Inviting independent incentives

August 22, 1997

Concerns are voiced on the future of clinical research, the impact of fees and the need to encourage more students into independent higher education

NOW WE know that the era of free higher education is coming to an end. Yet despite the recent recommendations for charging tuition fees direct to the undergraduate higher education "consumers" of the future, the recent Dearing report has had very little to say about the models of paying for undergraduate tuition that already exist in the UK.

In the under-used and relatively little-known independent higher education sector (most only know Buckingham University) the funding equation is simple: customers pay for their own education. In return they expect a high degree of quality and strong employment prospects. This is especially true in postgraduate and professional education where organisations such as Henley and Ashridge thrive on direct funding solely from individuals or theiremployers.

Our numbers in the undergraduate independent higher education sector are generally quite small, but for every student choosing to take the independent option, a student drops out of competition for a fully funded place.

This is a message the new government should notice. If only we can convince the Government to commit to additional incentives that would encourage more families to opt for independent provision at undergraduate level, then pressure on places in the public sector would ease and more would be available to the less affluent.

Our own recommendation to Dearing was the introduction of mandatory grants of Pounds 2,000 or Pounds 3,000 for every undergraduate student opting for an education at an independent college. This would allow for part of their tuition fees to be paid for by the state and the remainder by their parents or other sources.

What does this achieve? It opens up university places elsewhere for those who cannot afford to pay and for any of those who miss out on university places each year, it helps to contain the dramatic growth in the public sector, and it helps to expand the independent sector (and thereby higher education as a whole), contributing to a better educated population in the long term.

There are benefits all round. If you need evidence, you only have to look to the school system in this country for an example of how the option of sending your son or daughter to an independent education establishment benefits everyone else.

There were more than half a million pupils being educated privately in 2,424 schools last year, according to Independent Schools Information Service. Imagine if the only choice was state sector schooling - an unbearable level of taxation would be necessary to pay for all the extra schools, the upkeep and maintenance of buildings, the equipment and so on. How can we expect such a picture to be carried over into higher education, as we have been doing for years?

In order to create a level playing field that allows UK higher education to compete along the lines of industry we need to review our tax system. As things stand universities and certain language schools are exempt from VAT, but "private for profit" institutions in the HE sector are not exempt.

If the private sector is to grow substantially, capital investment is required. Investors will expect a return both in equity values as well as dividend, and they would not be encouraged by the idea that their investment is subject to a 17.5 per cent tax on turnover, almost all of which is irrecoverable. We should have a level playing field where all UK-recognised and validated higher education institutions are exempt from VAT, so that we can attract capital investment.

In our own country, however, the biggest argument levelled against the independent higher education sector is always "quality". "Do the standards in private colleges really live up to what is required by the public sector?" the critics ask. I find the issue of quality a red herring, and easily cited by those who do not know the private sector.

What they do not realise is that many of the new developments in British higher education in recent years have emerged from the independent sector. We were offering very specialist and professionally related education in fields such as management, law, fine and performing arts, religion and health care long before the public sector realised the market need.

The question asked by the public sector as to whether we in the independent sector have high quality standards can easily be answered. Many of our members are themselves validated by the same bodies and subject to the same procedures as universities.

Since the abolition of the Council for National Academic Awards, independent colleges of higher education are accredited and validated by other degree-awarding institutions. While this in most cases is positive, it also means that we are subject to any weaknesses of quality that already exist in the validating practices of these universities. Such weaknesses are already showing themselves in the criticisms made by the Higher Education Quality Council of franchised courses and sister colleges that have been established overseas.

This is an issue that private colleges would like to see tackled by the formation of a new regulatory body, which would investigate and maintain standards abroad and thereby safeguard the reputation of UK higher education.

Marcel van Miert is chairman of the Council of Independent Colleges and Research Institutions and director of the European Business School, London.

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