Under review

I have blogged on the PM's post-18 education review for the Sutton Trust and Public Finance.

It was 16 months before the 1997 election and Conservative education secretary Gillian Shephard had a problem. It was a time of austerity. University intakes were growing rapidly. New ways had to be found to fund higher education that didn’t simply involve the taxpayer.

So she approached David Blunkett, her Labour shadow for whom I then worked to support her in setting up a review – with explicit backing from Don Foster for the Liberal Democrats – under the late Ron Dearing. The review would report after the general election and would be wide-ranging in its outlook. But it is remembered for one thing: it led to the introduction by the new Labour government of tuition fees paid by students (then opposed by the Conservatives and Liberal Democrats).

In 1998, the decision was also taken to convert all maintenance grants to loans (some had already been converted), but to means-test fees. Those who faced new fees also got higher interest-free loans repaid after graduation for those earning over £10,000 a year.

Since the Dearing review, we have had other big changes to the system. In 2006, fees were increased to a maximum of £3000 – after a big argument in the Labour Party against variable fees that led to the plans almost being defeated – and income contingent loans were explicitly available for fees. By then, Scotland had already abandoned fees. Means-tested maintenance grants were reintroduced and the repayment threshold was raised to £15,000.

Peter Mandelson set up the Browne Review in 2009, which reported to the coalition government after the 2010 election. It led to a £9000 fee maximum and no more variability in reality than the 2006 reforms despite the government saying it expected many students to pay just £6000. Repayments now started at £21,000 – a hugely expensive concession to the Liberal Democrats that ensured that many loans would never be repaid – and a real rate of interest was introduced that would only start to bite when inflation picked up more recently. Tinkering since then has seen maintenance grants scrapped and – at a cost of £3 billion a year – the barely noticed raising of the threshold to £25,000.

That’s the background to the latest review announced by Theresa May on Monday. But the background also includes rising student numbers – touching the 50% of young adults entering higher education by age 30 target set by Tony Blair in 1999 – and some narrowing of the access gap between disadvantaged and better off students. Perhaps more importantly, the political backdrop includes a popular pledge by Jeremy Corbyn to scrap fees that undoubtedly helped win seats like Canterbury and Reading East for Labour at last year’s election. So rather than seeking cross-party consensus, this review is more about neutralising a perceived party disadvantage.

But the confused history of fees is reflected in the confused nature of the review. A bizarre flurry of weekend briefing – propped up by the Secretary of State in his first TV interview on Marr – suggested that a key outcome of the review might be universities charging more for courses in expensive STEM subjects and less in humanities. Given the importance of STEM subjects to the economy this could perversely discourage students from doing those subjects and cold harm social mobility by encouraging poorer students to take cheaper courses. One can only assume its intention was to distract attention from reports that fees would fall to £6,000 a year, which ministers feared would raise expectations that might not be realised.

And the review has not exactly had an auspicious start. It is good that it is looking at the too often overlooked FE sector and at the paucity of apprenticeship options – barely 10,000 young people a year start higher or degree apprenticeships compared with 330,000 freshers at university – but it will be vital that the review panel feels able to take a hard look at the whole funding system and the interaction between different levers.

Modelling by London Economics for the Sutton Trust in November showed that it would cost about £1 billion to restore maintenance grants. It was a mistake to remove them, even if students got higher loans, and this should be the first priority for the panel. Then if the committee wants to look at fees and variability, they should be varied according to family income not the cost of the course. A model that would reduce average fees to £3,500 a year could – with restored maintenance grants – reduce debts for the 40% poorest students from over £50,000 to £12,700 and increase the proportion of loans repaid from 55% to 65%. The total cost of this would be up to £3 billion – about the same as the threshold change announced last October. Less radical means testing could cost less. There is also a need to get better value from the £800 million a year that universities spend on access and outreach in England, building a reliable evidence base on what works. But the priority should be leveraging this existing money to achieve better outcomes for young people from disadvantaged backgrounds, rather than to risk stalling progress with cuts.

And then the review should take a long hard look at what’s on offer for those who go don’t go to university. For all the words about apprenticeships, the brutal reality is that less than a third of those taking higher apprenticeships are aged under 25 (let along being 18 or 19). Most apprenticeships for young people are limited level 2 programmes with few career prospects and patchy progression to higher levels. If anything, the apprenticeships levy is reinforcing a bias towards adults doing higher apprenticeships as the levy lacks the levers to prevent it being used simply to upskill existing staff. Addressing that issue and the quality of technical and paraprofessional education in colleges is as important to social mobility as changing the funding of higher education.

This week’s review may have had a pretty inauspicious start. But as the panel deliberates over the next year they have the chance to make a real difference to social mobility – if they get their priorities right.

Ministerial mobility

I blogged at the Sutton Trust on what the reshuffle means for education and social mobility.

Reshuffles are a funny – and brutal – business. For Prime Ministers, they rarely go according to plan, and this week’s was no exception. I’ve been in both the education department and at no. 10 while they have been happening, and seen the drama at first hand. For individual ministers, they may be a personal success – or tragedy. But for the general public, who would be hard placed to name more than a handful of cabinet ministers, any impact is a lot less than those in the Westminster bubble imagine.

Yet they can also tell us a lot about the direction of government, and the choices of minister can make a big difference to how particular issues are treated. That’s as true for social mobility as for any other issue.

Justine Greening has been a doughty champion of social mobility as education secretary, reflecting her own journey to become the first Conservative education secretary to be educated at a comprehensive. Her social mobility plan allowed her finally to define the issue on her own terms – away from the noises off about grammar and faith schools that dominated the pre-election discourse – and it was generally well-received. To explain her refusal to accept a sideways move to welfare secretary, Greening cited her commitment to social mobility, believing that she could do more for the cause (particularly the role of education) from the backbenches.

