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'Doomsday scenario': private access to student support may cost academy

Places at established universities could be cut to accommodate the government's plan to open up higher education to more private provision, it has been suggested.

The "doomsday scenario" was highlighted as one potential consequence of allowing students at private colleges full access to loans, as proposed by the Browne Review.

At a Universities UK event in London last week, David Willetts, the universities and science minister, said competition from new private providers would help to prevent universities from overcharging their students if proposals for higher fees were passed.

However, questions are being asked about how feasible it is for student places to be expanded in light of the loan system's costs.

Sir Alan Langlands, chief executive of the Higher Education Funding Council for England, said it was "clear" that total places would still have to be controlled due to the costs of student support.

Speaking at the Hefce annual meeting in London, he added that the government still wanted to find a way to allow numbers to fluctuate between institutions, but said that private providers were an "added complication".

Paul Marshall, head of the 1994 Group of smaller research-intensive universities, was due to say on 2 December that this was a quandary facing the government.

"It is assumed that part of the quid pro quo of an attempt to balance supply and demand will be that private providers will be provided access to the newly enhanced student-support arrangements," he was expected to say at the Private Provision in UK Higher Education conference in London.

"However, the financing of such a significant expansion of an extremely expensive and generous student-support package simply doesn't add up. There is little or zero headroom to expand student numbers.

"Indeed, one doomsday scenario put to me is that if the government pushes ahead with expanding access for the student-support arrangements to private providers, it cannot afford to do this without reducing the numbers of students accessing student support at the traditional universities."

For-profit providers such as BPP, a subsidiary of the US-based Apollo Group, are keen to sign up to arrangements allowing more students access to loans. Growth is even more vital after Apollo recently wrote off $170 million (£109 million) from BPP's value in the wake of the economic downturn.

An internal BPP email seen by Times Higher Education shows that in 2009-10 the company recorded falling revenues for the first time in its history. The memo - sent to staff by chief executive Carl Lygo earlier this year - reveals that 90 BPP employees had been made redundant and pay had been frozen.

BPP may face further cuts after Apollo said it intended to "aggressively manage" its costs in light of a tough US market affected by media criticism of for-profits' student-recruitment methods.

Readers' comments (1)

  • @research and teaching, others have already adequately replied to your comments about oxford and Cambridge. I attach no ideology to the word 'provider' or 'service'. I regard myself as left of centre, hopefully with many and varied intellectual interests. I'm certainly not a philistine conservative. However, having worked in science consulting I do know that providing a service simply means being focused on your clients/customers/students/learners rather than on your own seld interests. The main criticism I've had with the insiders view of UK HE that I've had in the last few years is that the culture is one of self interest rather than service provider. The age of deference and privilige is over and academia will need to change. I think it's important not to see research and teaching as an all or nothing combination. Most learner-centred colleges/universities (private and public) in the States also encourage research, it's just that the proportion of time spent on each is different. This does of course mean that the research being done is less time consuming and less expensive, but cutting edge research often leaves entire areas of knowledge unexamined in its wake. Those with less publishing pressures are able to fill in many of the gaps left by research-focused institutions. It also enables undergraduates to get involved with publishable research. I also think its important not to look on private education as only suitable to for-profit vocational colleges. There are many not-for-profit liberal arts colleges in the States. Once UK middle class parents, who appreciate a well rounded academic education, realise just what a raw deal they are getting (value for money depend on price and quality) from many UK universities, I suspect there would also be quite a demand of learner-centred liberal arts colleges in the UK. Perhaps this would leave more money for teaching at public universities? Personally, I like many of the ideas expressed in this article:

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