UCAS Keynote speech from Vivienne Stern, Chief Executive of UUK

You will know that for the last few weeks we have been engaged in the mother of all tussles with the government over the future of the Graduate Route. I genuinely don’t know which way it is going to go. We may get an announcement in the next couple of days, or it may drag on a bit longer.

The argument has spilled over into the papers and broadcast media. It’s a messy business. This argument has very significant consequences, as you know all too well.

A decision to close the Graduate Route would have an immediate impact on the financial stability of the sector, illustrated starkly by the Office for Students in its recently published report on the financial sustainability of the sector.

The OfS found that 40% of providers are projected to be in deficit this financial year, with a growing number showing low cash balances. In a particularly striking section of the report, the OfS considers what might happen should there be a contraction in domestic or international demand, or both.

It found that, if growth is flat – as opposed to healthy as the forecasts upon which its analysis is based predict – 176 providers could be in deficit by 2026, rising to 239 if numbers fall by as much as 35%. This sort of reduction would have felt far-fetched a year or so ago. Now, with extreme volatility in international demand, it feels less so.

So the argument going on in Westminster really matters.

It doesn’t just matter to universities. I would argue it matters to every single person in the UK. Universities UK has shown, repeatedly, just how much international students contribute to the economy of the UK. It averages out at about £58 million per parliamentary constituency – or more than £40 billion overall per intake of international students. That’s not just income that comes to universities. It is money that is spent in shops, and on services and in other business right across the country, from Paisley to Plymouth. It is one of the UK’s biggest export sectors, earning something like 1% of national GDP.

But there is no getting away from the fact that we’re caught in the cross hairs of the only political issue which can really rival growth for political attention - migration.

The government commissioned the Migration Advisory Committee to provide advice on whether the route was being abused, genuinely expecting them to find that it was, that large number of students were entering low paid jobs, and that the route was acting as a back door to low skilled migration. I think there was a degree of shock and anger in some quarters that, on the contrary, the MAC found, and I quote, 

and that, 

None of this has stopped those determined to close the route from arguing that a high proportion enter low skilled work, but in essence they need another stronger argument if they are going to win the day.

Over the last week the argument has pivoted back to a familiar one: that too many low quality universities are using international students to prop up low value courses. That these institutions deserve to fail and that if removing the graduate route precipitates that, so be it. This is laced with a fair dose of elitism – the old familiar argument that too many people go to university anyway, and that the Graduate Route is not attracting ‘the brightest and the best’ because the largest share of growth has been amongst lower tariff institutions outside the Russell Group.

I am going to address the four main arguments:

It is an argument I have heard many times throughout the two decades that I have worked in higher education policy and politics. It is often made by those who went to university themselves, and of whose children 100% participate.

Here’s the basics: the UK is not alone in seeking to increase the share of our population educated to tertiary level. In 1998, 20% of adults in the OECD had a tertiary education. By 2022 it was 40%. All but one country in the OECD has increased its share of young people with tertiary attainment in the last 10 years.

The UK has one of the highest tertiary attainment rates in the OECD, at 51%. However, that only puts us in 7th place, behind Canada, Japan, Ireland, Korea, Australia, Luxembourg.

We also know that higher rates of participation benefit the economy. Research by the Department for Education shows that skills and labour have been the only factor driving a persistent and positive contribution to productivity in the last few years.

And across the OECD there is a strong and positive correlation between tertiary enrolment and GDP per capita.

This is why developed countries have expanded their higher education: it makes economic sense. It would be a profoundly odd thing for an advanced economy like ours to try to pursue stronger economic growth while contracting the proportion of the population educated to degree level, especially in an age of technological transformation which is likely to demand that more – not fewer – people in the workforce have the critical thinking skills which university is uniquely well placed to foster.

But I want to make another argument too – not an economic one, but a moral one.

In the UK, expansion of the system has made a real change to the distribution of opportunity. In the period since 2005, the proportion of pupils receiving free school meals who go on to university has grown from 14% to 29%; the proportion of students from the lowest participation backgrounds has grown from 12% to 28%. In the last 15 years the number of students from BAME backgrounds at our universities has increased by over 200,000, and there are over 250,000 more students with a disability.

These are the people who have benefited from the expansion of higher education. These graduates are likely to achieve higher earnings, better health and a longer life as a result. These are the kids who would not have gone to university had expansion not happened.

And yet, you are still twice as likely to go to university in the UK if you are from the most advantaged social and economic group, than if you are from the least advantaged. That cannot be right.

This is one argument for continuing to expand participation, not reverse the progress of the last 30 years. The middle classes are highly unlikely to step aside, or tolerate being pushed aside by public policy. To widen participation, history has shown you have to expand participation.

That’s why I want to strongly congratulate UCAS on its recent move to ensure that students on Free School Meals no longer have to pay the application fee. It is a small part of a bigger picture, but I wholeheartedly agree that we should work to remove every barrier to participation amongst those who are least represented in higher education.

To put it bluntly, widening participation is unfinished business, and it is our job to ensure that it does not stall in the second decade of the 21st century.

Fortunately, there is good evidence that this is what we need to do in any case to meet the needs of the evolving labour market.

A recent study by the DfE predicted that the UK will need more than 11 million extra graduates by 2035, and that 88% of new jobs will be at graduate level. Within this we will need about 1 million more health professionals, and 1 million additional teachers.

