Trojan accreditation: Private partners pose threat in the battle for students

Universities are being undercut by colleges' low-fee offerings, UUK warns. Melanie Newman reports

March 4, 2010

Private colleges should be viewed as competitive threats to universities in the market for overseas and domestic students.

The warning is made in a report commissioned by Universities UK and comes in the same week as the Conservative Party pledged to end government bias against private higher education institutions.

The report, due to be unveiled on 18 March at a UUK conference on private provision, says private colleges offering university-accredited qualifications have become the most prominent private providers in the sector.

Many charge fees well below those levied by accrediting institutions and are recruiting increasing numbers of foreign students from outside the European Union.

A small but growing number of UK-domiciled students are also opting to study at these institutions, the report adds, possibly drawn by their low fees.

Many universities have links to private colleges because they are a good source of international students, who may go on to transfer to the universities after completing their studies. Accreditation fees are also a useful source of income.

But the report warns that these benefits may be outweighed by the competitive threat posed by some colleges. It urges publicly funded institutions to scrutinise the colleges they validate and the fees they charge to ensure that their own markets are not threatened.

Despite UUK's concerns, Keith Sharp, head of the UK Higher Education International Unit, said there was a "significant if unquantified flow" of students from private providers to universities.

"In franchising their courses to UK private providers, universities may be seen as tapping new markets rather than undercutting traditional ones," he said.

Meanwhile, David Willetts, the Conservative Shadow Universities Secretary, has called for a "level playing field" in terms of degree-awarding powers.

Unlike public universities, private providers have to apply to renew their powers every six years.

Speaking at the Association of Independent Higher Education Providers (AIHEP) annual conference at The Dorchester in London on 1 March, Mr Willetts said the UK was guilty of "reverse protectionism": it was easier for a foreign institution regulated abroad to call itself a university here than for an organisation that was UK-based and regulated, he said.

He also indicated that there was unlikely to be a short-term solution to the disparity over the renewal of degree-awarding powers. "Life is messy and we may have to leave that messiness for a while longer," he said.

Favourable treatment

Other delegates at the conference complained that publicly funded universities were being treated more favourably by the UK Border Agency over the new "highly trusted sponsors" list of institutions allowed to recruit foreign students.

This was despite the fact that some universities did not monitor student attendance properly, whereas some AIHEP colleges had introduced biometric attendance registers, they argued.

Mark Field, Conservative MP for Cities of London and Westminster, questioned whether London Metropolitan University, which he said had a 47 per cent dropout rate, should automatically be given "highly trusted status".

He added that the "nimbleness" of the private sector meant it was better placed to respond to student demands than public institutions.

Parity of treatment "should not be an ideological debate", he said. "This is about consumer demand that the public sector alone cannot satisfy."

Neil Kemp, visiting fellow at the Institute of Education, said the Government could come under pressure from the World Trade Organisation because of the General Agreement on Trade in Services, which aims to open up protected markets to free competition.

The UK could be asked to remove competitive advantages for public universities to allow private providers to operate more freely, he added.

Concerns still exist about the processes and legitimacy of some private colleges in the UK. The UKBA has suspended 145 colleges' licences to recruit foreign students and revoked 15 licences.

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