International agents – Reducing the risks

The financial landscape of British universities is changing rapidly as the state retreats from directly funding universities and the contribution of individual students becomes the primary source of tuition fee income. Even in Wales and Scotland, where the government continues to subsidise tuition fees, questions are being asked about long-term sustainability.

While the United Kingdom government recently announced a lifting of the cap on student numbers from 2015, it is highly unlikely that universities will be able to increase domestic tuition fees to match inflation, given the political sensitivity of the issue.

This places even more emphasis on the international student market as the main source of expendable income, and this in turn shifts the focus to the way in which students are recruited and the security of the income generated.

It is now estimated that there are more than 488,000 overseas students currently entering the UK to take a variety of degrees, of which over 330,000 come from outside the country. The British Council estimates this will rise by 25% within the next decade.

To achieve this growth, it is inevitable that UK universities, like institutions from other countries across the world, will come to rely more on the services of overseas agents. In 2011-12 recruitment agents working for UK institutions were paid an estimated £120 million (US$197 million) a year in commission.

But according to recent investigation, the quality of agents has been variable.

Ethical code of practice

It is for this reason that the British Council has proposed the introduction of an online database of approved agents.

This is not a system of accreditation, as Kevin Van-Cauter, higher education advisor for the British Council, has stressed. Instead it is proposed to offer training and regular assessments, and agents will be expected to sign up to an ‘ethical’ code of practice.

However, given the extent to which universities already rely on agents – one Northern university spent £2.2 million on commissions – the task of overseeing the business cannot be left to the British Council alone.

A recent study conducted by researchers at the University of Hertfordshire highlights some of the potential risks of using agents. They have uncovered a lack of transparency and poor communication.

Several cases were identified of “a potentially serious ethical conflict” arising from agents being paid by both universities and their prospective students. Indeed, seven out of 10 institutions did not actually know whether their agents were involved in this form of double charging.

On the other side of the equation, the main complaint by agents was a lack of communication with their client institution and this led, it was suggested, to misinformation.

Sadly, examples of fraud were cited in the Hertfordshire research – for instance, one case where agents were offering bogus places in institutions such as Liverpool Hope University. It was revealed in one example that the agent completed an application form to such an extent that the student had no idea what was actually in it.

This, and much more, revealed a serious lack of transparency in the system. Agents, the researchers concluded, were often more concerned with their own financial arrangements than with the actual needs of the student.

This is why Uni-Pay, the online payment system of which I am non-executive chair, is now seeking to provide additional safeguards which universities can easily access and which will help good agents and create a more transparent system for both sides.

The company has drawn on its research and its established position within the international education market to create a system that will allow institutions to share information about agents as well as communicate more effectively with the agents themselves.

Through this online system students, institutions and the agents themselves can see at the press of a button which payments are pending or complete on a secure system. It also allows institutions using it to rate agents according to the services they provide, and blow the whistle on any unscrupulous operators that they find.

Transparency

This is an example of universities, and organisations that work in partnership with them, taking proactive steps to take more ownership and control of their work with agents. As the experience in other countries such as Australia has shown, such measures are vital to protect students and the reputation both of institutions and reputable agents.

Perhaps the first step should be for institutions to make public information on which agents they use, as the University of Nottingham has done.

There are many more answers to be sought as this service expands.

What is the performance record of agents? What is the conversion rate of applicants to registrations, and what is the rate of visa refusals between different agents? What information do agents actually give students? Is it accurate or misleading? And above all, what is the real effectiveness of the contract between agents and universities?

This is not to say that agents, by and large, are not doing a reasonable job. But given the growth in the market and the increasing reliance on this source of income, universities need to be much clearer about the relationship and understand what options they have available if, for any reason, they become dissatisfied with a particular agent.

Agents will always be used, and in some parts of the world it is assumed that intermediaries are necessary to gain access to a university place.

The British Council’s database will go a long way to ensuring greater transparency. But universities need to be even more aware of the potential pitfalls and use systems which both reduce risk, and enhance quality – which the British higher education sector is both renowned for and should be careful to protect.

* Professor Sir Deian Hopkin is a member of the UK’s Higher Education Commission and non-executive chairman of Uni-Pay.