Written evidence from the University of Sunderland (WOS0052)


This response is submitted by the University of Sunderland as part of the call for evidence into the parliamentary inquiry into the work of the Office for Students.  This is based on the experience that the University has had as a post-92 university in complying with the OfS regulatory framework.


  1. Are the OfS’ statutory duties clear and appropriate? How successful has the OfS been in performing these duties, and have some duties been prioritised over others?


Whilst the OfS statutory duties are sufficiently clear, given its strategic aims, it has prioritised some duties over others since the launch of its regulatory framework in 2019.  For example, there was an initial focus on increasing competition and choice in the HE sector and promoting access and widening participation for underrepresented groups, which has shifted more recently to promoting value for money and on improving the quality of teaching and learning.


Some duties have also been prioritised depending on specific circumstances, such as the duty to protect the interests of students during the COVID pandemic. This resulted in new regulatory requirements being imposed whilst others were temporarily suspended, during what was a challenging period for all HE providers and their students.


  1. How closely does the OfS’ regulatory framework adhere to its statutory duties? How has this framework developed over time, and what impacts has this had on higher education providers?


It is acknowledged that the regulatory framework has developed over time to reflect the changing priorities and challenges of the HE sector. The recent focus on promoting value for money and on improving the quality of teaching and learning has seen the introduction of assessing performance against a set of key performance metrics, such as student outcomes, student experience and graduate outcomes, amongst others.


The regulatory framework’s continued focus on market competition will undoubtedly continue to impact on the behaviour of HE providers.  For example:



The impact of the OfS regulatory framework on HE providers has been significant.  Many universities and colleges have had to make extensive changes to existing policies and procedures to comply with the new regulatory requirements.  For example, particularly in relation to access and participation.  Some providers have subsequently faced financial penalties or other sanctions for failing to meet OfS’s regulatory standards.


In parts, the framework is overly prescriptive and bureaucratic, and places undue pressure on HE providers.  The regulatory conditions do encourage a “tick box” culture where HE providers are becoming more focused on having to meet regulatory requirements than with providing a high-quality education through developing innovation and creative solutions.


Adherence to the OfS regulatory requirements are costly, resource-intensive and time-consuming for HE providers. This places a disproportionate burden on smaller institutions who do not have the same resources as larger institutions.


The OfS approach to regulation can be fragmented and inconsistent. The regulatory framework itself is complex, with its wide range of different requirements and processes that can be difficult to navigate.  It comprises a range of statutory instruments, codes of practice, guidance documents and other regulatory requirements that apply to HE providers in England.  Whilst some of these documents are relatively short, others are lengthy and complex.  For example, the regulatory framework includes a Code of Practice for the Quality Assurance of Higher Education in England, which set out the requirements that higher education providers must meet to ensure the quality of their provision.  The Quality Code consists of 19 chapters, each of which sets out expectations for HE providers on topics such as learning and teaching, assessment, and academic standards. The Quality Code guidance runs to over 300 pages.


Putting to one side the concerns about how valid the key performance metrics are as a measure of the quality issues they relate to, there’s an implicit assumption that good or bad performance on these metrics are indicative of how effective the OfS regulation has been. 


The OfS state that “if a provider delivers outcomes for its students that are below a numerical threshold, we will make decisions about whether those outcomes are justified by looking at its context.”   This approach should, in theory, result in a more rounded assessment of an HE provider’s performance on quality.  However, the regulatory requirements focuses efforts disproportionately on absolute numerical baselines with limited reference to other evidence it would rely on.  Again, the complexity of these regulations are significant – with over 600 pages of guidance and explanatory notes for HE providers to consider and interpret.


There are currently circa 25 different data and information returns, some with different constitutent elements, that all have to be compiled, checked and submitted to the OfS (or its designated data body) on an annual basis.  Most HE providers have had to appoint planning, data and information specialists to facilitate the volume of returns and data submissions within the prescribed deadlines.


  1. What is the nature of the relationship between the OfS and the Government? Does this strike the right balance between providing guidance and maintaining regulatory independence?


