Private degrees: cash cows? 1

October 12, 2007

An obvious objection to the granting of university degree-awarding status to BPP College ("Private college to award degrees", September 28) is that the broader view of what constitutes the quality of education will be lost. In the drive to provide the service at lower cost, a liberal education is likely to be sacrificed to a narrow vocationalism.

The Dearing report reiterated the need in higher education for a "commitment to the pursuit of truth" and "willingness to debate issues rationally and openly". How firm a commitment can be expected from a "for-profit" institution, especially where such debate may undermine the commercial interests of its owner and shareholders?

A less widely recognised threat from for-profit providers is associated with the World Trade Organisation General Agreement on Trade in Services, which aims to extend free-market principles to "open up" services to competition. It would be attractive to a government with a free-market ideology to include higher education within the scope of Gats.

The basic principle of Gats is that the market for services that come within its scope should be open to all WTO members without discrimination. Thus member countries must extend to all other members the most favourable conditions that apply to any ("most favoured nation" status.) Foreign service suppliers must be treated in the same way as national suppliers are treated (the "national treatment" rule).

This implies that the subsidies made available to the state-funded universities in the UK would have to be available to all for-profit institutions operating here. This would include not only the public subsidy for buildings, facilities and overheads, which universities receive through the funding councils and research councils, but also grants and loans at low interest rates to students.

David Packham
Materials Research Centre
Bath University

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