Departmental Strategy

Five Year Strategy for Children and Learners

Chapter 8: Higher Education

Goal: Access to a world class higher education system for all those with the potential to benefit

1. Higher education is a national asset. Its research pushes back the frontiers of human knowledge and is the foundation of human progress. Its teaching educates and skills the nation for a knowledge - dominated age. It gives graduates both personal and intellectual fulfilment. Working with business, it powers the economy, and its graduates are crucial to the public services. Wide access to higher education makes for a more enlightened and socially just society.

2. British higher education is a success story. Drop-out rates are low: the completion rate from academic first degree courses is the fourth highest in the world.

3. More young people than ever before are getting the life-changing chance to go to university. 44 percent of 18-30 year-olds are now entering Higher Education, compared to 12 percent of 18-21 year-olds in 1980.21

4. The return to individuals from achieving a first degree is the highest in the world and has hardly changed as the number of graduates has grown.

5. And in research our universities punch well above their weight on the normal measures of output and impact, with only the US ahead of us. The sector is mature and confident, with strong independent institutions.

Issues and Challenges

6. But higher education faces challenges if it is to continue to develop into a 21st-century force for economic development and social change:

• It is vital to maintain and develop a clear focus on teaching quality, as student numbers increase. Teaching quality is still too variable; and we need to make sure, especially with the introduction of variable fees, that all students are getting a good deal from their university teaching.

• There is a real need to widen participation. The economy and society need more people benefiting from higher education - labour market forecasts show us that their skills will be in demand, particularly in the growing area of associate professional qualifications served by Foundation Degrees - but we also need to make sure that access is fair. Participation by young people has increased over 40 years from 1in 20 to 1 in 3,22 but with a stubborn gap between the higher and lower social classes.

• We must provide a fair system of student finance to support those who need it most in securing the benefits of higher education, and help universities bring in other revenue and build up endowments.

• It is vital that we sustain the excellent quality of our university research. The quality of research has increased over the last fifteen years, but we need to keep pace - countries such as China and India are fast developing competitive higher education systems.

• We need to build broader and deeper links between higher education and employers. Higher education contributes over £34 billion to our economy and supports over half a million jobs.23 These links need to cover the application of research to innovation and enterprise; the engagement of employers in expanding and developing new foundation degrees; and partnership between higher education and employers tomeet the ever-growing advanced skills needs in the workforce.

• To meet these challenges, we need to build the capacity of leaders in higher education to address the needs of varied stakeholders; to promote reforms to the system; and to help their institutions and the sector as a whole respond and evolve.

7. Working with, and through, higher education institutions themselves, our offer to individuals and employers will be:

Offer to individuals and employers

• High quality university courses with excellent teaching that bring real benefits to every student, both in terms of employability and personal development

• Access to university for those who have the potential to benefit, reaching out to those who might not otherwise consider university

• More and better flexible opportunities to study

• Better vocational Foundation Degrees designed with and for employers

• Grants for students that need them, an end to up-front fees for full-time students, and away for graduates to contribute to the cost of their course that is fair and affordable, together with more support for part-time routes

• World-leading university research, well funded and well managed, that keeps us as a leading edge nation - both economically and intellectually

• Well developed engagement between employers and higher education to boost economic performance, innovation and skills in the adult workforce

• Higher education that continues to encourage independent thinking, challenge, and engagement in society and community, and meets national needs

What this means in practice

8. The Higher Education White Paper set out our detailed strategy for addressing these challenges, especially by tackling under-funding and giving students and employers more choice and involvement, as well as giving more freedom to the sector itself. Wehave already begun to put our strategy intopractice.

High quality teaching and more personalisation

9. We must make sure that all students get the quality of teaching they deserve. Student choice and voice will be a major lever for further enhancements to teaching quality, particularly as we introduce variable fees. Higher education is already personalised insome ways, because of its focus on independent and self-directed study. There arealso more and more flexible routes and courses being developed to meet different needs and provide choice to young people, increasingly using ICT both to support for flexible delivery and more flexible study.

10. But there also needs to be clarity about the teaching and learning practices and standards students have a right to expect. The new Higher Education Academy's forthcoming framework of professional standards for teaching in Higher Education will support teachers in meeting the needs of 'lifelong learners', developing new and varied modes oflearning. All new teaching staff will receive training to meet the standards by 2006.

11. The use of Progress Files and Personal Development Planning enables the individual learner to reflect upon their own learning, performance and achievement and to plan fortheir personal, educational and career development.

