David Behan’s government-commissioned report into the work of the Office for Students – Fit for the Future – is a substantial addition to the recent literature on improving the regulation of higher education.
Building on the findings of the DfE’s 2022 legislative review (LR) of the Higher Education and Research Act, the 2023 House of Lords Industry and Regulators Committee report (IRC), and the government response (IRC response) to this report – the newest iteration has the notable advantage that recommendations will be taken forward by a new interim chair – David Behan himself.
This appointment has been confirmed in a Written Ministerial Statement from Secretary of State for Education Bridget Phillipson. Trailed earlier in the week on the Today programme, her statement does not propose a solution with the financial challenges facing the sector, but gives a welcome fresh steer to the regulator on the sector’s financial health. The statement also confirms that government accepts the core analysis of Behan’s review, and drops a Steve Jobs style “one more thing” announcement for the ages:
Lastly, I have written to colleagues separately about my decision to stop further commencement of the Higher Education (Freedom of Speech) Act 2023, in order to consider options, including its repeal. I am aware of concerns that the Act would be burdensome on providers and on the OfS, and I will confirm my long term plans as soon as possible.
As well as the sources detailed above, Behan and his team have engaged widely with the sector in developing their report. A “challenge panel” encompassing vice chancellors and senior sector figures met three times between February and April 2024. The team spoke to more than 110 stakeholders, including representatives from 44 providers, staff at mission groups, sector organisations, and officials from DfE, the Department for Science Innovation and Technology (DSIT), the Treasury (HMT), other departments, and devolved administrations. The process also saw five site visits to providers, six student roundtables, a survey of registered providers (307 responses from more than 150 providers), and a review of literature and documentation.
David Behan himself brings significant expertise to the process, and to his new role. He has, as a former Director General of Social Care at the Department of Health, an understanding of the way government works. As Chief Inspector at the Commission for Social Care inspection, and Chief Executive of the Care Quality Commission, he has a deep expertise in the modern world of regulation. And, as chair of Health Education England, he clearly understands higher education.
What’s in the report?
Thirty-two recommendations cover, as was set out in the specification of the review, the efficacy, accountability, governance, and efficiency of the regulator. As such, you would be right to expect this to work as a review of process and regulatory plumbing. There are no fireworks, no massive departures from existing practice, though there are – as we will see – a few surprises.
Behan situates the report in an understanding of the current financial realities of the sector – older readers may remember the first OfS chair, Michael Barber, opining that “golden ages don’t have to be in the past”: Behan notes that some suggest the “golden age” of higher education is over. The report also takes a technologically progressive view of the future of higher education – advances in digital technology could drive changes in teaching methods, and higher education will need to respond to increased demand for short courses and lifelong learning, including through strengthening relationships with industry.
The system will increasingly need to respond to the lifestyle choices of students who may more frequently be working and studying part-time or undertaking other less traditional and more innovative forms of education, whilst balancing other commitments such as raising families.
Against these broad social changes, the review argues that the “arguably imperfect market mechanisms” which drive much of the regulation and development of the sector, are insufficient to ensure the higher education sector is prepared for the future. The review advocates a more strategic, active role for both government and regulator in seeking to shape higher education research and teaching, defining the purpose of higher education and anticipating trends. You will look in vain for a mention of “competition” among the new conceptualisation of what OfS should be doing.
New priorities
Behan sets out four priorities for the regulator:
- The quality of higher education.
- The financial sustainability of higher education providers.
- Acting in the student interest.
- Protecting how public money is spent
The government is charged with thinking about the legislative powers and tools that OfS needs to regulate against these priorities. But before we get on to these there are brief notes on two overarching themes. On independence the report notes:
Whilst I am satisfied that the OfS operates independently in discharging its regulatory role, there is more that can be done to address the perception of the lack of independence of the OfS from government
With a recommendation that the government should be responsible for appointing the chair and non-executive directors only, the chair should appoint the chief executive, and the chief executive should appoint other members of executive. Currently, the Secretary of State appoints the chief executive and two directors (freedom of speech, and fair access), something which is outside of what one would usually expect from a regulator. The regulator is charged with developing “a more transparent style of communication” in order to better demonstrate its independence from government.
The other is on sector relationships. Behan notes sector feedback that there has been a sea-change since the publication of the very critical IRC report, but he is clear that there is more that can be done – both by the regulator and the sector itself – to bring about a “mature dialog that can secure a common and shared purpose” in bringing about:
High quality education provided by an effective, efficient, and sustainable system that operates in the interests of students.
This would include the development of a stakeholder strategy, and an annual stakeholder survey.
The quality of higher education
The report recommends that the various Office for Students quality assessment methodologies (for instance B3 investigations, other B condition investigations, bespoke work on standards, TEF) be brought together into an integrated assessment of quality. This should work as a continuous feedback loop, involving a description of high-quality higher education. OfS should gain the status of an official whistleblowing body, and the designated quality body functions described in HERA should be removed: giving OfS itself the sole responsibility to define quality and standards.
The financial sustainability of providers
The recommendations here are that OfS clarifies its position on market exit, “and whether the non-interventionist position is still the most appropriate for meeting the challenges of today.” Working with the government, the regulator should grow available advice and support for providers experiencing financial challenges. OfS and the sector should build and share an accurate picture of current financial risk in the sector to support forecasting and planning, and revise the requirements for student protection plans.
Acting in the student interest
Behan suggests OfS should be given full consumer enforcement powers, and the idea of a model students’ contract for higher education returns to the table. The regulator should directly involve students in formal governance and regulatory activity – with the existing panel being reconstituted as a committee of the board, and students involved in quality investigation. There’s also an enhanced focus on the assuring management and governance of providers, with a strengthening of the “E conditions” of registration, focused on good governance.
Protecting how public money is spent
This more general category includes recommendations around the reduction of burden (noting the Regulators’ Code principle of “collect once, use many times”) including on collaboration with other regulators. There’s encouragement for the OfS to rethink the way it addresses emerging risk, to consider an independent academic evaluation of its own practice, and to consult and pilot changes to methods before roll out.
Other recommendations
Of course, OfS needs to be accountable to government too. I appreciate that the niceties of the work of arms-length body sponsoring teams are a niche interest, but I note that this team within DfE is slated to become the “primary conduit” for new and ad-hoc requests for work. We would also see beefed-up information sharing protocols (like the joint work between DfE, SLC, and OfS on fraud), and closer links between DSIT and DfE to support a more joined up approach.
As above, DfE will appoint only the chair and non-executive board members. Behan recommends, as you would expect, that this is done with an eye to the required skills (including finance, risk management, and regulation). There should also be (another) independent board evaluation, and a review of which executive roles attend board meetings.
Like every report since time immemorial, the regulator is charged with pursuing efficiency savings and enhanced productivity. It should agree a resourcing plan with DfE, which in turn will review OfS’ registration fee structure alongside current and planned efficiency work.