David Kernohan is Deputy Editor of Wonkhe

There are four higher education sectors in the UK.

Although they have a lot in common, they differ in several important ways. Not least because each is regulated and funded on behalf of a different government.

How did we get here?

Even before the establishment of national parliaments, each country in the UK has differed in their approach to education. For example – there are no Sixth Form Colleges anywhere other than England, young people take Highers (a year earlier!) rather than A levels in Scotland, and more than 15 per cent of pupils in Wales attend Welsh-speaking schools.

With the coming of devolution in the late 1990s, these historic differences have expanded into four different approaches to education, and to higher education in particular. Famously, young Scottish students do not pay tuition fees if they study in Scotland, and Welsh students benefit from a much more generous maintenance system than in other parts of the UK. Northern Irish universities charge their home students £4,395 a year.

Northern Ireland was the first UK country to enjoy devolved powers over higher education via the 1998 Belfast Agreement. For large parts of the intervening time Northern Ireland has not had – to all intents and purposes – a functioning government, which has meant their system has by default remained closer to the English model circa 2004.

Powers were devolved to Scotland in 1998 – Alex Salmond’s famous “the rocks will melt with the sun before I allow tuition fees to be imposed on Scottish students” statement, made in 2011 (and engraved on a large stone shortly to be removed from the campus of Heriot-Watt University) has come to define policy. Following experiments with a graduate endowment payment, the Scottish Government abolished all fees in 2008.

Wales took a longer path to devolved powers, with the Welsh Assembly (now the Senedd) gaining the power to legislate in 2006. Because of high cross-border traffic in students between Wales and England fees rose first to £4,000 and then to the full £9,000 (with Welsh students able to access a fee grant to cover part of the cost). The 2016 Diamond Review implemented an enhanced student support system in 2018 – including a non-means tested grant of £1,000 and an income guarantee – but removed the fee grants, with students taking loans to pay off a £9,000 fee.

What else is distinct?

Support for the grant part of the dual-support research system is also a devolved matter, though all nations currently make use of the Research Excellence Framework (REF) results to inform allocations. In contrast project grant funding via UKRI is a reserved matter, with research councils funded from Westminster.

We also see differences in priorities and emphasis in each nation embodied in regulation. Scotland and (for the moment) Wales have discrete funding councils, whereas England has a regulator (even though it allocates several billion pounds of funding) and Northern Ireland funds and regulates universities from the Department of the Economy. Though Universities UK is, you would think, UK-wide it has national subsidiaries (Universities Scotland, Universities Wales, though sadly not Universities Northern Ireland) to lobby on devolved policy.

Scotland is alone in funding teaching quality enhancement activity as part of an approach to enhancement-led approach to quality assurance. The QAA is the designated reviewer of higher education quality in every part of the UK other than Wales – where it is chosen as a reviewer that complies with the required standards by every higher education provider.

All national systems provide data to HESA, allowing for a UK wide analysis. However the precise data collection requirements, and the way HESA is funded, has diverged over time. Other sector agencies, such as Advance HE and Jisc (formerly the Joint Information Systems Committee as it was a sub-committee of each of the four UK funding bodies), work UK wide.

Undergraduate degrees in Scotland have historically been four- rather than three-year courses, although many providers now offer three year degrees. Some Scottish undergraduates start university at 17, all though many stay on at school to do Advanced or additional Higher qualifications for an extra year.

The Barnett formula

When the government in Westminster decides to spend money on a devolved matter like higher education, it has customarily sent a proportionally equivalent amount to devolved governments that could be used to enact the same initiatives.

If you’re thinking there’s a fair few qualifications in there you are right – the Barnett formula (the source of what are often referred to as “Barnett consequentials”) is an unusual beast even by UK government standards.

It is a non-statutory convention that originated pre-devolution – the name comes from Joel Barnett, the Chief Secretary of the Treasury responsible for public expenditure in 1980, after the existence of the formula (reckoned to have existed in some form since the 1880s) was revealed during a hearing at the Select Committee on Scottish Affairs! Initially applying to Scotland only, it was extended to Wales and Northern Ireland in 1980.

It is based on marginal changes from historic spending (in 1978, because of course)), where comparable functions exist in the devolved nation in question. In a nutshell, the consequential in Wales, Scotland, or Northern Ireland is equal to the change in the UK government department’s budget multiplied by a comparability percentage (the extent to which the UK department’s services are devolved) multiplied by the appropriate population proportion. Again – please note that this is customary, so the UK treasury could in theory decide not to do it.