Her successor, Damian Hinds, has no silver spoon in his mouth either, but is more representative of the grammar school educated politicians who have played a much more prominent role in Theresa May’s cabinets than those of David Cameron. Hinds championed social mobility as a chair of the APPG in the early 2010s and showed a keen interest in the issue as a member of the education select committee. He is unlikely to dismantle the emphasis that Greening had introduced to the department on social mobility, though some of his solutions may be different.

Those changes were part of a wider reshuffle which has tilted the composition of cabinet meetings a bit more privately and Oxbridge-educated than before – though still a lot less than in Cameron’s day – and a bit away from the record achieved with May’s first cabinet as having the lowest proportion of privately educated members for a PM’s first cabinet since Clement Attlee in 1945.

But what of policies? In her social mobility plan, Greening set out a number of proposals which it would be surprising if they were not to continue – including the Future Talent Fund and the stronger focus on early literacy.

However, No 10 will also want to see a more robust advancement of the free school programme, as much laxity for new grammar schools as possible – the numbers attending existing grammars continue to rise – and more support for faith schools. The problem Hinds faces is that his room for manoeuvre on these issues is limited to the extent that new legislation is required – certainly the case for new grammars and abolishing Gove’s cap on faith admissions in new schools. He certainly needs to address the uneven performance of academy chains and revisit the rationale for free schools before applying the ‘rocket-boosters’ urged by some commentators.

But legislation is an overrated aspect of policymaking. A lot can be done by exhortation too. A second casualty of the reshuffle – perhaps less remarked than Greening’s – has been Jo Johnson, who was demoted to transport minister a day after gamely defending Toby Young’s appointment in the Commons. Some commentators see his move as connected to the Young business (and Young quit the next morning from his board membership at the Office for Students). But in reality it may have had more to do with Johnson’s reluctance to change the student funding model from that which had been introduced by David Willetts, beyond tinkering with interest rates and a very expensive raising of the repayment threshold.

And it is here that there may be more room for movement. The Sutton Trust has published a series of reports in recent months on higher education, with several important policy recommendations. There are three that could make a big difference: much greater use and transparency over contextual admissions; moving the sector towards post-qualification offers; and introducing means testing for fees as well as restoring maintenance grants. Sam Gyimah, the new universities minister, should take a fresh look at higher education access and funding, and surely has some licence to do so.

A second area where the new education secretary should focus urgently is on apprenticeships – in addition to implementing the technical skills reforms. The apprenticeship levy – a brave policy for a Conservative government – is in danger of being squandered. As our major pre-Christmas report Better Apprenticeshipsshowed, the quality of too many apprenticeships is poor; too few are taken young people; too many are accrediting existing skills; and progression for young people to apprenticeships that may be of some use is dismal. Done well, apprenticeships should be a route to social mobility for many; as they are now, they will be for too few.

And finally, Damian Hinds should look at what’s happening in the early years. A lot of headlines focus on the closure of Sure Start children’s centres – and that’s worrying – but the bigger issue is the quality of experience for disadvantaged toddlers in early education across all settings. They need the very best, but if the cash is spread too thin – as our recent report showed – the poorer kids will continue to start school at a distinct disadvantage and things will go downhill from there.

Damian Hinds may have had a few reporters searching urgently for his Wikipedia profile. But if he takes the bold steps needed in higher education, apprenticeships and early years, he has a chance not only to make his name; he can also make a big difference to social mobility.

Evidence of intent

My latest Sutton Trust blog on the evidence behind the parties’ election proposals for education

While much of the policy noise of the election campaign has focused on social care and the winter heating allowance, there is quite a lot of educational policy in the parties’ statements of intent. Polling over the weekend showed it particularly important with parents and young voters.

Despite the narrowing of the polls as Thursday’s ballot approaches, the likelihood is still that a Conservative government will be re-elected. So, it is worth examining what they say – and do not say – in some detail. A lot of the attention has focused on two policies – grammar schools and free school meals – but there were also other important proposals there too.

Free school meals have become a surprising issue. Just as Theresa May has been keen to show she’s been making tough choices with pensioners’ spending, she is also planning to remove the relatively recent universal nature of free school meals for infants and return to linking them to poverty. Instead, less costly breakfasts will be provided to all.

When free school meals were made universal, much was made of the impact on educational standards. At the time, I looked at the detailed NatCen evaluation and argued that universal school meals may make some impact on attainment, but seem likely to do a lot more for diet and socialisation in school. Delivering 1-2 months’ progress, it had less impact than other less costly options.

The EEF’s evaluation of Magic Breakfast suggested a two month gain over a year. The results suggest that for pupils in relatively disadvantaged schools it is attending the breakfast club, not just eating breakfast, which leads to academic improvements. This could be due to the nutritional benefits of the breakfast itself, or the social or educational benefits of the breakfast club environment.

So, shifting to breakfasts on the face of it looks like a less costly way of delivering results – even allowing for the forensic work on costs by Becky Allen and Datalab. However, neither study focused as much on the nutritional benefits which is what has exercised Jamie Oliver and other celebrity chefs most. There’s also the very real issue of cost for those parents whose incomes are just above the FSM eligibility threshold and who will lose most in this change. By contrast Labour and the Liberal Democrats want to extend free meals throughout primary school, though this feels like a costly commitment when school budgets face so many other pressures.

Labour has made its most expensive and eye-catching promise in higher education, promising to axe tuition fees and restore maintenance grants. In doing so, it has cited the £44,000 average debt figure first calculated for the Sutton Trust by the Institute for Fiscal Studies. Sutton Trust research has also shown student debts in England are the highest in the English-speaking world.

