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Education e-briefing: The Higher Education (Wales) Act 2015 - a new legal framework for a changing sector

  • United Kingdom
  • Education - Briefings

26-03-2015

Background

The Bill that was ultimately to become the Higher Education (Wales) Act was introduced into the National Assembly on 20 May 2014. The Bill’s aim was to provide a legal basis for a revised framework to regulate higher education in Wales. This was necessary in the light of the radically changed basis for funding the sector, with most funding of teaching now coming from students in tuition fees, paid up front by the Student Loan Company, rather than from HEFCW grants. The changed funding route meant that HEFCW had lost a substantial amount of its leverage over publicly funded institutions. At the same time there was an increase in the number of institutions which received no grants from HEFCW but were seeking designation of particular courses so that students could access support from the Student Loan Company. HEFCW had no regulatory powers in respect of such providers.

The Bill accordingly proposed a new regulatory system addressing three aspects of higher education provision:

• an institution’s arrangements for charging fees for full-time undergraduate courses taken by UK and EU based students, and arrangements for facilitating access to such provision by such students (fees and access plans having to be approved by HEFCW if the institution wanted all its courses to be eligible for student support);

• mechanisms for ensuring the quality of higher education provision (with power to HEFCW to issue guidance and directions);

• and a mechanism for regulating the financial affairs of regulated institutions (a Financial Management Code, binding on institutions, to be published by HEFCW).

The Bill also gave HEFCW various enforcement powers but also imposed responsibilities to report to, and accept guidance from, the WG.

Reception of the Bill

The Bill received considerable criticism from those in the higher education sector in Wales and the press commented that it would result in “micro-management” of universities by HEFCW and the Welsh Government. Particular criticisms were:

• the over-centralising of decision making in relation to universities’ arrangements for ensuring fair access by and retention of students, and in relation to universities’ financial and governance arrangements, with the Welsh Ministers having an involvement in detailed matters that could arguably be left to HEFCW and HEFCW being involved in matters that could arguably be left to universities;

• the lack of clarity as to the future role of QAA in Wales, given the roles given by the Bill to HEFCW and the Welsh Ministers in relation to quality of provision;

• the extensiveness of the arrangements for enforcement of directions given by HEFCW, and the consequent detailed legal machinery, which were not conducive to collaboration with the higher education sector;

• the extent to which details of the proposals were to be determined by regulations, drafts of which had not yet been made available.

Amendments to the Bill

Following lobbying by representatives of the higher education sector there was considerable criticism of the Bill in the National Assembly and a number of important amendments were made during Stage 3. The main changes were:

• a new statement that nothing in the Act gives HEFCW power to require the governing body of an institution to do anything incompatible with charity law or the institution’s governing document (s.47);

• a new duty on HEFCW that when exercising its functions under the Act it must take account of the importance of protecting academic freedom, in particular institutions’ freedom to determine the contents of courses and how they should be taught and assessed, the criteria for admission of students and their application, and the criteria for appointment of staff and their application (s.48).

• fee and access plans may now not require the institution to incur expenditure in any academic year of an amount exceeding the amount of qualifying fee income for the year, as specified in the plan (s.6).

• the power of HEFCW to give an institution directions in respect of failure to comply with plan requirements is now provided for in the Act rather than being left to regulations (s.13). A governing body is not to be treated as having failed to comply with a general plan requirement if it has taken all reasonable steps to comply (s.39).

• before issuing guidance relating to the quality of education HEFCW is now required to consult the governing body of each regulated institution and any other persons it thinks appropriate (s.24).

• the provisions dealing with approval of the HEFCW code relating to the organisation and financial affairs of regulated institutions have been extended so as to clearly contemplate the possibility that the code might not be approved by the Welsh Ministers (ss.29, 30). No draft code has yet been published.

The Bill was unchanged in Stage 4 and received Royal Assent on 12 March 2015.

Comment

These changes will be welcome to regulated institutions. However, it should be noted that they mainly address the first of the criticisms referred to above. The uncertainty as to the role of QAA has if anything increased since the Bill was published since the funding councils, led by HEFCE, announced in autumn 2014 a review of arrangements for quality assessment in higher education. There have been no substantial changes to the monitoring and enforcement provisions.  No drafts of the important secondary provisions, such as HEFCW’s intended intervention strategy or the guidance to be given to HEFCW by the Welsh Ministers, have yet been published. The extent to which the Act therefore represents an intensification of regulatory control over the publicly funded HE sector in Wales therefore remains to be seen.

Privately funded HE providers

The Welsh Ministers have published for consultation their plans for regulating the designation of individual courses for the purpose of eligibility for student support. As the intention is that only charitable providers will be able to seek such designation there is unlikely to be the dramatic expansion of the privately funded HE sector that has occurred in England.  

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