So funding allocations are not demand-led, or based on need – and are not ring-fenced, so although it is customary to spend on broadly equivalent services (and it would be a brave government that did not) a devolved government could spend Barnett consequentials on anything it wanted.

These consequentials are not ring-fenced, and come as block grants in Departmental Expenditure Limit (DEL) funding allocations. It’s not the entirety of UK funding that flows to devolved government by any means – capital (for instance for student loans) comes as ring-fenced, needs-based, block grants in Annual Managed Expenditure (AME) allocations.

Other money

While we are on finance – it is worth noting that while the UK government can pretty much borrow as much money as it likes, things are different in Wales, Scotland, and Northern Ireland.

The Scottish Government is allowed to hold reserves of up to £700m, and use £250m of this for day to day spending – and £100m on capital – each year. The Welsh government can draw down £125m each year. Neither can borrow money to spend on recurrent items, only to replace lost anticipated tax income and a small amount of capital spending. Both have the option to raise tax rates (Scotland can raise income tax by 3%, Wales by 10p in the pound) – neither ever has done so across the board, because of the likely political fallout, but high earners pay more tax in Scotland.

Both tend to do all or most of the additional spending and borrowing they are permitted to do each year. For this reason Barnett consequentials loom larger than would otherwise be expected in plans to bail out (or not) the university sector after Covid-19.


It does seem like the meeting between ministers on the English recruitment cap proposal did not go well. Welsh Education Minister Kirsty Williams demanded “respect” from her English counterpart – but what other paths to redress would she have?

As often with UK constitutional matters, very little. There is a Joint Ministerial Committee comprising the heads of the four governments that is supposed to meet each year and very rarely does. There are some “functional meetings” on particular topics – the HE meeting on Monday was, to all intents and purposes, of these.

Beyond that, she could make a legal challenge, which would be heard by the Supreme Court. Before 2009 it would have been the Judicial Committee of the Privy Council. As far as I know this has never happened to any appreciable extent.

Cross-border study

Cross-border study – students domiciled in one UK nation choosing to study in another – follows a well established pattern.

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The only sizeable (in proportional terms) cross-border flow is between England and Wales – just over 37 per cent of UK students studying in Wales are originally from England – and just under 30 per cent of students from Wales are studying in England. Flow between other nations is hampered geographically (Northern Ireland) or by a fundamental systemic difference (Scotland).

In comparison, it is easy for a prospective student in – say – Bristol applying happily to both Bath Spa and the University of South Wales. Rather cheekily, the Office for Students’ “Discover Uni” service asks prospective students to identify a preferred country or countries to study in at a very early point in the guided decision making process – and makes it very difficult to change this initial decision.

Beyond the UK, these systemic differences are not as widely understood as in the UK – the perception is very much of “UK universities” as a high-quality study destination. All four sectors appear content with this situation.

3 responses to “A beginner’s guide to… devolution in higher education

  1. Helpful as ever from David Kernohan. But just to note: why no mention of HEFCW (or SFC)? – an aspect of HE devo dating from early 90s. HEFCW pioneered credit-based T funding. And for a while Wales had differential support for Welsh-domiciled studying at Welsh HEIs (after 2nd Rees review of 2005). There are, in effect, 6th form colleges in Wales following the tertiary education reforms that led to the removal of school 6th forms in a number of local authorities. In those areas, with the exception of Welsh-medium provision, A level & equivalent are offered in FEIs. The FEIs do many other things of course so are not necessarily identical to 6th form colleges in England. Finally, the £1000 maintenance grant for Welsh-domiciled undergrads that has been provided since the Diamond recommendations were partly implemented, is NON-means-tested; it is also available on a pro-rata basis for those studying on a part-time basis. In fact, the difference in maintenance support for part-time undergrads is one of the most marked differences between Eng & Wales under the respective student support systems at present.

  2. Good attempt …

    Just an important minor correction of phrasing: Scotland did not abolish “all fees” in 2008, they still exist for all Scottish and EU domiciled students and are paid to institutions directly by SAAS for every full timer : what Scotland abolished and barred for Scottish/EU domiciles was the student contribution. Of course PG and students from outside Scotland/EU pay fees.

    In response to Rob’s comment, David does actually rightly point out the funding councils created in 3 of the 4 nations in the 1992 Act still exist, in Wales and Scotland since 1999 under the control of the respected devolved democratic institutions. Only in England has the funding council been “abolished”, though this is an ideological change of nomenclature to reflect the shift to fees, with as he rightly points out significant “funding” for Teaching still flowing through the second class replacement OfS.

