Franchising lets universities subcontract courses to external providers. But under new government plans published for consultation on January 30, delivery partners with 300 or more students will be required to register with the Office for Students to ensure courses meet rigorous quality standards, in order to be eligible to access to student finance.
If the OfS finds that a provider is not meeting the standards required of registered providers, they will be publicly held to account and risk facing fines and the suspension of their registration in the most extreme circumstances. The OfS will also publish student outcome data for all subcontracted partnerships every year.
The move comes ahead of a significant package of higher education reforms due to be announced this summer, which the government said “will put students first and cement universities’ status as engines of growth in their communities”, as it focuses on its Plan for Change to drive economic growth and raise living standards.
“We are committed to cracking down on rogue operators who misuse public money and damage the reputation of our world-class universities,” said education secretary Bridget Phillipson.
“Franchising can be a valuable tool to widen access to higher education, and these proposals will ensure students can trust the quality of their courses, no matter where or how they choose to study,” she continued.
“The credibility of our universities is at stake, but these proposals seek to protect students and safeguard taxpayer’s money, as part of our work to drive growth through our Plan for Change.”
The credibility of our universities is at stake
Bridget Phillipson, UK education secretary
The government said the measures seek to uphold good standards in higher education and ensure students are getting the high-quality education they are paying for.
The number of students studying at franchised providers has more than doubled in recent years, with over 130,000 using their services.
An investigation by the National Audit Office (NAO) raised concerns about franchising arrangements, with fraud in the sector costing the public purse £2 million in 2022/23.
More than half of 341 franchised institutions are currently unregistered with the OfS, according to the government, meaning they are not directly regulated. In some cases, students are offered poor-quality courses that fail to justify their cost, it said.
Franchising allows courses to be adapted to suit different needs and circumstances. It also helps colleges and universities work more closely together and gives new, innovative education providers a chance to get started.
The government used London South Bank’s partnership with NHS teaching trusts – helping students’ studying midwifery and other front-line services – as an example of franchising done right, with students achieving their qualifications “alongside invaluable workplace experience, helping to address the critical shortage of healthcare professionals”.
Universities and colleges whose names and brands are being used by franchises will remain responsible for ensuring their subcontracted arrangements meet quality and standards requirements. New regulations could come into effect as soon as spring next year, depending on the outcome of the consultation, the government said.
“These proposals would strengthen the OfS’s ability to protect the public money that goes into franchising,” a spokesperson said.
“The consultation aligns with the OfS’s work to strengthen conditions of registration related to governance and student interests,” they added.
The OfS will shortly be consulting on changes to requirements for providers that wish to join its register to ensure they are all managed and governed effectively.
The watchdog has currently paused registration of new higher education providers to support the sector with financial sustainability concerns, after finding 72% of providers could be operating in deficit by next year.
It expects the pause to stay in place until August 2025 but will review the decision every three months, meaning the registration process should be open again by the time the government’s proposed changes would take effect.
The Department for Education’s consultation will be open from 30 January to 4 April 2024. After the consultation closes, the Department for Education will review the responses and aims to publish its official response in the summer.
