Aug 8, 2011
Private institutions: Higher standards or a race to the bottom?
In a new survey of vice-chancellors, PA Consulting Group found that at least two UK universities are considering going private. The news comes hot on the heels of the announcement that AC Grayling and other leading academics will establish an £18,000 per year private college in central London. On the face of it, privatisation may seem fairly innocuous. But in fact, it’ a massive change for the UK’s higher education sector.
So what are the advantages for universities going private? Well, there’d obviously be less government intervention and regulation. As a result, the way they teach degrees, the courses they offer, and the personnel they hire to teach them would be far more flexible. And then there’s the tendering process. At the moment, because universities are state funded, they have to go down the “OJEC” route whenever they’re putting out a substantial job – for building work for example, or new student accommodation. Basically, this means they’re legally obliged to open the process up to all potential suppliers in the EU. Being freed from this regulation would mean that unis could get things done quicker, by giving jobs directly to suppliers they already know and trust. This would be great news for a company like us – because although we’re a big, well-trusted provider here in the UK, we don’t always have the time and manpower that huge companies have to throw at lengthy tender processes.
So privatisation could mean more efficient, streamlined, focused places of learning that aren’t burdened with the red tape public universities currently have to deal with. But there are obvious disadvantages too. For example, being completely private would mean that an institution is subject to the desires of its customers – in this case, students. This could have a big impact on research. In a public system, subjects that aren’t currently popular but that still serve a valuable long-term purpose are safeguarded (although this is also changing). In a private system, those subjects could be vulnerable – if they aren’t turning a profit, they’ll probably be cut. The US provides an interesting model for this. Because private universities are so well entrenched there, significant endowments and philanthropy protect valuable research areas from the whims of fashion.
And then there’s the question of price. The UK university sector is going to become hugely competitive in the next few years. So could we see price wars? Is it possible that universities will offer specials, or “bundle deals” to attract students? For an accommodation provider like us, this could be good news – because great accommodation will inevitably be a part of any promotional package. But at the same time, we’ll need to protect our brand and reputation as a high-quality provider from being caught up in a “race to the bottom”.
Whatever happens, it’s likely that higher education will be in a state of flux for several years as institutions figure out how they move from places of learning and research to service providers in a tough, crowded market.
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