Given the demands of the current crisis and response to
COVID-19, and the need for governments to prioritise expenditure on healthcare
and income support, higher education has been nowhere near any government’s
priority list.
But a crisis in higher education is emerging, particularly in
English-speaking countries. For decades now, demand for tertiary education from
rapidly developing countries – most notably China – has fuelled an enormous
growth in the sector. It is well-recorded that the UK has done exceedingly well
in this market. Many universities now rely on this income to fund a large part of their activities. In the space of three
months, this income has all but entirely dried-up. Higher education is counter-cyclical,
so there may be some uptick in domestic students to make-up a small proportion
of the income from international students. The impacts on universities will be
highly differentiated as well – some have fostered strong local, domestic
student markets so may be more resilient; others, particularly some of our most
prestigious institutions, are probably looking at not being a going concern in
a matter of months as their cash-flow dries up and they’re left with only enough to
pay three months redundancy.
The HE sector in the UK itself is highly differentiated as
well, and this often gets hidden in debates (including with ongoing industrial
disputes in the sector). Indeed, higher education policy is probably one of the
areas where there is the starkest difference between the four nations and
regions of the UK. Therefore there is a need for analysis to be differentiated and reflect the different decisions by the devolved administrations.
It is easy to blame the current situation on my mate Neil
Librul. The hens of market logics have come home to roost. If a company’s
market vanishes it goes bust. This is capitalism in action. However, because I’ve
used discourse analysis in my research to critique neo-liberalism, I do not
like using it as a catch-all thing to blame as that disguises who is implementing neo-liberal policy
decisions, why and how. So that is what I want to do in the blog post.
One of the things that sets Scottish higher education policy
apart is that, seemingly, the government explicitly rejects neo-liberal logics
that higher education is an individual asset that can be purchased as an
investment through a loan. Through its flagship policy of “free” higher
education it publicly proclaims higher education is a public good. A former
First Minister put a stone in the grounds of one of our HEIs to proclaim this
very point.
However, I want to suggest that there is an emerging crisis in
Scottish higher education because the Scottish Government has never fully
funded its commitment to a public education. Indeed, in the operation of its
policies it has pushed HEIs towards a market logic. To do this argument
justice, I would need a barrage of links to old newspaper articles; SFC reports
and university accounts. Frankly, I don’t have the time to do this as in my job
I’m trying to stop the crisis in a Scottish
university having a massive detrimental impact on the institution. If you want
something like that, get a copy of Andrew McGettigan’s The
Great University Gamble. Although it focuses on England, most of it
also applies to Scotland; the only difference in Scotland is that we still have
money coming into universities from the Scottish Funding Council paying for
some tuition.
Of course, hair-splitters will point out that higher
education was only not “free” in Scotland in a brief period between 1997 and
2001. After that, the up-front fees of just over £1000 were replaced by the “Graduate Endownment”
that was tacked onto your student loan when you graduated. When the SNP won the
2007 Scottish elections and formed their first minority government they vowed
to make higher education free and even abolish this fee. So, we have the
totemic social democratic policy of “free higher education” in Scotland.
As many analysts and organisations such as the NUS in
Scotland have pointed out though, this has led to particular quirks in the
system. To fund the fees, student grants have steadily been eroded and replaced
by loans to pay for maintenance, so that we end up with the odd situation that
students in Scotland who come from homes with the lowest household incomes end
up with the highest levels of graduate debt.
However, to go back to my core point, the fees policy itself
has never been properly fully-funded. I first became aware of this when I was
a PhD researcher in 2009 and the Scottish Government first started shuffling
the cards to deliver the student numbers they wanted without the bill becoming out-of-hand – they shifted what
subjects were in what funding bands, and reduced funding for degrees in the
lowest bands (art, humanities and social sciences). When I got my first
academic job in 2011, the Scottish Government were effectively only funding
three years of the four years of a Scottish undergraduate degree. The idea had
been that further education colleges would increasingly deliver the first two
years on the cheap through HNCs and HNDs and there’d be growing second and
third-year entries to Scottish universities. From what I know of the sector,
experience of this has been patchy. Also, the “free higher education” policy
was paid for by halving the budget for further education, amalgamating colleges
in regional mega-colleges, and drastically reducing provision to highly
gendered vocational qualifications in a limited range of industries. And then
until this financial year, for a number of years universities have had a
flat-cash settlement for the teaching grant and research quality grant from the
Scottish Funding Council.
Now, I do have some sympathy for the Scottish Government on
some of this. Until the recently increased powers over taxation, it was limited
by the funding envelope provided by the Barnett formula. It was having to make
difficult choices about what areas to fund and what areas to de-fund. Actually,
compared to further education, policing, fire and rescue and local authorities,
higher education in Scotland has not done too badly. We’ve not seen the wincingly
painful cuts they experienced. And I know this personally from living with a
local government officer and seeing the struggle he has to get basic things
done because the resources simply are not there. But then again, the Scottish
Government could have made painful policy choices in 2011 when they won their
majority, such as to completely reform local government finance, getting rid of the
Council Tax, and creating a new local tax that could have brought billions into
the public sector creating more fiscal leeway. But we are where we are.
