OfS is one year older – but how much wiser?

Happy first birthday to the Office for Students (OfS). In common with most one year-olds, OfS is now standing, if not quite running around freely yet. There have of course been some teething stages, but we are almost through that phase now and, as is normal after the first year, we are beginning to realise that this will be a lot more expensive than we expected!

The miracle of birth of any new body should never be downplayed. OfS has undertaken a huge amount of activity in its first year. Registering over 300 providers, with at least another hundred estimated to be still going through the registration process as well as guidance on a whole range of topics from unconditional offers, to Prevent, to vice chancellor pay. It has also established itself as an organisation, created an appropriate staffing structure and worked with the designated bodies to outline its regulatory activities. A lot has been achieved in the first year, and congratulations are in order for that.

At GuildHE we welcomed the introduction of OfS and its mandate for a lighter-touch regulatory system, more focused on areas of higher risk. As the sector has become increasingly diverse – whether in terms of provider, provision or type of student – so a more nuanced regulatory approach, tailored to different providers on the basis of risk is clearly the right approach, especially if the regulatory landscape is to remain fit for purpose for the future.

Rigorous registration

The registration process was rightly rigorous, with several rounds of detailed questions. It was also based on a one-size-fits-all approach, demonstrating that all registered providers meet a high barrier to entry to the higher education sector.

The establishment of OfS and getting institutions onto the register was always likely to be a time-intensive process for institutions and also OfS itself. In future, once we are past initial registration I would expect processes impacting on institutions to become more light-touch and risk-based as we were promised in the Higher Education and Research Act, which talked about proportionate regulation “targeted only at cases in which action is needed.”

The monitoring processes for providers on the register must of course be robust to identify whether any action needs to be taken, but the expectation is that unless there are any areas identified as being of higher risk then actually it should be significantly less burdensome than at present. There are of course questions about the reliance of data in the monitoring processes and the impact that this might have on smaller institutions, with more volatile student data due to cohort size.

Value for money

Registering 300-plus providers was always going to be a significant burden, but this is likely to reflect the high-water mark of activity of the regulator. It should, therefore, also be the high water-mark for OfS size of organisation and fees that are charged. The huge fees suggested in Parliament last week might just about be defensible in the first year of operation, and even then only just, but going forward into a lower burden, risk-based regulatory approach I would expect to see significant fee reductions in future years.

The Higher Education and Research Act is very clear about the fees charged by the regulator and the designated bodies, and we at GuildHE will work with other sector organisations to ensure that value for money is not something that is done to providers, but is also a value lived by OfS.

It would be very easy for the amount of OfS activity to expand to justify the fees being charged. But we would call for a rigorous independent, external process to scrutinise the fees, and activities underpinning the fees, to ensure that they live the principles of cost reflexivity and value for money.

Teething problems

It has been a significant achievement to get the OfS up and running so quickly and to register the number of providers, as rigorously as they have. However as with any new process, and establishing a new organisation, there will always be some teething problems, and questions about, for example, the consistency of decisions have been raised by our members. It will be important for OfS to listen to these concerns open-mindedly, and reflect on its processes and any changes to procedures required.

One of the themes that has come up has been the speed and tone of OfS in responding to questions. It is unsurprising that OfS in its early days is trying to create a very different feel from the old “buffer-body” approach of the funding council. Indeed it could be argued that this has been an important process to go through for the new regulator. But as OfS moves into its operational period it will be important to consider whether a different tone might be required.

For some institutions this stand-offishness, combined with the undoubted busyness of the OfS, has meant some quite challenging situations, such as an institution needing to renew their time-limited taught degree awarding powers in October, but unable to get a contact person to liaise with, or the many institutions wanting to start the degree awarding powers processes that are not able to because of the delays in publishing new procedures. These type of issues can have a significant impact on institutions.

Proportionate regulation

It will be important for OfS to consider the impact of different bits of regulation on different providers. The initial registration process was always likely to require a one-size-fits-all approach, but it should be recognised that institutions of different sizes will have different resources to be able to respond to these kinds of requirements, and different risk profiles.

The Higher Education and Research Act outlined the duty for the regulator to “promote…greater choice…in the provision of higher education” with choice defined as including a diverse range of higher education providers. It will therefore be important that OfS considers the unintended consequences of significant regulatory burden on smaller providers in light of its duty to maintain a diverse sector.

We would therefore call on OfS to undertake impact assessments on the diversity of the higher education sector for all its policies, whereby it considers each of its proposals through the lens of impact that it might have on different types of institutions. The universities minister was attracted to the idea of letting a thousand flowers bloom in terms of a diverse higher education sector and we should ensure that these flowers aren’t strangled by the weeds of regulatory burden before they’re even given the opportunity to bloom.

As we celebrate its first birthday we should congratulate OfS on achieving so much in such a short space of time. But like any new organisation after a period of major activity it would be good to take a moment to reflect on the activity that has been undertaken, consider how things could be improved and identify any changes to its processes and ways of working that it should consider for the future so that it is able to meet its undoubted potential.