News

• Maximum university fees of £7,500 a year
• Maintenance grants for students from low income households
• Student loan to be renamed ‘Student contribution system’
• Loan to wipe after 40, not the current 30 years
• Funding targeted to disadvantaged students and high value and high cost subjects
• Individuals should be able to draw down their HE loan allowance over a lifetime
• Increased flexibility in funding and student loans: learners should be able to access student finance for tuition fee and maintenance support for modules of prescribed HE qualifications at Level 4, 5 and 6

The Post-18 Education and Funding Review Panel comprised six members, chaired by Dr Philip Augar, thus the name Augar Review, and weighs in at 206 pages long with 53 interconnected recommendations.

The Panel has been praised for clearly understanding the sector and making useful recommendations that will address systemic problems, including the under-funding of the FE system.

However, from the point of view of the pipeline of talent in to the creative industries the figures used to calculate the value of tertiary study are troubling in what they leave out, and therefore how they value the sector. Many arts degrees are ‘high cost’ to deliver, but the review, using only partial income data from creative graduates, has concluded they are not high value to the tax payer.

It is important to remember that these are recommendations, not government policy. It will be up to a new Conservative leader to decide if they want to take them forward.

Focus on disadvantaged students

It is very welcome that the Review pushes for more resources directed to disadvantaged students:

“Maximum fees for students should be reduced to £7,500 a year, and more of the taxpayer funding should come through grants directed to disadvantaged students and to high value and high cost subjects.”

However commentators, including Martin Lewis of MoneySavingExpert, point out that the proposed changes will actually benefit higher earners more:

“The irony is that what'll likely be his two most popular proposals – to cut tuition fees and reintroduce student grants from 2021/22 – counter-intuitively actually make the system more regressive than the current one. That's because they both disproportionately help higher-earning graduates – who are the only ones who repay what they borrowed in full.”

Value of Creative Arts degrees

Creative Arts degrees do not come off well in the Review. They are singled out as requiring more government subsidy than other degrees because graduates are less likely to pay off their student loans, as they do not earn enough over the 30 years to pay back the full amount borrowed. The irony is that by extending the payment window to 40 years this situation is much less likely to occur.

“The IFS estimates that the public subsidy amounts to about £30,000 per student for those studying Arts and Humanities subjects such as English and Communications and Media and as much as £37,000 for those taking courses in the Creative Arts. The equivalent public subsidy is £28,000 for Engineering students and £24,000 for those studying Maths and Computer Science.” p.81

While the Review acknowledges the wider value of studying creative arts:

“We recognise that a significant number of graduates in the Creative Arts make a strong contribution to the economy through work in the dynamic creative industries sector and to society through careers in the arts and design.” p.105

And

“Tertiary institutions generate the knowledge and skills that fuel our economy and provide the basis for our nation’s intellectual and cultural heritage. The UK is an acknowledged leader in a wide variety of artistic and academic fields.” p.16

It goes on to say:

“But we question whether the sheer number of students taking subjects such as Creative Arts and Design and Social Studies, the current grant top-up, and the large likely debt write-off given these graduates’ predicted earnings, constitute good value for taxpayers’ money.”

The Review acknowledges that the data they are using to calculate earnings is flawed, for example it does not include self-employment and 47% of the creative industries workforce are self-employed at the last count. Graduates in the creative industries are also more likely to start companies and not draw down salaries, while also creating more jobs and GDP.

See this paper from GuildHE on why the numbers don’t add up, and the blog from the Creative Industries Policy and Evidence Centre on valuing creative arts degrees for more information.

The Creative Industries Federation also has a useful statement covering the weaknesses in the use of data and some clear calls for action going forward.

There are also a verity of summaries of the Review – we like the Guardian, Wonkhe and TES.