The Diamond Review and future of HE in Wales

The Welsh Government established the cross-party Review of Higher Education Funding and Student Finance Arrangements in Wales in April 2014. Chaired by the University of Aberdeen’s Sir Professor Ian Diamond, it was given two and half years to solve the problem of higher education funding in Wales.

The long timeframe may be down to its huge remit, the sheer weight of the task and the need to ‘get it right’ for a generation - or it might be those factors combined with the upcoming National Assembly for Wales elections in May and an attempt to temporarily depoliticise higher education – the final report is due to be released this autumn.

The Welsh sector makes a significant contribution to the economy - £3 billion a year in gross expenditure to the Welsh economy, employing 24,600 people and having an annual turnover of £1.3 billion. But it is a distinct beast to that of England and the rest of the UK. That is by design, led by current and previous Education Ministers, underpinned by a Welsh Labour Government that has been in power since 1999. For the nine universities in Wales, there is an emphasis on a world class, all-age system, delivering both social justice and economic growth. There has been a rejection of the market, a rejection of private providers and a rejection of competition.

Some might describe the Diamond Review as an uninteresting, overly long affair, with the best is yet to come. To quench the desire for output, an interim report was planned and has recently been released. While this report does not offer anything in terms of recommendations, it does provide a vast amount in terms of the evidence base it has gathered and salient themes. Undoubtedly, it is an impressive document.

Challenges to address

The Review is looking at the problem of part-time provision. The Government have gone as far as to describe the part-time provision as ‘vital’ to Wales. There are 42,890 higher education part-time students in Wales – 31% of overall student numbers; most studying for employment purposes while in work. But numbers are in decline, although not as sharply as in England. Demographic changes in the coming years show the proportion of younger people is shrinking, yet Wales needs to expand and develop its workforce. This means Wales needs to develop the workforce it currently has, and cannot simply rely on an influx of new graduates. Therefore part-time provision is not only a driver of social justice and widening access, it also lies at the heart of economic development.

And yet policy approaches and the inevitable funding that comes with them do not give part-time provision parity with full-time. Just one example: to afford the huge amount of money needed to pay for the Tuition Fee Grant for full-time students, the part-time pot was raided. This leads us neatly to another focus of the review: what to do about the Tuition Fee Grant? Since 2012/13 new entrant Welsh domiciled full-time students (and therefore also EU students studying in Wales) have paid no more than £3,400 in university fees per year regardless of where they study in the UK – the Tuition Fee Grant makes up the difference. A real vote winner, but also expensive – in 2012/13 the policy cost £172.6m on behalf of 50,600 Welsh and relevant EU students.

As a policy, the grants success should be determined on its purpose:

1. If this purpose is to reduce Welsh student fee debt then yes, very successful.
2. If it is to encourage non-traditional students to enter full-time higher education, the jury is still out.
3. If it is for Welsh Government money to fund a selection of (mainly) English universities to the tune of £64m in 2013/14, very successful.
4. If it is to deliver a populist policy and garner electorate support, then it’s yes once again, super successful.

But success or failure, the policy is very expensive. And funded at the expense of part-time students. Yet it is deeply popular. Some might say the Welsh Government has found itself in a pickle and needs this Review to lend a helping hand.Supporting the skills needs in Wales: projections indicate jobs are on the rise in Wales, but these will be for those with Level 4 qualifications and above. Wales is not currently producing these people in sufficient numbers. The role of the higher and further education sectors, and how they work together is being considered.

Lastly, the review is being asked to strengthen the position of post-graduate provision – an area identified as crucial to meet workforce needs. But also, an area that has experienced reduced investment. In 2013/14, there were 28,995 post-graduate students, or 21% of total students, all with little or no access to student loans or support.

And naturally, the review is invited to address these issues with only long-term, financially sustainable solutions.

Emerging themes

The interim report gathers together emerging themes in terms of the evidence gathered, below are just a sprinkling of the headlines:

• The status quo in terms of funding has to cease – it is not sustainable, this includes the Tuition Fee Grant. Although there is no consensus about what the replacement should be.
• The importance that HEFCW and Government strategies place on part-time provision does not translate into policy implementation and this has not translated into funding, even though this provision is so strongly linked to skills, employment and the economy. Part-time is still the ‘other’ and full-time the ‘norm’.
• The importance of Wales having a strong world-class research base but also having a shortfall in the number of STEM-related academic researchers.
• A belief that the £9k maximum tuition fee level for full-time undergraduate studies does not offer reasonable value for money for students. But neither does it cover the cost of expensive subjects, causing tensions within institutions in terms of cross-subsidy of courses.
• The importance of Welsh language provision, and the role of Coleg Cymraeg Cenedlaethol in supporting this.

While culturally and politically distinct, Wales is economically intertwined with England and a relatively poor part of the UK. And like everywhere else, it is experiencing unprecedented pressure on budgets. In December, the Welsh Government announced its draft budget, a depressing read. But interestingly, the decisions made in this budget seem inverse to the themes in this report.

The draft budget proposes an increase in spending on the Tuition Fee Grant (HEFCW had limited Welsh student numbers in Wales to control spending on the grant, but this was lifted by the Welsh Government, meaning further funding is required). Decreased funding for part-time, research, expensive subjects and Welsh language provision by £41 million or 32 percent. How the cuts will be distributed between these areas is yet to be determined. Part-time is certainly very vulnerable.

The release of the draft budget and this report so close together is likely a coincidence. The contradictions in their messaging is worrying. It clearly highlights the enormity of the challenge for the next Welsh Government. This author believes higher education should be free. And certainly any attempts to lower costs for full-time students should not be at the expense of part-time students.

Whoever wins in May must respond to the review’s recommendations next autumn, squaring this to be both affordable, sustainable and electorally palatable. No easy task, but such a very important one.