Part 2 – Higher Trust, Reduced Burden: Towards a New Risk-Based Framework

In Part 1 of this blog I set out some of the significant problems with the current regulatory framework in English higher education and the ways in which these could be addressed. The regulatory burden on universities and colleges is far too great and has to be reduced. Doing so will ease some of the financial pressures institutions are currently facing, at least a little, and earn some much-needed credit for government.

Some mention of the regulatory burden was made in the recent report of the Universities UK’s Transformation and Efficiency Taskforce. Much of the report is focused on institutions finding new ways to collaborate and share ideas and infrastructure but also explore restructuring and merger opportunities. Some of that is in the hands of universities themselves but the need for government to act in a supportive manner is stressed too. Beyond arguing for the collaborative development of a new vision and strategy for higher education, the report proposes that government should work with the sector to develop “a funding and regulatory framework that…creates a cohesive system in which higher education and research, policy and funding levers are better aligned.”

This seems to me to be the right way forward – developing an efficient and cost-effective regulatory framework, overseen by an Office for Students (OfS) with a refreshed mission, which will deliver a long-term way forward that works for students, institutions and stakeholders. Such a high trust, proportionate, lower-cost regime will mean universities are more able to make their contribution to delivering what the country expects, including economic growth. So, what might this new regulatory framework look like?

The Framework and OfS 2.0

Reflecting on the problems with and costs of the current arrangements it is proposed therefore that a modified regulatory framework be introduced (without new legislation being required in the first instance). HERA specifies the name and broad responsibilities of the OfS so this can’t change hugely but we will call the refreshed agency OfS 2.0 just to distinguish it from the current configuration.

Framework Principles

1. The Framework needs to command the confidence of everyone in the sector and all stakeholders, in the UK and internationally.
2. The framework should be evidence-based, genuinely proportional and risk-based.
3. We need to ensure it minimises burden and maximises impact in the interest of all stakeholders. Every pound spent on unnecessary regulation is a pound less to support the student experience.
4. The new framework must be credible, simple to understand for all, straightforward to implement and cost effective.
5. Trust has to be the foundation of the framework – everyone will be trying to do the right thing – and it needs to have real rigour too such that everyone knows there will be no hesitation if intervention is needed in the interests of stakeholders where warning signals show there is a problem.
6. We need partnership and understanding between the regulator and the regulated; not cosy consensualism but mutual respect and understanding.
7. The OfS will develop and implement this framework in consultation with stakeholders.

Specific Elements 

1. OfS 2.0 would be given a brief to engage actively with other sector agencies, including the QAA, Advance HE, Jisc, UCAS and the OIA.
2. The OfS will explicitly follow the Regulators’ Code. The Code provides ‘a flexible, principles-based framework for regulatory delivery.’ Its principles include: adopting a supportive approach; avoiding unnecessary burden; a simple and straightforward approach to engagement with those regulated; a risk-based approach; and that the approach is transparent and clear information is provided.
3. The new framework would include explicit recognition of the professionalism of academic staff involved in teaching, learning and assessment. This professionalism is the foundation on which the quality and standard of higher education is built and re-emphasising it is a key part of addressing the need to rebuild and sustain public confidence in the quality and standard of provision. 
4. The framework would stress the Importance of academic freedom. Over-regulation undermines academic freedom which is a cornerstone of quality.
5. Similarly, institutional autonomy would be highlighted as another essential component of the framework and indeed one picked out in HERA where the OfS is charged with protecting the autonomy of HEIs.
6. OfS 2.0 would have a brief to engage with research agencies to develop a joined up structured approach to linking education and research.
7. The revamped agency will also be expected to take a sector-wide view (or ‘sector stewardship’ as it is described by the UUK Taskforce), to attend to the international reputation and public perception of higher education and to consider the importance of universities and colleges as anchor institutions in their communities. (Whilst HERA allows the OfS to provide financial support to institutions it appears that this is only in cases of “mismanagement” – some broad interpretation of this may turn out to be necessary in extreme circumstances to prevent disorderly exits.)
8. In establishing a higher trust environment an appropriate aggregation of measures and assessment in combination will be identified as being sufficient to assure that standards are being properly set by institutions and achieved by students and that the educational offer is providing the right quality of learning and student experience. Staff appointment arrangements, student entry qualifications, the learning environment, curriculum design and refresh, course monitoring and review arrangements, rigorous assessment mechanisms, effective student representation and feedback and many other factors all combine to give assurance about standards and quality. The new framework would reflect this.
9. Institutional commitment to widening participation needs to be sustained but greater consistency of approach by the regulator is required. Means of enhanced structured engagement between HE institutions and FE have to be developed to enable a more joined up tertiary education landscape. 
10. OfS 2.0 would be focused on assessments which are genuinely proportional and risk-based and would have a strong brief to tackle poor provision which was failing to deliver the outcomes expected by students and society.

