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Numbers cap: government sets out how new controls will work

Image: Chris Parr for Research Professional News

Department for Education confirms penalties for over-recruitment

Universities could lose millions of pounds in tuition fee income if they break new rules about the number of domestic students they can recruit, the UK government has confirmed.

On 1 June, ministers set out how the new student cap will operate, including details on penalties for institutions that flout the rules and confirmation of how universities in the devolved nations will be affected.

In England each institution’s cap for 2020-21 will be calculated by looking at their 2019-20 recruitment numbers for full-time UK or European Union-domiciled undergraduates, plus any forecasted increase this year, and allowing for an additional 5 per cent of that total.

According to the Department for Education’s plans, published online, the government will monitor recruitment by universities in England via Early Statistics data for 2020-21, published by the Office for Students. Other data—from the Student Loans Company, the Higher Education Statistics Agency (Hesa) and the Individualised Learner Record—“may be used to help with this assessment”, it adds.

“Where, according to the criteria set out in this document, an English provider has exceeded the ‘student number control’ level notified to them, their fee limit for academic year 2021-22 will be reduced,” the plans state.

With a starting point of a provider’s current fee limit, the government said the following reductions will apply in the event of over-recruitment: for institutions going beyond their cap by up to 6 per cent, a 3 per cent reduction in their fee limit will be imposed; over-recruiting by 6 to 12 per cent incurs a 9 per cent reduction in the fee limit, while providers going beyond their cap by more than 12 per cent will have their fee limit slashed by 15 per cent.

“These revised fee limits will apply to all students on full-time courses in all years enrolled at that provider for the duration of the academic year 2021-22,” the government said—limited to “undergraduate courses, plus postgraduate initial teacher courses and postgraduate pre-registration healthcare and social work courses”. 

The Hesa data for universities in England show that in 2018-19 providers had an average of just over 8,700 UK/EU-domiciled full-time undergraduate students. Most of these will be paying £9,250 a year.

This suggests an average-sized English university receives around £80 million in tuition income a year from its UK/EU-domiciled full-time undergraduates. The government said the 3 to 15 per cent fee limit reduction would be applied to all these students, meaning a potential hit of between about £2.4m and £12m based on these undergraduate numbers.

Meanwhile, ministers have confirmed a similar numbers cap on England-domiciled students will be imposed on universities in Wales, Scotland or Northern Ireland. The plans, which were first reported over the weekend, have been widely condemned in the devolved nations.

In Scotland, Wales and Northern Ireland, the numbers cap “will apply to—and only to—all England-domiciled students, who have started full-time undergraduate study, including studying foundation years, and are in receipt of a tuition fee loan, paid by Student Finance England,” the government plan said.

“Part-time and postgraduate students are not included in the SNC…If any institution has exceeded its control in terms of offers made and accepted on or before the notification date, there is provision to address this. In those circumstances, the level for the institution will be the higher of the SNC number notified to the institution or the number of students starting courses at the institution who received and accepted their offers before the notification date.”

In a statement published alongside the plans, universities minister Michelle Donelan acknowledged it was “an extremely difficult and anxious time for students, universities and their staff, which is why we have introduced student number controls to stabilise the admissions system and protect higher education from the financial impact of Covid-19”.

“We want everyone who achieves their entry requirements to be able to go to university, and the measures seek to ensure students have the widest possible variety and most suitable places to study in the coming academic year, while avoiding harmful over-recruitment among providers which could go against the interests of students and the sector,” she added. “The controls will make adjustments to take account of offers already accepted before 1 June, and will make best use of taxpayer funding to support students.”

This means students with offers in place are protected even if their university has already over-recruited based on existing offers. The institutions in question will simply be asked not to recruit anyone else. The plans also confirm that ministers will allocate an additional 5,000 places for subjects such as nursing and healthcare, and another 5,000 for subjects including architecture, engineering and the sciences at what Donelan describes as “high-quality institutions”—based on continuation and employment rates—meaning there will be a number of extra smaller groups of students for whom universities can compete. A full list is published in the plans.

In a written statement to the House of Commons on 2 June, Donelan confirmed that the government “intends to lay draft regulations”, known as  the Higher Education (Fee Limits and Student Support) (England) (Coronavirus) Regulations 2020, before Parliament for its approval”. 

