Another university admissions cycle is reaching its climax with A-level results envelopes opening, university places confirmed and the clearing process for those who did better or worse than they’d hoped kicking into action. Amid all this, the government is having a third go at creating a real market in higher education.
Controls on the number of students that institutions can admit have been completely removed from this September, opening up the prospect of a free-for-all. But the failure to create a variable tuition fees regime with some universities charging more than others and the modest impact of a partial lifting of the cap on student numbers, suggests that the government’s latest move may not be the game-changer that supporters of a market in higher education hope for – and which its critics fear.
The market has always been present in higher education in England in some form, with students always free to choose which universities to apply to, and universities equally free to chose which applications to accept. But since the former coalition government’s 2010-11 reforms which tripled English tuition fees from a maximum of £3,000 to £9,000 from 2012, market behaviours and market mentalities now suffuse higher education. The attention paid to, and resources spent on, branding is one example.
In search of the market
Yet in another sense, the market still hasn’t fully arrived. Originally, the hope of the tuition fee reforms was that institutions would choose to vary their fees (£9,000 is only a cap), producing a market in terms of “prices”. That didn’t happen. Most have chosen to charge the maximum, or close to it.
The government tried to free up the market by partially removing the student number cap, allowing institutions to recruit as many “good” students as they wanted – initially those with A grades at A-level for 2012-13 and then those with A and B grades for 2013-14. Before this, the number of students each university could accept was regulated by the Higher Education Funding Council for England (HEFCE). This produced modest changes in the distribution of students, as a few Russell Group universities such as Bristol decided to expand.
As the student numbers cap now disappears completely, they will be joined by others – although not Oxford or Cambridge. But there are several reasons for caution.
It is far from clear that, on aggregate, there is significant unmet demand for more students to attend university. There could be a one-off blip this year if students abandon gap-year plans and start university a year earlier in order to benefit from maintenance grants, which George Osborne announced in his latest budget will be replaced by loans from September 2016. But only a minority of students are eligible for these maintenance grants.
Will demand hold up?
Some universities have been struggling to fill their places. According to a report by the Universities and Colleges Admissions Service (UCAS) on last year’s admissions cycle, 30 larger universities were still recruiting at 15% or more below their 2011 intakes.
At the same time, despite major political efforts to deny that higher fees have had any impact on demand, the rapid growth of the previous decade has been curbed. Although total applications for 2015-16 are up 1% on a like-for-like basis compared with last year, they are still 16,000 fewer than in 2011, the year before the fees increase.
The big increase has been in the number of applications from outside the European Union, up by more than a third over the same period, according to UCAS. But the number of traditional applicants, young adults with A-levels, is set to decline. In fact, the market in A-level applicants is already close to saturation, with supply and demand close to balance. The major growth in the future will be in applicants with non-A-level qualifications, mainly BTEC awards.
Different concerns across the sector
The incentives for individual universities to expand play out in different ways. Russell Group universities have to balance the impact of higher student numbers on the capacity of their academic staff to compete in an increasingly cutthroat global competition for research reputation – and resources.
A little-recognised fact is that the most research-intensive universities are now the most dependent on direct public funding, for research and also high-cost subjects – mainly in the sciences. This direct funding via HEFCE has already been cut – and will be cut again as the government rolls out its austerity programme.
This might push Russell Group universities towards maximising their fee income by recruiting more students. But it is a delicate balance of advantages and disadvantages.
For teaching-oriented institutions, the balance is different but equally delicate. Some of the big urban former polytechnics suffered most from the 2010-11 reforms and many are still recruiting 15% or more below their 2011 intakes. They may be tempted to increase intakes, if they can.
In the longer term, of course, the stagnation in the number of traditional A-level candidates and growth in applicants with BTEC and other qualifications may ride to their rescue – but at the same time make things more difficult for middle-ranked universities. But they have to watch the impact of higher student numbers on their league table positions, now seen as crucial to success in a system dominated by market behaviours even if market mechanisms are creaking.
Pile-them-high does not seem a sound strategy. And, in common with all universities, they have to worry about the impact of more students on the now ubiquitous concern about their “student experience”.
Overall, with universities in cautious mood, the final lifting of the student numbers cap is more likely to lead to fine-tuning than big changes in the pattern of clearing as it gets under way.
Peter Scott does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.
Authors: The Conversation