However, it is questionable that the answer is ending all tuition fees. University students are far more likely to come from better off backgrounds – so there is a massive deadweight costs if this is intended to improve access – and the evidence suggests that participation among poorer students has continued to rise since tuition fees increased. Nevertheless, there are still substantial gaps – the latest UCAS research using a multiple equality measure across demographic quintiles suggests that 13.6% of young people from backgrounds with the lowest rate of entry to enter higher education went to university in 2016, compared with 52.1% from the highest entry or richest areas, almost a four-fold gap, and this gap rises to ten times in the top universities. There has also been a substantial reduction in part-time students, which seems to have accelerated since the £9000 fees were introduced, despite the introduction of loans for part-timers.

A more cost-effective and targeted approach would have restored maintenance grants for poorer students – which the Liberal Democrats also propose – but also means-tested tuition fees so poorer students borrowed less, though proponents of fees would point out that repayments are equitable given that they are linked to earnings. The problem has been that size of borrowing, and the high interest rates now charged, means that barely a quarter of graduates are likely to repay their loans in full.

In other policies, the Conservatives have maintained their commitment to lifting the ban preventing new grammar schools, justifying the policy by referring to its new calculation of ‘ordinary working families’ – roughly the middle third of families based on income – though all the evidence, including that published by the Sutton Trust, shows that poorer students and those just above FSM eligibility are much less likely to get admitted. The manifesto does not detail what measures are proposed to address this gap or the income-related gradient in who gets in.

As importantly, perhaps, the party has also proposed a review of school admissions more generally, though pointedly ruling out ‘mandatory’ lotteries. That doesn’t mean there could not be more encouragement of both random allocation and banding, both of which could provide a proportion of places in popular urban schools, and are the only realistic way to end the ‘selection by postcode’ criticised by Theresa May early in her premiership. The plan for more accountability at Key Stage 3 could fill a gap that has been there since those tests were scrapped in the late noughties.

Labour, meanwhile, has pledged to outlaw unpaid internships, something that is gaining traction as an issue across the political spectrum. Since our 2014 research estimating that an unpaid intern in London would need to £926 a month to make ends meet, there has been a growing clamour for change matched by a growing number of companies changing practice. It requires proper enforcement of minimum wage legislation matched by open and fair recruitment practices.

In Scotland, the Global Gaps report that we published in February has been much quoted over concerns about the income-related attainment and university access gaps in Scottish schools. The SNP manifesto was less focused on education issues that are a matter for Holyrood but there they have been strengthening their work on attainment gaps and accountability amidst opposition criticism of a dip in standards over recent years.

But for all the education policy promises, the biggest challenge facing a new government will be in school budgets and teacher recruitment. The Conservatives, mindful of a backbench revolt, have promised that no school will lose in cash terms from its new funding formula. Labour and the Liberal Democrats are promising to restore budget cuts in real terms too. But whoever gets elected on June 8, the likelihood is that schools will still face challenges getting the teachers they need in a world of rising pupil numbers.

Under advisement

I've blogged about teachers' perceptions of Oxbridge at the Sutton Trust today.

What are we to make of the idea that some four in ten teachers rarely or never advise bright students to apply to Oxford and Cambridge? This finding in an NFER poll for the Sutton Trust published today has remained stubbornly unchanged since 2007.

And perhaps more troubling is the perception that teachers have of the proportions of undergraduates at our two most prestigious universities who come from state schools  – typically they say 20%, around a third of the actual percentage.

There is no doubt that there is still a real access issue at our best universities. At the top third, you are six times more likely to gain admittance if you come from the richest fifth of neighbourhoods than if you live in the poorest fifth. At our most selective universities, the odds are even lower. Yet the universities spend millions of pounds each year on outreach, and lots more on bursaries, designed to narrow these gaps.

It is good that Oxford now has 59% of students from a state school background, and Cambridge has slightly more. That’s a real improvement, but it still means that taking into account sixth form attendance, privately educated students are three times more likely to gain a place than their numbers in the population.

The Russell Group always argue the answer is attainment: A-levels achieved by those in the leafier communities outweigh those from the less advantaged by a significant margin at the top. Yet that’s not the whole story. The Sutton Trust identified a ‘missing 3000’ some years ago who make the grades but don’t get in to the top 13 universities. There is little sign that has changed.

And they’re the group who may lose out if teachers don’t encourage their brightest students to apply to Oxford and Cambridge, and other leading universities. Both universities are central to the leading professions and best salaries, and if we are to make a difference to social mobility at the top we need to see more young people of real ability from low and middle income homes getting to those great universities.

This isn’t about criticising teachers or Oxbridge dons. It is about both schools and the colleges and universities being prepared to look afresh at how they work and being open to making the changes that could break down these barriers.

Earlier this year, the Trust published a brief on admissions procedures at the two universities and made some fairly practical suggestions based on what state school headteachers with a track record of success at the universities, and some of the alumni from our summer schools had said to us.

University rather than college-based admissions are more common, but the distinctions that remain are more of a hindrance to state students than those from private schools with the right networks. What contextual admission offers that are made remain opaque and the information about bursaries and other financial aid is simply not known by too many schools. With a new VC at Oxford showing a strong commitment to fair access and change coming at Cambridge there is a real opportunity for a radical fresh look at what could make a difference.

But equally, schools need to do far more to stretch their highly able students. Grammar schools still have disproportionate Oxbridge entries compared to their numbers too. Every comprehensive should have a strong programme of enrichment for their brightest students from early on in their secondary education. The Sutton Trust works with students to provide such stretch through its Sutton Scholars programme, but programmes for what schools call the able, gifted and talented need to be as embedded in the culture of every comprehensive as much as their support for those with special educational needs.

Our Missing Talent report last year showed what happens where schools don’t do this: we identified thousands of students in the top 10 per cent at age 11 who had fallen outside the top 25 per cent by the age of 16. They could have been set fair for top universities, but had lost that chance. That’s why we need the government not only to require grammars to do much more to recruit bright disadvantaged pupils, we need them to be clear that this should be a part of the DNA of every comprehensive too. To his credit, Sir Michael Wilshaw has pushed this agenda in his time as chief inspector. But this needs drive from the whole government and as much focus as the Prime Minister has given to grammars and faith schools.

