Government admits it has no idea on private universities' course completion rates

The government has admitted that it is not monitoring course standards or student completion rates despite handing over £33 million of taxpayers' money to private companies in the last year.
 
In the letter, UCU says it is extremely surprised that companies are being allowed access to public funds (in the form of student loans) in return for virtually none of the quality assurance checks demanded of public universities.
 
The startling admission by David Willetts came in response to questions* by shadow higher education minister, Shabana Mahmood, and UCU warned that unless the government closed the current loophole and introduced proper oversight it risked a repeat of the scandals in the US where for-profit companies have siphoned off billions of dollars of public money in return for below-par courses.
 
From this autumn UK private providers will get greater access to treasury funds after the government increased the amount they can obtain per student from £3,000 to £6,000. Unlike public universities there is no cap on the number of students they can recruit.
 
In the States, for-profit companies offer derisory graduation rates, crushing levels of debts and degrees of dubious value. According to the US Education Trust, only 20 per cent of students at for-profit colleges complete a four-year course and a fifth of those who do finish default on their loans within three years.
 
UCU general secretary, Sally Hunt, said: 'The government has got itself in a complete mess over the way it regulates private providers. Unless ministers close this loophole private companies will continue to siphon off public cash to run courses that have been subject to little quality assurance.
 
'The government risks a repeat of scandals in the US, where under-regulation and a steady supply of public subsidies have made shareholders and CEOs very rich, but left taxpayers out of pocket and students with degrees of questionable quality.'
 

Notes
 
*Parliamentary questions and answers:

Shabana Mahmood:  To ask the Secretary of State for Business, Innovation and Skills whether (a) his Department and (b) the Higher Education Statistics Agency hold data on non-completion rates for (i) students at private higher education providers with their own degree awarding powers who have access to student loans and (ii) students at private higher education institutions whose courses are designated higher education courses and have access to student loans.
 
David Willetts: The Department for Business, Innovation and Skills, and the agencies reporting to the Department, do not hold the data requested on non-completion rates in private higher education institutions of students who are eligible to receive student loan funding. 24 April 2012
 
Shabana Mahmood: To ask the Secretary of State for Business, Innovation and Skills what differences exist between Quality Assurance Agency audits of higher education institutions and his recently introduced due diligence checks on designated higher education providers.
 
David Willetts: The Quality Assurance Agency carries out institutional reviews of universities and other higher education institutions in England and Northern Ireland. The core aim of institutional reviews is to examine whether universities and higher education institutions provide higher education qualifications of an appropriate academic standard and a student experience of acceptable quality and whether they exercise their legal powers to award degrees (where relevant) in a proper manner. The reviews are focused on the education provision.
 
The due diligence checks undertaken on organisations applying for specific designation, consider the management, governance, and medium term financial sustainability of the organisation. These specific checks do not consider the quality of the education provided as this is covered by other processes. The checks are important to ensure that both the student interest and potential public investment is protected. 26 April 2012