Bursaries and scholarships - an incentive or not?

At Birmingham City University, we are mid-way through our regular student number planning sessions to review recruitment targets for the coming cycle and to forecast the pattern in 2014/15 and beyond. In terms of the undergraduate market, as you would expect, we are considering the impact of fees, the emerging trends at subject level and the expansion to ABB of the Government’s core and margin policy. The question that is repeatedly coming up, however, is whether financial incentives have made any difference to our current offer or have the potential to do so.
 
It’s an interesting debate – and I don’t for one minute pretend to have the answers. It’s also one that requires a little clarity.

As a firm believer in the virtues of and rights to access Higher Education, I – like many – am of the view that there should always be financial support that is essentially needs-based and intended to ensure those who require additional financial support are not deterred from University on this basis alone. The National Scholarship Programme has a merit of its own that should not necessarily be linked to recruitment targets or bottom line.

The financial support I am questioning is that which is primarily recruitment driven – to win over particular cohorts to select a specific institution or discipline over and above other HEIs.

It’s a perfectly valid marketing tactic and one that pervades everyday life (‘BOGOF’ still amuses me). Back in November, the Telegraph reported a range of universities offering up to £10,000 to secure ABBs, including some on my patch (http://www.telegraph.co.uk/education/educationnews/9670355/Universities-paying-10000-to-sign-up-bright-students.html).

A review of BCU’s financial support for 2012/13 against that of competitors found ours to be fairly modest. We did not go down the route of offering large chunks of cash to secure higher performing students or win back numbers in Clearing. That said, we did not lose out on our AAB students (though numbers are fairly small) and our recruitment performance, as per the UCAS figures released earlier this month, was very good by comparison with many others. Our accepted applicant figures – according to UCAS – were up 1.8% on 2011/12 (the reality is that our enrolments after people withdrew or did not turn up were slightly down, but not by much).

Marketing logic tells me that we should be offering financial support packages that are at least on a par with our competitors. Yet I have to wonder that since we did not do this and, as it transpires, did not need to in 2012, would it really make commercial sense to increase the money we give out in future, if it’s potentially to students that would come to us anyway?

A survey of our own enquirers for 12/13 revealed that 60% said bursaries and scholarships were quite or very important, but 69% said they would not affect the students’ decision to apply. Market research released by dh insight this month based on a small sample of Year 13 students predicted As and Bs found little awareness of financial incentives and that it was essentially considered “a nice add on” rather than being a critical part of the decision-making process. Similarly, the Institute of Fiscal Studies reported last November that the uncertainty of the whole process which means that students often do not know what bursaries and scholarships they would be eventually awarded prior to making their application (and often after enrolment) meant that it made little or no difference to their decision.

The issue I have is that much of this research that exists is based purely on student opinions. Unfortunately, we know that what people say and what they do aren’t always the same. Not many students said they would pay fees of up to £9,000, but over 400,000 did and many more intend to do so; UCAS applications for 2013 are up about 3% to date.

I would like to see some robust market research that analyses the support offered at particular HEIs against their actual recruitment, particularly those that did very well in securing AABs and the additional student numbers they were awarded.

So, the question remains…should universities be seeking to provide a competitive market offer when it comes to financial incentives or should they trust that the broader academic offer will be sufficient to recruit the numbers they desire? What's your view?

Don’t let fees put you off…

You can still afford to go to University. That was the resounding message from the panel of experts at Birmingham’s launch of National Student Finance Day today.

The local event, spearheaded and hosted by Birmingham City University, was attended by over 80 teachers, parents and pupils from seven of the region’s schools and colleges. Events are being held up and down the country as part of the first ever National Student Finance Day, which has been initiated by the Independent Taskforce on Student Finance.

Former NUS Presidents Aaron Porter and Wes Streeting joined Birmingham City University Vice-Chancellor Professor David Tidmarsh, Aston University Senior Pro-Vice-Chancellor Professor Helen Higson, University of Birmingham Guild President Mark Harrop and BCU’s Director of Student Services Pamela Bell-Ashe to share their views on the new system of student finance to be implemented in 2012.

Wes Streeting, Deputy Head of the Independent Taskforce on Student Finance, announced a raft of new information, including a mobile phone app ‘unifees2012‘, with helpful hints and plain-speaking guidance on student finances now available at www.unifees2012.com.

