REMORINO OSCAR ALFREDO 3) BENEDETTI S.A.I.C

Upon creating the quasi-market, now in operation in the higher education sector, the Coalition Government also announced that the removal of controls on AAB+ ‘will represent a starting point’ (BIS, 2011: 50). To create a truly marketized system, however, the government would have to remove the quota of students – and the cap on fees – altogether and allow universities to expand and to recruit as many students as they wanted to, regardless of their grades. As discussed above,some 130,000 applicants did not gain a place in 2011 and the figure for 2012 – though down – remained high. UCAS statistics (UCAS, 2012c: Table 10a) report 455,414 applications and 343,902 acceptances in England in 2012 – i.e. 115,512 unplaced students (ibid: Table 1a). In other words, there is still a great deal of spare capacity in the system. If the government were to remove the cap on students completely, and if some more prestigious universities expanded their numbers, the most likely result would be a gradual ‘trading up’ of students. The Russell Group universities would attract high- quality students away from the mid-tier or ‘squeezed middle’ institutions, who in turn could make up the difference by attracting students away from lower ranking universities – and so on. Assuming institutions were more willing than previously to accept students with lower grades, this would likely continue for a while – until all spare capacity was used up. However, it may eventually lead to competition between institutions, particularly if some announce expansion plans.

Since the Coalition is highly unlikely to remove the cap altogether – even if universities were willing to recruit the remaining students, the policy would still be very expensive – the scenario is also an unlikely one. Even if the HEFCE refused to fund universities for these students, there would still be a significant extra cost in terms of student support.

The most likely scenario will see the Coalition’s somewhat awkward quasi- market prevail. Indeed, the government have already announced plans to remove the cap on ABB students as well as on those with AAB. The move is likely to have

a similar effect to the reforms of 2012, with Russell Group and other prestigious universities protected by their long-standing tradition of attracting such high quality students. Indeed, UCAS data for 2012 (UCAS, 2012c: 21) confirm that high-tariff institutions such as those in the Russell Group were less impacted by participation falls than were medium and low-tariff institutions.

Meanwhile, further education colleges and universities near the bottom of the pecking order – those who tend not to recruit ABB+ students – will be largely unaffected by the policy change (though they are likely to lose some students once a further 5,000 places are cut from the student number control limit). Again, it is likely that the ‘squeezed middle’ higher education institutions will suffer in 2013 and beyond, particularly if more of the elite institutions announce expansion plans. Indeed, the planned changes for 2013 might be having an impact already. ABB students who narrowly missed a place at their preferred university in 2012 might have deferred for a year, knowing they have a good chance of gaining a place at a top university in 2013 when these universities can expand.

But while we can be sure of the government’s plans for 2013, what is by no means certain is whether student numbers will recover, or if the 2012 slump in participation will continue for years to come, for all or some particular student groups. Coupled with the changes to the quota system for 2013, such questions could spell trouble for the squeezed middle, who may have some tough decisions to make in the coming years.

Conclusions

By increasing the tuition fee cap to a level almost three times as high as it was previously, freeing up 85,000 students from the strict quota system and auctioning 20,000 student places to institutions willing to charge less than £7,500 per year, the government has further oriented the higher education system in the direction of a market.

Combined with a 46,500 decrease in university applications and an unexpected shortfall in top-grade A-level students, far from generating the competition between universities it so desired, the government’s somewhat awkward ‘quasi-market’ has only increased uncertainty in the sector and created a ‘squeezed middle’ of institutions. Such mid-tier universities have had their quotas cut and lost students through the core–margin policy. With little history of attracting AAB students, they are unlikely to be able to make up the numbers.

If the government were to completely remove the cap on students, and if some more prestigious universities expanded their intakes, the most likely result would be a gradual ‘trading up’ of students until all spare capacity is used up. This would eventually result in competition at all levels., However, given the cost of removing all controls altogether, the scenario is highly unlikely.

Instead the quasi-market is likely to prevail in the future, which might generate some competition amongst ‘the squeezed middle’ universities if Russell Group institutions expand capacity and attract high-grade students away from less prestigious institutions. However, such competition is weaker than the sort that would be generated by a completely free market, and hence unlikely to lead to vast improvements in the quality of courses.

And with student numbers down in 2012, and fears of further declines in the coming years, the future of higher education in England – and the success of the government’s reforms – is highly uncertain.

Notes

1 _{Applicants for full-time undergraduate courses at UK higher education institutions (all}

student types); UCAS, 2012c: Table 4a.

2 _{UCAS statistics (UCAS, 2012c: Table 10a) report 498,119 unique applicants, and 368,316 UK}

domiciled accepts for England in 2011.

3 _{The UK higher education system is devolved, but quotas are in place in all four constituent}

countries, and operate in a similar way.

4 _{The Russell Group represents 24 UK institutions, which are considered to be particularly}

prestigious because of their focus on research. In 2010, Russell Group members received 72 per cent of all university research grant and contract income in the UK. The Russell Group was formed in 1994 by 17 British research universities: Birmingham, Bristol, Cambridge, Edinburgh, Glasgow, Imperial College London, Leeds, Liverpool, London School of Economics, Manchester, Newcastle, Nottingham, Oxford, Sheffield, Southampton, University College London and Warwick. In 1998 Cardiff University and King’s College London joined the group. In 2012, a further five institutions (Durham, Exeter, Queen Mary, University of London, and York) joined the group, though these are not included in Figure 6.3 (source: The Russell Group website: http://www.russellgroup.ac.uk/research/)

5 _{Note that unlike Figure 6.2, these figures depict the ratio of applications to acceptances, rather}

than unique applicants since applicants can make applications to as many as 5 universities simultaneously through the UCAS system.

6 _{Application: acceptances ratios are for UK students applying to individual institutions,}

derived from UCAS statistical services, available at www.ucas.ac.uk/about_us/stat_services/ stats_online/

7 _{See footnote 1; End of Cycle figures for English institutions not available at time of writing.} 8 _{At 2012 prices. In nominal prices, fees were set at £1,000 per year in 1998 and £3,000 per}

year in 2006.

9 _{Note that these figures are derived from application rates and population data so are}

approximate.

10 _{The IDACI measure shows the percentage of children in each area that live in families that}

are income deprived (i.e. in receipt of Income Support, income based Jobseeker’s Allowance, Working Families’ Tax Credit or Disabled Person’s Tax Credit below a given threshold). A rank of 1 is assigned to the most deprived area and a rank of 32,482 is assigned to the least deprived area.

11 _{For more details on this, see UCAS (2012), 28–31.} 12 _{See UCAS (2012a) 48–9.}

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Widening participation and