Everything going on in UK higher education
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Good morning. It's all about the money this morning following the Autumn Statement, the new inflation forecast and its implications for tuition fees and the exchange rate which looks increasingly costly for universities. The Welsh government is pressing ahead with much of the Diamond proposals on student finance and the Scottish government has confirmed the impending demise of the Scottish Funding Council. We round up what you might have missed on Wonkhe, all the other things going on and the rest of the week's HE agenda. Have a good one.

Mark Leach, Editor, Wonkhe

Autumn Statement jam

In a year of bad political and economic news for universities, the Autumn Statement finally brought some encouragement, to the tune of £4.7 billion over four years. Not £4.7 billion of reheated announcements, or tax credits, or loans, or spin. No, a real, tangible cash increase in the research and science budget, the largest such increase in any Parliament since 1979. The news agenda was dominated by measures for those 'Just About Managing' - or the JAMs (an official new acronym sponsored by Her Majesty's Government), and so you'd be forgiven for missing the news on Wednesday. 

The new spending, to be phased in over four years, will mean an extra £2 billion per year for the science and research budget by 2021, an increase of roughly a fifth. As befits the style of our new Chancellor, how the money is distributed will be determined less by the Treasury and more by UK Research and Innovation, currently chaired by Sir John Kingman (9, 2016 HE Power List), previously a top Treasury mandarin and whose fingerprints are all over this development. The question now is how the cash will split between the ‘research’ (i.e. universities) and ‘innovation’ (i.e. businesses) ends of UKRI. The Autumn Statement also introduced an Industrial Strategy Challenge Fund for some of the funding, and although the 'challenge-led' approach has been welcomed by the science community, it's still unclear how academic and business access will be balanced.

Ironically, Brexit has been the catalyst for this piece of good news, in two key ways. First, the vote to leave the EU led to the installation of a Prime Minister and Chancellor more amenable (than their predecessors) to spending for investment and making active interventions in the economy. Secondly, and perhaps most importantly, Brexit has led the Office for Budgetary Responsibility (and by extension, the Treasury) to conclude that George Osborne’s goal of eliminating the deficit by 2020-21 is completely impossible. I.e. if you’re going to have to borrow more anyway, why not go the whole hog and indulge in some much needed national investment. 

It is a testament to the sector's relentless lobbying efforts in this regard, that research and science are now seen as a valuable use of government funds, though of course carrying the expectation of an economic return on investment. And it goes without saying that the good news should be tempered when we remember how Brexit itself could severely damage science and research income all by itself. We could all be Just About Managing (or worse) in a few years time. Nonetheless, the Chancellor’s new approach and fiscal rules have given him some room for manoeuvre for tax and spending in future years, and so universities should continue to lobby for a slice of the ‘investment pie’ that may be forthcoming in an attempt to minimise any Brexit pain. 

On Wonkhe:

Policy Watch: Our first take on the Autumn Statement announcements relating to universities, science and research as they came in. 

Fees, TEF and inflation

Pity the poor folk at the Office for Budget Responsibility, who were left with the unenviable task of forecasting the health of the British economy for the next five years and, by extension, determined the fiscal room that the Treasury has to work with in planning the nation’s finances. As was widely reported on the day of the Autumn Statement, the OBR significantly downgraded the UK’s growth prospects for 2017 and 2018, but effectively reverted to their pre-Brexit forecasts for 2019 onwards. This is effectively an admission that they have absolutely no idea what might happen to the UK economy in the longer term but, then again, neither does anyone else.

However, a significant aspect of the OBR’s forecasts are predictions for inflation because of the impact on growth and the real value of government debt and spending. For universities, inflation will also determine fee levels. Last week saw a significant increase in the inflation forecasts compared to forecasts from before June’s referendum. This means that the 2.8% increase in fees in 2017-18 will not match the new forecast of 3.6% for RPI-X in Q1 of 2018 (the point in the forecast used by DfE in fees and TEF policy). It’s a difference of nearly 30%. In other words, in 2017-18, fees would be £72 higher per head if they were based on last week's forecast than on the March forecast which sector was previously planning around. Multiply by 15,000 undergraduates, and that's around £1 million in income to a university. The fluctuations in these forecasts really matter.

On Wonkhe:

We have used the latest OBR forecasts to project both the real and cash value of different fee caps over the coming years. The differences from the March numbers are significant-enough that the importance of the link between fees and TEF awards needs to be highlighted once again, as it becomes increasingly unlikely that many institutions could feasibly consider not taking part in the exercise. Inflation, TEF and tuition fees continue their complex dance.

