6 April 2017 Insight

Brexit sector focus: higher education

The transition towards Brexit may mean changes for the UK’s education system, from recruitment of staff and students to funding and intellectual property law

The UK’s higher education sector is truly world class, with four British universities in the world’s top ten. In economic terms, universities - through direct and multiplier effects - generate £73bn of output and support 760,000 full-time jobs. The UK also boasts a diverse network of further education and specialist colleges.

Recruitment

Brexit presents new challenges. On staffing, there is uncertainty over the future of nationals from the EU-27, which needs to be resolved as soon as possible According to the ONS an estimated 4 per cent of staff in education are from the EU-27, rising to 17 per cent of academic staff in higher education. Average lecturer pay in colleges is £30-35,000.

The industry body, Universities UK, warns it may be harder to recruit staff in areas crucial to economic growth such as maths, construction and engineering, and this may be exacerbated if the Home Office applies a salary test to employment.

Overseas students

The eligibility of EU students to attend courses in the UK is a vital issue. At the moment, 6.4 per cent of full-time undergraduate and post-graduate students at UK universities are EU-27 nationals. They currently pay the same fees as their British counterparts, and are able to apply to universities as equals. They are also eligible for student loans on the same terms.

Dame Julia Goodfellow, President of Universities UK and Vice-Chancellor of the University of Kent, said recently, “We also need the Government to confirm that EU students starting a course next year, will continue to be eligible for home fee status, and be eligible for loans and grants. As EU students start their research about studying abroad more than 12 months in advance of actual enrolment, it is important that action is taken as soon as possible to prevent a further drop in EU applications for 2018/19 entry.”

The Erasmus university exchange programme is the EU scheme enabling students to spend a year abroad. More than three million students have participated since 1987, and it has supported a further 300,000 research exchanges. Continued participation is possible - Macedonia, Turkey, Norway and Liechtenstein participate from outside the EU.

Funding

Though the Government did take some steps towards clarity on education funding in the short-term, there are still many questions about the long-term future.

The EU awarded the UK £3.9bn in research income via multiple sources from 2009/10 to 2014/15. Since then the bulk of EU funding has come through Horizon 2020, the European Commission’s research and innovation programme. Chancellor Philip Hammond has confirmed the Government intends to underwrite EU funding, amounting to £2.2bn in the current funding round.

The Government states: “Where UK organisations bid directly to the European Commission on a competitive basis for EU funding projects while we are still a member of the EU, for example universities participating in Horizon 2020, the Treasury will underwrite the payments of such awards, even when specific projects continue beyond the UK’s departure from the EU.”

Higher education colleges receive £100m a year from the European Social Fund. Again, this could be covered by the Chancellor’s promise to match existing funding.

Legislation

The laws governing higher education may change. At the moment much of the legislation is derived from EU directives on employment, public procurement, consumer protection, intellectual property and competition. The Great Repeal Bill proposed by the UK Government should bring all EU regulation onto the UK statute books. In the long-term there may be some opportunities for future flexibility of regulation, and businesses will be keen to help Government identify those opportunities. For example, Universities UK states: “Colleges would love less regulation but it is not clear that Brexit would deliver it for them.”  For the moment, the priority is stability and certainty while significant domestic reforms take place across further and higher education.

Naturally there are other opportunities. David Hughes, chief executive of the Association of Colleges, the industry body for vocational colleges, says he hopes the Government will invest in his sector. “I do see an opportunity. There is a real need for us to be more self-sufficient in skills, and employers have got used in recent years to bringing in labour with ready-made skills. That will ease. The borders won’t shut, but my sense is that people will think twice about migrating here because of the uncertainty. In a way that’s good news as the Government will realise they need to invest in skills here.”

Hughes particularly focuses on adult education. The key is funding: “There just aren’t enough opportunities to retrain adults to improve skills like English and maths to progress to higher-level jobs,” says Hughes. “My fear is that the investment won’t come, or won’t come soon enough.”

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