Leader: Get serious about teaching

How have we got ourselves into the terrible position where a report for the Higher Education Funding Council for England is warning that higher education in this country is in danger of losing the very thing that makes it so special: the personal interaction between students and academics who are experts in their fields?

The report blames a lack of funding (we invest less in higher education than the Organisation for Economic Co-operation and Development average, and the amount of funding per student fell significantly until 1998, so any recovery will take some time) for a squeeze on contact hours, pressure on student feedback and crumbling buildings. Class sizes have shot up since 1990 to the point that staff at some universities can no longer know their students by name. Current staff-to-student ratios are putting the quality and reputation of UK teaching at risk.

Until now, the growth in overseas student numbers has helped fill coffers, but it is unlikely that the rate of increase can be maintained. The recession is helping a little here. A bleak jobs market and a weak pound are boosting applications from abroad, according to the Universities and Colleges Admissions Service, with those from the European Union up by nearly 14 per cent and those from elsewhere by 9 per cent. For home and EU students, however, expansion is capped this year at an extra 10,000 places, some 5,000 fewer than planned, because of the £200 million student grants funding gap.

If higher education loses its competitive edge, the UK's economy and reputation will suffer, the Hefce report says, in what is becoming a familiar refrain. Surveys consistently show that it is the quality of teaching and learning that makes the UK attractive to these overseas students.

But if the sector wants more money to maintain this world-class student experience, it has to cost teaching properly. At present, institutions use different methods, and the data collection involved has been described as the kind that "would make Enron blush". In their Transparent Approach to Costing (Trac) returns, many institutions are said to have been underestimating the costs of teaching while overestimating the costs of research (because of the culture of encouraging research). If we want to ask for more cash for teaching, this is not the way to do it.

We also have to identify exactly what good teaching is. We all know great teaching when we see it, although we still do not recognise and reward its value in the same way we do for research, as this week's Higher Education Academy report affirms. Students tell us that they want more of it. But how do we assess it? For some the answer is peer observation; others pooh-pooh this, saying it encourages the notion that teaching is a public performance that requires little from students.

If we wish to preserve the reputation and quality of our higher education brand, the need for additional funding cannot be ignored. To provide this, the Hefce report suggests a one-off increase in core grant, indexing the core grant by the real rate of inflation or, the biggest bogeyman of all, raising the cap on fees. Both main political parties are refusing to have the debate on lifting the cap this side of a general election. Adrian Smith, the director-general for science and research, should be roundly congratulated for daring to raise the issue at a meeting last week and telling the truth: universities simply do not have enough money to carry on doing the job properly.