The MillionPlus group of newer universities has called for the government to fund additional university places and a “safety net” for institutions that “unduly lose out” because of the A-levels U-turn, as one admissions director acknowledged that his institution will have “eaten the sandwiches” of lower-tariff universities.
In a briefing note published on 19 August, the Institute for Fiscal Studies also said many universities had already been facing a precarious financial situation because of the Covid-19 crisis, but could now be further impacted by the government’s decision to let students use their teacher-assessed grades for university entry, rather than grades determined by an algorithm.
As higher-tariff institutions typically over-offer to ensure that their places are filled even if some students do not get their grades, they will now be “awash” with students, the IFS said.
On 19 August, almost 85,000 students had either accepted a place that was not their first choice or were still deciding on their next move. For UK students holding offers at the University of Oxford or the University of Cambridge, this could amount to an additional 500 students who have now achieved their offers, the IFS said.
Some institutions will be full to capacity because of social distancing rules. Durham University is offering students bursaries if they defer their entry until 2021.
However, many of England’s high-tariff institutions, including Russell Group universities, do have plans to expand their intake. This includes Queen Mary University of London, which announced that it had made an extra 500 places available through clearing for students with revised grades.
Such a course will be adopted by those universities worried about a drop in the number of international students and looking to reduce the hit to their finances through increasing their domestic student intake, one UK vice-chancellor told Times Higher Education.
Richard Harvey, academic director of admissions at the University of East Anglia, said “the obvious response to the storm that was brewing with calculated grades was to dramatically lower entry grades”.
This was “not pleasant but we felt it was the right thing to do”, he added. “By doing that we will, to some extent, have ‘eaten the sandwiches’ of other universities, who in turn will have eaten yet more sandwiches.
“At the end of that chain will be some universities who are now in serious financial difficulty. The taxpayer is the guarantor of those universities and so ends up paying double: once to bail people out and once to help expand the universities at the top of the food chain.”
Alan Palmer, head of policy and research at the MillionPlus association of modern universities, said “a major problem with this scenario is that this taps into the long-standing perception that only some universities are worth going to and others are consolation prizes. This is simply not true.”
Greg Walker, MillionPlus chief executive, said: “The government should invest urgently in the capacity of universities to boost the number of places they can safely offer. This is an imperative for universities, who have to make decisions in the coming days on healthcare courses and other critical areas.
“The unexpected removal of the cap on student numbers, combined with the big upward shift in student grades, may create difficulties for universities across the sector who’d planned a stable level of recruitment this year.”
In a reference to the “restructuring regime” recently announced by the government, which would offer universities hit by the pandemic financial crisis emergency loans in exchange for stringent conditions, he said extra government investment should not be seen as resulting from “a ‘restructuring’ or a longer-term viability issue, but the impact of a sharp policy change from government. A ‘safety net’ investment stream for those universities who might unduly lose out from the policy change should be a priority for government.”
There is “a risk that some lower-ranked universities might lose a substantial share of their intake, which could be financially crippling – especially for those whose pre-Covid financial situation was already weak”, according to the IFS. Previously, the IFS had warned that 13 universities might not be viable in the long run without a government bailout or a debt restructuring.
The IFS recommended that the lowest-ranked universities avoid large losses by tapping into the pool of potential students who got no offers or have not yet applied. “These students will have much better grades than usual this year, and many might be interested in going to university given the exceptionally tough labour market,” it said. However, the IFS warned that some of these students might be “unprepared” for their courses.
In response to the crisis, Michelle Donelan, the English universities minister, announced that she had convened a task force to address the “challenges facing universities and provide as much support as we can”. The task force is made up of higher education sector groups, including Ucas, the Office for Students, Universities UK, GuildHE, the Russell Group, the University Alliance and MillionPlus.
Ms Donelan added: “We announced a package of support for the sector during the pandemic, including bringing forward tuition fee and research funding, and a scheme to assess any restructuring support higher education providers may need.”
In July, the Department for Education announced a scheme to assess the case for restructuring support where there is a case to do so. However, the plans were seen as a vehicle to drive changes in universities, such as shifting towards science subjects and potential mergers, and raised fears for university autonomy.
