Source · Select Committees · Public Accounts Committee
Recommendation 22
22
The OfS told us that one of the things it became very aware of during...
Conclusion
The OfS told us that one of the things it became very aware of during the early days of the pandemic was that it did not have the tools needed to intervene quickly if facing a provider failure. It said that, because addressing that issue was urgent, in early 2020 it consulted quickly and introduced a new regulatory condition, effective from 1 April 2021, which enables it to impose directions on providers it considers at material risk of failure. The OfS described to us examples of the sort of directions it might make, including: requiring a provider to specify what it was doing to protect students’ interests; ensuring that students could transfer to a different institution to complete their studies; complete their intended course of study, or complete their current academic year or term and receive an exit award or credit to recognise their achievements with sufficient evidence retained to enable students to demonstrate the credit they had secured; and ensuring that complaints processes and a compensation scheme were in place.42
Government Response
Not Addressed
HM Government
Not Addressed
3: PAC conclusion: Protection for student, in the event of providers facing financial distress, are not strong enough. 3: PAC recommendation: The OfS should prioritise ensuring that all providers’ published student protection plans are fit for purpose and sufficiently clear for students to make confident, well-informed decisions about the protections universities are promising them. 3.1 The government agrees with the Committee’s recommendation. Target implementation date: March 2023 3.2 The OfS’s focus has been ensuring that protections are as robust as possible in those providers which might face financial distress. This reflects the OfS’s risk-based approach by ensuring that regulatory action is proportionate and targeted where it is most needed, while also ensuring there is not unnecessary burden on providers with robust financial health. For this reason, the OfS introduced a new ongoing registration condition on 1 April 2021 (Registration condition C4 of the regulatory framework for higher education in England). This substantially strengthened its ability to ensure the rigour of a provider’s plans to protect students against the risk of the provider ceasing to deliver higher education. 3.3 Registration condition C4 means that where the OfS reasonably considers that there is a material risk of such a market exit, it can put in place a Student Protection Direction, with which the provider must comply, setting out detailed and rigorous planning and measures to protect its student body. These go far beyond what would be covered in a student protection plan. 3.4 The OfS also intends to begin discussions with the sector about its regulatory approach to protecting the interests of students, with a view to updating and revising the requirements where appropriate.