LONDON -- The British government released its long-awaited "white paper"  on the future of higher education, offering a sweeping set of proposals that would produce dramatic changes in how the country would educate students and fund institutions.
Under the plan, for example, a quarter of all student places are to be open to full competition in 2012-13, in a government bid to force higher education institutions to vie for the brightest and best applicants at one end of the sector, and to compete on price at the other. And for-profit providers of higher education would be given full access to the student loan system on condition that they agree to follow the same rules on standards, quality and fair access as publicly funded institutions.
The reform plan released by British government's Department for Business Innovation and Skills says that in the first year of the new funding regime, around 65,000 high-achieving students will be able to go to whichever university will have them. This represents a change from the present strict controls on the number of students each university can accept. It raises the prospect of some elite institutions expanding their intake to vacuum up more top students.
The government’s aim is to ensure that students with very high grades -- AAB or above -- on the country's college entrance exams will have a better chance of reaching their first choice of university.
The white paper has also set out plans to make a further 20,000 student places contestable in a different way, allowing institutions that charge tuition fees of less than £7,500 to bid for them on the basis of “quality, value for money and student demand.”
These institutions could include not only further education colleges (roughly equivalent to American community and technical colleges), but also private providers, with the government taking steps to ensure that such institutions are operating on a more “level playing field” (see below).
Taken together, the government expects the changes to make a total of 85,000 student places open to competition between institutions -- around one in four of the total number. It has indicated that this proportion may increase over time.
However, this new contestability will sit within an overall cap on the total number of student places in the sector. Consequently if some elite institutions expand their intake, it will be at the expense of others, which will necessarily have to shrink.
It also means that highly selective institutions, such as those in the 1994 and Russell Groups (consortiums of elite universities), will have to compete for a large proportion of their students, many of whom already achieve AAB or above on the "A level" exams.
Speaking to Times Higher Education, David Willetts, the government's universities and science minister, said the aim was to "dynamize the [British higher education] system."
“It’s a very fine judgment we’ve had to reach," he said. "On the one hand I was very keen … not to break down the old quota system, [but] we wanted something that was more open and liberal. On the other hand, there’s quite a lot of change happening in 2012, and the last thing I want is a kind of change so disruptive that our universities can’t handle it.
“We think that these two proposals, adding up to 85,000 places, get the balance about right. And then, after we’ve seen how it works in the first year, we aim gradually to increase that.”
Willetts denied that the government’s aim was to create an elite set of institutions in which all the top-achieving students were concentrated.
“I’m not trying to plan the system. The whole point about this is we’re taking some steps back and it will be the choices of students and the reaction of institutions – I have no view on that,” he said.
He argued that with funding following the student, and universities and colleges forced to compete for those students, the quality of teaching and learning, and the student experience, would rise.
“We’ve got very strong incentives to reward research, and the intense competition through the [research excellence framework] and research councils has yielded an incredibly strong research [base]. We haven’t had comparable incentives on teaching,” he said.
Expanded Role for For-Profit Providers
In addition to changing how students compete for spaces in British universities, the White Paper would shake up the regulatory regime governing higher education in the country. All providers, including those with for-profit status, would be subject to the same oversight if they have loan-funded students.
The new regime is likely to include a transformed, but not renamed, Higher Education Funding Council for England, which would become a “consumer champion” with beefed-up powers to act on concerns raised by other bodies such as the Quality Assurance Agency for Higher Education, which is designed to regulate institutional quality and student qualifications.
Meanwhile, the QAA would move toward a more “risk-based” approach to inspection that makes it easier for student complaints to trigger an audit, as well as reducing the burden for universities with a good track record.
Willetts, the universities and science minister, said the “conceptual shift” was that the whole framework of regulation needed to focus on “the student in receipt of the loan, rather than a group of institutions in receipt of [a government] grant.”
He said: “You have to think of a regulator protecting students as consumers, ensuring they have access to what is still a very significant amount of public money and being clear about what happens in return.”
There are no plans to create a single “super quango” to regulate the sector -- as proposed in another government review released last fall  -- but Willetts envisaged that the government funding agency could ultimately have the power to stop institutions accessing the student loan system if they run foul of the rules.
“I would say that [Hefce’s] powers will be linked ultimately to whether it will [allow money to be loaned] to students to pay the fees to go to institutions.
“Some of the conditions that are currently attached to [teaching] grants -- in a modernized, light-touch way -- will be attached to eligibility to student support,” he said.
There are also proposals to allow the Office for Fair Access to impose new fines if a university or other provider fails to keep to agreements on helping poorer students.
Meanwhile, the white paper says the government will look at the rules governing degree-awarding powers and university title, which could make it easier for companies, further education colleges and providers from overseas to enter the market. On university title, the government aims to look at the rules specifying how many students an institution must have before applying for use of the term.
With degree-awarding powers, there are proposals to remove the barriers that can prevent non-teaching institutions such as examining boards from offering degrees that can then be taught by institutions such as further education colleges.