Because of this situation, of an underfunded principle
policy commitment, Principals and governing bodies of Scottish universities
have been forced to make a choice: stick to a flat-cash income from the
Scottish Funding Council and watch your university slowly wither away as it
loses staff through voluntary severance and natural wastage as staff costs increase, and buildings and equipment fall into disrepair;
or make riskier investment decisions in the hope than the return on these is
high and allows you to expand. This latter choice of expansion is the policy agenda of the
Scottish Government. It needs growing universities to: educate growing numbers of
Scottish undergraduates as it seeks to meet its own targets for improving
education equality; to invest in regional research and development; to bring in
export income; and to be Scotland in
international markets.
So we’re left with universities that have aggressively
expanded into international higher education markets to pay for new staff,
shiny new buildings and equipment, fantastic library resources and who are now
horribly exposed as income from international students falls off a cliff. And
students from Scotland will suffer because of this, as universities are forced
to make staff redundant so class sizes increase and as very basic services like
libraries and IT are curtailed to make budget savings.
I’ve tried to be measured about writing this and
thinking this through, but I’m not. I’m angry. I’m angry and frustrated that the
Scottish Government have pushed universities into this situation. Its made me
angry during our current industrial disputes. We’re meant to be angry at our
management, but I’m not. I can see why they made the decisions they made. I’m
angry at the Scottish Government. And both my trade union and the employers
have both been told, explicitly, by the current Higher Education Minister in
Scotland that if the sector needs more money then it has to raise it itself
through attracting in international students. The Scottish Government want a world-class higher education sector, but the money is not there.
As I wrote at the start of this post, the current COVID-19 crisis is
bringing this into stark relief. Some Scottish institutions will be just as
exposed as those in England. So, what to do? This is interesting as higher
education in Scotland is such a totemic part of our national identity that the
government portrays on an international stage – Scotland had more
universities than England until the late nineteenth-century. Higher education
is what Scotland does. Therefore, I
cannot see the Scottish Government allowing an institution to go bankrupt and a
reduction in the number of HEIs through forced mergers (a proposed 2011 merger between Abertay and Dundee never happened). There is also the unquestioned assumption that
a Scottish undergraduate degree is four years. Woe betide the Scottish HE
minister who suggests that a Scottish degree should only be as long as it’s
actually funded for. To clarify, I think the four-year degree is a good thing; I only wish it were funded.
There was going to be a small
real terms uplift in funding from the Scottish Funding Council for
universities in Scotland this year anyway. Given the counter-cyclical nature of
higher education, the Scottish Government could
just chuck more grant income into the sector and hope for the best. Yet for
some institutions this will only be pennies compared to what they will need
because of the gaping hole from international student income. However, the
economic collapse due to COVID-19 might put an almighty hole in the Scottish
Government’s budget as income from devolved taxes falls. It remains to be seen
whether Barnett Consequentials from UK Government expenditure will be enough to
make up the shortfall, or if the Scottish Government’s limited borrowing powers
are enough to tide it over until tax income increases again.
But why are we even talking about institutions going bust?
Well, that’s the odd quirk of the British higher education system that, due to
historical quirk and the demand for academic freedom, our universities are
private charitable companies and governed as such. They just happen to get the
majority of their income from government. I’m on the board of a similar
organisation, so I know well the odd pressures it put on the governing body. On
the one hand, you want to deliver a public service, but on the other, you’re
subject to company law and have to ensure every year that you are a financial
going concern. You have to borrow from commercial money markets, with all the limits
that entails.
Which, oddly, brings us to another policy option that would
be a sort of radical status quo – turn HEIs into public sector institutions, as they
are in many European countries. Government agencies that shadow each HEI could
be created and staffed TUPEd across. The charitable companies that are left,
with their liabilities could be wound down over time. Academics and all
university staff would become civil servants. The sector would become wholly
dependent on the whim of government policy, rather than be subject to the “freedom”
of the market.
I happen to know that crisis talks between representatives
of Scottish HEIs, the trades unions, the Scottish Funding Council and Scottish
Government are ongoing. And this is a crisis. There needs to be a policy
resolution to the crisis in Scottish universities in the next few months
otherwise there will be mass redundancies, massive reductions in investment in
research infrastructure, and if the “market doesn’t correct” quickly then HEIs
will be forced into the decisions their public sector cousins have been forced
to make since 2013: cutting even essential functions just to keep some
lecturing staff in the classroom; a fire-sale of buildings and land and an end
to pretty much all ongoing investment in infrastructure. Yes, the Principals of
Scottish universities have made risky, market-based decisions, that have led
them into this situation, but as far as I am concerned, this is because an
underfunded Scottish Government policy has left them with no other choice.