Unintended policy consequences constrain student choice

The policies of successive English governments, aimed among other things at enhancing student choice through income-contingent loans tied to rising tuition fees, have had the opposite effect for many students.

This is especially the case for part-time degree students, whose numbers plummeted by one-third between 2010 and 2015, says Claire Callender, a professor of higher education studies and deputy director of the Centre for Global Higher Education.

If the government was really committed to choice and university competition – hallmarks of its higher education reform policies for the past two decades – and to opening up access and making study more affordable, it would need to take radical action, she stated.

“It will also need to reconsider its idealisation of the market and the choices and dynamics of competition, if student choice is not to be an illusion and contribute to further inequality.”

Callender was a keynote speaker at the Centre for Global Higher Education’s 2018 Annual Conference, held on 11 April at the UCL Institute of Education, University College London. A professor at the UCL Institute of Education and at Birkbeck, University of London, she was speaking on “Student Choice in Higher Education – Reproducing social inequalities?”

Higher education policy in England has been underpinned by a move towards marketisation, seeking to promote student choice and provider competition. Central to this have been student funding reforms focusing on higher tuition fees and income-contingent student loans.

In her keynote Callender explored government rhetoric on student choice, especially around student funding, starting with the 1997 Dearing Report and continuing to the Independent Review of Higher Education Funding and Student Finance in 2009, chaired by Lord Browne, through to funding reforms for part-time students in 2012-13.

Idealisation of the market

“Policy documents demonstrate the idealisation of the workings of the market by politicians and policy-makers. They talk about choice only in positive terms – the positive effects, the positive outcomes. They are blind to any negative impacts, the values that choice and markets and competition engender. They are blind to the winners and the losers.”

Despite government calls for greater student choice, none of its documents define what is meant by choice. Neither do they spell out in detail what choices are involved, or how students make choices in a complex higher education ‘market’ that offers intangible services, where the range of choices is very large and where the outcomes are uncertain and depend on the subject of study, the university attended, grades and socio-economic background.

“Put simply, individual choices are shaped by who students are and where they come from. They are shaped by social structures and social inequalities,” said Callender.

“Critically, these social dynamics of choice are absent from the choice and competition rhetoric we’ve found in government policies and documents. But the choice agenda, which seemingly can be seen as desirable and fair, actually legitimates social inequality. It builds on and extends social difference and disadvantage.”

Callender explored part-time student choice, specifically in relation to reforms introduced in 2012-13. There had been a long-term decline in part-time students, especially since 2008, and dramatic changes since 2012.

“We have to remember that at its peak in 2008, 45% of all students studied part-time. Today, 20% do. This is because year on year, part-time student numbers have fallen while full-time student numbers have increased.”

There have been numerous explanations for the long-term decline – above inflation rises in tuition fees; inadequacies in student support; ending of funding for a second degree; recession and other economic factors; supply factors as university income from part-time study fell behind income possible from full-time provision; and the rise of unrecorded learning via unaccredited courses at universities and the growth of massive open online courses.

“All of these factors play a part, none of them is mutually exclusive. And as others have suggested, they form pressure from all sides.”

Impacts of reforms

The key way in which the 2012-13 reforms affected part-time students was that means-tested grants and course grants were abolished, replaced by up-front loans to meet tuition costs. Reduced block grants to universities led to higher tuition fees, which were capped at £6,750 (US$9,400).

The White Paper stated that the loans would benefit many part-time students from non-traditional backgrounds. But reforms have had the opposite effect. “Indeed, they largely explain the spectacular and persistent falls in part-time undergraduate enrolments.”

There was a massive rise in tuition fees.

For example, the Open University increased fees for students living in England from £1,400 to £5,000 per full-time equivalent between 2011 and 2012 – a real rise of 247%. In 2012-13, the median tuition fee charged for a part-time degree was £5,000 per full-time equivalent, and some institutions charged the maximum £9,000 per full-time equivalent.

“So across the sector as a whole fees increased and the increases were greater than the sector had ever seen before,” Callender continued.

There was also a massive decline in part-time student numbers. While in 2010 there were 216,000 entrants, by 2015 the number had fallen to 106,000 – a fall of 51%. At the Open University the falls were greater (63%) than at other institutions, where the drop was 45%.

To ascertain the impact that fee rises had on the numbers, Callender compared trends in entrants in England with those in Scotland and Wales, where students were unaffected by the 2012 reforms.