The relationship between the OfS and government appears to be multi-faceted and complex. 


It is clear that the OfS is accountable to the DfE and the Secretary of State for Education, who appoints the OfS Board members and provides the OfS with its strategic guidance and funding.  The OfS states it is required to report regularly to government on its performance and to comply with government policies and regulations.  However, the OfS is statutorily independent and has the power to make decisions and take actions that are in the best interests of students and the wider public, free from political interference. 


When the new Chief Executive of the OfS was recruited, it was stated that the successful applicant would ‘play a major role in delivering government priorities for higher education’.  Interestingly, at the same time, it also acknowledged that the role needed to focus on “continuing to identify ways to reduce regulatory burden so that the higher education sector can focus on what really matters”. 


It is of interest to note that, as the level of public funding for the HE sector has decreased, the amount of regulation and oversight has increased.


  1. Does the OfS have sufficient powers, resources and expertise to meet its duties? How has its expertise been affected by the Quality Assurance Agency for Higher Education’s decision not to continue as the OfS’ Designated Quality Body?


Whilst the OfS has a range of statutory powers and likely employs staff with relevant expertise, it is highly probable that the OfS does not have sufficient resources to carry out all of its regulatory functions effectively, particularly given the complexity of the higher education sector. 


Furthermore, as the OfS regulatory conditions continue to expand, it would be a continuous challenge for the OfS to claim it has sufficient expertise in all areas of regulation, particularly in newer and more specialist areas such as market competition, the prevent duty, student protection or harassment and sexual misconduct matters.  This is of potential concern to HE providers who have, for several years, been focused on these matters and have developed the internal experience and expertise in navigating these complex issues.


  1. How does the OfS measure value for money for students? How can this be measured in an objective, tangible way that is not based on economic or political judgements about the value of subject areas or types of institution?


The OfS measures value for money for students through a range of mechanisms that are designed to provide students with information about the quality and outcomes of higher education provision, as well as the costs involved.  One of the key mechanisms that the OfS use is the Teaching Excellence Framework (TEF). The OfS claims the aims of the TEF are to provide students with information that help them make informed choices about where to study, based on factors such as teaching quality and career prospects.


Measuring value for money in an objective, tangible way that is not based on economic or political judgements about the value of subject areas or types of institution would be challenging but not impossible – this needs further dialogue with HE providers themselves. 


  1. How does the OfS engage with students? To what extent does input from students drive the OfS’ view of their interests and its regulatory actions to protect those interests?


One of the key mechanisms the OfS uses to engage with students is through its Student Panel, made up of students from across the higher education sector. The Student Panel advises the OfS on a range of issues, including how to improve the student experience, how to ensure students are represented and how to promote student health and wellbeing.


The OfS has provided examples of working with various student representative bodies such as the National Union of Students (NUS), to gather their views. 


The OfS claims to place significant emphasis on engaging with students and ensuring their views are represented in its regulatory activities.  However, as the profile of students across the higher education sector continues to expand and diversify, the OfS will need to continue to find meaningful ways to ensure it is considering representative views from the entire student population, including, for example, those Student Unions’ that may not be affiliated with the NUS.


  1. What is the nature of the OfS’ relationship with universities? Does the OfS strike the right balance between working collaboratively with universities and providing robust challenge?


It is not sufficiently clear that the OfS is striking the right balance between working collaboratively with universities and providing robust challenge. 


As the OfS is so highly focused on regulation, it could do more to work closely with universities to promote innovation and excellence in the sector.  For example, by working more collaboratively, the OfS could help HE providers to improve the quality of education they provide and to respond effectively to the changing needs of students.  This could include providing more focused guidance and support to providers on how to meet the OfS’s regulatory requirements and encouraging best practice.  For example, to promote student health and wellbeing and mental health.  Case study examples can be very valuable and enable individual HE providers to adapt and implement the good practice examples of others as tailored to their own context.  Regulatory requirements can, in many ways, be a ‘one size fits all’ blunt instrument.


The OfS could also ensure that there is more transparency of its regulatory activities, for example, by publishing anonymised case studies where it has opened an investigation into a provider.


