CHEAD welcomes our members to the new academic year and we hope everyone has enjoyed a restful break – ready for the fresh challenges facing the sector!
Brexit Manifesto and Industrial Strategy
CHEAD commissioned a report on creative education post-Brexit which was launched on 11 September in Parliament with a speech and Q&A from the Rt Hon Matt Hanock MP, Minister of State for Digital. The report is based on four consultations based across the UK and its constituent nations and will form the basis of CHEAD’s policy work on Brexit to 2020.
The Government has now accepted the creative industries as a key sector for the Industrial Strategy and the Creative Industries Federation (CIF) has published its Industrial Strategy for the Creative Industries. The document identifies four headings under which to organise what the sector most needs from an industrial strategy:
- Skills pipeline
- Finance and funding
- International policy
CHEAD is working closely with the Creative Industries Federation’s (CIF) HE/FE Sub Group as well as the All Parliamentary Design and Innovation Group (APDIG) to maximise our relationships with the creative industries and lobby most effectively on behalf of the creative HE sector.
The good news is that the UK’s competitive advantage: 2017 update highlights the success of UK universities in delivering a truly world-class experience for international students at all levels – undergraduate study, postgraduate taught, and for postgraduate research students. It is based on the findings of the world’s largest survey of international students – the International Student Barometer (ISB). The UK remains one of the world’s leading study destinations for international students because of the first-class experience offered by our universities.
HE Bill and Funding Model
A £7,500 Fee Cap?
Few could be unaware of the recent leaked proposals to cap fees at £7,500. It’s important to bear in mind that the Sunday Times is prone to this kind of genteel sensationalism but, nevertheless, it could be that the Government has set this hare running to see how it’s received? In any case, raises to £9,500 appear wildly unlikely for the Autumn budget
The Government is proposing that high-cost subjects such as STEM would be topped up to the tune of £1,500 (no mention of arts and design) via HEFCE – moving HEFCE back into its role as a funder? On courses with no link to ‘graduate premium’ via LEO, the cap could be even lower. The repayments threshhold may also be lowered, possibly to £25,00. There is a lot of misunderstanding about differential fees as cross-funding is somewhat mysterious to those outside the HE system – however, it is clear that the Government is far more concerned about graduate incomes meeting the ‘graduate premium’ and/or repayment threshhold than in adequately funding courses across all provision, or even those crucial to the UK economy.
As an effort to tackle the popularity of Labour’s fee policy with Corbynistas and young voters in general this may leave much to be desired but possibly Government is hoping that the ‘money tree’ can do its media party piece again and this modest relief be touted as ‘realistic’. However, the response from students and their unions has hardly been enthusiastic. Whilst any cut to interests rates is welcome, most students think this should actually be in line with inflation and thus would remain punitively high. Indeed, IFS figures show, a reduction in interest rates would actually be regressive in that it would only benefit higher earners. Interest rates are so unrealistic there are fears that potentially high-earning graduates might look for cheaper ways of financing their studies, thus increasing the overall cost of the scheme. However, changes since 2012 have increased the repayments of almost all graduates, increasing the burden of student loans the most for low and middle earners – driven largely by the freezing of the repayment threshold. Few believe the proposed reduction in fees would actually do much to relieve stress for students as it’s the immediate cost of living which they find most difficult to cope with and which is felt to account for drop-out rates and mental health issues. The 2015 policy that replaced maintenance grants with loans means students from the poorest backgrounds will accrue debts of £57,000 (including interest) from a three-year degree [IFS].
Jo Johnson has been arguing, also based on IFS data, that universities are amassing vast reserves from a 25% rise in fee income since the hike to £9,000 but the actuals in HESA data don’t back this up. IFS is suggesting that courses which are cheaper to run may leave anything up to 47% surplus in fees and even high-cost courses leave a small surplus but this fails to take into account how universities actually spend money. Only around 37% of universities’ incomes are spent in academic departments, the rest going to administration, premises, and related services. Universities obviously also cross-fund more expensive courses from surplus generated by lower-cost services. The assumptions fail to take into account not only cross-funding but also the capital cost of upgrading facilities in line with rising fees and student expectations. In 2012, as external funding for capital expenditure declined, HESA noted that universities were replacing this from their own funds (via WonkHE). It may also have a great deal to do with the 2015 HEPI Report identifying an issue with the RAB charge which obliges BEIS to meet a portion of RAB charge from its own dwindling budgets.
In short, student fees are a troublesome and large hole in government finance which everyone in government would like to be someone else’s headache – or, better still, to be drastically reduced. This is the driver behind TEF and LEO where the ‘quality’ of a course is likely to be linked most crucially to student loan repayment threshhold as well as the ‘graduate premium’ level. It’s also a toxic issue with young voters and the Conservatives have been struggling to appeal to younger voters. However, it is felt pretty much across the board that the leaked government proposals would do little to solve either problem.
The HE Bill also opens out the sector to competition from the private sector and to increased flexibility including a focus on part time, accelerated, and apprenticeship degrees and the funding model has come under fire from this direction too. It is to be expected that the funding model is unlikely to remain unmolested.
LEO, New DLHE, TEF
Meanwhile, Graduate outcomes: longitudinal education outcomes (LEO) data was published by the DfE on 4 August. As expected, it presents significant challenges to art, design, and creative education. LEO cannot purport to link the value added by universities to graduate earnings because the data is not comprehensive and excludes important socio-economic context but it will, nevertheless, undoubtedly be used as a key piece of data and assumed by most to provide such a link.