There was little change in student numbers or fees between 2007 and 2011, after which students in England saw a 247% hike in fees.

“By 2012 we see a decline of 43% in students living in England whereas in Scotland and Wales there is next to no change.” Since then there had been a further decline in England, matched by falls in Scotland and Wales – but the declines have been greater in England.

Comparing changes between England and Wales among students at other institutions, research revealed that if entrant numbers had fallen by the same proportions as those in Wales, there would have been 149,000 entrants in England – instead there were 106,000.

“In other words, there are 43,000 fewer students than would have been the case without these changes.” This shows that tuition fees caused some of the decline in English part-time entrants to universities, demonstrating how student choices have been extremely limited.

“The student loans that were introduced in 2012 for part-time students were specifically designed to protect students from tuition fee rises, to make part-time study more affordable and to safeguard access. But they haven’t – because the loans are far too restrictive.”

Eligibility and take-up of loans

In 2015, said Callender, fewer than half of all students were eligible for loans. “Without loans, students have to pay upfront out of their own pockets, or abandon the idea of study.” As research in the UK and elsewhere has repeatedly shown, upfront fees and fee hikes negatively affect student participation, unless accompanied by equivalent increases in student support.

Lack of data available has restricted research, but what is known is that around 59% of part-time students who were eligible for loans in 2012 took one up – compared to well over 90% among full-time students.

Overall, only about a quarter of all part-time students are eligible for loans, Callender pointed out. Clearly, some part-time students are willing to borrow, but for many, part-time studies are “too expensive and definitely unaffordable”.

Research confirmed that part-timers were more debt-averse than younger full-time peers, probably because they are older, have families and more financial commitments. Their reluctance or inability to pay higher fees upfront or via loans was absolutely understandable.

“Taking out a loan and having to pay in reality an additional 9% in marginal tax to repay that loan, or more than £6,000 a year for fees, is a leap of faith when the returns on investment are unknown and uncertain.”

“As research repeatedly demonstrates, financial returns from lifelong learning in terms of earnings and improved employment opportunities are mixed,” she continued.

“And yet the government justifies student loans because of the assumed financial returns, and their belief that who benefits pays. And government’s current answer in trying to reverse this decline in part-time numbers is just to increase opportunities to take out loans, by relaxing the eligibility criteria by increasing maintenance loans, which they are going to do next year.

“But the evidence suggests that more loans will not have a great impact. Loans have not worked to date and are unlikely to work in future. Loans are unlikely to reverse the decline.

“For many, the alternative to loans is not paying fees upfront, it’s deciding not to study. More loans will not enhance student choices – they will continue to limit and constrain choices.”

Further, Callender said, student funding has impacted on what can be studied.

“Students needing a loan can no longer gain a degree by building up institutional credits over a number of years, going in and out of study. Instead they have to commit to undertaking a degree or particular qualification at the outset because of the loan eligibility criteria.

“They can’t take courses under a year, because they can’t get a loan. They can’t study at an intensity of less than 25% because of the eligibility criteria. Consequently, there has been a very dramatic shift in students’ qualifications aims and in their intensity of study.”

Between 2010 and 2015 in England, the number of part-time students taking non-degree courses fell much more rapidly than the number of degree entrants. “So what’s been lost are many vocationally-orientated short continuing education type courses,” said Callender.

“Similarly, there has been a massive change in intensity of study. There was a 64% decline in the total number of entrants studying on courses of less than 25% intensity.

“Not only are students choosing not to do these courses, but also higher education institutions are modifying their provision so that more students can qualify for loans.”

Conclusion

The dramatic decline in part-time study has had consequences for social equity and for social mobility. “Part-time study provides a way into higher education for those who haven’t followed the traditional route. It gives people a second chance,” Callender pointed out.

But those most affected by reforms are from groups traditionally targeted for ‘widening participation’ – those over the age of 35 and with low or no qualifications.

Moreover, provision is now concentrated in non-Russell Group universities – while the universities in this group are the United Kingdom’s elite institutions. “The Russell Group has pulled out of part-time study.

“The demise of the part-time undergraduate sector in England is clearly related to the 2012-13 reforms,” Callender concluded. “It is one of the victims of these policy changes; it is one of the unintended consequences of government’s choice agenda.” Student choices have been limited and constrained.

“In government’s own terms, it is clear that there has been a market failure.”