Tough new reforms proposed by the Department for Education would
tighten controls on university franchising arrangements in
England to safeguard public money and shore up the reputation of
our world class higher education sector.
Franchising enables universities to subcontract courses to
external providers. When done right, it makes it easier for more
students to access higher education, especially in areas where
options are limited, or when people such as mature students are
balancing study around work and life.
The number of students studying at franchised providers has more
than doubled in recent years, with over 130,000 using their
services. But an investigation by the National Audit Office (NAO)
raised concerns about franchising arrangements, with fraud in the
sector costing the public purse £2m in
2022/23.
More than half of 341 franchised institutions are currently
unregistered with the Office for Students (OfS), meaning they are
not directly regulated. In some cases, students are offered
poor-quality courses that fail to justify their cost, showing a
clear need for reform.
Under new government plans published for consultation today (30
January), delivery partners with 300 or more students would be
required to register with the OfS to ensure their courses meet
rigorous quality standards, in order to be eligible to access to
student finance.
If the OfS finds that a provider is not meeting the standards
required of registered providers, they will be publicly held to
account and could risk facing fines and the suspension of their
registration, in the most extreme circumstances. The OfS will
also publish student outcome data for all subcontracted
partnerships every year.
The move comes ahead of a significant package of higher education
reforms due to be announced this summer that will put students
first and cement universities' status as engines of growth in
their communities, as the government delivers its Plan for Change
to drive economic growth and raise living
standards.
Education Secretary
said:
“We are committed to cracking down on rogue operators who
misuse public money and damage the reputation of our world-class
universities.
“Franchising can be a valuable tool to widen access to higher
education, and these proposals will ensure students can trust the
quality of their courses, no matter where or how they choose to
study.
"The credibility of our universities is at stake, but these
proposals seek to protect students and safeguard taxpayer's
money, as part of our work to drive growth through our Plan for
Change.”
Franchising allows courses to be adapted to suit different needs
and circumstances. It also helps colleges and universities work
more closely together and gives new, innovative education
providers a chance to get started.
Providers such as London South Bank University, which partners
with some of the city's top NHS teaching Trusts to help students'
studying midwifery and other front-line services, demonstrate the
real-world benefits of franchising – with students achieving
their qualifications alongside invaluable workplace experience,
helping to address the critical shortage of healthcare
professionals.
Universities and colleges whose names and brands are being used
by franchises will remain responsible for ensuring their
subcontracted arrangements meet quality and standards
requirements. New regulations could come into effect as soon as
spring next year, depending on the outcome of the
consultation.
These reforms would protect the high standards of the UK's higher
education sector, which contributes around £265bn to the UK
economy, ensuring it continues to drive economic growth and
benefit both students and the wider economy.
These proposals would strengthen the OfS's ability to protect the
public money that goes into franchising. The consultation aligns
with the OfS's work to strengthen conditions of registration
related to governance and student
interests.
The OfS will shortly be consulting on changes to requirements for
providers that wish to join its register to ensure they are all
managed and governed effectively.
The OfS has currently paused registration of new higher education
providers to support the sector with financial sustainability
concerns, after finding 72 per cent of providers could be
operating in deficit by next year.
They expect the pause to stay in place until August 2025 but will
review the decision every three months, meaning the registration
process should be open again by the time the government's
proposed changes would take effect.
The Department for Education's consultation will be open from 30
January to 4 April 2024. After the consultation closes, the
Department for Education will review the responses and aims to
publish its official response in the
summer.
