How students pay for our ‘world class’ universities

10 Sep 2013

I was interested to read UUK’s recently released report on Where student fees go.  Having spent much of the summer visiting universities up and down the country,  I can testify first hand to the number of shiny new buildings and facilities that are springing up across campuses nationwide.   Indeed I had an interesting conversation recently with a former colleague who believes levels of capital investment are currently running at unsustainable levels relative to institutions’ turnover and levels of surplus.  There’s certainly no doubt universities are splashing the cash to attract the best students, but I would suggest the UUK report is a little disingenuous as to where all the money is going.

In particular, the absence of almost any reference to university research in both the publication and its accompanying promotional video was striking.  Of course the communication is aimed squarely at prospective students and their parents, who might consider research to be somewhat irrelevant to their choice of institution.  Yet this seems particularly ironic given the video ends with the words ‘World-class universities’.  On what grounds, one might ask, do we claim our universities are world-class?  Is it because of their excellent teaching, the quality of their student facilities, and their graduate employability rates?  Well no, not really.  A quick glance at the major international league tables shows they are dominated by measures of research quality, rather than teaching.  The Times Higher bases 65% of its ranking on research measures of one form or another (research income, volume, reputation, industry research income, international collaboration and citations), and only 35% on teaching.  The QS World University Rankings are weighted 60% towards research reputation and citations, while the Academic (Shanghai Jiao Tong) World Ranking of Universities ignores teaching altogether.  Yet these are the very same league tables that universities proudly cite in their bid to attract the best students.

Of course it can be argued that the bias towards research only reflects the difficulties of obtaining robust, comparable data on teaching quality and student experience, and that “everyone knows” league tables are arbitrary and subjective exercises.   Yet woe betide the Vice Chancellor who lets his or her institution slide down the rankings, and as we’ve seen the surest way to ensure it doesn’t is to invest in research not teaching.

The latest Transparent Approach to Costing data, from the 2011/12 year which predates the introduction of £9,000 fees, suggests that universities spent 30% more on research than they receive in research funding, meaning research costs the sector a net £2bn a year.  Most of this shortfall was made up by a corresponding surplus on teaching, though admittedly it’s international students who’ve contributed the most to university bottom lines in the past.   Not any more, in my opinion.  With the advent of £9,000 tuition fees coinciding with both a squeeze on research funding (particularly for capital expenditure) and preparations for the 2014 Research Excellence Framework, it’s a safe bet that much of what UK students are now paying is being used to underpin institutions’ research activity.

But is this a bad thing?  Does it matter that student fees aren’t all being spent on state-of-the-art lecture halls, luxury student residences, trendy bars and coffee shops?  I don’t think so, even leaving aside the value of being taught by academics who are genuine leaders in their field.   If, as David Willetts, Andrew Witty and the OECD have argued, university research plays a key role in driving economic growth, then investing a proportion of student fees in that research is one of the surest ways of ensuring today’s students can go on to find rewarding employment later in life.  And if I was a prospective student contemplating a £27,000 tuition fee debt in 3 years’ time, that wouldn’t sound like such a bad deal.