Our response to the Office for Students’ consultation on new requirements for the oversight of subcontractual arrangements

The condition would require providers to: 

• maintain a ‘comprehensive source of information’ about their subcontractual arrangements.
• demonstrate that they operate in accordance with the comprehensive source of information (e.g. policies and procedures).
• comply with a ‘subcontractual arrangement direction’ (SCD) if imposed by the OfS. The SCD can require a provider to do something or stop doing something.
• disclose more information about their subcontractual arrangements, including a ‘rationale’ for why they have entered into the arrangements and how much of the student fee is retained in these arrangements.

• We are supportive of the aims of the proposals as we see increased accountability as a positive addition to the measures universities are already taking to improve governance and management of subcontractual arrangements.
• We think the OfS should more clearly define what they consider ‘reasonable grounds’ and ‘significant risk’ in any decision about whether or not to impose a subcontractual arrangement direction.
• The OfS should not bring other kinds of partnerships (eg transnational education) into scope under this condition without further consultation and careful consideration.
• The OfS should put appropriate checks and balances in place so that imposition of a subcontractual arrangement direction is considered with a degree of independence and proportionality.
• The OfS should ensure they consider context in a providers’ ‘rationale’ for franchising or the proportion of fees it retains through these arrangements, and not view these in isolation when considering regulatory action.

This focus on increased accountability and transparency compliments our work to help the sector improve governance of franchised provision. Last year, with GuildHE and the Committee of University Chairs (CUC), we produced a Franchise governance framework to support members in managing such arrangements. We encourage universities to continue to use the Framework alongside their own methods of improving practice.