Pro-market regulator will have ‘different relationship with sector’

GuildHE’s chief executive, a former BIS official, warns that Hefce’s expertise on teaching grant should not be lost

November 17, 2015
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Market forces: Office for Students’ focus on competition will be major sector shift

English higher education’s new pro-market regulator will have a “different relationship with the sector” than the funding council has had in its goal of "promoting stability", according to GuildHE's chief executive.

Gordon McKenzie, the former deputy director for higher education strategy and policy in the Department for Business, Innovation and Skills, was in charge of managing the relationship with the Higher Education Funding Council for England during his time in BIS.

He said the Green Paper was clear that the proposed new regulator, the Office for Students, to be created by merging Hefce and the Office for Fair Access, would be “about promoting the interests of students and about promoting competition”.

That was a contrast to Hefce, whose “job was to fund and advise” as well as to “translate policy” from government into the sector.

Hefce, Mr McKenzie added, is a body that “understands universities, consults universities and whose chief executives are vice-chancellors, and [is] a body that has promoted the stability of universities”.

He continued that the OfS will have “different outcomes, different motivations. From that starting point, that does suggest a different relationship with the sector.”

On teaching grant, presently allocated by Hefce, the Green Paper says that in future BIS could do the allocation or it could be carried out by the OfS.

Mr McKenzie said both scenarios presented problems, with OfS risking a “potential conflict of interest” and being “too close to the providers” if it allocated teaching grant.

“As long as you’re keeping a direct funding lever, by keeping teaching grant, I just think that pragmatically you’re more likely to achieve your policy objectives by keeping Hefce’s expertise in using it,” he said, calling for a way for that to be maintained with the new regulator.

On the spending review, Mr McKenzie said he was “sure BIS will have made a strong case about investing in productivity” via higher education funding.

He added that “you see just how linked in to industries GuildHE members are: whether it’s marine engineering at Southampton Solent, the agricultural industry, the creative industry – there’s about 2.5 million jobs in the creative industries…You see those productivity links really very powerfully.”

He also said there was a “strong case” for the specialist institution funding that benefits many members of GuildHE, which is one of the sector's two official representative bodies alongside Universities UK.

Mr McKenzie said he aimed in his GuildHE role, which he took up in July, “to bring to more people’s attention – who perhaps only understand a certain type of university or a certain type of higher education – the incredible diversity that’s out there. Students and potential students can only benefit from that, when they realise the real breadth of choice.”

And he also pointed to the crisis in part-time study. “I do think that you have to find a way to fix the finances on this,” he said. And he called degree apprenticeships – expected to benefit from funding from employers via the government’s proposed apprenticeship levy – “a possible way of beginning to energise part-time”.

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Print headline: Ex-BIS official’s warning on OfS

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