OfS 2.0 – Assessing Quality and Standards

In relation to assessing quality and standards HERA states that the OfS 

may assess, or make arrangements for the assessment of, the quality of, and the standards applied to, higher education provided by English higher education providers

and that it must have a Quality Assessment Committee to advise it on this (HERA Part 1, Paras 23-24).

HERA set out arrangements for the OfS to designate an organisation (following consultation with the sector and others) to undertake assessments of quality and standards on its behalf (the Designated Quality Body, or DQB). The Quality Assurance Agency (QAA) was the obvious choice to fulfil this role and indeed was originally appointed to it. However, some fundamental differences of approach emerged which ultimately led to the QAA withdrawing from the DQB role (elements of the OfS requirements around the publication of reports and reduced involvement of students risked the QAA losing its place on the European Quality Assurance Register of quality assurance agencies, a change it could not countenance).

The issues and disagreements behind all of this need to be set aside and a fresh route taken to establishing arrangements for the assessment of quality and standards of English HE. One way to achieve this would be to amend HERA to place the assessment of quality and standards explicitly in the hands of the QAA (reporting to the OfS) whilst allowing greater flexibility and future developments, including perhaps the possibility of a UK-wide arrangement. The other, quicker, route is to designate the QAA as the DQB for a second time and charge it, working with the OfS and in consultation with the sector, with developing a stripped back set of conditions of registration which explicitly link to compliance with the UK Quality Code for Higher Education 2024.

The new approach would require a different attitude and a higher level of trust on the part of all involved, and all parties could learn valuable lessons from the much more positive experience in the Scottish sector where a lighter touch approach has been adopted. Drawing on this a new institutional review model could include:

• periodic external peer review against the principles of the UK Quality Code for HE
• thorough in person institutional review visits
• student engagement and partnership
• evidence and criteria-based judgements and findings
• published reports and follow-up activity based on agreed action plans.

This institutional review model, in revising the current OfS conditions of registration, would draw on the existing national quality frameworks. In addition to the UK Quality Code these include the national credit framework, the national qualifications framework and subject benchmark statements. The QAA has previously mapped the OfS conditions of registration against the UK Quality Code and vice versa – this would be the ideal starting point for developing a shared approach to a reduced set of conditions of registration linked to compliance with the UK Quality Code.

Ensuring the assessment of quality and standards is undertaken effectively and efficiently and that the approach, including this model for institutional review, has the confidence of all stakeholders is fundamental. The approach taken since HERA has not fully achieved what is required in these areas and therefore a new model is required. Implementing this model will not be without challenges and the expectation would have to be that the OfS 2.0 Board will drive it through.

Reducing the Burden

Unnecessary and overbearing regulation is costly and distracting and does little to enhance the quality of provision or the student experience (and especially at a time of significant financial challenge it could be argued that it risks undermining the quality of the activity it is intended to assure). The renewal of the framework for quality and standards provides an opportunity to address this problem. Much of the unnecessary regulation is principally, but not exclusively, managed by the OfS. There are other burdensome regulatory activities at play too though, including some self-imposed ones, which do need to be considered. Part of this is about stopping things but also about the direction given to the regulator, its governance, structure, culture and operations.