Brexit means breakfast (and rising costs)

As everyone knows, the value of sterling dropped significantly since the referendum. It's been particularly bad news for Marmite lovers but great for foreign tourists coming to the UK. The drop in sterling helps exports, but the benefits for HE are currently reaped by international students paying lower fees and living costs than they previously planned for. Meanwhile, universities are facing major increases for some in-year costs: libraries are reporting cost increases of hundreds of thousands of pounds and IT departments are looking at contracts costs increasing by a fifth.

In the longer term, there will be pressure on the pay bill, currently just over half of all spending, as the national inflation figure creeps up and there are calls to maintain salaries' spending power. Universities’ capacity to cope with the in-year and longer-term price rises will depend on the slack in their budgets and capacity to cut costs elsewhere. But that will inevitably hit the student and staff experience. 

On Wonkhe:

Exchange rate starting to bite for university costs - Ant Bagshaw assesses another big financial challenge to UK HE that is already appearing at the Brexit table where it might be a bit more JAM than Marmite for UK HE after all. (Are we all toast? - Ed.)

Diamond presses on

As expected, all the major elements of the Diamond Review of student finance and funding in Wales were accepted by the Welsh government last week. This includes the abolition of the tuition fee grant, the universal £1,000 maintenance grant, the total maintenance support of grants and loans being based upon the National Living Wage, and the means-tested combination of grants and loans linked to household income. Support will be provided on a pro-rata basis for part-time students and will be available to all Welsh students regardless of where they study in the UK.

However, the upper threshold for the means-tested element of the maintenance grant will be £59,200 rather than the £81,000 suggested by Diamond, so more students will be taking out loans rather than grants. NUS Wales has criticised this move, despite broadly welcoming the Diamond reforms. It is still the most generous student support package in the UK, and Welsh students of all backgrounds will be able to access more cash in their pockets than any of their rest-of-UK peers. The ‘average’ Welsh student will receive approximately £7,000 in grant support, topped up with an additional maintenance loan to the maximum level of support around £9,100.

These headline reforms will be implemented by 2018-19, but the Welsh government has decided to pause and continue to consider other reforms proposed by Diamond, including the introduction of monthly maintenance payments, creating incentives for graduates to remain in Wales, and funding for Coleg Cymraeg Cenedlaethol. A consultation has been launched on the proposals which runs until 14th February. 

Delivering Diamond - Wonkhe and the Open University in Wales are hosting a free conference on the implications of Diamond Review proposals on the 7th December in Cardiff. Find out more and register here - space is now very limited, so don't delay. 

Scottish Funding Council endgame?

After a week or so of uncertainty, Scottish education minister John Swinney confirmed last Wednesday that the board of the Scottish Further and Higher Education Funding Council (SFC) will be merged into a new Scotland-wide statutory board that will oversee a range of hitherto independent organisations: Highlands and Island Enterprise (HIE), Scottish Enterprise (SE), Skills Development Scotland (SDS), and the SFC.

Swinney stated in the Scottish Parliament that “the overarching board will replace individual agency boards while retaining the separate legal status of each of the bodies,” and gave a “cast-iron commitment” that there would be “no government control of universities.” Quite how this arrangement will work is unclear, and no doubt there will be some anxiety for the staff at the SFC over the direction that a new board will take the organisation.

Shirley-Anne Somerville, the Scottish Minister for Further Education, Higher Education and Science, had to address an uneasy gathering of Universities Scotland last Tuesday evening, and stated that she was “aware of the unease within the universities” and that the Scottish government will “have to handle with great care the issues in connection with the board of the Scottish Funding Council in order to ensure that we can protect the independence of the university sector.” Neither Swinney nor Somerville has yet ruled out a minister chairing the new board, despite insisting that the sector will remain autonomous. 

You might also have missed on Wonkhe

Quality, compliance and international students doublespeak - Wonkhe's Mark Leach argues that the government looks increasingly likely to back away from its much maligned proposal for allowing only the "best" universities to recruit international students. Vice Chancellor of Nottingham Trent University makes the case for a social mobility league table - a recent suggestion of the Social Mobility Commission. Sarah Davies of Jisc argues that there are things we can learn from the olympics in designing the TEF, particularly the concept of 'marginal gains'. Joy Carter, vice chancellor of the University of Winchester and chair of GuildHE sets out a student charter for active citizenship. And to mark the 50th's True Crime on Campus, Registrarism returns to some of the greatest hits from the long-running series.