12. We also need to be clear about the value placed on teaching - university teaching should be seen as just as valuable as university research. We are creating Centres for Excellence in Teaching and Learning whichwill reward institutions with astrength inteaching. The Higher Education Funding Council for England (HEFCE) published the outcome of the first round of bids in June. 106bids are going through to stage two (of which 24 are collaborations between institutions). The first Centres will befunded byMarch 2005.

Widening participation

13. We must also make sure that in time everyone who has the potential to benefit hasthe chance of higher education, and that access to higher education is fair. We will:

• provide more support to those who would otherwise be deterred from entering university on financial grounds by restoring the maintenance grant for the least well off students and ensuring that universities channel some tuition fee income into bursaries, giving £3,000 a year of support to the students that need it most from 2006;

• continue, through HEFCE, to use the Widening Participation allocation to help universities support students from non-traditional backgrounds;

• give more generous support than ever before to part-time students, to help encourage both supply and demand formore flexible ways of studying;

• ensure, through Access Agreements and the Office for Fair Access, that universities that decide to charge higher tuition fees arealso reaching out to young people in schools and colleges which have not traditionally sent students to university, andmaking active efforts to attract and support these people.

A fair funding system

14. The move to variable fees will mean that the benefit higher education brings to graduates is better recognised; and will bring much needed additional revenue to higher education.

15. We have worked hard to make sure that our new system for making contributions is fair and reasonable, with no graduate asked to contribute until they are earning at least £15,000 a year, and contributions varying according to income. In addition, any outstanding contributions owing after 25 years will be waived.

16. We believe that variable fees will also play an important part in driving up quality in the system, making student choice a much more powerful force, and allowing institutions to reap rewards for offering courses that are popular and serve students well.

17. Variable fees give universities themselves much greater choice and control over the funding they raise, and should encourage them to focus still more closely on the needs of their students. An Independent Commission will review the first three years' operation of variable fees and consider their impact on both students and institutions. The Commission will report direct to Parliament in 2009. We have also announced that Sir Alan Langlands will report by mid-2005 on how the public sector and professions can sustain and improve recruitment opportunities for graduates, especially those who do not qualify for financial support.

18. The recent report by Professor Eric Thomas highlighted the significant opportunities available to universities, as registered charities, to seek donations from alumni and others for scholarships, buildings, new posts, endowments and other purposes; and how much further our universities need togo if they are to stand comparison with USuniversities (including state - funded US universities) in fundraising. We believe that thedevelopment of new independent sources of charitable and philanthropic income is a high priority for our universities, and will respond formally to Professor Thomas's reportlater in the year.

Maintaining and developing our research excellence

19. Research activity is valuable for many reasons - for the intellectual well-being of the nation, for improving health, underpinning the development of social policy, and for helping us understand the past, interpret the present and plan for the future. But it also makes a massive economic contribution.

20. We will continue to focus our funding on the best researchers - funding good quality research and giving premium funding to institutions and departments which are world-class to help them lead our system.

21. But we will also make sure that there are ways for promising new research teams to develop and improve. Additional funding of £5 million from 2004-05 will benefit 62 institutions to support the staff development of their promising researchers. The Capability funding of £118 million to support emerging research in less well established disciplines will also continue.

22. We will make sure that we continue to support the Government's overall strategy of developing the sustainability and excellence of the UK science and research base. Spending on science and research in 2005-06 will have increased by £1.25 billion a year compared to 2002-03 - around 30 percent in real terms.

23. We believe that there is increasing value in research collaboration between institutions, departments and research teams. Well conceived collaboration can help us maintain asystem able to compete with the best in the world, sustain provision in subjects and fields of study of strategic importance, strengthen emerging disciplines and support economic growth in the regions.

Better partnerships between universities and employers

24. Engagement between higher education and employers across a broad front is critical. We know that, though our research capability is very strong, our capacity for innovation does not always match it. The Lambert Review of links between higher education and business made clear that universities and businesses could each do more to work with the other. At their best, these links are highly interactive, with each partner well aware of what the other can offer, and what their needs are. A full Government response to the Lambert Review is being issued within the ten year investment framework for science and innovation.        

25. The Higher Education Innovation Fund (HEIF) draws together support for reach out from higher education to business and the community. Funds are awarded to support universities and colleges, increasing their capability to respond to the needs of business, public services and the wider community, and to transfer knowledge. The second round of HEIF sees investment rising to a total of £187 million over the period 2004-06. 124 awards have recently been made to universities and colleges across England.

