Martin Wolf: HE bill’s market vision ‘defective’ and ‘unworkable’

FT commentator gives damning verdict on what he describes as ‘government takeover of university sector’

January 27, 2017
Source: iStock

The UK government’s higher education bill amounts to a “fully fledged government takeover” of the university system and risks scandals by ushering in “corrupt” for-profit providers, according to the chief economics commentator of the Financial Times.

Martin Wolf said that the Conservative government’s plans to apply market forces to England’s higher education system were “intrinsically defective” when he gave the Campaign for the Defence of British Universities’ annual lecture in London on 26 January.

Mr Wolf was a colleague of Jo Johnson, the universities and science minister who created the bill, when the latter was at the Financial Times. He is the husband of Baroness Wolf of Dulwich, a King’s College London professor and cross-bench peer prominent in House of Lords opposition to the Higher Education and Research Bill.

The bill would create a regulator with far-reaching new powers, the Office for Students. Mr Wolf said that the OfS would be the government’s means to “force universities closer to its market vision”. The bill would introduce new providers by easing the path to university title and degree-awarding powers.

Mr Wolf argued that turning higher education into a market is “neither desirable nor workable”.

Higher education is an “experience good” in which students cannot judge the value of their degree “until long after they have got it”, he said. “This deprives would-be consumers of most of the information on which to make a good decision.”

Creating a true market would also require it to be possible for providers to fail, he noted. But this would be so damaging for an institution’s students that it was “almost inconceivable” and would be “socially extremely unjust”.

Mr Wolf also noted the presence of government-funded, income-contingent loans for students in England and the absence of caps on student numbers.

This created “huge opportunities for irresponsible or corrupt providers”, he said. “If one can eat lobster at other people’s expense, one tends to eat too much of it.”

He added that the changes risked “huge scandals involving new providers – particularly profit-driven providers”.

Mr Wolf also noted the range of the powers to be granted to the OfS, which include the authority to revoke an institution’s university title and degree-awarding powers, even when granted by Royal Charter.

“Make no mistake, this is a fully fledged government takeover of the…university sector,” said Mr Wolf. “And anybody who thinks this will genuinely end with more diverse, more innovative, more courageous and more independent institutions is, on the basis of my fairly lengthy experience of the world, a fool.”

He concluded: “The great idea of the university has to be protected, and the government needs to think again.”

Answering audience questions, Mr Wolf argued that the bill was going ahead despite opposition for a number of reasons. “I think ideology is an important element here. I think the ambition of politicians is an important element here.”

Lord Bragg, a Labour peer who is University of Leeds chancellor, asked Mr Wolf for advice on how to get through to Mr Johnson, “because we are getting absolutely nowhere”.

Mr Wolf said of Mr Johnson: “As is not infrequently the case with non-economists, he has got a few economic ideas, not fully understood, absolutely deeply embedded in his mind.”

He continued: “I fear the only thing you can do about it is to persuade people more important than Jo that this is a really dangerous course.”

The answer, Mr Wolf said, was to “make such a fuss so effectively that the prime minister decides that ‘I’ve got a few other battles to fight…this is not a war I want to fight’.” But “you’re not going to change Jo”, he added.

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Martin Wolf's complete lecture can now be downloaded from this site: