This week on the podcast artificial intelligence remains front and centre, with a look at the growing concerns around AI-generated teaching content and the student backlash it’s prompted. We also discuss our new project with Kortext on AI in pedagogy and an emerging debate over AI’s place in the REF process.
Plus we explore the financial strategies universities in England are adopting in response to mounting pressures, and what does a more ambitious civic university agenda look like in 2025?
With James Coe, Associate Editor at Wonkhe, Jo Heaton-Marriott, Managing Director at the Authentic Partnership, Jonathan Simons, Partner and Head of the Education Practice at Public First and hosted by Mark Leach, Editor-in-Chief at Wonkhe.
On the site:
The end of pretend – AI and the case for universities of formation
High quality learning means developing and upskilling educators on the pedagogy of AI
Counting the cost of financial challenges in English higher education
Civic 2.0 – the civic university agenda but with sustainable impact
You can subscribe to the podcast on Apple Podcasts, YouTube Music, Spotify, Acast, Amazon Music, Deezer, RadioPublic, Podchaser, Castbox, Player FM, Stitcher,
Transcript (auto generated)
Mark Leach: It’s the Wonkhe Show. Students rebel against AI lectures – are universities listening? Vice chancellors balancing budgets with blunt tools – and we ask what’s being lost. And the Civic University agenda gets an upgrade – but will it change anything? It’s all coming up.
Jonathan Simons: But at no point did we say, “Well, OK, fine, let’s just accept those.” We said, “No, that’s cheating. You can’t do it.” Now, using AI in and of itself is not cheating. But giving in to the pressure that’s like, “Well, it’s here anyway” – I think is a really fundamentally flawed approach.
Mark Leach: Welcome back to the Wonkhe Show, your weekly roundup of this week’s higher education news and policy analysis. I’m your host Mark Leach, and here to dissect the week’s developments are three excellent guests as always. In Lancaster, it’s Jo Heaton-Marriott, Managing Director at the Authentic Partnership. Jo, your highlight of the week, please.
Jo Heaton-Marriott: The excellent report from the National Centre for Universities and Business that shows the interactions between universities and business are on the increase.
Mark Leach: And in Liverpool, it’s James Coe, Associate Editor at Wonkhe. James, your highlight of the week, please.
James Coe: Hello, listeners. My highlight of the week was the Counterculture Christmas Party at Delalive Pavilion. Had a good dance, heard a speech, listened to some good music – merry men to buy all.
Mark Leach: And in London, it’s Jonathan Simons, Partner and Head of the Education Practice at Public First. Jonathan, your highlight of the week, please.
Jonathan Simons: Morning, Mark. Morning, everyone. My highlight of the week is that this week’s Ashes test is a day-night game, so I only had to get up at 4am and not 2am.
AI in Higher Education
Mark Leach: So, yes, we start this week with AI. James, the robots are thriving, aren’t they?
James Coe: Well, I think we might have wrecked the economy by accident, Mark. There’s an AI bubble that I think we are all worried about, and we’ve ended up in this position where AI is now so pervasive in society it is going to have to succeed. It’s so deeply embedded in our economy – if it doesn’t, it’s going to crash all of our pensions. So the stakes are quite high, I think it’s fair to say, and they could not be higher when it comes to educating our future generations.
You might have seen the viral video that I first came across on my favourite social media platform, LinkedIn, of the students complaining that their intelligence was being insulted by the production of AI slides, which has then gone viral. And I think it’s interesting because we risk ending up in a situation where students are producing AI work, being taught by AI slides, and then being marked using AI algorithms – that brings into question, what is the point of any of this?
You might have read Jim’s piece on the site, which is probably one of our most commented this year, if not the most commented, where the centre of his argument is that the panics about technology have existed forever. The thing that we should be concerned about is what is the quality of learning, what are students actually learning, and what are the skills that they are developing. The output is sort of by the by.
For a slightly different take, you might have seen Debbie’s piece, where she’s talking about how AI is here to stay, and the future is about how we learn, how we share skills, and how we develop them.
I suppose two reflections from me. It feels like we are in a moment when it comes to AI. We can either pretend it doesn’t exist, and we can force people to continue to do online assessments and online essays. We can try and get round it by making people sit written exams – so basically get rid of technology in its entirety. Or we have to acknowledge it’s here. We have to have a greater imagination of what it is we think is actually worthwhile about university education. I don’t necessarily think it is a question about learning and teaching, but it is a question about what is the university for and how do we develop that? Something I know we’ll be discussing on the 17th of March, Mark, at the Secret Life of Students. And I’m led to believe you can book tickets now at wonkhe.com/events.
Mark Leach: So, Jo, we saw the students complaining about universities being debased by AI, as reported in the Guardian. You can sort of understand where they’re coming from. We’ve kind of come full circle on this, haven’t we? How do universities have a response to this?
Jo Heaton-Marriott: Yeah, I completely agree, Mark. Students are absolutely aware that they can find information themselves through ChatGPT. So why would we present AI information in the classroom? I think we’re in a position almost where AI is starting to challenge that value of human learning and expertise. And certainly, I’m a school governor and we talk about this a lot in high school – around how students are able to access information and then present that and challenge their teachers with things they perhaps read, that they’ve taken beyond the conversation in the classroom. So I think we’ve just got to speed up in higher education and really think about how our students are accessing that information and how we use it responsibly and ethically.
Mark Leach: Well, Jonathan, what do you make of this idea that we’ve gone back to first principles – that the AI isn’t a crisis, but the thing we need to focus on is formation? And I quite like that as a concept, but it does require quite a substantial rethink, doesn’t it, of why we’re all here.
Jonathan Simons: Well, it does, but it also requires us not to concede on the very nature of what a university is and what scholarship is. So I was at a higher education conference earlier this week – it wasn’t a Wonkhe one, so it wasn’t very good. But I was in a discussion with university leaders and we were talking about AI and AI governance. And people were saying things like, “Well, I just think AI means that we can do a PhD in a year now.” And I just thought, no, it doesn’t.
Yes, of course you can do a literature review in 30 seconds now, but the point of a literature review is not to have sort of suddenly managed to create a thing with a million footnotes in five minutes. It’s to have read around the subject and thought critically about it in order that you can advance the discipline. Just because you happen to be able to get someone to spit out 10,000 words for you at the touch of a button doesn’t actually mean that you necessarily speed up your learning process.
And what I worry a lot about with AI is that we confuse the helpful ways in which it can inform and strengthen pedagogy with a sort of short-circuiting of the actual premise of learning and understanding. And if we give that up as universities, then frankly, we’re not in the game for anything anymore. Because as you say, students will say, “Well, why am I bothering paying anything?” I think it’s really, really quite dangerous. I don’t know what the point of us existing is if basically what we say is we mark AI things generated from AI tools – we just become this massive circular bear production.
James Coe: I suppose my problem – and I think I’m probably on the more sceptical end of things that we do. In fact, I would go as far as to say I think it is a net negative to humanity so far – that the ability to critically think becomes massively devalued, and the want to produce things at speed becomes overvalued, even if what they’ve produced at speed is ultimately crap. It sort of makes no difference, right?
And the thing that I think I worry about is we’ve allowed the hype to become enormous because it can solve all kinds of learning and teaching problems that we think we’ve not addressed, whereas the reality is actually patchy. But now because we’ve spent loads of cash on this, we have to make the reality catch up with the thing that we’ve imagined. So it’s fine – “say you can do a PhD in a year.” OK, but I’ve spent like £3 million now integrating my IT systems with the new AI thing that was going to solve all my problems. And so I’m stuck in this path dependency where AI has to succeed because I’ve sort of decided it must. We’ve ended up not thinking critically enough about actually, what is the point of doing this in the first place? Versus, “Oh, this seems quite convenient. So let’s just give it a bash and see what happens.”
Jonathan Simons: I think that’s exactly right. I couldn’t agree more with that. And I think the other thing we have conceded too quickly is, “Well, you know, students are going to use this stuff. So we might as well just sort of let them and we might as well put pressure on faculty to accept it.” It’s like, well, you know, students used to use – well, I probably shouldn’t name them, but you know, a very large organisation that could be seen as akin to an essay mill. But at no point did we say, “Well, OK, fine, let’s just accept those.” We said, “No, that’s cheating. You can’t do it.”
Now using AI in and of itself is not cheating. But giving in to the pressure that’s like, “Well, it’s here anyway” – I think is a really fundamentally flawed approach. We set moral limitations on the things our students do all the time that we know they’re going to do anyway. You know, there’s no university that says, “Yeah, sure, we’ll just accept drugs because we know students are going to do this.” They sort of set a moral and ethical boundary around things as well as saying, “Actually, this is the reality we live in.” But we just seem reluctant to try and mediate it somehow.
Mark Leach: Do we think students will use it? Because what I hear from young people is they refer to “AI slop.” And I do think there’s a real understanding of what it turns out isn’t quality and that it can be in many ways absolutely pointless. So do we believe it’ll just be a free for all? What do your students do, Jo, when you see as a school governor – like what do you see young people doing that are going to go on to be the university students?
Jo Heaton-Marriott: Well, I just see them criticising AI output. You know, they’re sick of social media that’s just full of AI. They’re sick of deep fakes and they can spot them a mile off. They can tell when something’s been written by AI – they’re extremely savvy. So I wonder if there is a crisis coming or not in terms of how they’d want to adopt and embrace AI technologies.
Jonathan Simons: I wish I thought that was true, Jo. But actually, you know, we’ve done a bit of work at Public First around conspiracies and misinformation around students – school students. And actually, what we find is staggeringly large numbers of students both see this stuff, but also sort of recognise that it becomes a thing and they think it’s plausible and they hear their friends talking about it. And actually, some of the time they hear their teachers or parents talking about it.
So yes, of course, I think students are simultaneously aware of the junk that can come out, but also at the same time, like using the stuff and reading the stuff and consuming the stuff. I don’t think we’re going to get away from it. And I think that’s why the focus has to be on using it properly. But as I say, that doesn’t mean just saying, “Oh, well, anything goes.”
Mark Leach: But that brings you right back to critical thinking, doesn’t it? And people have the ability to see through that.
James Coe: But I think it’s because the production of knowledge in the university setting operates on two levels, right? So there is the development of the knowledge which students are reliant on to inform their own opinions. If that is being AI produced in the research field – which we know there have been lots of accusations of – and then students are using AI to reinterpret that information, it’s quite hard then to blame students. They’d be like, “Well, I simply just looked – the information was out there, as I’ve always been taught.” Unless exactly one of that is critical thinking skills, then when it comes to interpretation of the knowledge, you are having AI machines learning from AI machines to produce AI outputs. It doesn’t seem to negate the critical thinking of it in any kind of meaningful way.
AI and the REF
Mark Leach: You mentioned research prematurely, perhaps, James. But as you did, tell us what’s going on with this AI REF thing – is the REF being done by ChatGPT now?
James Coe: So there is a REF AI report by University of Bristol – I’m going to mispronounce this – one called CHET (C-H-E-T), JISC, and funded by Research England. Basically trying to understand, taking a rapid sort of review of what the applications of generative AI in the REF are.
There are a few interesting findings, but basically I suppose the two or three headlines. The use of generative AI for REF is pretty patchy. There’s been lots of variation in what people are doing, and some people are using some in-house tools in order to improve their use of the REF. There are some challenges to credibility, but there are some opportunities on that.
I think the two killer bits that have caused a lot of debate in the sector – one is a view from the report that there is, to quote, “a broad consensus that the REF will inevitably become increasingly AI-infused and ultimately fully automated.” And secondly, I suppose this goes to our earlier chat, that “the use of gen AI tools for REF purposes will culminate in unregulated inappropriate use.”
So I think those two together are basically saying AI is inevitable in the REF, and number two, unless you find a more permissive sort of framework, people are going to use it anyway. I suppose going back to our earlier conversation, Mark, the question is: if people are going to use AI more consistently in the production of their outputs for the REF, maybe the REF as a model – or the REF as a sort of tool for measuring research outputs – is no longer right. Like there is potentially something in that, I think.
Mark Leach: This is back to this earlier point about we can’t have AI marking AI and everything just a kind of closed loop of machines talking to each other. So there’s no point in automating the REF with AI to basically review a bunch of AI submissions. I mean, it seems like a general waste of public money, not to mention carbon. I mean, how do you approach that as a university? Because clearly we can’t, like with the marking and assessment – we’re saying you can’t put in a moratorium on using AI completely. But how do you have a conversation about putting that framework together? What are the natural barriers and limitations of what we should be doing?
Jo Heaton-Marriott: Everything needs to come back to those ethical principles, doesn’t it? And as institutions, universities should be leading with principles that I think are ethically led. And I would come back to that environmental point as well, because AI is absolutely contributing to the carbon crisis and we’re all as universities tasked with being environmentally sustainable. There’s not enough work happening in that space. And I’m just not convinced that that wider impact is being factored in at all. So on the one hand, you’ve got research happening in universities to try and move us towards net zero. Yet we’re embracing technologies that perhaps are doing more harm than good.
James Coe: Yes, I think one of the interesting things as well is that the AI opportunities operate on two levels, right? So you have the institutional one – in the preparation of their REF submission – and actually the report also suggests they won’t really save much cash for institutions because you still have to do lots of stuff. And the second is then on the REF level.
We sort of say that peer review is the gold standard of everything that we do in institutions, right? This is about the protection of knowledge, about the assessment of knowledge. If you’re going to say that there is a way for AI to alleviate some of that burden, then surely the natural corollary is to use another metric – simply award research funding for how many PhDs there are in a single institution. If the goal is to have a more efficient system and do that, I’m just not convinced that the goal is to have a more efficient system. It should be to have a better system for assessing quality research, of which AI can probably help you organise information in some way, but should never sort of go further than that, I don’t think.
Mark Leach: So I think the other point that this raises, of course, is what is the cumulative learning within an institution? So, not only are we saying that actually the teaching is going to be supported by AI, that the production of knowledge is going to be supported by AI, but actually that we can mark each other’s work with AI as well. And I suppose, Jonathan, Jo, I’d be interested in your views on the extent to which you think students are comfortable with the idea that AI is playing a role in the assessment of their work, not just the production of knowledge.
Jonathan Simons: I think people simultaneously are worried about it and think it is a good thing that it reduces workload. Again, I’m more familiar with the research based in schools than universities on this, but school-age students are a bit worried because they think, “Well, it’s not going to be personalised. It’s not necessarily going to be reliable.” There’s a sort of inchoate sense of “I want a teacher to care about me.” And if AI is marking their work, then I don’t really think I get that. But they also recognise that actually it’s a quite a big time saver and quite efficient.
And again, depending on the level at which you are contributing assessment work, it can actually be straightforward. Now, that’s easier in schools than it is in universities. You know, if you are doing Key Stage Three – age 11 to age 14 – the vast majority of that probably can be fairly accurately assessed by AI. The minute you get into sort of extended writing, it becomes harder and I suspect people will rightly be a bit more cautious about it.
James Coe: This might be an unpopular view, but when I think about sending my daughter to university in 15 years from now, there was something about – even if the AI and the human came out with similar results – I would feel like I’m paying for the human’s time and somehow I’m being fobbed off by them just delegating it to AI. I don’t know if that’s an unreasonable view.
Jonathan Simons: No, I think that’s exactly right.
Jo Heaton-Marriott: Yeah, I think that’s exactly right. It’s that value. You know, students want contact with people. That’s why they come to university. And I think that’s why we still see students choosing to come to university despite the amount of online offerings that are out there. They want that human element.
Jonathan Simons: That’s exactly right. And you can think this way more broadly about the growth of automation across consumer goods and services. So even when people know statistically that, let’s say for example, a driverless car or a driverless train is safer – and therefore also cheaper, which gets passed through in reduced ticket prices – almost everybody wants there to be some form of human involvement.
And that’s because some of this is just small-c conservatism, but some of it is because people inherently believe in and value the ability of a human to be there in case something goes wrong, or to personalise it, or to make it a more human engagement. As Jo said, we could do almost everything online, we could be completely atomised, but – oh my God, if Covid taught us anything – it’s that whilst it is functionally possible to still do that, it takes away inherently part of what makes man a social animal.
James Coe: But I mean, this is the tension, right? So on the one hand, we have a significant university agenda, which is students want to engage with material. We know that the number one or two reasons students go to university is to learn something they’re interested in. They want to make friends. They want to socialise. But the economics of universities actually means that on the input end, at least, you want to make that as efficient as possible.
So I do wonder if there may be this kind of pivot where actually, in a strange way, the universities that succeed are the ones that place an emphasis on the most analogue experiences. I can see the university whose single marketing point is “every single piece of your work is marked by a human” – you know, all of your campus, all your teachers are people. Number two, there seems to be something a bit – I don’t know – like a craft woodworking class. It has a sort of nostalgia to it I think people would pay for.
And again, you see this already emerging, don’t you? You see this emerging in supermarkets and food, you see this emerging in the airline industry. You actually see it emerging quite interestingly in independent schools outside of the UK, where you essentially get this kind of two-tier or three-tier or four-tier market, where you pay increasing amounts for personalisation and a human-driven experience.
So, you know, BA costs more than EasyJet, at least in part because you still have a person that manually checks you in and you get someone that manually pushes a trolley down the aisle. Now, as long as people are fairly choosing between the two, that’s absolutely fine. You pay more for stuff at a farmers’ market, not necessarily because it’s better, but because it’s produced at a lower volume and there’s more human involvement. You pay less for a mid-price or low-price international private school, particularly in the Gulf, because you have fewer teachers.
And as long as people are comfortable with that bifurcation of the market – but you do get into kind of socially inequitable issues. You can imagine a world in which – and for some students, this is absolutely fine – some students want to go to university to gain job-relevant skills. They want to get in and out as quickly as possible. They want to get into the labour market. They want to accrue minimum debt. Actually, a sort of fairly AI-driven intensive model where they probably can do a three-year course in two years might actually suit them quite well.
The difficulty comes when people actually want the three-year human-centred thing, but can only afford a two-year AI-driven thing. That’s what gets you into difficulty.
And whether the university is the right vehicle to do that short, intensive, AI-driven model – because of course the benefit that a non-market incumbent would have is they can set up entirely online and be like, “Look, we’ll just do two years of it – the thing you simply want to know is how to do, like, I don’t know, sets of accounts,” right? To take a very sort of instrumental thing – I’m showing you very offensive content here, I admit it’s probably very hard. But if you just want to learn that, then you want to do two years online. That’s fine. It makes no sense to try and do that in an incumbent institution which has enormous costs. It’s really hard to do that.
And I wonder actually if the point here is it’s about transparency across everything. Like, are you actually clear what the deal is that you’re getting? And are you clear what the learning expectation is? So people don’t feel fobbed off. In everything I’ve seen, the thing that people don’t like is effectively being told one thing and sold another. That is, higher than anything else, they just don’t like being lied to.
Jonathan Simons: Yes. And I know the sector gets incredibly irritated when people ask what they think are incredibly dumb questions like, “Where do my tuition fees go? And why does it cost so much money? And why does it cost so much when I only get four hours of lectures a week?” and so on and so forth. And most people listening to this podcast will understand the answers. But it is simply not good enough to say, “Oh, my goodness, you just don’t understand the economics of this stuff.” You do need to be able to explain it to people. You do need to be able to talk about it.
But if your answer is at least in part scholarship and research – and it not just being a big school – then you can’t also simultaneously offer an offering which is increasingly denying scholarship and is a big school, because the two of those don’t work. That’s where challenger brands come in. And that’s where people are just straight up like, “Yes, we will just offer you straight-up functional teaching of content at sort of tertiary level, but we can do that very, very quickly, very, very efficiently for you. We don’t have a load of legacy costs. We probably don’t have TPS liabilities. We don’t have massive estates that are needing to be zero-rated for carbon. We can do that very, very efficiently.”
Michael Grove: Hi, I’m Michael Grove, Professor of Mathematics and Deputy Pro
Vice-Chancellor for Education Policy and Academic Standards at the University of Birmingham. This week on Wonkhe I’ve been blogging about educational gain – why it mattered, why it faded, and why the sector needs to reclaim its language of excellence and enhancement.
Educational gain was never perfect. It was hard to measure. But its real value was what it stood for – a belief that university is about transformation, capability, confidence, identity and personal growth. It reminded us that education is deeply developmental, distinctive, and reflected in the broader gains students make beyond what metrics can easily show.
When the Higher Education Funding Council for England gave way to the Office for Students, the sector’s focus shifted from enhancement and partnership towards compliance and comparable outcomes.
Right now, a live Teaching Excellence Framework consultation signals a tighter focus on standardised outcomes, but educational gain was removed because the evidence was judged too inconsistent to compare. That change raises a bigger challenge for universities. If national measures narrow, institutions need to define excellence clearly for themselves and be more intentional about strengthening the human gains that matter most to students.
Universities have become skilled at reporting quality, but perhaps, as a result, we’ve become less confident about building it through enhancement and innovation. Education should grow knowledge, judgement, curiosity and resilience – the human terrain that policy data alone cannot fully capture.
If excellence is what we value, enhancement is how we build it. It’s time to reconnect the two.
University Financial Health
Mark Leach: Jo, there’s been a new survey, hasn’t there, about how universities in England are responding to financial pressures? Walk us through it.
Jo Heaton-Marriott: Yeah, so this is the report on university financial health, which has come from the Innovation and Research Caucus, who have interviewed 74 finance directors from a variety of institutions. And I think it’s fair to say there’s been a huge amount in the news about the precarious nature of our university finances and you could be forgiven for thinking every institution is in the same position and taking the same choices, and that it’s all down to the same reasons as well – particularly policy changes and declining international students.
But this report really draws out the complexity of all those various factors that universities are responding to and looks at the diversity of solutions that they’re adopting to manage their costs and diversify income. Some of those, again, are as you’d expect. So it found around a quarter were actively selling off assets – a bit of a fire sale. Half had implemented voluntary severance. And 32% had reduced support for non-university activities – so things like community and civic engagement.
For me, there are a few takeaways that really stood out. Unsurprisingly, most institutions reported a decline in staff motivation and trust in leadership. 62% felt government support had not been effective, and nearly all of them talked about this current situation being systematic and long-term and talked about a new business model being critical.
And then there was one theme that I felt we could maybe start with. For me it was “there were too many universities, too few students.” And I thought that’s a really bleak takeaway from that report, but it really stood out that across all of those different research-intensive, specialist, small institutions, that seemed to ring true for everybody – that there was too much competition and not enough students to go around.
James Coe: I think just reading through the report, it is interesting how few institutions have taken on additional debt in order to cope with their financial challenges. I think it’s only 5% from what I remember, which suggests that either institutions believe they can cope with the long-term financial challenge within their own resources, or they can’t get anyone to lend to them anymore. I suspect that they’re either over-leveraged – so they have too much debt – or lenders wouldn’t feel comfortable.
On the question of too many universities, I think it’s interesting because I don’t think anybody has a good idea of how large the potential market is, right? So in theory, you have the entire world you can aim at, and that’s why you get the rise of things like TNE. Because what you say is, “I can do transnational education, I can put a campus somewhere, I can attract the students, that solves all my finances.” I can do online. University of Manchester’s strategy is to go 50-50. So what they’re saying effectively is, when there is competition for a dwindling number of students, we simply find more students, and we make that up.
I think that is much harder, as the report points out, if you’re a post-92 institution, where you don’t have the incumbency advantage of having large amounts of resources quite often, of having the prestige to be able to do that. I think the bigger risk is effectively you allow the growth of the top end and the decline of the middle end of the financial resource envelope.
The last thing that I touched on that I think is interesting from your provocation, Jo – I couldn’t agree more that the source of the business model is broken. But the problem is, if you believe higher education is a market, then you shouldn’t be worried about market exit because that allows the strongest providers to succeed. I think market exit would be a significant disaster for the entire country and many places, which therefore leads me to believe that higher education is in fact not a market in the way that we understand it.
You should not allow failure if it will destroy your community. That is clearly an absurd goal that government should pursue. So instead, what you need to have is a regulatory regime which recognises that institutional financial distress is now a permanent part of the landscape. That is the only alternative. We pretend that it isn’t, but it is: failure or intervention and nothing else. Those are the two choices that we have.
Mark Leach: I mean, some of this is about demographics as well, isn’t it? James talking about potential size of the market, but we’re going to have lots more students – potential students – because of 18-year-olds coming through in a few years’ time, and then that number is going to fall off the cliff again.
And other parts of the education system are not immune to that. Primary schools closing down, school years being merged – and we’re getting a kind of hollowing out of higher education in a lot of ways because it’s obviously come at a time when funding has been cut in various different ways.
So this comes back to this market point because it’s not a planned system, is it? So the only thing we really can do is get universities to make better choices about how to cope with those peaks and troughs, right?
Jonathan Simons: Yes, I think that’s right. I think the difference in the school sector – and you’re right that we’ve seen quite a lot of primary schools closing, particularly in places like London, because a pupil boom has now gone through the primary phase and it’s now into early secondary. So secondary schools are growing at the same time that primary schools are shrinking.
The difference is, of course, that most primary schools don’t own their estates and they haven’t built fancy buildings by borrowing. So it is much, much easier – it’s not easy, but it is much more financially straightforward to kind of close and merge estates in the compulsory school sector than it is at universities.
Eventually, student numbers go up, student numbers go down. Demographics are your friend and your foe simultaneously. And if you are borrowing – this comes back to the point about borrowing – you’re probably not borrowing over a three or a five-year cycle. You might be borrowing over a 10 or a 15 or a 25-year cycle. And so you do need to have that long-term perspective.
Where I think schools have got better at this is that they have, on the whole, greater visibility of both their costs and their revenues. So if you’re a state school now, you have a reasonable understanding of what your costs are for the next few years because the biggest composition of that is pay. And you have a reasonable estimate of your revenues because you’re not in competition in quite the same way. You know roughly how many children aged 11 to 18 or 5 to 11 are in your town or city or suburb. And you can make a reasonable projection as to how many of those you’ll get. It’s not perfect, but you’ve got 90% basically locked in as a base. And then you can argue over the remaining 10%. That allows you to do some quite interesting medium-term thinking.
What I thought was fascinating about this report – and Jo’s point picks this up – is that a lot of that visibility just doesn’t exist. And the really interesting thing about, “Well, actually what we’re going to see is the expansion of the top and the collapse of the bottom,” is that the high-tariff universities here are in more difficulty than the medium-tariff.
So the charts show this really clearly – that high-intensity universities are much less likely to be in surplus than medium-intensity, they’re much more likely to be in deficit. Actually, a decent chunk of them are in break even. But they are struggling more than medium and low tariffs with the decline of international students. So actually, the thing that’s really interesting about this report is it shows that there are different financial drivers.
High tariffs don’t tend to be affected by Teacher Pension Scheme, for example, but they do tend to be more affected by international student decline. The ability of everyone to sort of rent out their accommodation and premises is one of the major things that the report says people are trying to do to raise income. That is hugely dependent on where you are in the country and also frankly how attractive you are. If you’re Imperial or King’s or UCL or Oxford or Cambridge, you could make a lot of money out of that. If you are many other universities, it is unlikely that people are going to do that. I couldn’t possibly comment. But let’s face it, some of them are less attractive for large-scale conferences, large-scale international students coming in in the summer and so on.
So it shows that actually there is not a unified position of financial health across the sector, but also what the drivers of this are. And again, I think what makes this report so interesting is it’s 75 university financial directors – that’s a really, really good sample. And they’ve actually spoken to them at a huge level of in-depth and the report is very good, I think, at really disaggregating this. I think it gives us a lot more of a nuanced picture than we’ve had previously.
Jo Heaton-Marriott: Joe, I was just thinking about your introduction and I suppose the problem is that clearly the financial framework just doesn’t work.
James Coe: So if you think that this market is sort of about consumer choice, about all of that stuff, then there’s an argument that it is succeeding. There has never been a better time to be a home undergraduate student. There is fighting for your places, tariffs are lowering, inflation has eroded the real value of fees. It is boom time if I’m a 21-year-old – or 18-year-old – who wants to go to university. But clearly it doesn’t function like a market because the more money that you take out of the quality of the product, I have more choice but a poorer output. That’s nonsense. Clearly you can’t have a market that functions like that.
The Civic University Agenda
Mark Leach: Jonathan, so Civic’s back. Civic 2.0 – talk us through it.
Jonathan Simons: Yes, absolutely. Civic, Civic rides again. So a couple of friends of the show – Richard Brabner and Alex Sherrer – have reignited the Civic Agenda. They have done some really good work taking the Civic University Network and putting it in a new institution, a new organisation, largely coordinated appropriately enough by the National Coordinating Centre for Public Engagement.
But they’ve also got a group of universities who were really interested in the early Civic Agenda – including places like University of Birmingham, University of Newcastle – getting together to look at this.
And the fundamental aim of this agenda is to say that the civic agenda, I think, spoke really well to universities four or five years ago when Richard and the UPP Foundation were really first pushing this. But as Andy Haldane pointed out – and indeed in his reflections on the commission – it didn’t go beyond the sector. It didn’t really impact policy.
And so what they’re calling Civic 2.0 is starting to talk less about what happens within the sector and more about how policy can be changed and how policy can recognise the wider place-based role of universities. So it’s less about what happens within the university and more the engagement between the university and its local and indeed national communities.
Mark Leach: Yeah. And this is really neat, isn’t it, particularly in the context of our last discussion about finances? It’s obviously a place that universities have turned to cut back, but actually that’s going to start to undermine the whole licence universities have to do what they do in the first place, isn’t it?
Jo Heaton-Marriott: Yeah, absolutely. So I feel like I have to make the point that Civic is much wider than policy. Civic work is really people-centred. And alongside the work that’s happening through Civic 2.0, there’s also work that the NCCPE are pushing around – looking at the metrics for civic engagement, the civic mission, where that needs to go next, where the movement might take us, and really mapping civic impact across cultural, economic, social, environmental – all these different facets of civic work that happen right across the institution.
And I just think that’s so critical in the context of the financial challenges and the cuts to resources that we’ve seen. Civic colleagues need to be able to demonstrate the wider value of their work. And that network of civic practitioners really needs to be nurtured and supported, which again is something we see the NCCPE stepping into.
James Coe: Jo, I’d be interested in your view, but I suppose what I find odd about the civic agenda is that the more social goods you do, the worse your financial position gets. And it seems exactly the opposite thing that a government would want to incentivise. Do you think that’s the case?
Jo Heaton-Marriott: Well, there’s a diminishing return. I don’t think it’s like – so you can get some incidental benefits, like your region might fund you to do more stuff, your local authority might fund some projects. But if you look at the REF, for example, it is not place-sensitive impact. It doesn’t care where you do your job.
James Coe: You get no kind of reward for the KEF. High funding is limited. Whether you recruit 100 of your Access and Participation Plan local students or you recruit one from overseas, you get no additional money on the back. There seems to be no incentive to me to do beyond the bare minimum of social impact, other than the people who work in the sector believe it is important.
Jo Heaton-Marriott: But yeah, it’s our mission. That’s the problem. They also believe we should stay open. And those two things – I don’t think there should be tension, but I feel like there is.
Mark Leach: I mean, it comes back to that marketisation conversation, doesn’t it? Because we have been pushed into it. We’re a market now. Doing good things does not play into being a marketable opportunity.
Jo Heaton-Marriott: So for me, the value in doing civic work, public engagement, community work – it’s about, it’s the right thing to do. It’s an ethical and moral prerogative to me that universities were here to make a difference and that we should.
And you’re absolutely right. I think I would look at the KEF as somewhere where this should be better at knowledge exchange. There are plenty of metrics around social return on investment that you could be mapping and bringing into the KEF. Public engagement at the moment is only assessed through a narrative, but there aren’t any metrics that I can point to to make that hard and fast value judgement. So I think there’s a couple of things that are really interesting here.
Jonathan Simons: The first is the LPIF funds – the Local Partnership Innovation Funds that are coming out – specifically say that universities have to be in the lead in a bid, and they talk about this as a “triple helix partnership.” Now, notwithstanding the fact that that’s a terrible phrase, that is a piece of funding which explicitly links local authorities and universities and says that this funding only flows if universities are at the centre of it. And I think that is really interesting and really welcome. And let’s see what comes out of those.
The other thing that I think is necessary here is I think this Labour government has a slightly different theory of place and civic than the previous government did. And the previous government actually had quite a theory around levelling up. And I know it was much mocked, but actually they did have a sort of theory of change of what they expected to see.
This government is theory-light. That’s not a criticism, but it is a statement of fact – that there is no such thing as Starmerism. Starmerism is completely bereft of political theory. What they want to see happen in areas is for life to just look better and for people to feel happier in their areas. So they don’t care about, in the nicest possible way, a theory of civic. They would like people to get their potholes fixed. They would like it to be easier to get to a GP. They would like the roads to be slightly cleaner. That is what people in those areas want, and that is what Labour MPs want.
So what I think I would want the Civic 2.0 agenda to look like is just really, really focus on the practicalities. And one of the biggest issues is potholes. People are furious about potholes. Universities are full of engineers. Universities are full of people that could think about a really practical way in which they can improve local roads.
For all the theorising we do about political and policy engagement, if a university could fix some potholes on the local high street and say, “By the way, this was fixed by a consortium of students in the engineering department of University of X,” I’m pretty sure that is the biggest single bit of impact you can have locally. And it’s things like that which we need to look at.
James Coe: I entirely agree with you, but your research is rewarded based on the notion of “outstanding,” not “I’ve made the economy marginally better.” And this is the entire problem. You could add a billion pounds to GDP by making an industrial process 1% more efficient. The REF will not thank you for it, which is the currency we work in, which means we’re chasing nonsense. But you know, surely we are here to make lives better.
Mark Leach: So, that’s about it for this week. Remember to go in deep on anything we discuss today – you’ll find links in the show notes on wonkhe.com. Don’t forget to subscribe – just search for the Wonkhe Show wherever you get your podcasts. So, thanks very much to James, Jonathan and Jo, and Michael Salmon. We’ll be back next week. Jim will be here. Until then, stay Wonkhe.