DfE pushes for graduate earnings metric and franchising squeeze

Westminster government plans for graduate earnings data to be used in the English regulator’s quality metrics – and potentially in setting student number caps – have provoked sector concern, as moves to tighten franchising oversight after high-profile criticism receive a mixed reception.

While the government courted headlines with a crackdown on “rip-off” degrees via student number controls on courses falling below Office for Students quality thresholds, its response to the higher education reform consultation also said that the Department for Education would “ask the OfS to consider how they can take graduate earnings into account in [its] quality regime”, which would mean earnings figures potentially triggering OfS investigations and determining which courses have numbers capped.

Universities have long cautioned about the context needed around the government’s Longitudinal Education Outcomes dataset, showing graduate earnings by course and institution.

“Graduate earnings are not an accurate measure of university quality: there are far too many external factors at play, such as local jobs markets or earning disparities across different sectors,” said Vanessa Wilson, chief executive of the University Alliance.

“There is a risk that a small number of genuinely high-quality courses could come under investigation if earnings data were used as a quality measure, wasting the time and resource of the regulator and drawing the institution’s resources away from delivering for students.”

The DfE consultation response acknowledges that “many factors influence graduate earnings”, but says “students have a right to expect that higher education will lead to improved employment opportunities and commensurate earnings”.

Chris Millward, former director of fair access at the OfS, now professor of practice in education policy at the University of Birmingham, said “robust and contextualised salary data has been available for some time”, so it was “not surprising that the government should be interested in exploring how it could inform other regulatory activity”.

But he added that “context and use of judgement” from the OfS in using this data would be crucial “if a breach of the B3 [quality] condition restricts admissions through number controls”.

He went on: “There could also be challenging questions about the extent to which earnings can reflect quality, as defined in the 2017 [Higher Education and Research] Act, particularly if their use is tested in court.”

GuildHE chief executive Gordon McKenzie said: “Basically, I think it’s unlikely to mean much because I think the practicalities of trying to use it [deciding whether to use raw data or how to adjust the data] will lead OfS and ministers, of whatever party, to conclude that it adds nothing, it doesn’t work.”

Meanwhile, on franchising – in which a university subcontracts the delivery of a course to another provider – the DfE said it planned to “work with the OfS to make clearer our expectations of providers in these arrangements and to ensure that the oversight of franchised provision by lead providers is robust and effective”, and would “closely consider whether we should take action to impose additional controls, in particular regarding the delivery of franchised provision by organisations that are not directly regulated by any regulatory body”.

The spotlight was turned on the quality of franchised provision delivered by small private colleges outside OfS regulation by a recent New York Times article looking at Slough-based Oxford Business College, which offers degrees from Buckinghamshire New University, the University of West London and Ravensbourne University London.

Iain Mansfield, a former adviser in the DfE, now head of education at the Policy Exchange thinktank, said: “The government is right to raise concerns about the quality of franchised courses – another area where low value provision has grown rapidly.”

He said the move “raises the stakes” for the OfS, “yet to complete a quality investigation, over a year since the first were announced”.

Diana Beech, chief executive of London Higher, said there was “a concern that these regulations may be implemented in a manner that adds to the significant regulatory burden that higher education providers already experience. Therefore, we would make the case for a proportionate and risk-based approach in this area.”

Professor Millward said the move sounded like “straightforward tidying up of gaps in regulatory oversight, which is important if this way of expanding higher education is to sustain confidence and grow”.

john.morgan@timeshighereducation.com