“These Regulations will amend the legislation which prescribes tuition fee limits and tuition fee loan amounts,” she said.“These [number controls] are in the best interests of the financial health of the higher education sector overall, and will help to ensure we can continue to look after the best interests of students, allowing them make well-informed choices that give them the best prospects for success in their lives and careers.”

Sector response

Emma Hardy, Labour shadow universities minister, 
said the “intention to limit the number of English students allowed to study at Northern Irish, Welsh and Scottish universities by the UK Government has been announced without consultation with, or the support of, both the devolved authorities and the higher education sector.

“The announcement has been made ahead of any details which once more gives the impression of a government making policy on the hoof. Labour believes that solutions to the challenges posed by Covid-19 should be arrived at together. The government’s divisive announcement can only add to the difficulties this sector already faces.”

Colin Riordan, vice-chancellor at Cardiff University, said it was “obvious from the reactions in the devolved administrations”, as covered in Research Professional News’ article, that there was “no consultation on this”.

“It’s a pity that English ministers and officials didn’t take the opportunity to work closely with Wales, Scotland and Northern Ireland to coordinate the approach to the temporary reintroduction of the student numbers cap, especially since Michelle Donelan has been very open, collaborative and communicative in other respects during the crisis,” he said.

“One assumes that the devolved administrations will have little option other than to respond in kind. This is a particularly acute issue in Wales since the cross-border student flows are so substantial, and it’s important to consider the interests of students and institutions on both sides of the border when making critical decisions with far-reaching effects.”

Daniel Zeichner, chair of the All-Party Parliamentary Group for Universities and MP for Cambridge
, said institutions would be “looking at the fine detail to work out whether they may benefit from the opportunity to recruit more students into the key public service sectors that the government now claims to favour”.

“My concern is that a government not generally predisposed to such interventions will lack clear purpose, and in just trying to muddle through, will fail to give the clear leadership needed,” he said. “Those Conservatives who believed that they had adopted a market-based approach to higher education will read this detailed micro-management of the sector with dismay.”

Nick Hillman, director of the Higher Education Policy Institute, said his role in removing student number controls while special adviser to then universities minister David Willetts was “the policy I am proudest to have worked on in my entire career because it meant more people could go to higher education and more people could go to their first-choice institution”.

“I was never likely to welcome their return,” he said. “England entered the [pandemic] with a marketised system of higher education and some of its best features, like responsive admissions systems, are being curtailed in the crisis. Some people believe that is necessary in the short term, but the degree to which it represents a problem in the long term will depend on whether policymakers willingly give up the new powers afterwards.”

Smita Jamdar, partner and head of education at law firm Shakespeare Martineau
, said the plans seemed like “a strange way of going about their desired objectives”.

“If an institution breaches the number controls, the penalty appears to be to reduce the fees available for all undergraduate students the following year, [meaning] there will be less money available to teach the students, so it’s the students who will suffer,” she said.

She added that new starters in 2021 would potentially get a reduced fee for year one from those institutions that had seen their cap reduced for over-recruitment, which “may prompt more of them to pick one of the ‘naughty’ providers”.

“There’s a lot in the document about fairness between providers but not a lot about fairness between students,” she added. “It’s not clear whether for English providers the cap applies to all students eligible for a tuition fee loan even though they haven’t taken it and paid upfront, or whether it is only for students who actually take out the fee loan. I think in England it’s the former, but if the latter it raises an equity point.”

Diana Beech, head of government affairs at the University of Warwick and a former adviser to three universities and science ministers, agreed that the policy suggested the Department for Education might be “perversely making over-recruiting institutions more attractive to students on price”, unless students were still charged the full £9,250 while providers only received the capped value. If that is the case, “who pockets the penalty? Would government be profiting from students’ money?”

And with new regulation on the cards, “does that not make this more likely to become a permanent fixture of the higher education landscape in England? Things are typically harder to remove once on the statute books.”

Jo Grady, general secretary of the University and College Union
, said the UCU remained concerned “that  [these proposals] will simply push the problems created by coronavirus down the chain and lead to the financial instability of many institutions, as well as create problems for the devolved nations.

“Instead of a ham-fisted attempt to regulate the failed higher education market, students and staff need the government to stand behind universities, protect their current income and encourage cooperation, rather than competition.”