  1. What systemic financial risks are present in the higher education sector? Is there the potential for significant provider failures if these risks crystallise, for example through an unexpected reduction in numbers of overseas students or an unexpected increase in pension costs? Are these risks limited to particular groups of providers or are they widespread or systemic in nature?


The higher education sector, like any other sector, faces a range of systemic financial risks that could potentially lead to significant provider failure if they were to crysallise.  The financial risks facing the higher education sector are not limited to specific groups of providers but are widespread and systemic in nature. 


All higher education providers face financial risks to some degree, and the risks are influenced by a range of factors, such as the provider’s size, mission, location and its financial management.


Financial risks are also influenced by broader economic and political factors, such as changes in demographics, and global economic conditions.  These factors can create uncertainty and volatility in the HE sector, making it more challenging for providers to manage financial risks effectively.


Examples of the key risks for many HE providers include:



  1. What business models are present in the UK higher education sector? Are these models resilient to the financial risks of the sector, and are universities focusing sufficiently on having a viable business model?


The higher education sector in the UK has a diverse range of business models.  Some universities are research-intensive and rely heavily on income from research grants and contracts, while others focus on teaching and rely heavily on income from student tuition fees. 


Some universities have diversified income streams, including, for example, income from transnational education partnerships, commercial activities, and philanthropic donations. 


The resilience of these business models to the financial risk of the sector varies, depending on a range of factors such as the size and complexity of the institution, its student mix, its location and its financial management.  Those universities that are reliant on a single source of income or those that have low financial reserves, are likely to be more vulnerable to financial risks.


Given the importance on universities to have a viable business model, universities have to be proactive in identifying and managing financial risks, and have, for many years, put in place well-developed strategies for diversifying income and managing costs. 


  1.        How does the OfS oversee the financial sustainability of higher education providers and the higher education sector? Is its approach clear, and is its oversight sufficient to spot potential risks early on and take action accordingly?


The OfS has a financial monitoring framework in place, which enables it to assess the financial health of HE providers based on a range of financial metrics and indicators.


Some concerns have been raised within the sector about the clarity and effectiveness of the OfS approach to financial monitoring.  For example, the financial monitoring framework is overly complex and there is a lack of transparency in the OfS decision-making processes.


The OfS should continue to engage with HE providers to ensure its approach is fit for purpose and that it delivers the desired outcomes for all stakeholders.


  1.        What is the OfS’ tolerance for the failure of higher education providers, and what processes are in place to manage provider failure? Would the failure of a large provider follow a clear regulatory process or is there the potential for political considerations to play a role in such decisions?


The OfS has a documented range of processes in place to manage provider failure, such as financial sustainability assessments, ensuring providers have contingency plans in place in case of financial difficulty, intervention through sanctions or revoking a provider’s registration and ensuring that providers have student protection plans in place.


Through its regulatory actions to date, the OfS has a low tolerance for the failure of higher education providers. As the OfS has a duty to protect the interests of students and the wider public, a balance must be struck between the support and guidance that should be provided to a failing HE provider to ensure the interests of both former and existing students are protected.


  1.        To what extent is the financial sustainability of providers determined by government policy and funding rather than the OfS’ regulation? Is there a need for policy change or further clarity to ensure the sustainability of the sector?


The financial sustainability of HE providers is influenced by a range of factors, including government policy and funding as well as OfS regulation. 


Changes in government policy and funding can have a significant impact on the financial sustainability of HE providers, as they affect the level of income that providers receive and the costs they must bear.  This includes, for example, changes in government funding for higher education, changes to the student loan system and changes in tuition fee levels all have a significant impact on the finances of HE providers.


There is a likely need for policy change and further clarity to ensure the financial sustainability of the higher education sector.  For example, there are ongoing debates about the level of government funding for higher education, the balance between tuition fees and government funding, and the impact of the student loan systems on the finances of HE providers and students. 


There is a need for ongoing policy discussion, including with HE providers, alongside regulatory clarity to ensure the long-term financial sustainability of the sector.

06 April 2023