Bright initiatives made to please the chancellor

Last February in a speech at the University of Greenwich, education secretary David Blunkett caused a stir with two new policies: the e-university and the foundation degree. The speech came as Mr Blunkett was negotiating with the Treasury for his department's allocation in the spending review for 2001-04. It is probably not too cynical, therefore, to assume that the two bright new initiatives unveiled at Greenwich were designed to please the chancellor.

It worked. When the spending figures were announced in July, higher education's allocation for the first year of the three was better than expected: cuts had apparently come to an end. But there were two ominous omissions: there was no figure for the unit of resource - the amount of cash per student - and there were no figures for years two or three.

Now we are on the brink of this year's autumn statement from the chancellor and higher education is expecting figures soon from the education department for the second of the three years (2002-03), though not for the third. There is a strong suspicion that higher education is about to lose money won by Mr Blunkett in its name because it has not recruited the target number of students - though this will be dressed up as good news in the form of an improved unit of resource.

It will be interesting, therefore, to see if Mr Blunkett plays down his two Greenwich initiatives, opting instead to give higher education such money as he feels inclined with fewer strings. It could be a popular and convenient move. The habit of funding through earmarked schemes is irritating and expensive to administer and, after seven months of consultation, neither of the Greenwich initiatives is quite what the minister originally intended.

The e-university has become not an Oxbridge-branded competitor for the big beasts on the American eastern seaboard but, in effect, a national publishing house for distance-learning packages produced by any UK institution with degree-awarding powers.

The foundation degree was initially proposed as a two-year-only terminal qualification for people at work, with no right to top up to honours degree level, and perhaps even a ban on such upgrading. Criticism was muted at the time because all could see the advantage of the scheme for winning cash from a chancellor fixated on inflation targets and fearful of skill shortages at technician level. Nonetheless, higher education's price for cooperation was that successful students should be able to progress, as of right, to honours degrees.

The presence of pre-1992 universities among the many bids for cash to pilot the new qualification demonstrates the importance of this change. By collaborating with further education colleges that are better at recruiting the kind of students universities need to attract to meet government access targets, the new qualification will help them trawl a pool of talent they have consistently neglected. But it will not necessarily do the job the government intended (Letters, opposite).

Combined with the shortfall on student recruitment targets across higher education, this is bad news for institutions caught in the middle: namely institutes of higher education, particularly those without degree-awarding powers. Crisis does, however, concentrate the mind. The Standing Conference of Principals, which will gather in York next week, is seriously considering pressing for mission-based funding (page 4). This idea, developed by the Council for Industry and Higher Education and the Institute of Education, may not suit large universities and may be too cumbersome for the system as a whole, but it could be ideal as a means of fostering the diversity that the colleges bring to higher education.

With big changes due in the next year at the Higher Education Funding Council for England, Scop is very wise to explore this idea now.