University Alliance have submitted their response to the Office for Students strategy consultation for the years 2025 – 2030.
Find the full submission here.
Overview of the response
Whilst University Alliance supports many of the priorities set out in the proposed strategy, we
were dismayed to see a lack of focus on cutting the cost and burden of higher education
regulation. In fact, many of the proposals seek to expand the OfS’s regulatory remit. At a
time when a) up to 72% of higher education providers are facing a deficit in 2025-26 by the
OfS’s own calculations and b) the Chancellor of the Exchequer has urged “every regulator,
no matter what sector” to enact a “cultural shift” and tear down the regulatory barriers that
are holding back growth, cutting – or at the very least freezing – regulatory cost should the
OfS’s top priority.
The Secretary of State is demanding that higher education providers develop a sustained
efficiency and reform programme and the OfS expects them to take “rapid and decisive
action” to avoid going bust. It is only right that the OfS also takes meaningful steps to
become a more efficient regulator, cutting the cost of its regulation and improving its value
for money to students, providers and the taxpayer.
The case for increasing regulation simply hasn’t been made for a sector that is generally
high performing and an important engine of economic growth. In the OfS’s own estimation,
“most provision in the higher education sector in England is already excellent” and “most
students have positive experiences of HE”. The UK HE sector enjoys the lowest drop-out
rate of any OECD country. By no means does this mean that there is no need for regulation,
but it must be proportionate and targeted.
Higher education providers already feel the existing burden of OfS regulation is high, and
there is too much overlap with other regulators. UUK research found that universities have
had to hire 18 extra staff on average to meet the current regulations. In its inquiry into the
OfS, the House of Lords Industry and Regulators Committee found that many of the
regulator’s decisions and data requests “generated a significant burden for providers” and
called on the Government to reconvene the Higher Education Data Reduction Taskforce.
The Taskforce never took place and no attempts to reduce unnecessary burden on providers
have explicitly been made, yet the OfS is proposing in this strategy to collect even more data
from providers and expand its remit to areas such as transnational education (TNE).
The Lords Committee also queried whether the OfS provides value for money to providers.
Noting widespread provider discontent over the 18.5% registration fee rise in 2023, it
observed, “the OfS appears to be adding to their regulatory burdens and then charging them
more as a result.” A similar outcome seems inevitable if the OfS decides to take forward the
proposals in the strategy without an explicit focus on cutting the cost and burden of its
regulation.
It is notable that despite the above-inflationary rise in registration fees in 2023, the OfS does
not currently have the capacity to carry out one of its core statutory functions: granting
degree-awarding powers (DAPs) to providers. This suggests any expansion of its regulatory
remit would significantly increase the cost of OfS regulation. It is important to understand
that this cost would ultimately be borne primarily by students.
In spite of these concerns, University Alliance does support several elements in the draft
strategy. First and foremost, we welcome the acknowledgement that the OfS must change
as regulator. We concur with the need for more agile and flexible regulation and for the OfS
to have a sharper purpose. We also broadly agree with the three priorities set out in the
strategy: quality, student interest and sector resilience. That said, we are not sure if equality
of opportunity is well served by acting as a cross-cutting theme, which seems to dilute rather
than enhance its importance. Nonetheless, work in these areas needs to be carried out in
ways which do not increase the cost of the operation of the OfS, or the cost passed on to
providers. The financially challenging context for higher education providers means that their
response to any regulatory change will need to be delivered within increasingly constrained
resources.
