This article is more than 6 years old

The cost of everything and the value of nothing

Brian Hipkin questions what we lose when we’re counting beans.
This article is more than 6 years old

So now we have it in black and white. The Office for Students is proposing in the Regulatory Framework Consultation that all institutions who want to retain or gain University title will have to publish ‘value for money’ statements. They go on to be more specific; “providers should design this statement to allow students to see how their money is spent, following examples from other sectors, such as local authorities publishing breakdowns of how council tax is spent.”

In many ways this is the logical outcome of the moment when the drift towards data, that started in 2005 with the NSS, then in 2017 involved LEO (Longitudinal Educational Outcomes), become a narrow, monetised notion of ‘value for money’ – based on an equation between tuition fees and earnings 3-5 years out from graduation.

The addition of LEO to metrics that will be used contextually in the Teaching Excellence Framework (TEF), and the pressure from the Treasury that variable tuition fee levels should be tied to earnings data, are but skirmishes in the coming battle for the soul and purpose of higher education in this country.

What’s the point?

Is a university education simply a journey gathering employability skills along the way, with the single goal of earning enough to start to repay student loans?

The introduction of tuition fees in 1998 meant that students were for the first time, able to put a monetary value on their education. This has brought with it some interesting notions of ‘value for money’. Where students feel they are getting ‘poor’ service they are articulating the value of that service as equivalent to their annual fee.

Comments such as ‘I am not paying £9,000 for a rubbish lecture like that’ are not uncommon. The fact that the vast majority of undergraduates are not actually paying anything upfront, or possibly ever, and that a single ‘bad’ lecture is not costing £9,000, are facts that have never entered into the debate around ‘value for money’. The yearly tuition fee has become the yardstick by which ‘value for money’ is judged in the same way that the salary of the Prime Minister has become the unit of comparison for judging the merits of vice chancellors’ pay.

Counting beans

As with other complex organisations, universities find it notoriously difficult to understand all their costs. Despite the existence of the Transparent Approach to Costing (TRAC) and benchmarking tables produced by companies such as Tribal, the core activities of teaching and learning, at least when you think about the wider suite of services and resources required, remain a mystery wrapped in an un-costable enigma.

It is a historical symptom of the academic/support services divide that the latter has been subject to more detailed costing. This is due, in part, to the outdated notion that support services are a ‘tax’ on the revenue-generating work undertaken by academics.

So, it will make interesting reading when students open their cost breakdowns and find that those one-hour lectures of 150 students in their first year, were given by a lecturer paid at £30 per hour, working out at 20p per student. Value for money?

Real value

Knowing how much is spent, via a detailed breakdown of costs, will be rendered virtually meaningless because students are being encouraged to use a model of ‘value’ that is based upon deferred gratification. This is one where the debt incurred by tuition fees is judged in retrospect, often many years later against the ‘graduate premium’ element of their earnings. This becomes a theoretical and largely irrelevant measurement compared to models of ‘value’ that surround students’ everyday spending of their maintenance loans and part-time earnings that are based upon immediate judgements using commonly held societal yardsticks,

A baseline that students deserve the best teaching and facilities, even if they are not incurring any debt at all, has been obscured by a HE landscape now filled with the debate around fees and debt.

Is it too nostalgic, even romantic, to argue that ‘value’ for students is created when they have their potential realised, supported and developed via a university education?

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