left to my own devices – occasional thoughts on higher education

New year, new hopes.  That’s how we like to think at this time of the year, but it feels like a bit of stretch right now in UK higher education.

where are we now?

Of course 2025 will see much that’s good from and for universities.  We will still see the benefits to individuals and society that are higher education’s reason for being.

At the same time we know the challenges the sector faces as the financial storm continues to rage, and universities engage in ever more self-surgery in an attempt to make the books balance (or at least to make them less unbalanced than they are now).

But the sector has already seen some small providers ‘withdraw from the market’ (e.g. Applied Business Academy; Dartington and Schumacer College).  And the extent of the fear that a university will soon find the financial waters rise above its head is clear from the flurry of reports (e.g. Public First; WonkHE/Mills and Reeve) about ‘managing provider exit’.

this is where we were always headed

This isn’t a bolt from the blue.  Threats of provider closure have been a regular topic of discussion in the sector since the Covid pandemic hit us five years ago. It was essentially designed into the English sector through the market ideology that underpinned HERA, and made (inadequately) manifest through OfS requiring Student Protection Plans as part of its Regulatory Framework.

HERA didn’t initiate or mark the start of the free market higher education system (experiment?) currently causing such havoc in the English higher education sector, of course.  HERA was essentially about the legal and regulatory framework catching up with the seismic shifts in ethos, approach and funding that were taking place with the introduction of £9K fees in 2012, followed by the end of student number controls, and the stepping back of the state from direct funding of the education part of higher education.

Everyone knew at the time that this would have a seismic impact.  Most of us were unsure what that would be; some less so.

I remember being at a conference in 2013 where the panel included two then VCs who were also members of the UUK executive, and who had had significant roles in the high level lobbying on the new HE funding mechanism. Both were congratulating each other on their contributions to the strategic masterstroke they had just pulled off on behalf of the sector, in helping to secure the new fee regime.  As I’ve said elsewhere in a different context, big decisions need long timeframes to be properly assessed.

Thinking about all of this brought to mind a memory of a point at this time (2013) when I was asked to imagine a higher education future.

‘it’s tough to make predictions, especially about the future’

[Yogi Berra, of course]

When all this was going on in 2013 I was working in a strategic planning team, including supporting the development of a new institutional strategy.  Linked to this we were looking at ‘institutional brand’. As part of the latter exercise I was asked to do a presentation on ‘what will higher education look like in 2023’.

Rather than deliver the type of graph and number heavy presentation I think was expected of somebody from a planning team, I decided to do something different.  I jumped early on the trend that recognised the perils of prediction, and preferred the safety of scenarios.  So I presented a single scenario in the mode of ‘here we are in 2023, and look what’s changed and why in the last decade’.

I’m far too insecure to do the full ‘let’s look at what I said and see what I got right and wrong, as a learning exercise’ thing.  Well, at least to do so in public.  There was though, one thing that struck me looking back at what I said in 2013 and which I’m willing to share.

A key element of my scenario was that there would be a financial crunch for the university sector.  I got the specific causes wrong.  I was also a fair way out on the timing, as I suggested this would happen in the late 2010s.  But still, I did feel it was all going to end in financial tears and I had a go at setting out what this might look like:

A number of universities simply closed.  However, the widespread institutional failure and closure that some commentators had been forecasting from the early 2010s did not materialise, largely because after dealing with the fallout from a small number of such cases the government’s appetite for this type of ‘creative destruction’ sharply diminished.  In other cases, universities that were not able to cope with the new environment were subject to takeovers by private for-profit providers.  Many universities survived the crisis through mergers: some by choice, others by de facto instruction of the government.

In terms of the consequences for universities of a financial crunch, there’s perhaps not much original insight in that quote.  But there is one aspect that while not original is, I suspect, going to be crucial for the sector over the coming year.

predictions – still tough

I very much hope it doesn’t happen, but it’s starting to feel that it’s more likely than not that at some stage this year a university will reach the point of financial no return.  (Apologies for the pessimism; the only thing I’d say in my defence is that I think we’re significantly nearer a 51:49 balance of probabilities than a 99:1 balance).

OfS is gearing itself up for such a situation (£), and the calls noted above to establish a proper framework for ‘provider failure’ may be heeded by the government.  However, even if both of those steps are effective, if a university does fail the social, economic and political fallout in the location and region where that happens will be enormous.

Universities are anchor institutions in the places they are located; remove the anchor and there’s a good chance the ship gets dashed against the rocks.  A key question this year is whether the government is willing to allow this to happen.  I suspect the answer is yes, given the fiscal challenges it faces.

At least the first time.

But after it has seen the consequences start to play out once, will it do so again? That I’m not certain that it will, doesn’t give me any insight into what it might do instead.  But I suspect this government’s appetite for creative destruction is even smaller than would have been the case with the government I imagined when I was presenting my future scenario in 2013.