Of course, many schools and sixth form colleges do push their best students to aim high, and universities do run more programmes than ever to reach them. But today’s research shows that this needs to be a national drive if we are to make a real difference to social mobility at the top.

Brexit's mobility challenge

I blogged at the Sutton Trust on the implications of Brexit for education and social mobility.

It is not as simple as saying – as many do – that we are heading out of the European Union thanks to the disaffected poor who felt their needs were overlooked by the distant metropolitan elite.

As YouGov’s final polling showed, there was a huge age divide too – 71% of 18-24 year-olds were for remain versus 64% of the over-65s backing leave – and a marked difference between those with different levels of education – those with few formal qualifications voted Leave in as great a proportion as graduates voted remain.

There is undoubtedly a strong degree of disaffection among older poorer voters. And this underlines more than ever the importance of ensuring that educational and employment opportunities are available for their children. In a sense, intergenerational poverty could breed intergenerational disaffection if whoever emerges as our political leadership in the months ahead doesn’t address the social mobility issue head on.

We need to start young. The gaps in school readiness at age 5 – the bottom 10% are 19 months behind the richest 10% – continue through the education system. While the pupil premium and other education reforms have reduced the gaps at age 11, on traditional measures little has changed at GCSE and there are still eight-fold access gaps to our leading universities.

As I have argued before, there is a danger that those gaps will perpetuate in the new accountability regime – though there is also growing evidence that such gaps are far from universal – so it is increasingly important that rhetorical choices between apprenticeships, college and university are made a reality in ways that really make a difference to young people’s life chances.

This matters at several levels. The Sutton Trust has long championed the importance of changing the elites – and the referendum has arguably thrown that into sharp relief – where our research earlier this year found that the privately educated continue to dominate in the professions. Even in politics, half of the current cabinet went to private school, and that’s a lower proportion than the coalition cabinet.

Politics needs to become more representative – something the social mobility APPG will be discussing later this month – but so does the leadership of all those institutions that affect our lives.

But change needs to come at every level. We have seen a welcome embrace of transparency in school-level data over the last 25 years, with the chance now to compare schools on a like for like basis as never before. That has spurred real improvement, and with the pupil premium has placed the attainment of disadvantaged pupils centre stage.

Yet there still remains a real challenge narrowing the gap between London and other parts of the country, in part because of different attitudes to reform, but equally the result of differential access to good teachers and demographic differences. It may be no accident that the strongest Brexit votes came in coastal areas and North East cities where students end up with fewest qualifications. The urgency of addressing those inequities has never been greater.

Equally, there is a real challenge assessing the value of post-school opportunities. Colleges have been measured on ‘success rates’ for too long, rather than student outcomes. There are welcome moves to change this, though the danger is that the data is presented in ways that are not easily understood – a real danger too with the new GCSE rankings (replacing A-E with 1-9). The best colleges transform lives, but it is vital that in communities where colleges are the only source of post-16 education that the current patchwork of performance is transformed for the better.

More worrying, perhaps, is the emphasis on quantity over quality in the apprenticeships programme. Apprenticeships are back in vogue, which is a good thing. But for young people, it is not good enough that only 40% of them lead to a qualification at level 3 – A level equivalent – or above. Too few teachers will recommend apprenticeships, but until the government is clear that every young person starting a level 2 apprenticeship will progress to a level 3 without having to change course – as is the way in what are still (for now) our European partners – that won’t change.

And finally we need to shake the university sector out of its complacency and open it up to a transparency that has been alien to them for far too long. It is good that they are judged on impact in the research excellence framework, and that the teaching excellent framework will force them to think more about how they impart knowledge to those paying them £9000 a year in fees.

But it is quite appalling that universities can refuse to co-operate in publishing the data on earnings by course linked to tax data from HMRC, something that Anna Vignoles worked with IFS to show recently at an aggregate level. We will be working with MPs to get that changed in the higher education bill. Students have a right to know the worth of their courses, not least when our data has shown that on average higher apprenticeships may be an option as good – or even better – financially.

So if we are to ensure that the disillusionment that led to Brexit among their grandparents – and many of their parents – is not translated through the generations, we need to make sure not only that opportunity is available to young people across Britain, but that it is provided in a way that is open and honest about the strengths and shortcomings of different pathways. Brexit may have its long term economic downsides, but politicians of all parties need to find ways to ensure that the young who voted overwhelmingly to remain have the chance to use their talents to the full.

Scotland's access challenge

I blogged for the Sutton Trust on access in Scotland, linked to a new Trust report that attracted a lot of Scottish interest last week.

Nicola Sturgeon has placed education at the top of the government’s agenda. By making her deputy John Swinney responsible for education in her cabinet, she has given a clear signal of how highly she prioritises the issue. And in looking again at national testing, she is showing a willingness to put pupils’ interests first: good data is vital to educational equality, and must be part of what emerges.

But the scale of the challenge should not be underestimated. Today’s Sutton Trust report Access in Scotland from Sheila Riddell and her colleagues at Edinburgh University provides the most detailed data to date on the scale of the access challenge north of the border.

Some figures are familiar: between the most and least disadvantaged, there is a four-fold gap in university access in Scotland at age 18, compared with a 2.4 point gap in England. Others are encouraging: access to “higher tariff” universities is less polarised than in England, although this may in part reflect that a larger proportion of the Scottish sector are in this category, though it includes all the ancient universities . But what is new is the startling figure that of the growth in new entrants to higher education from the poorest areas over the last decade, fully nine in ten have been to sub-degree courses at further education colleges.

This is not to decry the efforts of colleges. As I learnt in my time as a member of the Scottish Commission on Widening Access, articulation from college to university is a tried and tested route into university. Colleges have displayed an enormous dedication to improving the education of poorer students. But in a system where half the students moving from college to university have to repeat at least one year,  there are clear issues about both the  nature of what has been learnt before university and the willingness of universities, particularly the Ancients, to credit that learning.