The main advice given to the audience was to ’do your homework’ when you are considering university - to find out as much information as possible from the universities themselves, from the many user review websites and sources like moneysavingexpert.com. Aaron Porter was quick to stress that “visiting universities is the best way to get a sense of whether going to university is the right decision for you”.

A quick straw poll of the audience by David Tidmarsh, whose daughter is in the process of applying to university, revealed that there are a number of individuals who feel uncertain about the new finance arrangements and as such are having second thoughts about university. David summed up the panel’s feelings when he said it would be a terrible shame if people were put off going to university because of the cost, not only for the individuals themselves, but also because of the serious impact it will have on the country’s economy and skills capabilities.

Aaron felt that the natural ‘complexity’ of the funding arrangements was to blame for the confusion and misunderstanding. Research conducted recently by the Independent Taskforce found that 59% of people in England have little or no understanding of the new fee arrangements. One college said that many of its students were now giving real consideration as to whether or not to go to university because of the rising cost.

Mark Harrop viewed this tendency towards greater consideration as one of the positives of the changes to the system. He said that individuals are more likely to spend more time researching their options to find the course and the university that is right for them, which can only be a good thing. Helen Higson felt that another positive would be the focus by universities in delivering better teaching and learning and providing more financial incentives to help those from poorer socio-economic backgrounds.

Speaking about the practicalities of the new student finance arrangements, Wes noted that “students under the new regime will actually pay less in monthly repayments than students currently do now”. He relayed some of the key facts of the new system - that students don't have to pay anything up front, they will only start repaying when they are earning above £21,000 and will then only pay 9% of anything over £21,000. He pointed out that the debt is written off after 30 years and that the monthly repayments are the same regardless of whether the tuition fee is £6,000 or £9,000.

One prospective student raised concerns about the size of debt that would be accrued. Wes acknowledged that if fees were higher and the debt was therefore larger, students would be paying it off over a longer period of time, but he re-iterated the fact that the debt is wiped out after 30 years. David added that this is where 'value for money' comes into the equasion; students should be looking at what they are getting for the different fees being charged.

Another concern from the audience related to portraying the value of Higher Education over a lifetime. One college tutor, who is a strong advocate of university education, shared his own experience of leaving school with two GCSEs and now being in his fifties with a son who, by comparison, has recently graduated and is now earning £30 per hour, which is more than he has ever earned. “I wish I’d known then what I know now” were his words of advice to the many prospective students in the room.

Answering the question of value, Aaron explained that the standard figures given are that graduates will on average earn around £100,000 more than their non-graduate counterparts over a career, but for some professions, such as doctors or lawyers, the sums are even greater. Wes added that while there has been much publicity about unemployment, it is important to remember that while there is 20% youth unemployment, the outlook for graduates is actually more positive with around 10% unemployment for those aged 21 and over. “There’s never been a better time to be in education or training,” he advised, though he did stress that this didn’t just mean a university education and that young people should consider other options, like college or apprenticeships.

There was concern raised about the fact that some universities are seeking to change their fees and how individuals would be able to find out which universities were doing this. Aaron said that he was working with the Office of Fair Access, which was currently considering how best to relay the information without providing an unfair advantage to those universities who will effectively be announcing their fees for a second time. Helen also pointed out that universities will not be able to disadvantage students when changing their fees.

One prospective student raised the issue of studying abroad with many universities in Europe offering substantially lower fees. Pamela said that those considering studying abroad should do their research in the same way they would if they were looking at a British university - to make sure the course is taught in English, to investigate the teaching and learning quality and so on. David added that if prospective students are looking at European universities they should be asking how many students usually complete their studies and the time it takes to complete study as this is often longer in Europe.

Understanding whether fee arrangements will change once a student begins studying was one parent’s primary concern. Pamela pointed out the fee regime under which student first enter higher education will remain throughout their studies. Other than inflationary rises, the cost will not increase substantially and the same financial regulations will apply throughout the duration of study.

