Wrong kind of competitive tension threatens FE options

AoC warning as validating universities withdraw from college partnerships. Hannah Fearn writes

April 7, 2011

The Association of Colleges has warned that the government's ambition for more higher education to be delivered by further education colleges is being undermined by cuts.

Nick Davy, the association's incoming higher education policy officer, said he had "real concerns" about the number of validating universities that are pulling out of their relationships with colleges.

Although he did not name those affected for fear of exacerbating the problem, Mr Davy said that the UK's "excellent" higher education in further education provision was being threatened by universities' attitudes to their partner colleges.

"We have concerns both in the number of universities talking about withdrawing and the amount of students (being withdrawn)," he said. "We can't have a market situation where effectively a competitor can control the numbers of another competitor. What if a university doesn't want the college to develop a course that it is offering itself?"

Speaking at the HE in FE: New Landscape, New Opportunities? conference in London last week, David Willetts, the universities and science minister, said that any institution revising its validation charges and franchising arrangements to hinder the development of further education colleges would be guilty of "anti-competitive behaviour".

"Universities should not impede cost-effective provision of higher education by colleges," he added. "It would be a backwards step if colleges are squeezed out of the market by universities seeking to claw back franchised places. In the White Paper, we will be looking at how we can free colleges from these risks."

Also at the conference, association members discussed how colleges should price their higher education courses when the cap on tuition fees rises to £9,000 a year in 2012.

Mr Davy said that colleges may not be able to significantly undercut local universities.

"Colleges have a slightly lower cost base than universities, but they need to be very careful because it's very rare that a college would pack 300 students into a lecture theatre," he said. "We often deliver specialist courses that would never attract more than a dozen people and the costs of delivery are not that different (to universities)."

He predicted that most colleges would be forced to charge about £7,500 a year for their undergraduate provision - the sum the government hoped would be the sector-wide average.

Julian Gravatt, assistant chief executive of the AoC, led a session at the conference on 31 March aimed at helping colleges to set their fee levels. He said that college heads had been warned that discussing the fees with partner universities could put them at risk of breaking competition law, preventing them from having "helpful discussions" with their validating institutions.

However, he advised AoC members that "there is nothing to stop you going for (permission to charge) high fees but then charging a lower one in the end".

hannah.fearn@tsleducation.com.

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