The UK must do a better job of predicting future student numbers

The Office for Budget Responsibility’s methodology is of incredibly low quality, says Nick Hillman

January 11, 2018
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Forecasting future student numbers is difficult but important. If you want to shape a higher education sector to the needs of your country and economy, you need to plan ahead, using the best available evidence and forecasting techniques.

The UK’s Robbins report of 1963 rested on such forecasts. It is regarded today as having made the mass university system possible, although it did not set a new direction: it merely responded to contemporary realities by assuming that the post-war growth in higher education would continue.

The Robbins committee looked at the birth rate and rising school achievement to predict a more than doubling of the number of full-time places required by 1980, to 558,000, assuming no diminution in competition for entry.

In the following decade, other official forecasts were produced that bounced up and down. In 1970, the Department of Education and Science planned for 835,000 full-time students by 1981, whereas a 1972 White Paper set the figure at 750,000. In the event, the more sophisticated modelling of the Robbins committee turned out to be remarkably accurate. There were 535,000 higher education students in 1980.

The challenges in forecasting the future did not dissuade people from doing it. In the mid-1980s, for example, the Department of Education and Science provided two new projections. One assumed that the same proportion of people with the right entry qualifications would enter higher education; the other assumed that the proportion would increase, especially among women. The first projection foresaw a decline from 693,000 students in 1985 to 633,000 in 2000. The second predicted a rise to 723,000 by the same date. In the event, both were too pessimistic.

More recently, others have taken on the mantle of forecasting student numbers. Many of the Higher Education Policy Institute’s early reports focused on the issue, and we hope to consider it again this year. What all these past attempts to predict future student numbers have in common is that they took numerous factors into account and sought to recognise that the world is constantly changing.

These days, official future student number forecasts are produced by the Office for Budget Responsibility. Unfortunately, as Hepi recently explained, this work is of incredibly low quality and takes no account of past forecasts.

The OBR considers just two inputs: the birth rate and the latest information on university admissions. This ignores the wider policy environment (such as the removal of student number controls), experience abroad (such as information from the OECD), levels of aspiration in society (as shown in the Millennium Cohort Study) and future labour market needs (perhaps resulting from Brexit). Nevertheless, the OBR acts as if its modelling is sufficiently sensitive to sustain two wholly new forecasts each year.

In March 2016, the body suggested that there would be 1,189,000 UK and EU full-time publicly funded undergraduates in 2020-21. Since then, it has reduced its numbers three times and now says that there will be only 1,064,000 – fewer than now. The OBR’s latest change alone, from November 2017, cuts the prediction for future government borrowing by £900 million for 2021-22.

The Robbins report’s calculations were hardly the height of sophistication, but, although more than half a century old, they are light years ahead of the OBR’s. That is why I have been calling on the OBR to consult the sector on how it calculates its figures – without success.

Some people have said to me: “Don’t worry. The OBR considers the whole economy. Student numbers are just a tiny part of that.” But, for two reasons, this issue is a matter of national importance, not just an esoteric higher education quibble. First, student debt has been forecast to make up about 20 per cent of the UK’s future national debt. So it is not small beer even when looking at the economy in its entirety. Second, if the OBR’s work on student numbers is at all indicative of its other work, we should worry about all its figures, and the entire basis on which the UK plans its economic future.

Nick Hillman is director of the Higher Education Policy Institute.

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Print headline: Poor predictions hold us back

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