Securing student success: Regulatory framework for higher education in England
Last updated: 24 November 2022
In this section:
PART II – Sector level regulation
Allowing the higher education sector to flourish, and creating the space for innovation
The OfS will focus on creating the conditions for competition, continuous improvement and informed choice. To achieve this, and ensure that the higher education sector is able to diversify, innovate and flourish, the OfS will take action at the sector level. As it discharges its stewardship role, the OfS will have its primary regulatory objectives in mind and will ensure that it is focused on influencing outcomes for students from all backgrounds.
The following sections outline the approaches that the OfS will use to promote diversity, incentivise innovation, and to manage the risks to the interests of students and taxpayers at the sector level.
Removing unnecessary barriers to entry and minimising regulatory burden for all providers
The OfS’s regulatory framework has been designed to take account of the needs of a diverse range of providers, including providers entering the higher education sector for the first time, and existing providers that represent the diversity already present in the sector. The OfS will regulate providers based on any risks they pose, not their age, size, mission or legal form (although this context will be considered where relevant to risk).
The regulatory framework will support new and existing providers, in particular through the following mechanisms:
Recognition of the diversity of the sector
A diverse sector supports student choice. The conditions of registration are explicitly tailored to a diverse set of providers, by focusing on the outcomes a provider is expected to achieve, rather than determining how this should be done. Providers are free to determine their individual mission, strategy and approach. For example, the management and governance condition requires a provider’s governance arrangements to be appropriate for its size, complexity and legal form.
Minimising regulatory burden
Providers that do not pose specific increased risk will be subject to light touch monitoring and should have less regulatory burden once this regulatory framework is established.
Such providers will be free to innovate however they choose, provided that they continue to deliver positive outcomes for their students.
New and faster options for market entry
The initial conditions of registration are designed so that providers do not need to have a track record of delivering higher education to be able to meet them. Where such a track record does exist, the OfS will take it into account, but there are other ways to evidence that a condition of registration is satisfied. For example, the financial viability and sustainability condition might be satisfied by demonstrating the availability of sufficient funds and sound business plans, or a legally binding financial guarantee from a third party, rather than evidence of past financial performance. There will also be a faster route for high quality new providers to gain access to degree awarding powers directly, without the need for a track record.
Validation
The OfS will take steps to improve the validation system, and address some of the barriers that providers may face when seeking a validating partner and that can make offering innovative and flexible provision unnecessarily burdensome. If the OfS considers it necessary, it may enter into commissioning arrangements with existing higher education providers, or as a last resort, become a validator itself, if authorised to do so in regulations made by the Secretary of State.
Ensuring a minimum baseline of quality for all and promoting excellence and innovation beyond that baseline
The conditions of registration for quality and standards that apply to individual providers are designed to ensure a minimum baseline of protection for all students and the taxpayer. Beyond this minimum, autonomous providers are free to pursue excellence and innovation as they see fit, and the OfS will use its sector level tools to create the space for this to happen.
The OfS has adopted the TEF as a sector level intervention to promote excellence in teaching, learning and student outcomes beyond the minimum baseline. The TEF also provides information to students about where they might find such excellence. Participation in the TEF from the 2022-23 academic year is a condition of registration for providers that meet the requirements for participation set out in the guidance to Condition B6. Other registered providers may participate on a voluntary basis if they meet the eligibility criteria. It is for an individual provider to decide whether or not it wishes to perform beyond its regulated minimum quality baseline in order to affect its TEF outcome. The TEF provides a sector level incentive for improvement beyond the baseline.
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Championing issues and sharing evidence and examples of effective and innovative practice
The OfS is well placed to champion particular issues, themes, and approaches. Although the OfS will not, in general, dictate how autonomous providers should act or what methods they should use, the OfS will be able to help shape sector wide debate and focus. Through its influencing power, the OfS may promote innovation in particular areas, or encourage the dissemination of information about what works best to enhance particular outcomes.
