Franchising crackdown ‘should target rapidly expanding providers’

Interventions aimed at stamping out poor-quality franchised provision in the English sector should focus on providers that have grown rapidly in recent years, according to a new report that highlights how “catch-all” policies risk penalising arrangements that are working well.

Data analysed by the Quality Assurance Agency for Higher Education show the growth in franchising has far outstripped that of the traditional sector – with students taught via third parties increasing by 343 per cent between 2019 and 2024, a period in which directly taught student numbers grew by only 2 per cent.

This has been mirrored by declining outcomes for franchised students, with overall figures for this type of provision lagging below Office for Students (OfS) thresholds for continuation and progression, and only just meeting completion baselines.

Many have grown increasingly suspicious of franchised provision as a result, with accusations of widespread student loan fraud adding to the pressure on politicians to intervene.

But the QAA paper published on 28 May argues that the debate so far has been too “binary” when the “reality is much more complex” and “different franchises are delivering different outcomes for different groups of students”.

Franchised provision is “diverging into two distinct groups”, it argues, with small-scale partnerships on the one hand and larger, rapidly expanding partnerships on the other.

In 2017-18, no delivery providers were larger than 1,000 students. By 2020-21, 6 per cent had at least 1,000 students and this had doubled again by 2023-24 when it was 11 per cent. One institution has grown so rapidly that, in just five years, it has become the largest provider of full-time, undergraduate provision in the UK.

The report says that it has been these rapidly expanding providers that have been “disproportionately failing to meet the baseline thresholds”.

Rebecca Robinson, data analyst at QAA, said that the findings “suggest that the situation is much more complex than we see portrayed by newspaper headlines which sometimes tar all franchised provision with the same negative brush”.

“Many small and specialist partnerships deliver positive outcomes. We need to focus our scrutiny on the areas of higher risk, rather than imposing catch-all responses which may unnecessarily burden, penalise and even stigmatise franchise arrangements that are working really well.”

The paper argues for “targeted, proportionate interventions” that aim to tackle unmanaged growth, where it poses a genuine risk to the student experience.

All franchised providers who serve more than 300 students are being required to register with the OfS, and the regulator has promised to go further in scrutinising the arrangements.

The QAA report says issues that have been identified are less to do with franchising itself – which supporters argue serve cold spots and disadvantaged areas – but with how providers have gone about growing provision.

“The expanding outcomes gap suggests that rapid growth has exceeded the quality system’s capacity to accommodate it,” it says. “This is not necessarily a function of student demographics or franchising as a model, but of the strain of scaling up on admissions, academic oversight, support and enhancement processes.”

Robinson said that rapid growth “doesn’t automatically mean lower quality”.

“But if it isn’t supported by robust oversight and appropriate resourcing, the mechanisms that protect academic standards can weaken and outcomes can fall below sector expectations and regulatory thresholds.”

tom.williams@timeshighereducation.com