6% for medicine (Belfield et al. 2017, tbl 4.1) . Since the cap on student numbers was lifted in 2015, many of the more prestigious universities have substantially increased their recruitment (i.e. lowered their entry requirements) to the cheaper-to-teach subjects, resulting in newspaper stories of overcrowded lecture halls, and less contact with senior academic staff and probable reductions in the quality of the student experience (Henry 2019; Sandiford 2020) . The assumptions that informed the creation of a regulator of a market in higher education have also been modified by unexpected consequences. In 2017, after quite vigorous debates in the House of Commons and particularly the House of Lords, parliament passed the Higher Education and Research Act, which replaced the Higher Education Funding Council for England with a new Office for Students (OfS) from January 2018. The legislation, and the regulatory framework adopted by the OfS, includes four primary objectives: enhanced access and success for students; ensuring the quality of the student academic experience; student progress to employment and further study; and value for money. The primary powers of the new regulator are those that allow it to register or deregister higher education providers, set registration conditions and monitor performance against them. The language of the Act and the White Paper that preceded it was distinctly instrumentalist, with an emphasis on outcomes related to student access, progression and achievement, particularly the acquisition of economically useful skills. The White Paper set out the analysis and policy intentions informing the new legislation and placed an emphasis on 'more competition and informed choice in higher education'. It argued that there was not enough competition between existing 'providers', and that it should be easier for new degree awarding institutions to enter the 'market', including private forprofit institutions. Students were expected to behave as consumers: 'Competition between providers in any market incentivises them to raise their game, offering consumers a greater choice of more innovative and better-quality products and services at lower cost. Higher education is no exception' (Cm 9258 2016, p. 7). The OfS has quite quickly met with slightly perverse responses to its interventions, particularly to its duties to monitor teaching quality and value for money. In order for the OfS to fulfil its primary objective of ensuring the quality of the student academic experience, in 2016 the Department of Education introduced the Teaching Excellence and Student Outcomes Framework (TEF) and made participation in it a condition of registration for institutions. The TEF has sought to make judgements about the quality of undergraduate teaching primarily based on metrics that measure outcomes, rather than rely on the established system of academic assessors visiting universities and reporting on the management of quality. The first round of the TEF assessed whole institutions rather than individual subjects and used a limited range of data from the National Student Survey together with measures of student retention and available information on the proportions of students going into employment and particularly higher-skilled jobs after graduation. These metrics were adjusted, 'benchmarked', to allow for the entry qualifications and some other characteristics of students, and the balance of disciplines within institutions. The results were used to award quality 'medals' to universities, ranging from gold, through silver to bronze. As a result, the first iteration of this method, while in principle declaring all institutions receiving medals to be satisfactory, effectively defined the two-thirds not awarded gold as less than excellent, and these included some of the most prestigious universities in the country. The sector currently awaits a report into the effectiveness of the TEF method, but there has been significant disquiet about the message it sends to students, particularly international applicants, and the validity of the methods it uses. For example, the House of Commons Education Committee in 2018 reported 'mixed reviews of the TEF and its ability to signal the quality of teaching in a broad range of institutions. We heard strong objections to TEF from Professor Louise Richardson [Vice-chancellor of Oxford University]. She called it a "costly distraction" and the Russell Group has made no secret of its reservations about the metrics used. We also received written evidence from the University of Sheffield which said that although the ethos behind it is correct, its implementation is fundamentally flawed' (HC 343 2018). One of the more disconcerting aspects of the project to regulate higher education as a competitive market has been the reluctance of students to either behave or conceive of themselves as consumers. There is little evidence to suggest that students assess their experience of university in consumerist terms. The Higher Education Policy Institute has since 2006 conducted an annual academic experience survey of a large sample (over 14,000 in 2019) of undergraduate students to assess their evaluations of their education. The survey focuses on a range of areas, including value for money, teaching quality and experience versus expectations. Although the question is not asked directly, there are few signs in these rich survey results that students think of themselves as consumers of a product. Rather 'many students recognise their own responsibilities in terms of what they contribute to their own experience. Students clearly like to be challenged, and reasonably expect that they will be, often being prepared to make significant effort in return' (Neves and Hillman 2019) . There is a long history of government ministers complaining that students, conceived of as consumers in a market, cannot access appropriate information to inform their choices of universities and courses. As a result, institutions have been required to spend considerable resources for publishing information on their websites or submitting it to central data sets. The funding councils, and more recently the OfS, have regularly changed and elaborated the information requirements universities have to fulfil. From 2011 this was a 'Key Information Set', then replaced with 'Unistats' and since September 2019 by 'Discover Uni'. However, there is considerable evidence that students do not use these sources to make their choices. Recent evidence suggests only a third of all applicants to HE courses had some knowledge of the TEF at the time of their application and 15% used the TEF in their decision-making (Vivian et al. 2019) . The House of Commons Public Accounts Committee investigated whether it was possible for students to obtain information that would allow an informed consumerist choice of university and course but broadly concluded students are likely to be overwhelmed by the volume and variability of the information available and that they essentially need advice and not more information. Implicitly the committee agreed with one of their expert witnesses (Professor Roger Brown) that 'providing good information to students to inform their choice was an "insuperable problem" in the higher education market…because it is impossible to ensure valid, reliable, comparable and tailored information' given the range, complexity and individuality of university-learning and its outcomes (HC 693 2018). As Kernohan (2020) has written, 'there has never been any indication that prospective students find any of this information useful -every serious study of decision making patterns suggests that personal contact with the institution in question (be this with current students, staff, friends with experience, or on a visit) is the gold standard'. Since 2012, British universities have experienced an increasing pace of change, particularly in how they are funded and regulated. In 2020, they now face considerable uncertainty about the volume and sources of future funding and in the distribution of students across the sector. The coronavirus pandemic has amplified forces allowing some universities to prosper while others are forced to make reductions in staffing and to close degree programmes. The main consequence has been the development of quite brutal and probably wasteful competition for students from both the home market and overseas. The main longer term driver of these changes has been a shift from a system of funding allocated by government and civil servants to a market-and price-driven system in which resources follow student choice. This change took place slowly and incrementally over fifty years. It was not caused by neoliberal or populist values, but by governments seeking to control public expenditure and university leaders seeking extra income. 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