Willetts signals boost for external providers

Mixed response to proposals for private takeovers of public institutions. Simon Baker reports

June 24, 2010

A report that suggests how a public university could be taken over by a private company in the UK is likely to be considered by universities and science minister David Willetts, it has emerged.

The study by law firm Eversheds, commissioned by private education provider BPP, looks at what changes to the law would be needed to allow profit-making companies greater involvement in the sector.

It is understood to be similar to a report prepared last year by Eversheds partner Glynne Stanfield for Universities UK, which included a section on university takeovers.

Mr Willetts has faced intense lobbying by BPP, and other private providers, to bring in changes that would help them compete on a "level playing field" with publicly funded institutions.

Suggestions include allowing the private sector better access to the student loans system, making it easier for them to call themselves universities, and wider distribution of degree-awarding powers.

The new report is believed to cover current impediments to such changes, and also addresses legal barriers to private companies acquiring existing public institutions.

A source confirmed that the study had been prepared and was commissioned by BPP.

Speaking last week, Mr Willetts said independent providers had a "significant role to play" in the government's future plans for higher education.

Speaking at a conference organised by the Chartered Institute for Securities & Investment and sponsored by BPP, he said: "It is very important that we have a properly diverse sector and that involves recognising the role of new external providers like BPP ... which clearly have a significant role to play."

However, some private institutions are unhappy that Mr Willetts has not been more explicit since taking office about plans for opening up the sector.

Aldwyn Cooper, principal of Regent's College in London, said: "One should not directly compare stump speeches before an election with the realities of office.

"However, institutions in the private sector would now like some clear and consistent guidance on the role that David Willetts believes that we should play."

Meanwhile, other groups said questions would be raised about the government's motives if it decided to open up the sector to private takeovers.

Pam Tatlow, chief executive of Million+, which represents new universities, said: "I don't know why that would be preferable to mergers or other forms of collaboration.

"I think questions would be asked about what the government's intentions were. Would the motive be to preserve an institution or give a private company a massive windfall?"


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