First, the bad news, or more accurately, the bad lack of news. The Autumn budget made no mention of higher education and offered no financial relief to struggling universities, other than some protection and enhancement of research budgets. Recent rumours of a rise to the student fee cap appear to have been wishful thinking, and it looks as if we’re going to have to wait at least until next year’s spending review for any tangible response to the HE sector’s budgetary woes.
In contrast, some very welcome extra money for FE, though it’s not yet clear whether this will be delivered through a rise to the 16-19 funding rate or linked to lecturer pay, as happened last time. There’s also an extra £40m to fund the shorter and foundation apprenticeships being launched through the Growth & Skills Levy, £240m for the DWP’s drive to get economically inactive adults back to work and extra funding for local authorities to support the growing number of young people with special educational needs.
All this will potentially provide more income opportunities to colleges over the next few years, although it’s unlikely to make a major difference to most. And in common with the HE sector, the sharp rise in Employers National Insurance contributions offsets any income boost with a big rise in employment costs.
What has HE done to deserve such a cold shoulder, despite the warm words about universities coming from ministers recently? There will undoubtedly be a great deal of debate about this over the coming months. The challenge is not just to demonstrate the positive impact of universities on the economy – something which the government is surely well aware of – but to demonstrate how universities support Labour’s priority groups, which the Chancellor has recently described as “hardworking families”, “strivers”, and those who “graft every day”. Access and participation is back on centre stage, but for adults, not just school leavers.
Which brings us to the good news. The budget statement confirmed that the Lifelong Learning Entitlement is still very much alive as a policy, although its launch has been delayed until 2026/27 – hopefully to allow time to improve its design. Given the clear expectation from the new government that the HE sector needs to do more to raise adult access and participation in HE, universities and colleges need to prepare positively for this. It may not represent a huge income opportunity, and the set-up costs involved are not insignificant, but successfully engaging with working adults through the LLE will be a clear sign of the HE sector aligning itself with the government’s educational mission. More importantly from an LEI perspective, the LLE represents a genuine opportunity to reverse the decline in adult participation in HE and provide working adults with the skills needed to raise productivity, drive economic growth and improve their earnings.
Any future increases in funding for FE or HE are likely to be based on a “something for something” approach. In the current political and economic climate, that has to be linked to the tertiary sector’s active engagement with local economic development in devolved areas, and to the sector’s direct impact on economic success for hard-pressed individuals and communities, the “strivers” that are at the heart of Rachel Reeve’s thinking.
Far from being kicked into the long grass, the decision to delay the implementation of the LLE is a sign of its future importance, alongside Apprenticeships and Higher Technical Qualifications, as a platform for raising skills in key growth sectors and for supporting working adults at risk of being left behind economically.
As an organisation which has its origins in the legislation which introduced the LLE, the LEI will have plenty to say about this over the coming months. At the moment we’re simply pleased that the LLE is not drowning, but waving.
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