A magic money tree but not for HE

There are multiple branches of history – as Dominic Cummings tells us. There is, for example a branch somewhere where we are preparing ourselves for five more years of Ed Miliband and his coalition of chaos.

Closer to the path that reality has taken (not so much a branch as “vote leaf”), Sajid Javid was initially expected to be presenting a full, multi-year, spending review this September. This detailed presentation of the next three years of spending would have included the results of the DfE post-18 review of fees and funding, which would incorporate the government’s response to the Augar report.

No HE in the new economic plan?

The value that this government puts on higher education as a central component of a nascent “new economic plan” is clear. The Prime Minister used his first Facebook “People’s Question Time” to announce tweaks to Tier 1 visas to encourage the best and brightest minds to work in Britain.

Even Sajid Javid’s spending round speech today looked to a “stream of ideas and innovations” that would “flow from our brilliant universities and research institutes”. But there was no actual money in the pot for higher education. Not this time.

Branch offers

The Department for Education will see a spending increase of 3.3 per cent in real terms next year, with a budget (departmental expenditure limits, or DEL) of £64bn in 2019-20, and £67.8bn in 2020-21, an increase of £3.8bn.

The first year of the three year settlement for the schools budget takes compulsory sector spending from £44.4bn in 2019-20 – excluding depreciation – to £47.6bn in 2020-21, a £3.2bn year on year increase. This includes pension funding following changes to the Teachers’ Pension Scheme (TPS).

A large part of the remainder of the increase looks like it is taken up by the £400m announced for further education (a lot, but not enough to reverse the historic cuts), and the extra £100m to cover TPS in further education, with the rest devoted to early years provision and inflationary increases. DfE will likely also see a small slice of a further £2bn promised for no-deal planning, which comes on top of the £2bn promised in the summer.

There is a branch of history where this is good news for higher education – we could expect a considered response to the post-18 review later this year, perhaps alongside the budget, allowing enough time to finesse the details before a full spending review and the start of recruitment for the 2021 application cycle. Changes to higher education funding could be taken seriously, outside of election planning, on a consensual cross-party basis. After all, we are all agreed on the central importance of education and research in a knowledge economy.

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People, we are not in that branch of history. John McDonnell’s response characterised the announcement as a “compendium of meaningless platitudes” – and the speech itself was interrupted twice (once by former Chancellor and former Conservative MP Ken Clarke) on points of order – as Javid took time at the dispatch box to attack the opposition and what front bench government politicians seem content to call the “surrender bill” (the European Union (Withdrawal) (No 6) Bill).

Since the return from recess the Commons has veered between aggression and disbelief – there was certainly no press or politician’s comment that did not see this one-year spending round as electioneering. The “new economic plan” will replace the “long term economic plan” of Javid’s predecessors – the Chancellor now believes we are at the start of a “new decade of renewal”.

The Institute for Fiscal Studies and others have expressed doubt about the affordability of these spending commitments – without an Office for Budgetary Responsibility Forecast we can’t know for sure, but it appears Javid will breach his own fiscal rules. There’s also a lingering suspicion that this is Philip Hammond’s no-deal rainy day fund that is being spent.

But cast your mind back to 2017. The election was widely seen as being swayed by distinctive commitments on free higher education from Labour – Theresa May instigated the post-18 review (sacking two ministers, including current universities and science minister Jo Johnson in the process) to come up with a Conservative offer to counter this. It would have been easy to add a splashy higher education promise – the return of student grants, for example – to give the party something to swing student-heavy seats that way.

Instead, it feels like a bet is being placed on Corbyn’s perceived personal unpopularity in planning for this month’s election. That was the same bet Theresa May placed last time, and it wasn’t a wise one.

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