26. A network of 22 new centres for Knowledge Exchange activity are included in the HEIF funding. The centres will provide specialised shared services for business and community partners and will be exemplars of good practice. It is expected that funding for the centres will then continue for a further three years

27. Links developed to support applied research and innovation are only part of the picture. We know that we need more skilled graduates in the economy. Forecasts by the Institute for Employment Research show that of the 13.5 million total jobs expected to be filled by 2012, 50 percent - or 6.8 million - are in occupations most likely to demand graduates. 24 Almost half of these jobs will be at associate professional and higher technician level - best served through effective vocational degree programmes.

More choice and partnership with employers: Expansion of Foundation Degrees

28. As we continue to make progress towards 50 percent of young people having the chance to go to university, our drive to expand Foundation Degrees will be important. Foundation Degrees help strengthen links between universities and employers, as employers take an increasingly active role in the development and delivery of courses, both to meet the needs of existing employees and potential recruits. They are often studied part-time in flexible ways. Studied full-time they normally take two years to complete.

29. Numbers of Foundation Degree students have grown from 12,000 in 2002/03 to 24,000 in 2003/04, and the number of applicants for full-time Foundation Degree places for September 2004 is up by 50 percent on the same point last year.25 We are supporting the growth of Foundation Degrees by making 10,000 extra funded places available to institutions for these degrees over the next two years, and we expect this expansion to continue.

30. Better higher education-employer links, with advice from the Sector Skills Councils, will encourage the expansion of higher education's role as a key provider of high level skills training and continuous professional development, including taught postgraduate degrees.

Case Study

Foundation Degree in Construction Engineering, Kingston University

The two-year Foundation Degree gives individuals a chance to gain a 'fast-track' preparation for industry, with the option to'top-up' to BEng (Hons) level via further study.

Student Jason Bale (20) is working for the award-winning civil engineering company Edmund Nuttall. He is getting paid while he learns. The balance between study and practice is proving to be successful - Jason said "The course is very good at providing you with a balance of practical and academic knowledge, which you get the opportunity to put into practice on site."

Jason also feels that this course has given his career a head start. Nuttall's is offering him support during his studies, paying his course fees, giving him time off, and will continue to employ him after graduation.

Edmund Nuttall is involved with the Foundation Degree at Kingston University. Their director of human resources Graham Medcroft believes there is a close correlation between education, training and staff retention. "If workers feel they have a formal career path and that their employer is interested in them, then they'll stick with the firm," he said. "We have 150 people doing degree-level qualifications, including the Foundation Degree at Kingston. Early indications show that the Foundation Degree is a good course."

Changing the system to deliver our reforms

Autonomy and freedom

31. The higher education system is already more autonomous than other education and skills sectors. Universities are less heavily dependent on state funding (on average) than other institutions; there is a strong element of self-regulation, for example on quality; institutions' fees and charges are deregulated except for undergraduate study; and decisions on mission, provision of courses and the curriculum are very largely left to higher education providers themselves. The Government's reforms enacted in the Higher Education Act 2004 introduce new safeguards for potential students and students in the form of the Office for Fair Access, and the Office of the Independent Adjudicator to deal with student complaints. But there is still room for development of the system.

Student voice and choice as a driver for reform

32. The move to variable fees has been a major system change that will help deliver reform through the power it gives to student choice, and the responsibility it places on providers to respond to that choice as they benefit from increased fee income from a broader funding base. But choices need to be informed, so we will support students with high quality information on teaching quality, student progress and employment and salary outcomes across subjects by each institution by 2005 at the latest. The first national survey of students' views about the quality of their courses will take place in 2005, and the results will be published in a clear and accessible form, to help other prospective students to make choices which are right for them.

33. We will also publish summaries of external examiners' reports, which will contribute to the public picture of the standards reached in different universities. We will work with higher education and the sector bodies to explore the most useful and efficient means of publicising this information, including through the Teaching Quality Information website and publishing it in their prospectuses.

University funding to match new patterns of study

34. As patterns of study develop and change it is important that the funding system reflects this. The Higher Education Funding Council is reviewing university funding. One of the aims of the review will be to ensure that actual costs of all types of courses - including distance learning, part-time and workplace learning - are all reflected in the funding method for teaching.

Reducing bureaucracy and improving accountability

35. Maintaining and increasing the independence and autonomy of universities remains a core goal, of which changed funding arrangements are a part. Right across government, we will try to ensure that institutions do not face duplicate or inconsistent demands from the many departments and agencies with whom they deal. The Higher Education Regulatory Review group set up in June 2004 to challenge existing and new regulatory requirements imposed on higher education will spur on this effort. We will also be looking to make accountability and inspection requirements increasingly proportionate to the potential risks in particular institutions or activities, with the general aim of reducing and removing these burdens wherever possible.