I’ve written before, more than once, about the savings which would accrue from reducing the burden. The changes I would propose, in addition to those already mentioned above, include:

• Scrapping the B4 condition, which requires the retention of all assessed work (or an “appropriate” sample) for all students for five years post-graduation (see this on the full joy of the B4 requirements on retaining student work). 
• Ending the Teaching Excellence Framework (TEF) which is of little interest to many prospective students.
• Retiring the External Examiner system, which has long outlived its usefulness in a mass system.
• The sector reconsidering where it has ‘gold-plated’ its own processes, starting with the external examiner system, before moving onto other areas of excessive self-generated internal regulation.
• Addressing the burden of excessive and overlapping data collection from universities.
• Removing universities from the requirements of the Freedom of Information Act would reduce the excessive burden this imposes across institutions and would certainly deliver real savings.
• Radically reconsidering the scope of the Competition and Markets Authority (CMA) to intervene in higher education. As well as the anxieties that discussions institutions want to have about collaboration, sharing provision and potential merger might fall foul of competition law (as a result of which the CMA has had to publish a an advisory blog) the CMA regime has led to excessive self-generated internal regulation around course and curriculum modifications.
• Furthermore, in terms of research there are some significant savings which could be made:
  • Implementing the recommendations of the Tickell report on reducing the burden of research. Tickell identified significant unnecessary regulation around assurance bureaucracy and process duplication, complexities and waste in application processes, monitoring and contract arrangements and, significantly, institutional bureaucracy and risk-aversion.
  • Ending the Knowledge Exchange Framework (KEF). There are simpler and much more efficient ways of determining the allocation of knowledge exchange funding.
  • Postponing the next Research Excellence Framework (REF) process would potentially deliver major financial benefits(this would be one of the biggest savings prizes). Whilst it could be argued that plans are already too far advanced for the next REF and that delay would cause problems for institutions, the reality is that little would be lost by postponing this huge and costly exercise for several years. The previous REF outcomes can continue to be used for funding allocations for the time being without causing any major difficulties. A report published by UKRI in 2023 indicated that the cost of REF in 2021 was conservatively estimated at £471m. Allowing for inflation and other cost pressures, delaying REF until the next decade would potentially save around £750m.

Additional Benefits of Reducing Regulation

In 2024 Moorhouse Consulting produced an insightful report for Universities UK which included a substantial sector survey of the cost and burden of different aspects of the OfS regulatory regime. Among other things the report noted that the resources required to understand and meet regulatory requirements were significant as were the opportunity costs of the regulatory burden for universities. 

In assessing the direct cost of the OfS regulatory regime Moorhouse collected data on the number of staff involved. Their estimates of the total numbers dedicated to regulatory matters show that the institutional investment in addressing such matters really is not trivial:

We estimate that this would be 128 FTE at Executive level, 638 FTE at Manager/Director Level and 1,288 at Officer/Coordinator level dedicated solely to regulatory compliance across all 116 UUK members in England. Universities typically do not have dedicated regulatory teams; this resource is incorporated as part of existing roles. 

So this is over 2,000 senior and very senior staff FTE across England’s universities. The total cost of this will be of the order of £150-200m per annum. Of course some of this will remain necessary, and it is possible that some of these roles are already being cut as part of major institutional restructurings currently underway, but there is major scope for savings/redeployment here. 

Summary of Savings

If most of the changes set out above were to be introduced then the total savings by my very broad brush estimates from reduced regulation would be roughly as follows:

Staff reductions/redeployment as per Moorhouse report:	£100m per annum
Scrapping B4 retained assessed work requirement:	£500m over 5 years
Other changes to the regulatory framework including revised conditions of registration, ending TEF and KEF, CMA changes and reducing ‘gold-plating’:	£150m per annum
Delaying REF until, say, 2033:	£750m
Total over 5 years:	£2.5 billion

So, around £500m per annum is potentially there for the saving and redeployment into core university activities.

Towards a New Framework

The regulatory burden is so great on higher education now it really has to be addressed. If we were able to reduce the weight and cost of unnecessary regulation, at least some modest resources would become available to support other financial challenges.

We do need a much more efficient and cost-effective regulatory framework, overseen by a refocused OfS, which will deliver a long term model which works for students, institutions and other stakeholders. A high trust, proportionate lower-cost regime which incorporates the proposals set out here will mean universities are significantly better placed to make the greatest contribution to delivering what the country expects from high quality teaching and learning to world-leading research to economic growth.

As summarised above, it is estimated that the changes proposed could save of the order of £2.5 billion over five years. That’s £2.5 billion which can be spent by universities on continuing to support our students, deliver world class research and support economic growth. What’s not to like?