The OfS will scan the local, national and global horizon, and use intelligence obtained from its monitoring of individual providers, to identify specific themes or issues that it wishes to explore at the sector level. This will enable the OfS to anticipate future threats, challenges and opportunities that may not immediately be apparent, but have the potential to affect the higher education landscape.
Certain of these themes may be more relevant to some providers than others, and the OfS may choose to explore these themes in more detail through voluntary targeted engagement with specific providers, focus groups or thematic surveys. The findings of these thematic reviews would then inform the OfS’s sector wide interventions to ensure that higher education in England works in the interests of students and taxpayers.
A cornerstone for the OfS’s agenda-setting influence will be its annual report. Here, the OfS will set out the progress that has been made, the challenges that remain, and the future needs and direction of the sector.
Promoting student choice through diversity of providers and the provision of information
Information for students
The information landscape is continually changing. The OfS will work collaboratively with students to ensure that the information, advice and guidance that is offered, and the way that it is provided, is continually adapted to support students to make the right higher education choices for them. The OfS will also work with employers, regional and national industry representatives, government and UKRI, to ensure that student choice is informed and enabled by the skills needs of industry and the country.
The OfS will improve the quality of information available to students. It will revisit the operation and design of Unistats, taking the latest thinking on behavioural science into account, to consider how best to present this data in a consistent and helpful way to ensure that students have access to an authoritative source of information about higher education. Providers will be expected to provide information, advice and guidance to students from disadvantaged backgrounds and underrepresented groups through activity agreed within their access and participation plans.
The OfS will draw on the longitudinal education outcomes (LEO) dataset as an important source of information about graduate outcomes. Its further development will be a priority for the OfS, taking into account both its limitations and its significant potential.
Diversity of provision and providers
The OfS’s risk-based approach is designed to promote diversity of provision, and of providers, because this is an effective way to extend choice for students. The OfS will also support student choice by:
Promoting the ability of students to transfer to another course or provider
Students sometimes wish to transfer from one course or provider to another. Research1 suggests that students do not see the ability to transfer as a market mechanism, and that there is relatively little latent demand for transfer. However, it is an important way to improve the lives of a small, but significant minority of students who have made the wrong choice or who face a change in personal circumstances.
Many providers have formal transfer systems in place but many students are unaware of the transfer opportunities available. The OfS will work to ensure that in practice students are able to transfer within and between providers wherever it best meets their needs and aspirations.
In order to improve the information available to students, the OfS has set a condition of registration requiring providers to publish information about their arrangements for student transfer. The OfS will monitor and report on the availability and utilisation of student transfer arrangements, in accordance with section 38 of HERA.
Supporting accelerated courses
Accelerated courses provide students with the opportunity to study for a qualification over a shorter period of time than is typical, by increasing the intensity of study during the academic year. HERA includes powers for the government (subject to approval by Parliament) to set the annual tuition fee cap for accelerated courses at a higher level than their standard equivalent. This is intended to incentivise providers to offer accelerated courses, increasing choice for students. Maintenance costs and tuition fees for a student taking an accelerated course will usually be less than that for the same course studied over a longer period.
The OfS will support the development of this form of provision. It will make relevant information available to students, and may undertake thematic reviews to support the early and widespread adoption of such courses.
Strategic use of public grant funding for teaching and related activities
The teaching grant is designed to support a range of activities and provision across those providers that are registered in the Approved (fee cap) category. The majority of the funding is used to support provision where the cost is greater than the amount received as tuition fee income. This may be because the course is costly to provide, the location brings about additional costs or additional opportunities, or because the provision is highly specialised, as with the support provided to our world-leading specialist institutions. The teaching grant is also used to support access, success and progression for students from disadvantaged backgrounds and underrepresented groups where additional funding is needed to build on provider level regulation, for example to support collaboration. In addition, funding supports innovation, the Industrial Strategy, and the national academic broadband infrastructure.
The OfS expects to continue with these broad priorities, but to review its approach in the future to ensure that funding is deployed in a way that supports its student-focused objectives and complements its provider and sector level regulatory activity.
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