Debt restructure?

There is still a risk that a future government may redesign student loans and force graduates to repay more, according to the outgoing chief executive of England’s funding council.

After leading the Higher Education Funding Council for England since April 2009, Sir Alan Langlands leaves to become vice-chancellor of the University of Leeds next week.

Speaking to Times Higher Education to mark the occasion of his departure, Sir Alan said he had identified “three groups of risk” facing the academy: student numbers, financial sustainability and regulation.

On student numbers, the reputation of the coalition’s £9,000 fees and funding regime has been boosted by a strong rebound in applications and acceptances this year.

However, Sir Alan said it was “a little bit too early to relax completely”.

There are “still warning signs and worries, certainly around part-time and probably postgraduate education – although we are trying to tackle that issue”, he added.

Nevertheless, he thought that the reforms had generally been “well managed by the government, the various national agencies, including Hefce, and the sector”.

Sir Alan added: “I would say that given the cards the government has been played in terms of the economy and public finances, higher education has come through the process pretty well and hopefully in a way that will support students into the future.”

He also said that the size of the fees increase “was pretty well compensated by the generosity of the student support system and the loans”.

But Sir Alan added: “The big financial sustainability question for the future is: can these be maintained by the government without having to revisit some of the other variables?”

He warned: “If there are pressures on the Resource Accounting and Budgeting charge [the proportion of loans that will never be repaid] and pressures on the student support system because there are more people than expected tapping into it, and if the government’s ideas about how loans will be repaid prove to be too optimistic…you will have to revisit the [graduate repayment] thresholds in the support system.”

‘We’re kind of making it work’

On regulation, Sir Alan has previously said that legislation would be needed, citing Hefce’s limited ability to exercise authority over student loan funding and the need to safeguard quality.

He told THE that the funding council was “having to patch things together without a proper legislative base” for doing so. But he added that thanks to collaboration between Hefce, other national agencies and the academy, “we’re kind of making it work”.

Sir Alan said that he was “not a kiss-and-tell person” and had “too much respect for the people who do these difficult jobs to start shooting my mouth off”.

But he described David Willetts, the universities and science minister, as “exceptional in many ways as a minister…You can disagree with him, but that’s seen as a natural part of the process of trying to get to the right answer.”

He also said that he hoped Mr Willetts would stay on in the event of any future reshuffle.

Summing up his time at Hefce, Sir Alan said: “I saw my task [after the 2010 election] to implement the government’s reforms, to do so in a sensible way forward that protected the things that really matter: education, research and knowledge exchange.”

He added: “If I take any credit or satisfaction from this job, it would be in trying to successfully guide the sector through a period of really quite difficult political and economic uncertainty.”

john.morgan@tsleducation.com