Sturgeon has commendably accepted many of the recommendations of the Commission, including the idea of an independent Commissioner for Fair Access – a cross between Les Ebdon and Alan Milburn, at least in their current roles – and the target that a fifth of higher education entrants by 2030 should be from the poorest fifth of neighbourhoods.

There is a danger that the access debate is simply clouded in the arguments around tuition fees. In truth, neither side has a strong enough case there. The absence of tuition fees has not obviously changed the access picture – and in other countries, the abolition of tuition fees has proved a welcome initial saving for middle class families rather than a spur to participation by the poor. But then it is hard to argue that incurring £50,000 debt on graduation in a debt-averse culture is the right answer either, even if a proportion of the fees are used to fund access and outreach and regardless of what protection may be in place for lower earning graduates.

That’s why it is not enough simply to accept radical targets. The means must be put in place too. And that means accepting also the more radical commission proposal that universities should formalise their contextual admissions work with institutional minimum thresholds that are targeted at disadvantaged students. Critics in Scotland have talked of social engineering, but the inspiration for this idea was the radical access work at St Andrews which I heard about when visiting the university.

At St Andrews, studying Physics and Astronomy has become so popular that the standard asking rates are AAAA in the Highers. Students from a widening participation background can join standard degree programmes but with a modified Gateway entry year, which has a lower asking rate for entry, typically BBBB. In their year of entry these students do about half their credits on traditional modules integrated with the rest of the intake, and about half their time on strongly tutored modules designed for this entry cohort. The early Gateway cohorts include some doctoral students.

That’s also why it is so important that the Scottish government continues to fund dedicated places at the Ancients for disadvantaged students, particularly when other places continue to be capped.  But the changes needed to meet the ambitious targets can’t just be about the Ancients. Some universities already meet the 20% target, but there is room for more higher and degree-level apprenticeships in addition to their existing offer, directly linked to employers and jobs. The overall scale of provision at Scotland’s universities deserves more debate too, with applications having risen faster over recent years than the number of places.

Of course, none of what universities or ministers might do is enough on its own. The real challenge lies in what happens in schools, where attainment gaps are evident from an early age. It is a good start providing comparable data through assessments, but that needs follow up with equally radical approaches through targeted funding, a strong drive to improve standards, and intervention and support for schools with poorer results, especially in disadvantaged areas.

But we need to go further in raising aspirations too. The Sutton Trust supports 250 students each year at its summer schools at Edinburgh and St Andrews. Other charities, like the Robertson Trust, play a vital role funding access programmes too.

It is simply not fair that 26% of places at ancient universities go to privately educated students, when less than 5% of Scottish students are educated at independent schools. We need to see a concerted drive to improve education for able, gifted and talented students in every state school from S1 (Year 7 in England) onwards too.

That’s the challenge behind today’s report. And it is one that matters for Scotland’s future success.

Getting the student architecture right

I've looked at the possible impact of merging the Office for Fair Access into a new catch-all higher education regulator on my latest Sutton Trust blog.

Green and white papers are published for a variety of reasons, aside from the need to ‘consult’ prior to legislation. A new minister wants to make his or her mark. The government needs to save money. A department wants to show it is doing something, usually a new organisation with a new acronym. Whatever the reason, they are rarely all they seem, and the outcomes don’t always match their ambitious good intentions.

So how does the latest universities green paper, Higher education: teaching excellence, social mobility and student choice, match up? Among its new ideas is a Teaching Excellence Framework (TEF), a way of holding universities to account on an aspect of their delivery that is decidedly patchy, and a new Office for Students (OfS) which will be a ‘single, light touch regulatory system’ that will ‘empower students, drive quality, eliminate unnecessary bureaucracy and save taxpayer money’.

The detail may still be dependent on MPs’ approval, though the acronyms are already in place. But can the Office for Students (OfS) really do all of these things successfully, and what will it do as a single entity for social mobility that maintaining the successfulOffice for Fair Access, and expanding its remit a little, would not achieve? The new Office will not only see OFFA absorbed under its wing, it will also run the new teaching framework, absorbHEFCE’s regulatory role and provide quality assurance.

Sensibly, it will not take over the creaky behemoth that is theStudent Loans Company, and the department itself wants to change how the remaining teaching grant is allocated to universities. There must, however, be concern at the suggestion that raising the fee cap would no longer require a parliamentary vote, and could be done by power of the Secretary of State.

The new body will operate in the students’ interest, we are told, but it will be funded by universities. There is much that is good about the overall functions of the new entity – it will have specific duties to promote students’ interests, excellent teaching and fair access. It will also be the body charged with deciding which new providers can offer higher education and providing better information on choices.

Having had my time in Whitehall, I can see how logical all this may seem. Government loves having everything ‘joined up’. It promotes efficiency and collaborative working, the civil servants hum. It (ostensibly) saves money, the chancellor purrs. And it gives me something to be seen doing in parliament, the minister cheers.

But I’m not convinced it will meet another important objective of the green paper: improving social mobility. One of the less well publicised government targets (they’re back in favour again, apparently) is to double the percentage of disadvantaged students going into higher education from 13.6% in 2009 to 27.2% by 2020, and to improve access for minority ethnic students. The figure was 18.2% in 2014. Achieving this will require real focus, not least with potential cuts in the spending review of widening participation funds, and a drive that ensures the target isn’t met simply by plucking the lowest hanging fruit – there is still an eight fold access gap in our most elite universities, after all.

The record of ‘logical’ mergers in recent years is hardly encouraging. The Every Child Matters agenda under the Labour government was a worthy and logical attempt to join up education and children’s services. The result was a lost focus on education standards in many local authorities where a social services agenda dominated, or vice versa. The resultant loss of dedicated child protection teams as part of that agenda arguably contributed to the Baby P case in Haringey. The ‘logical’ merger of the National College of School Leadership with the Teaching and Development Agency has been accompanied by a teacher recruitment crisis and the near-destruction of a programmecredited by the OECD as ‘changing the landscape of school leadership.’ Both were affected by a loss of focus.

