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Learning lessons

Susan Lapworth responds to recent criticism of the Office for Students

There’s no ducking the critical nature of the report from the House of Lords Industry and Regulators Committee on the work of the Office for Students. Alongside its recommendations are some forthright criticisms. But the price of being a regulator with significant powers over an important sector is the scrutiny we face about our work. This is democracy working as it should, whether or not we find the process or the outcomes comfortable.

There can be no doubt that the committee was diligent in its work—calling 26 witnesses and reviewing 64 written submissions. While we won’t agree with everything in the report, it contains important feedback offered to the OfS in good faith. We’ll want to think carefully about how we respond, working out what really matters—particularly to students—and not getting too distracted by the inevitable swirl of media comment.

Almost universally, the witnesses—students, vice-chancellors, sector representative bodies—accepted the need for meaningful regulation of a sector receiving billions of pounds each year from students and taxpayers. That must be right. And it provides a solid, shared starting point for the thinking and discussion that will now follow.

Doing things differently

As we think and discuss, I expect there will be things we conclude that we do need to do differently and areas of our work where we do need to change. So we’ll embrace the report as a learning tool for the next phase of our development as a regulator rather than see it as an attack against which to defend ourselves.

One of the most prominent themes in the report relates to our relationship with the sector. Introducing an entirely new regulatory system in a sector that cherishes its autonomy was always going to be challenging. It was inevitable that the web of relationships across the sector would need to change. And, of course, we’d all wonder about the effectiveness of any regulator that received only praise from those it regulated.

But we recognise that we’ve not yet got those relationships quite right. That’s why, even before the committee launched its inquiry, we started making changes to how we engage with institutions. The report reinforces the importance of that work. The changes we’ve already made have been well received by institutions and have been valuable for us too, helping to deepen our understanding of the sector’s diversity and complexity.

We’ll continue to focus here. Along with senior OfS colleagues, I’ll be out and about during the autumn on visits to individual institutions and at conferences and events. We want to create opportunities for colleagues across the sector to tell us about their priorities and challenges, as well as opportunities for us to explain more about the OfS’s role and approach. We’re seeking a richer two-way dialogue.

Financial awareness

The committee’s report covers a lot more territory and now is not the time for a line-by-line response. But I did want to touch on one more of the central criticisms. I don’t think it’s right to suggest that the OfS is not sufficiently aware of the financial risks facing the sector.

We will, of course, carefully consider the committee’s recommendations here—and it was right to place significant emphasis on financial sustainability. The committee was also right that our most recent assessment is that the aggregate picture indicates that the higher education sector is currently in good financial shape. That’s an assessment built from the forecasts that individual institutions have sent to us. So it’s based on the sector’s own data—and, of course, we look to each autonomous institution to have a proper grip on its financial sustainability.

There’s an important ‘but’ here. Our analysis, published in May, goes on to say that there continue to be significant differences between individual providers, and we expect providers to come under greater financial pressure in the coming year. We also identified a number of financial risks—including the impact of a fixed undergraduate tuition fee, cost pressures and an overreliance by some on international students. We said, and continue to say, that if these risks materialise or continue at current levels, there could be a material impact on the financial sustainability of individual institutions.

It’s important that a regulator presents a clear, impartial view of financial resilience—neither downplaying acute issues we may see in a small number of cases nor exaggerating the currently sound position of the majority of institutions. We’ll continue to do that, on the basis of expert analysis of financial data and risk.

Our work here generally happens behind the scenes. Institutions facing financial difficulties would not thank us for making them publicly visible. But we continue to monitor carefully and intervene where necessary—most recently this week to seek to protect the interests of students at the higher education institutions run by the Dartington Trust.

Conflicting interests

A final reflection. When I gave evidence to the committee back in May, I said that the interests of students and the interests of providers were not always neatly aligned. I’m struck that the report illustrates this challenge.

Students tell us that they want us to do more about harassment and sexual misconduct on campus, whereas institutions have suggested that this shouldn’t be a priority and the committee seems to support that view. Institutions and the committee are understandably concerned about the impact of potentially prescriptive regulation, whereas the report suggests more detailed regulation so prospective students have clear information about contact hours.

So there’s much for us to reflect on—and already it’s clear that there aren’t easy answers to some of the important questions being posed. But we will think carefully about the best way forward.

And however we respond to the detail of the committee’s report, we’re going to continue to focus on regulating in the interests of students. Dedicated and talented colleagues right across the OfS continue to deliver important work. Just this week, we published the first of our quality assessment reports—sober, credible reports setting out the judgments of academic experts. That’s just the latest example of meaningful regulation on issues that matter to students. That’s our job—why the OfS exists in the first place—and we’ll learn the lessons from the committee’s report as we press on with that vital mission.

Susan Lapworth is chief executive of the Office for Students.