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