Partnerships in support of progression

36. We need to support widening participation and improve the flow of students with non-traditional backgrounds or vocational qualifications into higher education. 9 out of 10 young people with two or more A-levels enter higher education by the age of 21, compared with 50 percent of those with vocational qualifications at Level 3.26 Addressing this means more intensive co-operation between further education colleges and providers of higher education.

37. Around 10 percent of higher education is already delivered through further education colleges. Many Foundation Degrees are offered through colleges, and the work described in the last chapter to drive up standards in further education will be critical to their success.

38. Proposals for Lifelong Learning Networks will engage area and regional providers and forge links to sector skills councils and Regional Development Agencies. They aim to bring coherence and clarity for students; offer individualised learning plans and choices, including choices between continuous study and modular approaches; and make it easier for students to move between courses and institutions in pursuit of their personal learning goals.

Collaboration to promote diversity, excellence and student choice

39. As higher education becomes more diverse - in terms of the courses on offer and students included - there will also be more pressure for collaboration, so that individual institutions can specialise, playing to their strengths and safeguarding excellence. Collaborations may entail informal alliances such as the Lifelong Learning Networks mentioned above; joint courses offered; individual disciplines, credit transfer arrangements; dual or multiple accreditation; collaborative research, whether pure or applied; and so on. Or they may develop into more formal cooperation and even merger.

Improving leadership and management capacity

40. In a complex and demanding system, characterised by a wide range of customer and stakeholder needs, it will be increasingly important to have highly skilled leaders and managers in our universities.

41. The new Leadership Foundation will help the sector to strengthen its leadership and management, investing in the leaders of tomorrow as well as those of today. Its vision of UK higher education leadership as world class and held in high esteem will have a pivotal role to play in this - by developing and commissioning high quality development programmes and championing examples of excellent leadership

Timetable for Change

Taken together, our reforms mean that:

Now, in 2004:

• More people, young and old, are getting the life-changing chance to go to university than ever before

• The quality of our research is outstanding - second only to the US

• We have very low drop-out rates, and very high rates of return to degrees

• Higher education makes a massive contribution to our economy and to the well-being of society and communities

By 2008:

• We will have increased participation towards the target of 50 percent of those aged 18-30 entering higher education by 2010, mainly through the expansion of work-related, employer-led Foundation Degrees

• Higher education will be benefiting from a new funding stream, over which institutions have control, as a result of variable fees

• We will be beginning to notice results in terms of employer satisfaction with the levels of skill in the workforce with experience of higher education, especially at intermediate and higher levels

• We will have made significant progress towards fairer access

• Our drop-out rate will continue to be low - and there will be fewer institutions with unacceptably high drop-out rates

• We will be retaining and strengthening our world - class position in research with further investment and steps towards collaboration

• All new teaching staff will receive training to meet professional standards and many existing teaching staff will also have taken up the offer

Our Long Term Aim:

• Young people from all backgrounds aspire equally to go to university, and those with the potential to benefit have the opportunity to do so

• Participation increased towards 50 percent of those aged 18-30 by 2010

• Our research position enhanced through further investment and our universities involved in national and international collaborations addressing the biggest global challenges

• Many more employers working with universities to innovate and apply new technology

• Higher education delivering graduates with the skills and knowledge that the economy needs from a variety of courses, including well - recognised employer-led higher vocational qualifications

• Students making well-informed choices about universities and courses, and receiving excellent teaching wherever theygo

• Higher education financially strong, benefiting from varied funding streams involving the state, voluntary and private sectors

• Higher education continuing to challenge, stimulate independent thinking, and be a positive force for social change - globally, nationally and at local level

21Provisional Higher Education Initial Participation Rate 02/03 - Source: DfES (2004) Statistical First Release 07/2004; and Great Britain, Age Participation Index, DfES.

22Great Britain, Age Participation Index. Source: DfES, Dearing Report.

23Universities UK (June 2002) The impact of higher education institutions on the UK economy.

24Institute for Employment Research (January 2004) Working Futures: New Projections of Occupational Employment by Sector and Region, 2002-2012.

25Numbers of Foundation Degree students from HEFCE. Applicant figures from UCAS, Press Release, 29 April 2004.

26DfES, Youth Cohort Survey, Cohort 8.

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