The data from the initial IFS/Nuffield report supported the findings of many existing studies into student earnings and socio-economic context. Even after adjusting for type of course and institution, graduates from wealthy families earn on average 10% higher than those from less wealthy families and women graduates earn significantly less than men. It is difficult to find an alternative explanation to plain old discrimination to account for this. As expected, creative careers are characteristically lower-paid, often even below earnings levels for non-graduates, at least for the early years of a graduate’s career. There are some indications that mid-career creative graduate earnings are rather more impressive but the cohort which could show a ten-year arc will have graduated in 2002/3 and wages have undergone significant changes since then. In the context of current uncertainty about the nature of future work and wages, it seems impossible to project any ‘graduate premium’ that university qualitications may offer over the lifetime of a graduate. See a fascinating WonkHE analysis here.
Now that LEO is data published, it indicates that the DLHE data has been broadly reliable, there are no shocks. LEO data is raw and doesn’t measure value-added by universities or adjust for diversity, it measures graduate earnings by JACS categories. WonkHE calls the median graduate salary of £20,800 the ‘magic number’ – the median salary of 25-29 year-olds’ in work for 2014-15 (ONS), or what you might call the plimsoll line for the ‘graduate premium’. The other important number is the student loan repayment threshhold. In other words, the value of Higher Education is effectively being reduced to a stark line dividing courses which are ‘worth taking’ to access the ‘graduate premium’ and courses which are not ‘worth taking’ because they do not access the ‘graduate premium’ – and those not ‘worth taking’ are less likely to be considered worthy of taxpayer subsidy in the form of RAB given that they are also less likely to increase repayment and reduce RAB.
Because the numbers don’t adjust for diversity of background, gender, etc, there is no consideration of, for example, the lower median earnings of women and people from less privileged backgrounds revealed in the earlier IFS data and by countless educational studies. It doesn’t take into account that courses which attract a high number of students likely to experience discrimination (such as women, LGBTQ, or people of colour) are likely to show poorer earnings outcomes in LEO. It also doesn’t take into account regional variations or the specificities of particular job markets or careers or the importance of employment sectors to the wider economy. Most of all, it doesn’t take into account any measure of educational value other than salary levels.
Courses are grouped by JACS at the moment, with all the problems that implies for the creative sector and the new CAH or HECoS seems unlikely to be an enormous improvement. It’s unclear what the relationship of LEO to TEF might be. There are no prizes for guessing that creative subjects do not fare well in LEO and this could have significant ramifications if, as seems likely, the government will interpret the ‘value add’ of higher educational courses purely in terms of ‘graduate premium’ and, at the very least, try to ‘nudge’ recruits or, more drastically, look at restructuring fee levels, access to loans, or student numbers overall. Andrew McGettigan in WonkHE suggests that the creative sector will have to “talk about pockets of planned provision funded differently” before some kind of “botch” precipitates a crisis for creative HE.
HESA is now preparing for launch and offering training seminars in late September. On 31 August, HESA blogged on the final version of the model and dubbed it ‘Graduate Outcomes’. The new survey is based on DLHE but reinvented with new fields and structure. A number of HEIs pointed to issues with data collection in the new model and HESA also responded to these with possibilities including returning a LinkedIn or institutional address and some extension of timing for the return of contact details data. The post also outlines HESA’s communications strategy for the new Graduate Outcomes survey.
The TEF: Lessons Learned report was published on 7 September with changes to be implemented in TEF 3. The headline is cutting NSS weighting in half, mitigation for the NSS boycott, and action to tackle grade inflation, probably in the form of GPA which Jo Johnson sees as tackling league table inflation. WonkHE, on the other hand, describes TEF as “a very new entrant to this market for arbitrarily ordered lists of universities” with new metrics deployed to mitigate the effects of old metrics which incentivise universities to award more 1st class honours. Leo will factor into TEF3 alongside DLHE (or Graduate Outcomes) survey data. Alongside reduction in NSS weighting this will, again, push the metrics towards the focus on labour market outcomes which is likely to be disastrous to the creative sector.
HE Policy and ‘Bad Press’
Current HE policy seems to be strongly influenced by negative press attention to Higher Education over recent years, much of which flies in the face of the actual evidence. CHEAD needs to begin to address this negative presentation of our sector and, perhaps, consider a wider field for our policy work?
Diversity in HE
The Higher Education Commission released its fifth inquiry report, One Size Won’t Fit All: The Challenges Facing the Office for Students. The Commission believes that the changes in the funding regime and subsequent policy decisions present serious risks to the diversity of our world class higher education system and calls for more flexibility and closer working with industry. The emphasis on retention in TEF could result in universities being reluctant to take on ‘riskier’ students and the Commission is also concerned about the role of FE and of the effect of the current funding model on the higher cost of providing more intensive teaching and innovation without which diversity cannot flourish.
HEFCE has published its report on Initial decisions on the Research Excellence Framework 2021 – key points:
- Assessment of output quality, in relation to interdisciplinary research, outputs due for publication after the submission date, and assessment metrics
- Harmonised definitions of impact
- Assessment of impact
- Unit of assessment (UOA)-level environment
- Institutional-level assessment
- UOA structure
- Recruitment of the expert panels
- Outcomes and weightings
- REF development timetable
Deadline for applications for sub-panel chairs is noon, 11 October. Higher education institutions and other groups and organisations with an interest in the conduct, quality, funding or use of research are invited to provide their views on the proposed approaches to the submission of staff and output portability, and the eligibility of institutions to participate in the REF. Further information is set out in HEFCE Circular letter 33/2017 – deadline 29 September.
CHEAD – Upcoming Events
- Leading and developing teams: how to develop high performing teams at different levels in art and design higher education
November 2 @ 10:00 am – 4:30 pm, Coventry University, Priory Street, Coventry, CV1 5FB