And finally the point was made that universities are fairly good at targeting prospective students with information, but that it is parents and teachers who have a real influence over the end decision. One parent was worried that if parents or teachers don’t fully understand the implications of the new fee system, they could deter individuals from going to university because of the worry of debt. Helen said that in Birmingham four of the universities have teamed up to ensure that the work of Aimhigher continues which provides information and activities to schools and colleges. She added that most universities already work with schools and colleges and are increasingly providing tailored information for parents too. Parents were urged to visit the university websites; Birmingham City University offers a Parents’ Guide (see
http://www.bcu.ac.uk/_media/docs/Parents-Guide-2011-spr.pdf)

　

A personal perspective on the White Paper

Having spent an afternoon trawling through the Government White Paper, it left me perplexed. I'm struggling to see how universities, like mine, despite our rising popularity will benefit, but I'm trying to remain open-minded. This is my personal perspective and my comments on the points that particularly stood out to me.


The report is launched with a foreword that begins: "Our university sector has a proud history and a world-class reputation, attracting students from across the world". That’s true and it’s nice to see the Government acknowledge this, but we won't for much longer with the restrictions the UK Border Agency is putting in place. The message overseas is not a positive one and other countries are being quick to capitalize on the opportunities to divert international students their way.


The second sentence I found particularly amusing as it stated that "Higher Education is a successful public-private partnership: Government funding and institutional autonomy". Unless I'm missing something, the Government funding seems to be reducing and, the last time I checked, autonomy means ‘self-government’, which is hardly the case when our full-time undergraduate numbers are strictly monitored and there is a Government-imposed limit on what we can charge for our services. The partnership, I’d suggest, is an increasingly uneasy one.


The foreword goes on to tell universities that we will be under competitive pressure "to provide better quality and lower cost". How exactly – with a magic wand? Where else does low cost mean better quality?

The Paper itself starts with an admission that “Higher Education has a fundamental value in itself” (I wholeheartedly agree) and that “the challenge [universities] face is putting the undergraduate experience at the heart of the system”. Again, true, but excuse me, I would suggest that most universities have been focusing on putting the student experience at the heart of what we do for some time now because if we don’t, we won’t have any students. I’m also not convinced that restricting student numbers, cutting funding and limiting university income potential are the really best ways to do this.

It points out that “the current system of controls limits student choice because institutions are prevented from expanding in response to demand from applicants”. This has been one of my biggest frustrations: UCAS applications to Birmingham City University rose 63% in a period where our numbers were capped. The Paper talks about creating “a more dynamic sector in which popular institutions can grow”, which sounds fantastic until you take a look at the criteria for releasing places. The Government is going to allow unconstrained recruitment of roughly 65,000 high-achieving students scoring the equivalent of AAB or above – okay, so that keeps the Russell Group happy. It’s also going to create a flexible margin of about 20,000 places to reward universities and colleges “who combine good quality with value for money and whose average tuition charge (after fee waivers) is at or below £7,500 per year.” But what exactly constitutes good quality and value for money and how much influence will the price have on the decision to award extra places? What if, as a result, your university doesn’t meet the eventual criteria but remains one of the most popular? It doesn’t sound like the “level playing field” the Government is keen to foster.

Where I think the Government has it right in terms of creating real market forces is the focus on transparency when it comes to our performance. I do support the plans to “radically improve and expand the information available to prospective students”. Universities should be proud of what they have to offer and unafraid of the indicators that benchmark them. And, in a university where we are leading the way in student engagement (on the back of our THE ‘Outstanding support for Students’ win last year), it’s not surprising that I support the move towards greater student feedback and consultation. Our services should be market-driven.


I do fundamentally agree – though I might not like the personal implications for my family – of having a system where the beneficiaries make a larger contribution to their costs on a “pay as you earn” basis. What I’m less comfortable with are plans to charge a levy on those who want to pay off their loans early. Consultation on the Early Repayment is taking place now and, following all the negative publicity about the fee rises, it’s particularly important we get this right.  To make sure your voice is heard, visit www.bis.gov/HEreform.


On the whole, for me, the White Paper raises more questions than it answers and is somewhat self-contradictory. I do sympathize with the “enormous deficit” and resulting “spending pressures” the Government has inherited, but I am particularly anxious about plans to reduce the core allocation of student numbers at universities every year, particularly if the focus on additional numbers remains cost-driven and on an assumption that better quality equates to lower cost.