The Office for Fair Access has had a good record since its inception in 2004. Its access agreements have kept universities accountable in a very specific area that is vital to social mobility. The duty to report on access to parliament, combined with the power to prevent universities charging higher fees, have supported improvements in access from disadvantaged students despite the trebling of those tuition fees.

The green paper would not take away any of these powers, and it would maintain the access regulator’s post. Indeed there is an expectation that the regulator should look also at the destinations of access students, a welcome extension of the existing remit. Improved information for students would be a great boon too. But the new Office would absorb OFFA into an entity with lots of other complex responsibilities. The result could be a gradual erosion of independence and loss of impact in a body that is likely to spend much time on the complexities of competition. That would not be good for social mobility.

There is much to welcome in the new green paper, not least the stronger role for students and the overdue focus on teaching. But the danger is that in its desire to create a clean new ‘architecture’ the Office for Students ends up creating something closer to theWalkie-Talkie than The Shard. We need to be convinced otherwise.

University funding challenge

I've written this feature on university funding for the Jan/Feb 2015 edition of Public Finance.

As the general election looms, Nick Clegg’s decision to back a trebling of tuition fees could come back to haunt him. A study by the Higher Education Policy Institute think-tank in Oxford suggests 10 Liberal Democrat university seats could be vulnerable to student anger, after the party’s decision to support higher fees despite its manifesto pledge to phase them out.

here are also doubts that the expected financial savings will be made. There is growing evidence that graduates will face debts into their 50s, while the Exchequer may see little real benefit because nearly half of the loans will have to be written off.

To understand why, look again at the 2012 student funding package and how it differs from what went before. When Labour introduced income-related ­tuition fees of up to £1,000 in 1999, it also replaced the remaining maintenance grants with loans to be repaid at a rate of 9% of graduate income above £10,000 a year. In 2006, fees rose to £3,000, although universities were permitted to charge less. Fees were no longer income-related, though some maintenance grants were restored. Tuition fee loans were introduced and the graduate repayment threshold was raised to £15,000.

The coalition government trebled fees to a new maximum of £9,000, extending the income contingent loans accordingly. But two crucial additional changes were made. First, the repayment threshold was increased to £21,000. Conservative ministers wanted it to be £18,000, but the LibDems insisted on the higher level. The second was the addition of a real rate of interest. Previously debt rose with the retail price index (RPI).

Under the new system, undergraduates are charged RPI+3% while studying and then pay interest of up to RPI+3% on a sliding scale once they graduate. The result is that from this year, graduates will pay off their loans – now much larger after the fees hike – much more slowly than under the old system.

Read the full article here.

Delivery depends on detail for new ministers

I've posted at the Sutton Trust on the reshuffle.

Reshuffles can be a brutal business. This week’s surprise move of Michael Gove, and his replacement by Nicky Morgan as education secretary, seemed particularly so. But no less surprising to those in education was the departure of David Willetts as universities minister to make way for Greg Clark.

Both had been highly able ministers, as well combative advocates in defence of their policies. And both leave significant legacies. For Gove, the media has focused on the growth of academies and free schools and the changes to the curriculum. With Willetts, raising tuition fees without any medium-term impact on the numbers of young people going to university was a clear political success. 

Yet, their legacies in tackling disadvantage and improving access may lie elsewhere, and it is important that their successors recognise these achievements as much as those with a higher profile.

It is true that there are now 4000 academies, scores of free schools and that the curriculum is being made more knowledge-focused, with exams toughened to match. The direction of travel towards greater school independence has been accelerated, but whether it leads also to rapid improvement will owe as much to other less celebrated changes. The best academies and free schools clearly make a difference, but there have also been significant failures.

As significantly, Gove – and his Liberal Democrat deputy David Laws – have championed the use of evidence to improve teaching, gradually increasing expectations that their pupil premium is used on what works, and this week’s Ofsted report suggests that is having some impact. The funding of the Education Endowment Foundation, our sister charity, was an important part of that process, and it is one that not only enjoys cross-party support but growing buy-in from school leaders and teachers.

Equally important in my view has been the continued use of floor targets to raise the minimum acceptable standard for schools – though the impact of planned changes to the core league table measure may not have been fully considered – and the development of Teaching School Alliances to support school-to-school improvement, a key feature of the London Challenge.

Although his critics presented his policies as intensifying competition, the reality of the growth of academies has been an explosion in multi-academy trusts and similar co-operative arrangements at a local level, of which the Teaching Schools are an important aspect.

For Nicky Morgan, the challenge will be to build on these aspects of the Gove legacy and to foster greater collaboration between schools, particularly isolated primaries and schools in regions as yet largely untouched by the reform bug in ways that may support the growth of academies, but also enable all schools to provide the academic curriculum now expected of them.

If there was one significant weakness in the Gove – and to an extent, the Laws – approach, it was in their willingness to use levers sufficiently. The pupil premium is being used more effectively, but why not do more to reward schools that make a real difference to their disadvantaged pupils, and cut the premium from those that persistently fail to do so? Why not expect more collaboration from converter academies, which gained financially from their conversion, so they are required in their funding agreements to play a part in wider school improvement, as the best converters already do?

Greg Clark faces challenges in higher education too. Although student numbers have held up, and the proportion of students from poorer backgrounds has continued to grow, there are significant concerns about the impact of student debt in the future. Analysis by the Institute for Fiscal Studies and others suggesting that the current likely repayments will barely cover the increased fees suggest that the overall funding model needs review; equally, while it may seem attractive to load repayments onto people’s salaries in their 40s rather than their 20s, the social implications of this extra burden may not have been thought through. The new minister will need to take another look at the arithmetic.

