University ‘bail outs’ have been in the news. One university was ‘bailed out’ by the Office for Students (OfS) in the summer (the funds were repaid). Meantime, rumours circulate over which universities are facing serious financial difficulty, and speculation continues about whether a university would be allowed to ‘go bust’ and what would happen in that event – especially to students.
In itself this is nothing new as stories like these have floated around for years. However, the intensity has ratcheted up a notch or three since the passing of the Higher Education and Research Act, which heralded the demise of the Higher Education Funding Council for England (HEFCE) and the advent of the new OfS. The OfS Chair has made his views clear in this article on The Guardian. He is quoted as saying “Should a university or other higher education provider find themselves at risk of closure, our role will be to protect students’ interests, and we will not hesitate to intervene to do so. We will not step in to prop up a failing provider.”
Much has been made of these remarks outside (and inside) the sector, and about what the Department of the Education would or wouldn’t do as well. OfS is markedly not HEFCE, and will not respond like HEFCE used to when an institution experienced difficulty, for instance by giving some support to deliver major change (including from time to time merger). Some reports have talked about (so-called) past ‘bail-outs’ from HEFCE.
The prospect of university failure might conjure up for some prospects of juicy new headlines. Thankfully there has been some balanced writing about the wider impact of potential closure including and beyond that on students. For instance, within this article in the THE. Additionally London Metropolitan University alone presents one recent example of an institution that was assisted by HEFCE and is in a much stronger position now than they were previously, as can be seen here. To me it is very difficult to call supporting this institution to change a waste of HEFCE effort or taxpayers money…
Based on my past experience, I wanted to offer my three pennyworth on student protection plans. Institutions are now required to submit and have these approved by OfS. Would these work as smoothly and with no questions asked as both OfS and DfE (and maybe the public at large) seem to believe? Some questions have been asked, for instance in this THE article, and in a detailed WonkHE piece from Jim Dickinson. However for the most part there haven’t been as many as I would have expected.
Back in 1991, I was a member of staff for the old Polytechnics and Colleges Funding Council (PCFC). I may be wrong, but I think that to this day the only time a serving Secretary of State has approved an order to close an institution, or in this instance dissolve and disperse a Higher Education Corporation (HEC), was in the case of what was then South West London College (SWLC). The Council recommended this option in preference to others (including possible mergers). I should add that the executive powers available to the Secretary of State or HEFCE/OfS (under the 1988 Act or later versions) are different for Higher Education Corporations (which includes many of the former Polytechnics) compared with, for example, universities established under royal charter. For more on this read this article by Denis Farrington.
It was a week or two after I had returned from maternity leave, with my head still getting to grips with being back at work, that I (along with a couple of others) was called in to see the PCFC Chief Executive and handed the brief to see that the Order of the Secretary of State was put into action. It involved transferring the students (and staff in that instance) to one of the identified group of ‘transferee institutions’, and redistributing the assets, rights and liabilities too. There were no precedents to follow, and the Government imposed timetable was extremely tight (months not years). It consumed my working life for around 9 months.
Each of the dispersal strands presented different demands. For the students an offer was developed. ‘Teaching out’ cohorts of students – which apparently features in many of the new plans – was not an option. Potential courses were identified at nearby alternative PCFC institutions. [Polytechnics or HE Colleges as they were in those days as Universities were the responsibility of the Universities Funding Council at that time and were not involved]. Students were offered the chance to see an independently appointed ‘student advisor’ and to talk through their options. They were asked then to express a preference as to which of the (seven if memory serves me right) ‘alternative’ polytechnics they would wish to move to. And there was an appeal process as well for anyone unhappy with the proposed outcome.
At the end of a frenetic and often stressful period (for everyone involved – at PCFC, SWLC – staff and students – and transferee institutions), the order was discharged. SWLC shut its doors and students transferred the following autumn. I seem to recall there was surprisingly little controversy, and not much in the way of media or even sector interest either. I haven’t seen any of the new era student protection plans and I don’t know what criteria the OfS are using to determine whether they consider those plans to be acceptable or not. I do know that the SWLC students were given a choice, and the reality was that the institutions they were moving to were considered far stronger to the one they had originally joined. As well as choice they had a voice during the process, and many exercised it about where to transfer (some did ask to switch on to courses at institutions outside of the identified group).
My simple reflection, based on that experience which remains etched in my memory, is that students of today (were one of the new student protection plans to be triggered) may not be happy with any decision effectively made for them, or otherwise to quietly go along with a pre-set arrangement whether it involved staying with a ‘failing’ course (or institution) whilst it closed out, or switching. It should not be assumed that it would all flow in a straightforward way. Just a thought…