New HEPI report: Down with the World-Class University: How our business models damage universal higher education

The Higher Education Policy Institute has published a report calling for a fundamental re-evaluation of the way universities are run in the UK. Down with the World-Class University: How our business models damage universal higher education (HEPI Debate Paper 38) argues good growth, and an era of universal higher education, can be achieved if we ditch the 'world-class university' model in favour of group and collaborative approaches.

The report, which has been kindly sponsored by Goldsmiths, University of London, is the first of its kind to examine the UK university environment through this lens.

It highlights that:

• The UK lags behind other advanced economies in tertiary enrolment rates.
• Current business models fuel the sector's financial crisis and limit its reach, thanks to over-reliance on the 'world-class university' model.
• The sector can learn from emerging non-university competitors how to offer higher education at scale, in partnership and at lower cost.

The report, which has been written for HEPI by Edward Venning, calls for:

• A re-design of the higher education system – to achieve a universal offer, created by an Independent Commission. This should go beyond funding considerations to differentiate types of providers and introduce new business models.
• New credentials and value propositions – to be designed by providers, working with the Office for Students (OfS) and Skills England, as a central part of the universal offer. These should define skills as conceptual and enquiry-based, not just technical.
• A major transition fund – to offer loans to providers to develop new business models, value propositions and organisational structures in line with the new system design.
• Group and federal structures – collaborative structures and joint ventures to be preferred to the use of mergers and acquisition, especially in the case of distressed providers.
• A sector-wide leadership body – responsible on behalf of providers for overseeing the tertiary ecosystem, including resource distribution, scrutinising regulatory burden, and shaping public understanding of higher education's value.
• Rebalancing the role of the Office for Students – to safeguard the sector, the Secretary of State to direct OfS to have regard to the overall health of providers and the sector, alongside its responsibility to students. This should include managing regulatory burden.

Edward Venning, author of the report and Partner at corporate affairs consultancy Six Ravens, said:

‘UK universities have stalled in an era of surging demand for advanced education and skills. This is due to reliance on an immersive, high-cost model which works for a few universities but drains resource elsewhere. 

‘As other countries head rapidly towards universal higher education, this report recommends a broader set of business models, while safeguarding the unique characteristics of the sector.'

Professor Frances Corner, Warden of Goldsmiths, University of London, said:

‘In the age of technology, we need more, not fewer, graduates equipped with advanced skills to solve complex problems. Structural reform of our sector is essential. We must innovate within the spirit of our rich educational heritage, equipping more people with the conceptual and practical tools required for growth, progress and social innovation.'

Notes for Editors

1. HEPI was established in 2002 to influence the higher education debate with evidence. It is UK-wide, independent and non-partisan, and funded by organisations and higher education institutions that want to see vibrant policy discussions.
2. Edward Venning is Founding Partner at Six Ravens Consulting LLP, working with knowledge-led institutions on their most important communication, governance and policy challenges. Previous work for HEPI includes Size is Everything (HEPI Report 160), the first full picture of small, specialist and practice-based institutions in higher education. He has served on the executive board of University of the Arts London (UAL), the largest world-class specialist university, and of Southbank Centre. Before that, he was a senior civil servant.
3. The report has been sponsored by Goldsmiths, University of London.