It was a vintage week for connoisseurs of the Wonkhe live blog: we were following the Autumn Statement developments live, you can also catch up with GuildHE's annual conference last week from our live blog of the event. On Friday, Wonkhe hosted an event on the renewed universities-schools agenda including much insightful debate ahead of the coming close to the government consultation - the live blog of the day's discussions can be found here

What else is going on?

New UUK President
Professor Janet Beer, vice chancellor of the University of Liverpool, has been elected the next President of UUK, seeing off a challenge from Paul Boyle of Leicester. Beer’s term of office will begin in August 2017 and her expected two years in the role will roughly parallel the Article 50 negotiation period as Brexit-proper begins. To say her task is daunting is somewhat of an understatement, and to be the chief spokesperson and lobbyist for a sector Theresa May doesn't like hearing from will never be an easy task. But Beer can't be bullied, and her forthright style is probably just what's needed in the difficult months ahead.

Needed: one working class hero
Much of the media was quick last week to mock students at St Hilda's College, Oxford who voted to install the new post of Class Liberation Officer. On the site, an alumna of St Hilda's Claire Lynch responds to the criticism and defends the decision as more important than ever

Liberal academic register
A new website in the US been launched by a conservative group which asks students to “expose and document” professors who “discriminate against conservative students, promote anti-American values and advance leftist propaganda in the classroom.” Professor Watchlist is a grim development and has been making waves on social media, re-igniting the debate about free speech on campus. The site already has profiles on many academics who are known to have opinions that the site opposes although there is a widespread move to sabotage the site by users uploading nonsense profiles. 

UUK / CASE Political Affairs Conference
Policy and public affairs wonks from universities will gather in Woburn House tomorrow for a day of debate and discussion about the sector’s role in public life. The event is themed ‘the new politics – influencing government in a changing landscape’, and delegates will no doubt be doing some hard thinking about universities adapt to a very different political environment to that at the beginning of the year. Wonkhe is supporting the event and will run a live blog throughout the day's discussions which you will be able to find here.

The rest of the week's HE agenda

Monday 28th November
  • NUS is launching a report into Jewish students' experiences, particularly regarding anti-Semitism.
  • Sheffield University Students' Union will be hosting an event on the future of higher education.
Tuesday 29th November
  • Universities UK and CASE are hosting a forum on Political Affairs in HE supported by Wonkhe in London.
  • IndependentHE has its Annual Conference.
  • Inside Government is hosting its 7th Annual Research and Development Conference on Utilising Research to Drive Growth.
  • The House of Commons Public Bill Committee for the Technical and Further Education Bill will meet at 9:25am and 2pm
  • ECU is hosting an event on ‘Connect, collaborate, share: building the equality community in HE’.
  • The Leadership Foundation is hosting its ‘East and South East Regional Event: Leading Change in Higher Education’.
  • HEA is hosting a workshop on ‘Growing your skills in Pedagogic Research’ in Yorkshire.
Wednesday 30th November
  • Jisc is hosting its research data network workshop.
  • The House of Commons Education Select Committee will discuss area reviews of post-16 education.
  • The House of Lords will debate the immigration regime for EU citizens following the UK's withdrawal from the European Union.
  • The House of Lords EU Home Affairs Sub-Committee will meet.
  • The Welsh Assembly Committee for Children, Young People and Education is meeting.
  • Inside Government is hosting an event on ‘Delivering Effective, Engaging Degree and Higher Apprenticeships’
  • The Hot Courses Group is hosting an International Student Recruitment Forum.
  • HEA is hosting a workshop on ‘Teach well: Embedding mental wellbeing in the curriculum’.
Thursday 1st December
  • Jisc is holding an event, ‘Reveal Digital: innovative library crowdfunding model for open access digital collections’.
  • The Department for Exiting the European Union is having its ‘question time’ in the morning.
  • The House of Commons Public Bill Committee will meet to discuss the Technical and Further Education Bill.
  • The Centre for Global Higher Education will host an event on whether governments should worry about graduate underemployment.
  • The Association for University Administrators will have its 2016 Development Conference and Annual Lecture.
  • SCONUL is hosting a library design awards and showcase in London.
Friday 2nd December
  • UCU is hosting its Annual Equality Conference and a conference for further education staff governors.
  • Jisc is launching its Northern Data Centre in Leeds.
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