    David also incorrectly states Joel Barnett was Chief Secretary to the Treasury in 1980 – in fact, Barnett was a Labour MP and Chief Secretary in the Labour Government of October 1974 to May 1979 . This context is important: the 1974-79 government was elected on a manifesto mandate in October 1974 to bring forward the Kilbrandon Royal Commission’s proposals for elected assemblies in Scotland and Wales to take forward democratic reform (as actually were the MPs of the Conservative opposition; the “sacred stone” of the October 1974 Conservative manifesto also committed to elected assemblies, despite later backtracking by the likes of Theresa May in 1999). Despite not having a majority in the latter stages of the parliament, the Labour Party secured the support of SNP and Liberal Party MPs to bring forward devolution legislation, but this was sabotaged by dissident Labour MPs with the backing of the Tory Party and although a majority in Scotland voted for an elected parliament the referendum result was disallowed (a position that would have been replicated over Brexit which also failed to secure the “40% of the electorate” requirement of the 1979 referendum). Thus, the codification of the Barnett formula was in a context in which devolution was at the forefront of political debate. (What happened after the referendums of March 1979 is another matter … ).

    But what is missing from this article is any concept of what the “Higher Education sector” actually is.

    I appreciate that this is a gentle introduction on one aspect, but an important part of the Scottish HE Landscape is that 30% of HE student numbers are NOT delivered or funded by the so-called “HE sector”. While the proportion of “HE in FE” is less than 10% in England and the funding is separated from regulatory oversight, it is also a significant absolute volume of HE outside what people usually mean by the “HE Sector”.

    To understand this we need to distinguish between institutions and courses (or awards if you prefer). Before 1992 in English local authority further and higher education, there was the concept of “Advanced” and “Non-Advanced” Further Education courses (AFE and NAFE – overseen by classifications of the “Burnham” committees that also had links to salary rates for lecturer grades). These levels (there were actually five) could co-exist in the same institution. There was a further subdivision into Poolable and Non-Poolable AFE (ie Higher Education). In Scotland’s non-university sector, there was a different division at institutional level between Central Institutions, incumbent to a Scottish Office run by the government at Westminster, and Local Authority institutions, but both types of courses also existed across institutions. Some specialist institutions/monotechnics (eg art, agriculture) represented a strongly vertically integrated concept of post-school education that has been largely sidelined.

    The original definition of HE in the 1992 Act was courses/awards above the standard of GCE A level or equivalent, and that to be in the English HE “sector” you had to have 55% of student numbers in the Higher category (later clarified as FTEs when a slip up left City Poly off the 1989 original list for demunicipalisation). This arbitrary legislative division left many hundreds of thousands of students on HE courses in institutions not in the HE sector (in at least one English case there was an “FE” institution in the mid 2000s with more full time HE students than several universities; in Scotland the dividing line was different and several “FE” institutions in the 1990s had 70-80% of students on HE courses/awards). In abolishing one “binary line” the 1992 Act created another with HE in FE (and in a few cases FE in HE) falling outside logical and sensible educational delineations. (The splitting of the English Funding Council with a separate teacher training offshoot and it’s own “sector” further confused things).

    Fast forwarding to present day Scotland, the policy of the (elected) Scottish Parliament and Government in recent years has been to expand HE through the growth of HNC/HND qualifications delivered in colleges, officially designated as “FE”, and to cajole universities and other HEI into accepting a greater proportion of students through articulation arrangements into the third and fourth years of Scottish degrees, though also several FE colleges have also developed some full honours provision (funded by the FE funding council) and at least one has had the aspiration of TDAP (taught degree awarding powers) for some years.

    In the USA most people understand that there are typically several HE systems at state level (in the case of New York State at least 6!). It would be better if we thought about the UK as more of a similar patchwork quilt and spectrum of institutions than the unified “sector” entity some would like to imagine it is (or would prefer it to be).

  3. I also meant to point out that the University of the Highlands and Islands is a special case, as a federal HE “institution” whose major components are largely in the FE sector. In an unusual example of what used to be called “franchising”, or more accurately sub-contracting, funding flows from the HE Funding Council into the federal UHI, which delivers no courses, but the delivery arms are a miscellany of public and private independent institutions with significant sized FE colleges among them. It’s actually an inspired model to reach deprived and isolated communities, which exist not just in geographically remote parts of Scotland but in every city, town and village in the UK.

    By the way, the last remaining local authority HE institution in England is the Guildhall School in the City of London. Arguably the large “Saturday Schools” of the conservatoire “sector”, seen frequently on BBC Young Musician of the Year, are an important remaining example of vertical integration between what is notionally HE and notionally FE, as are a few of the remnants of the Agricultural College sector that used to be in every part of the UK (“one per county”).

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