Professor David Midgley reviews English Universities in Crisis: Markets without Competition, by Jefferson Frank, Norman Gowar and Michael Naef


The policy objectives against which this book measures the effectiveness of the current system for funding and regulating universities in England are those of the Browne Review: to improve participation rates in higher education among the less advantaged, and to enhance quality and student choice within a diverse sector. By those measures, it shows the system established since 2010 to have manifestly failed.

Of the three authors, two are members of the Economics Department at Royal Holloway, University of London, and the third, Norman Gowar, is their former principal, a founding member of the Open University and a mathematician. Between them they provide a robust and astute diagnosis of some of the detrimental effects generated by the fee/loan system of funding introduced in 2012 and the regulatory regime established by the Higher Education and Research Act of 2017. Their volume therefore provides a valuable source of arguments for an informed critique of the proposals that are expected to emerge shortly from the Augar Review of university funding and Dame Shirley Pearce’s independent review of the TEF.


The damaging impact of removing the numbers cap

The authors are clear about the unfairness built into the fee/loan system: higher-earning graduates tend to pay back less, while those who earn less are likely to pay back more, or else be subsidised by the taxpayer. They also note that the debt burden on students tends to impede labour market flexibility. But their main target is the perverse incentives generated by the financial imperative for institutions to recruit students in combination with the removal of the cap on undergraduate numbers. The consequence has been that universities with stronger reputations absorbed the better students, while weaker institutions competed for the weaker students by the much-advertised techniques of grade inflation and lowering entry standards, and by over-investing in new buildings. The expansion of private provision appears to have exacerbated this trend.

One of their main recommendations, therefore, is that competition for good students should be stimulated by restoring the numbers cap, while making an exception for students from disadvantaged and/or non-traditional backgrounds. At the same time they point out that a serious approach to widening participation would require a restoration of means-tested fee and maintenance grants.


TEF: wasteful, misleading and counter-productive

They are no less forthright in their criticisms of the Teaching Excellence and Student Outcomes Framework (TEF). It is wasteful, misleading and counter-productive. It also encourages a managerial approach that treats teaching and research as separate domains rather than two halves of the same domain, and which deals with the demand for teaching by hiring in teachers on a casual basis, a practice that the authors describe as “penny-wise and pound-foolish”. Since good teaching cannot be defined in a generally applicable way, let alone quantified, the TEF should be abolished, and the Quality Assurance Agency (QAA) and National Student Survey (NSS) along with it.


Restore authority to external examiners

What should have been done to improve teaching when tuition fees were raised to £9,000, they argue, was to reduce student-staff ratios by employing more regular academic staff. That way the needs of individual students could be addressed where they can best be dealt with – at departmental level – by a team of people whose talents and specialities complement each other and who provide each other with the mutual support and stimulus that is necessary to fulfil their own potential and that of their students. This is one of three areas in which the authors would like to see more effective power placed in the hands of academic staff. Another is the restoration of authority to external examiners in order to counteract the propensity for grade inflation by applying sound academic judgement. The third is a rebalancing of university governance towards people who have extensive experience of what academic work actually entails.

The effectiveness of competition as a positive aid to improving standards is something they acknowledge – but it has to be the right kind of competition. It should encourage institutions to develop a high-quality service for the purposes that are germane to their own particular educational mission, rather than imitating other institutions in the hope of improving their position in the league tables. It should be such as to encourage them to raise their game in order to attract better students, and it should put them in the position of being able to plan for the long term, which is what will help them to achieve good quality, efficient management of resources, and genuine diversity.


English Universities in Crisis: Markets without Competition is published by Bristol University Press 2019, 199pp. You can buy it here.