2 Information requirements in a new
environment
11. The Funding Council has a duty to promote value
for money in relation to the £7.9 billion of funding it provides
to the sector. It does this by:
i. promoting benchmarking by institutions and
providing data to enable comparisons between institutions; and
ii. specific initiatives, for example on procurement
and information systems.[11]
12. The Funding Council does not assess the overall
value for money delivered by individual institutions, for example
by considering the relationship between the level of fees charged
and the amount and quality of tuition time received by students.
This is because academic standards are, by law, the responsibility
of the institution. The Funding Council does have a statutory
responsibility to ensure that there is appropriate and effective
teaching available, which it does through the work of the Quality
Assurance Agency, a body funded through subscription from the
sector.[12]
13. As students are required to invest more money
in their own higher education, they will need better information
to allow them to make an informed choice about value for money.
The Funding Council is working with institutions, the Quality
Assurance Agency and other stakeholders to put in place an information
pack on institutions to allow prospective students to make a more
informed choice. Information will cover the content of courses,
the processes of assessment, the balance of teaching time and
employment prospects on graduation. Since we took evidence, the
Quality Assurance Agency has announced a new review process from
September 2011 that will over time examine each institution and
make judgements, for example, on:
i. the threshold academic standards used by the
institution (the level of achievement a student has to reach to
gain an academic reward);
ii. the quality of students' learning opportunities
(teaching and academic support); and
iii. the quality of public information including
that produced for students and applicants (from 2012-13).[13]
14. The Funding Council normally waits three years
before publishing the names of institutions it judges to be at
higher risk. But this practice does not take account of the interests
of prospective students deciding where to study. As part of its
risk assessment processes, the Funding Council assesses institutions
as either At Higher Risk or Not At Higher Risk; around 95 per
cent of institutions are assessed as Not At Higher Risk. Professor
Wathey, Vice Chancellor of Northumbria University, suggested there
was a big difference between those institutions assessed as At
Higher Risk in the risk assessment and those in financial difficulties.
One of the institutions at higher risk revealed in the C&AG's
report, for example, was not in financial difficulty but was receiving
support for a large capital project. The Comptroller and Auditor
General recommended a more graduated risk assessment system to
take more account of the different reasons for being At Higher
Risk and give earlier warning of possible problems. The Funding
Council told us that it would reflect on whether its current risk
assessment mechanism and disclosure policy were still appropriate.[14]
15. In modelling the costs of the new funding environment,
the Department assumed an average fee loan of £7,500 would
be taken up by 90% of students. At the time of the hearing, a
majority of institutions were proposing to charge the maximum
£9,000. The Department acknowledged that higher than forecast
fees would lead to a pressure on the student support budget, potentially
up to several hundred million pounds. It noted that the likely
cost would become clearer once scholarships, bursaries and fee
waivers were taken into account and the Office for Fair Access
had made its judgements on institutions' arrangements to safeguard
access for lower income and other under-represented groups. Depending
on the result, the Department will need to consider the options
available, which might range from finding more money through to
reducing the places available.[15]
16. The Department's balance sheet shows the value
of the student loans outstanding, with an adjustment for an expected
rate of non-repayment of around 30%. The balance of loans outstanding
could rise from about £24 billion currently to around £70
billion by 2015-16. Higher than forecast fees will increase the
financial pressures on students. Furthermore, the Funding Council
does not yet know how student demand will respond to higher fees.
The Funding Council has a model which forecasts the financial
position of institutions and there may be scope to develop it
further, for example to assess the impact on institutions of options
for responding to the increasing pressures on public finances.[16]
11 Q 43, 45 ; C&AG's Report para 1 Back
12
Qq 44-47, 50 Back
13
Q10, 21, 30, 51-52 : http://www.qaa.ac.uk/reviews/institutionalreview/
Back
14
Qq 22, 34, 39, 70-74, 99 Back
15
Qq 83, 90, 92, 93 Back
16
Qq 83-86, 102 ; C&AG's Report, paras 2.26 - 2.27 Back
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