It was way back in 2010 when I last unpicked a grant letter on here, but even despite my sporadic discovery of more interesting things to write about they keep on coming – despite the persistent rumours of the waning of HEFCE’s power.
And here we are in 2013. Maybe there’s robots knocking about and Davina McCall is the new Pope? Maybe you can download rice? Maybe BIS and HEFCE, working together, have solved some of the many, many issues that are still firmly lodged within the now almost completely discredited Willetts/Browne funding model.
Nope.
You’ll remember from the 2010 post that such is the convoluted drafting system of this alleged letter from BIS to HEFCE that every turn of phrase, every structural choice, is tremendously important? The 2013 letter kicks off with five entire paragraphs of BIS expressing gratitude to HEFCE. The quasi-QANGO is thanked for support in embedding white paper reforms, supporting students across the UKBA/little englander malarkey, for oversight of a bag of committees around regulatory oversight and university titles, and for reporting on philanthropy and the whole MarginCore shooting match.
Is BIS up for “best actress”?
More likely, HEFCE is in need of some serious love from BIS after a difficult few years – and wants to demonstrate to staff and the wider sector that it still has a purpose even though another billion has been lopped off its budget.
As more and more of HE funding goes through a bizarre and expensive loan system to institutions (which allows the Treasury to keep HE Funding off-balance-sheet) the traditional “do as we say or lose the money” power that HEFCE has exercised is lost. And there is no sign of a HE Bill to provide the regulatory powers that are supposed to replace this lever.
Way back in November Sir Alan Langlands was warning us that legislation was needed to properly control student numbers (and thus government financial exposure), a position compounded last week when it emerged that HEFCE were seeking legal advice as to what they could actually do to fine institutions who over recruited.
The 2013 Grant Letter, attempts – once again – to push this issue into the long grass.
“We will also look to HEFCE to help us develop a mechanism for controlling the number of students recruited by alternative providers as outlined in the recent BIS consultation” (para 6)
And more specifically, and more worryingly:
“Secondly, at a time of continued pressure on the public purse, there remains an overriding need to manage the demands on public funds. So, we are asking the Council to recoup unanticipated student support costs wherever possible. We would like this to be on the basis of cost recovery. To achieve this, grant adjustments should reflect both the average life time and the upfront outlay cost to Government of providing student support, recognising this latter is particularly influenced by the different fees institutions charge.” (para 33)
I say more worryingly, because para 33 implies a whole range of things that are at best mistaken, and at worst outside of what HEFCE is legally permitted to do. “Unanticipated student support costs”, here, are costs relating to paying fee loans with respect to students that an institution has recruited outside of the numbers it is permitted and expected to recruit.
“Now hang on a second,” you are probably asking, “wasn’t the whole point of AAB and MarginCore and all that lot that you wouldn’t know how many students any given institution (or indeed the whole system) would recruit?”
And you would be right. That was the point, but as usual the implications have not been properly thought through.
Remember those provisional allocations, where it emerged that the effect of the market would be that institutions who took a lot of students with grade AAB or above might decide to take some more, roughly in proportion with their share of the existing AAB pool?
Over-recruitment appears to mean that the institution exceeded those provisional allocations (which are now “Permitted Allocations”, it seems.) And those institutions that have done this will be fined at least £5000 per student for being just too damned popular.
By fined here we mean having to give HEFCE money that they didn’t get from HEFCE (ie they got it from the deferred future income of the student in happy-lala-Willetts-land, or from the massively screwed BIS budget in our universe). And for such a fine, as we know from a Knight of the Realm, HEFCE may or may not have the legal powers to make happen.
In an effort to avoidexacerbate this issue in 2014, BIS recommend that HEFCE are more lenient in setting targets (which might mean the glorious return of the tolerance band!) and just generally lighten up and ease off on the whole MarginCore rules. Meaning even more potential overexposure the year before the entirely coincidental 2015 general election.
But wait, wait, it gets better (and non-wonks and overseas readers: no, I am not making this up) – all this leniency will be possible because:
“Given the pattern of recruitment in 2012/13 […] we have the flexibility to apply student number controls less rigidly in 2013/14” (para 32)
So, just to recap. We have flexibility in the system due to under-recruitment, but “there remains an overriding need to manage the demands on public funds”. Institutional managers may, at this point, wish to hide under their desks and gibber.
But – never fear, Vice-Chancellor – help is at hand.
“we know that many institutions will take a cautious approach to recruitment in attempting to avoid such grant reductions. This can lead to unfilled places.” (para 34)
In a hope to remove such caution, BIS propose that HEFCE allows institutions that recruit strongly more flexibility to, er, recruit strongly – and institutions that recruit less strongly correspondingly less flexibility to suddenly start recruiting strongly. Oh, and:
“You should also consider mechanisms to allow new providers to enter the system.”
Gertcha, cowson. Gertcha.
Leave a Reply