I want to turn to the second core criticism we face: that too many degrees are poor quality. Now this one really deserves a speech to itself. But actually my challenge is getting across the quality argument in a pithy way – one which is not defensive, which is compelling, and which addresses the serious question.

It is not wrong to be concerned about quality. We should all be concerned about quality. In fact I would argue that it is the strong historic focus on quantifying measures of quality which have driven improvements in the UK. Government likes to talk about areas in which the UK is world leading. I’d say our quality assurance architecture is one of them.

But it is hard to get people to listen to you about subject benchmark statements, the QAA, programme review, external examiners without your interlocutor glazing over.

And actually, when people talk about quality, they are really talking about outcomes – and most often they are talking about earnings. I’ll come back to that in a moment.

But my answer to those who are concerned about quality is to say – in England – we have a regulator which is there to examine whether universities are delivering for their students. You could point to the fury the sector expresses over it as evidence that it must be doing something right. Universities are measured on the kind of outcomes our critics hold up as evidence that there is a problem – continuation and completion rates, what happens after graduation, and the opinions of students themselves.

The OfS’s own calculation is that 99% of providers are meeting their expectations in these areas.

So, my very basic argument is this: you are right to be concerned about quality. It really matters. We should all be concerned about it. Is everything perfect everywhere? Unlikely, in a system with 2.8 million students and almost 1000 providers of higher education of one form or another. But in England we have - quite recently – legislated to create a regulator to keep an eye on this. It is already taking action where it finds that things are not as they should be. If you are still worried, talk to the regulator and work out how it can be improved.

But, and this is the important point, if you are implying that the majority, or even a large part of the sector is a cause for concern, the data and the evidence of the regulator do not support you.

I want to turn now to the third – and most troubling argument. That it is not really worth going to university anymore.

This is the one that keeps me up at night.

It is wrong.

UUK is about to publish some very important research. We have been able to look at the career trajectories of graduates over a 15 year period, and compare them with those of non-graduates who could have gone to university (ie they had qualifications at key stage 4 which would have allowed them to do so) but did not.

It shows that graduates earn more than non graduates in every region of the UK, in almost every occupation category, and that the earnings gap widens over time. By the age of 30, graduates are earning on average 37% more than non graduates, and that their wages are growing faster, at 7% a year compared to 3%. They are 50% less likely to be on out of work benefits. This broad picture holds across the broad range of career paths. For example, in Arts and Entertainment, graduates in the North West earn 53% more than non graduates in the same sector.

Looking at all occupation groups and all regions there appear to be just four exceptions. For instance, London based transportation and storage workers earn on average 1% less than non grads, although they attract a premium in every other region of the UK. There are three regions where graduates in electricity, gas and air conditioning workers earn less than non-graduates. But they are the rare exceptions, not the rule.

So the message is: for most graduates, wherever they work in the UK, and whatever their subject of study and occupational path, a degree is worth it.

Evidence won’t necessarily change minds, but we have to keep pointing to it nonetheless.

This matters because the current ‘poor value’ narrative is almost certainly putting off students who would go on to be wealthier, healthier and more fulfilled if they did go to university. So the rhetoric matters, and we must do all we can to counter it.

The final argument I want to address is a more difficult one. I want to be clear: all Russell Group members are members of Universities UK. But the way in which the Russell Group is presented as representing the only universities which matter to the UK is troubling to me and wrong. I do feel we have to point out that excellence is widely distributed across the UK university system, and that a country like ours needs a wide range of universities to serve its broad needs. We need the specialists, the dual intensives, the institutions which are focussed on a predominantly local mission, and those which are at the forefront of widening participation.

After all, the Russell Group does not include the world’s leading Art and Design institution, the Royal College of Art; or St Andrews, a university which regularly tops the domestic rankings, or many of the universities which have topped rankings  or won awards based on student feedback, like the University of Chester or the University of Lincoln who came second and third respectively, after the University of Sheffield, in the Whatuni student choice awards.

Over 98% of all teachers, and over 90% of nurses – which all parties say we desperately need more of - are taught at non-Russell Group universities. Around one third of all medical degrees are taught at non-Russell Group universities. What about opportunity, matching employees with the skills employers and the UK need? Almost ninety percent of degree apprenticeships take place outside the Russell Group – in towns and cities around the UK.

Can you really believe that it doesn’t matter if those universities are pushed over the edge by a combination of government inaction on the funding of teaching and research, and action on restricting the graduate route?

And when you focus on the brightest and the best, do you really mean (in the context of international students) those who can afford the highest fees? If so, are you willing to see that translated by governments around the world, where students are more price-sensitive and likely to go for less highly ranked, lower cost courses, that their young people are not ‘bright?’

You know better than anyone that prior attainment does not necessarily dictate future success. There are people in this room who will have been directly or indirectly responsible for transforming the lives of thousands of students, who would have been on a different path without the opportunity that university offered. Those were the stories we tried to capture in our recent 100 faces campaign.

We have to keep telling these stories and making these arguments. We need to push back against the elitism and snobbery which says that it was a mistake to expand participation; that we should return to a system where a tiny proportion of the population have access to the life changing experience on offer in our universities.

We’ve got work to do. You are at the heart of it. It matters to all of us.