It will also be important to monitor the impact of the raising of the student numbers cap on recruitment to elite universities. While this may increase student places overall, some Russell Group vice-chancellors fear that it will make it harder to improve access, as A*AA or higher may become the norm in popular courses, with less room for contextual offers.

For both ministers – and the same is true for Nick Boles, who replaces Matthew Hancock as skills minister in improving apprenticeships – it is to be hoped that tackling social mobility and the impact of disadvantage should be as much a priority as it was for Gove and Willetts. Doing so means getting the detail right, as much as it does sketching the big picture

Payback time for graduates and government

 In my latest Sutton Trust blog, I explain why I think the Government needs to think again on tuition fees, student debt and teaching grants.

When the coalition trebled university tuition fees to a maximum of £9,000 a year, it said it was making hard choices. Students would have to repay higher fees as graduates because the Government could no longer afford to subsidise their teaching grant, the argument went.

To some extent, I bought that argument at the time because the evidence of previous fee rises had been that they didn’t deter disadvantaged students, though I argued then that universities should cover loans above £6,000 and that there should be a better balance between teaching grants and fees than the Government planned. I also noted the problems in raising the repayment threshold.

But even I didn’t foresee quite how the new system would work in practice. Last month, the Government admitted that 45 per cent of debts under the new system are unlikely to be repaid, close to the level where the Exchequer would find itself worse off than before the fees increase.

Now, our new research by the Institute for Fiscal Studies reveals the true impact of the new loan system on middle income graduates like teachers,  as they continue paying off their student loans into their fifties. It highlights the ripple effect of the changes to the loan system and some unintended consequences.

Under the old system, a typical teacher would  have paid off their loans before their 40^th birthday. Under the new system, they will still be making payments of over £2,000 a year throughout their forties and into their early fifties - the equivalent of an extra sixpence on their income tax. This is at a time when most will have children at school, and family and mortgage costs are at their most pressing.

As the lowest earners will repay less and high earners will be able to pay back their debts more quickly, avoiding many of the high interest charges introduced in the new system, it is those on middle incomes who will be most affected.

With this double debt trap of longer repayments for middle earning graduates and a potential loss for taxpayers, ministers should look again at the student loan system.

Students who graduate from 2015 will not have to start repaying their student loans until they are earning £21,000 a year (more than £5,000 higher than before). Payments are at nine per cent of income above that threshold. This means that while graduates in their twenties will tend to make slightly lower repayments, three quarters of graduates will continue paying back until their early fifties. At this point, most graduates will still owe tens of thousands of pounds, which the government will have to write off.

Typical graduates now have to repay £67,000 in cash terms (£35,000 in 2014 equivalent prices), twice what they paid under the old system. Since the loans now attract real interest rates from  before the student even graduates, nearly half will pay back more in real terms than they borrowed.

When the Government trebled fees, the Sutton Trust argued for a better balance: lower fees with a smaller cut to the university teaching grant. However, the increased repayment threshold and a strengthened access regulator were enough to win over most coalition backbenchers.

The argument is not about whether loans and fees should exist – I have always argued in favour of both since the mid-1990s - but what proportion of university funding should be paid by graduates rather than general taxation, and how much graduates should pay. I am now convinced that argument needs to be revisited in the light of the new data on defaults and repayment levels.

When the fees were introduced, we were told few universities would levy the maximum fee, and many would charge £6,000. In reality, most courses cost the maximum, another reason for the predicted default levels.

The Government already provides larger maintenance grants to lower income students. Indeed, when I worked with David Blunkett to introduce tuition fees of £1,000 a year in 1998, we means tested them then. Ministers should consider doing so again. Given that most graduates are having large amounts of debt written off, this could be done at relatively little cost to the Exchequer. That would allow lower fees for those in receipt of full maintenance grants, who come from low income households.

There is an important social mobility point here. It is true that the new system is ‘progressive’ in the sense that those graduates whose average income is just £24,000 or less gain significantly from the new system, and those below £28,000 gain marginally in real terms. But few jobs that require a degree pay so little across a lifetime. The argument made for an investment in higher education has been about earning more than non-graduates.

So it seems unfair to penalise most those strivers who have had to work hardest to improve their lot. With means-tested fees, they would be the real gainers.

It would also provide more impetus to deal with another issue that has seen little improvement in recent years. Although more disadvantaged young people are entering higher education, numbers from low and middle income backgrounds going our best universities have yet to see significant improvement.  Students from the most advantaged fifth of neighbourhoods are still seven times more likely to go to a Russell Group university than those from the poorest fifth.

Universities today use much of the money they are required to spend on access and outreach funding bursaries and fee subsidies to attract those students. Means-tested fees would allow them to focus those resources specific programmes to attract more of the thousands of young people who get the grades but don’t apply to the best universities.

As the experience of the Sutton Trust summer schools has shown, such interventions could make a real difference to those disparities in access.

The Government may have got its sums wrong on student debt, but it now has an opportunity to make the right calculations to improve social mobility.

I also had a column in The Times on the report and appeared on BBC TV News.

I argue in a new Centreforum report that university endowments can make a contribution to postgraduate funding.

Sutton Trust research has highlighted the growing importance of postgraduate degrees in today’s labour market. Stephen Machin and Joanne Lindley have shown that 11% of 26-60 year-olds in the workforce now holds a postgraduate qualification, up from 4% in 1996.[1]

They also showed that somebody with a Master’s can on average expect to earn over £200,000 more over a 40 year working life than someone only holding a Bachelor’s degree.[2] The Sutton Trust report highlighted how the recent growth in UK postgraduates, dominated by international students, poses a threat to social mobility.

This makes it all the more important that postgraduate courses are affordable to the brightest graduates, regardless of financial circumstances. Universities and government need to think imaginatively about how to fund them. Without action to enable bright students from all backgrounds to access postgraduate qualifications based on their ability rather than their ability to pay, this could become yet another barrier for those from low and middle income homes.

