Work to repair the economy and generate employment is well underway. Back in April, the government announced £95 million extra funding into their Lifetime Skills Guarantee fund. 400 qualifications – from engineering to social care to conservation – are now open to those adults who haven’t already achieved A-Level standard grades.
It’s a really positive step in terms of the economic revival – bridging the skills gap and opening up more opportunity for those keen to retrain and carve out a new career.
However, universities are concerned it could come at the expense of their traditional funding structures. With the government’s exposure to unpaid student loans currently standing at £10bn a year, there’s a concern the autumn spending review could look pretty bleak for university finances.
The Treasury is already discussing its options. Those include cutting tuition fees from 9250 to 7500. Lowering the income threshold for loan repayments (currently sitting at £27,295).
Limiting the number of university students eligible for loans each year. Which could mean either introducing minimum GCSE grade requirements or capping the number of people who can apply.
And finally restricting the number of applicants for what the government call ‘low value’ courses like humanities and the creative arts.
It’s not the first time creative departments have been threatened with cuts and they’ve already fought back.
In Design Week, Kingston University Vice Chancellor, Steven Spier, reminded the government ‘creative industries contribute £115.9 billion to the UK economy.’ Which, according to Steven’s research, is more than aeronautical, automotive, life sciences, and the oil and gas industries put together.
In partnership with YouGov, Kingston University surveyed 2,000 businesses from across the UK to see which skills they were short of and desperately needed to bolster the economic revival.
Unsurprisingly to Spier, problem-solving, communication, relationship building, and creativity were among the top 10 core skills needed for the economy to effectively bounce back. He said what the report proves and what the government often miss is that a third of creative jobs aren’t even in the creative industries.
But in spite of the evidence the government still considers arts subjects as ‘not of strategic importance’. These courses also need subsidies to run properly and the proposed cuts mean that subsidy will be slashed from £243 per full-time student per year to £121.50.
The government’s levelling up agenda is another initiative that could negatively impact university funding. More specifically, those institutions in London.
The government proposes taking the Strategic Priorities Grant (SPG) of £64 million from London Universities and redistributing the funds to other institutions in the regions.
But with the higher cost of living in the capital, a report from London Higher strongly opposes the plans and believe it’s more an act of ‘levelling down.’
Universities are legally obligated to pay a London living wage, which is much higher than anywhere else in the country. An average 55% of total expenditure goes on higher costs of staffing and buildings, so these cuts will put them at a huge disadvantage.
Also, although the purpose of the levelling up programme is to open up opportunity outside of London, these cuts could eliminate opportunities for disadvantaged communities within it.
A third of London boroughs are in the 30% of the most deprived areas in England. Without the SPG, many of these communities wouldn’t be able to access higher education courses.
A lot of London universities train key workers too. Health higher education courses are already working in a deficit and removing the SFG could make them unworkable.
London Higher believes that taking away this funding at such short notice will slash the money available per student and make providing a good quality service for London institutions even more testing than it already is.
As with many budgeting and funding issues, balance is often what the government is aiming for. The Lifetime Skill Guarantee scheme and Levelling Up programme both come with the admirable intention of redistributing wealth and opportunity. But it shouldn’t mean universities and their traditional courses should suffer.
For the sector and the country to properly recover from the impact of the pandemic, there has to be a solution that caters to all.
Published date: 5th August 2021
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