The Trust supports targeted state-backed loans for postgraduates. But Government is concerned about affordability, given the growing cost of the current student loan scheme. One way to keep costs lower would be develop income-related bursaries funded by universities through their alumni alongside means-tested loans for postgraduates.

Tim Leunig’s earlier research for Centreforum has shown that while there is some funding available through university bursaries, research councils and other sources, fewer than 4% of students on taught master’s programmes receive sufficient funding to cover their fees in full.[3] Most universities offer some partial bursaries, but these are often a fraction of the costs of fees and living costs, which can be £18-£20,000 a year, depending on the course.[4] This is an expensive proposition for graduates with debts already set to exceed £40,000 from their undergraduate studies.

In the United States, many universities, including the Ivy Leagues, fund undergraduates from low and middle income homes fully through their endowment funds. Many also use their endowments to provide targeted support for postgraduates (as well as to develop new buildings and facilities, often their primary purpose in the UK.)

With a state regulated system of undergraduate fees and loans in the UK, and substantial mandated access funds linked to the new fees regime, there is a strong case for focusing a growing endowment pot on postgraduate studies and research. For this to happen, UK universities need to grow their endowments. Only Oxford and Cambridge currently have endowment funds comparable in size to the top 20 US universities, with the next largest, Edinburgh, significantly smaller at £248m.[5]

The 2004 Thomas report led the Labour Government to introduce a match-funding scheme designed to stimulate greater fundraising by English universities from alumni, and the development of larger endowment funds.[6] That scheme, which ran from 2008-11, had some success: annual fundraising by UK universities rose from £513 million to £694 million.[7]

But the potential is much greater. While US Ivy Leagues have always had large endowments, much American alumni fundraising is relatively new. Many state-funded universities have only developed their funds in the last 50 years: for example, the University of Florida increased its annual donations from $2m in 1976 to produce an endowment fund now worth $1.3 billion.[8]

Only 1.2% of UK graduates donate to their universities regularly, compared with 9% of US alumni. A Higher Education Funding Council for England report in 2012 proposed a target of 5% for the UK within the next 10 years, with some universities achieving double digit rates, to put the UK onto the US track.[9]

Explicitly linking some of those funds to support for postgraduates could make giving more attractive to some donors. Some universities already do this. Sheffield has alumni fund scholarships, funded by donations from 1500 alumni each year, worth £2000 each, and targeted at bright students who might not otherwise be able to study there.[10] However, such scholarships remain small scale: in 2013, they plan to provide them to 15 students, but only provided 6 in 2012.[11] Others with larger endowments say they are relatively generous. Oxford, with £3.7 billion in university and college endowment funds, says that 62% of its research students and 17% of its students on taught Master’s courses receive full scholarships covering fees and living expenses.[12]  

Such endowments may not cover all postgraduate costs, but they could make a significant contribution, when coupled with targeted student loans for those of modest means. Sheffield targets its scholarships to those who received maintenance grants as undergraduates. A similar approach more widely applied to those able enough to study as postgraduates would help ensure such support was well targeted where it was needed most.

Government may not want to cover the full cost of postgraduate studies and living costs, given the prevailing climate. While wealthier UK and overseas graduates may be able to turn to family funds, those for whom a postgraduate degree is the final rung on the social mobility ladder are unlikely to have access to such resources. Such students should have access to more means-tested bursaries, funded by universities through alumni fundraising. For that to happen, universities will need to improve their fundraising capacity. Government should make it easier for them to do so: the tax system needs to be simpler for large donations, and more pump priming should be available to enhance fundraising capacity.

Postgraduate studies are the next social mobility frontier. It is now widely accepted that we need to do more through nursery education, schools and undergraduate access to enable bright young people from low and middle income homes to fulfil their potential. They must not encounter a brick wall when it comes to postgraduate study. A new partnership between alumni, universities and government could help ensure they don’t.

The Centreforum report Postgraduate Education: better funding and better access is edited by Tom Frostrick and Tom Gault and available at the Centreforum website.

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[1] Stephen Machin and Joanne Lindley, ‘The Postgraduate Premium’, Sutton Trust 2012

[2] This is a gross figure, so it doesn’t allow for lost earnings, fee costs, extra taxes due or inflation, as some other analyses showing smaller premiums have done.

[3] Tim Leunig, ‘Mastering Postgraduate Funding’, Centreforum 2011

[4] Cambridge suggests these figures for most courses at http://www.admin.cam.ac.uk/students/studentregistry/fees/costs/coursecost/costs2013v9.pdf . Taught course fees for home or European students at Sheffield and Newcastle universities are typically £5000-£6000 a year, with research fees starting at around £4000 a year, but often much higher depending on the course.

[5] http://www.suttontrust.com/research/university-fundraising-an-update, drawing on data from ‘Caritas Higher Education Yearbook’ data in the UK and the US ‘Chonicle of Higher Education’.

[6] ‘Increased Voluntary Giving to Higher Education’, DfES, 2004,

[7] ‘Review of Philanthropy in UK Higher Education’, HEFCE, 2012 http://www.hefce.ac.uk/media/hefce/content/pubs/indirreports/2012/philanthropyinukhe/HEFCE%20Philanthropy%20Report.pdf

[8] ‘Increased Voluntary Giving’, p.25 and University of Florida website for latest data http://www.uff.ufl.edu/AboutUFF/Endowment.asp

[9] ‘Review of Philanthropy’

[10] http://www.shef.ac.uk/ssid/finance/alumni

[11] Information supplied by University of Sheffield. The University also uses alumni funding to provide £3000 scholarships for undergraduates.

[12] http://www.ox.ac.uk/feesandfunding/prospectivegrad/scholarships/ and http://www.ox.ac.uk/about_the_university/facts_and_figures/