Bursaries, fee remission or a training salary for all?

Why is paying a bursary to a trainee teacher seem as potentially having a deadweight cost attached to it, but paying a salary to a trainee army or navy officer does not seem to be regarded in the same way? The Education Policy Institute, where ex-Lib Dem Minister David Laws is Chief Executive, has just published at short review paper on teacher recruitment into training and other teacher supply issues https://epi.org.uk/wp-content/uploads/2017/07/EPI-Analysis-Teacher_Supply.pdf  The Review say that bursaries are not efficient because, when they are increased in amount, this extra has to be paid to everyone and not just to those extra trainees it would entice into the profession. I seem to recall a parable In Chapter 20 of St Matthew’s Gospel that deals with an analogous situation.

As might be expected by a body whose chief executive was associated with the famous Orange book, this issue of paying the same to everyone reads as if it may be troubling for the authors of the review and they discuss alternative and more efficient scenarios to bursaries, including the student fee forgiveness package promoted in the Conservative Manifesto, but presumably a casualty of yesterday’s funding announcement.

Personally, I favour the situation that brings trainee graduate teachers nearest to their colleagues in other public services, many of whom are paid during training. The EPI review doesn’t address the issue of fairness between the different routes into teaching; indeed it is very thin on a discussion of why higher education is still proving so attractive to applicants and it is the school-based routes that seem to be bearing the brunt of the fall in applications this year.

The other interesting observation in the review is that the pupil teacher ratio in secondary schools will worsen from 14.5:1 in 2016/17 to 16.0:1 by 2026/27. Much of this apparent deterioration will just be a reversal of an improvement achieved while pupil numbers were in decline in the secondary sector and some of the change can be brought about by relatively small changes in group sizes and Key Stages 4 & 5 where periods of generous funding always allow for smaller classes to be operated than in less generous periods for funding. Nevertheless, an expectation of a deteriorating pupil teacher ratio is not a great selling point for attracting new entrants into the profession or retaining those already there.

To me it reads as if the unidentified writer of the EPI review would have liked a real free market in salaries, both between schools and within schools between teachers, as if this had never been the case in the past. Within the tightly managed central control of salaries, (even though funding of schools was at the direction of local authorities), that existed in the post-war period up to the introduction of local management of schools after the great Education Reform Act of the late 1980s, there were marked differentials between promotion opportunities in the primary and secondary sectors and it was easier for teachers in some subjects to achieve additional payments if the school know that they would be difficult to replace. To that extent the market principles of supply and demand probably worked at least as effectively as they do at present.

Indeed, one interesting question is why there hasn’t been a return to the use of recruitment and retention allowances by schools, a favoured device during an earlier recruitment crisis.

 

Abolish tuition fees?

When I wrote back in April about the iniquity of the hike in repayments rates on student fee debt to 6.1% hardly anyone noticed https://johnohowson.wordpress.com/2017/04/12/debt-hike-for-teachers/ That’s the price you pay for being ahead of the game. Then came Labour’s abolish fees pledge during the general election and there is now a growing groundswell on the issue, further fuelled by the fall in applicant numbers reported by UCAS this week.

So far, few have tried to put the debate in even the wider education funding agenda, let along government funding policy as a whole. As I argued in my earlier piece, cutting student fees might mean losing or postponing some other project either in education or society more widely unless the funds can be generated from an increase in taxation somewhere else. There might also be the unintended, or I assume unintended, consequence of reducing further social mobility if the abolition of fees and their replacement with direct payment for university places by the government led to a cap on places. Those that could afford to pay for extra tuition might scoop the bulk of available places, leaving others less well-off to claim only any reserved places under government mandated schemes or unfashionable subjects in unpopular universities.

Earlier in the century there were schemes to help young people save for expenses like tuition fees so that they would not be the burden they now are seen to be. I am not sure what happened to them? It is interesting that the insurance market also never saw saving for tuition fees as a necessary product, presumably because parents with young children were seen as not having the level of disposable income to fund such schemes in advance. As I said in April, at the present time it would be more cost effective for families to increase their mortgages than to incur student debt in terms of current repayment levels.

The risk is that in the present political climate judgements will be made on votes to be won rather than sound economic or social policy. But, then fees were increased to £9,000 probably without much thought for either issue and certainly no rationale as to why a classroom subject would cost that sum to deliver. Anyway, the concern must be that a Conservative strategist sees abolishing fees as spiking Labour’s guns with young voters and so worth doing ahead of sorting out the mess with funding social care or even the NHS.

Although there are many worthy articles written about the rationality of government financing, in the end it comes down to plain old horse trading and what works politically. With the number of eighteen year olds set to fall, part-time students numbers already having been decimated and no EU students to pay for, the government could well explore a deal with universities of fees paid for home students, but higher full-cost fees for overseas and non-government funded students. The government could also rebalance the subject offering so as to demonstrate to Conservative voters that they have wiped out subject that shouldn’t be degrees and moved them into the new apprenticeship sector. That might play well with those that think there are too many students wasting three years at university. So, whether fees survive looks increasingly like a political decision based on electoral strategy and the date of the next general election.

 

Tuition Fees rethink

One of the most spectacular policy announcements of the recent general election campaign was Labour’s offer to scrap tuition fees for new students and abolish outstanding repayments for graduates. There was no attempt to link this to the NHS and social care funding crisis as the other great funding need. There was also no real vision for how this would sit alongside the need to remove the cap on public sector pay. However, it seems to have worked, like most much announcements, in this case attracting many young voters that would benefit from any removal of fees.

I notice that the Tory press has taken to blaming the Lib Dems for the present university student fee levels, this despite the fact that it was a decision of the coalition government, albeit taken by a Tory minister and presumably approved by both a Lib Dem Secretary of State and the Cabinet as a whole.

One of things that riled me at the time of the fee hike was the lack of any discussion on why classroom subjects should be assumed to cost the same as laboratory and practical subjects? I wonder if ministers thought the market would drive down prices but, as I have pointed out before, with demand far exceeding supply, there was no incentive for any university to anything other than tinker at the edges with the £9,000 fee levels.

So, are such fees justified for arts and humanities subjects? Well, much depends upon the size of the group and the number of hours taught. Fees at this level should allow for minority subjects cross-subsidised by more popular courses and lots of options within courses, even if only 25% of the fee income goes directly to teaching and the rest to legitimate university and departmental overheads. Of course the level of salary and the mix of experience of teaching staff also play a part, as they do in school finances. One cannot help feeling that universities are possibly also possibly funding future capital programmes and increasing their surplus funds from the fees being paid by current students. Both seem to me good reasons for re-assessing the balance between the price paid by students and the eventual cost to government.

I think university accounts should be much more transparent on how fee income is spent, especially between different types of course. Many years ago, I conducted research into the funding of teacher education courses and it was clear that at the £3,000 fee level universities that paid a fee to schools could not cover their costs and had them written off each year by the central administration. It would be interesting to repeat that exercise on the £9,000 fee level.

Personally, I think that there is a case for fees to be in the £6,000 range, to allow for funding of free nursery education that might be a casualty if fees were to be abolished, with a direct government top-up for specified STEM and other more expensive subjects that universities might need encouragement to develop. I certainly don’t want undergraduates subsidising either the summer conference trade or in most cases either research programmes or postgraduate taught courses.

 

Worrying reports for teaching

Two new pieces of evidence that support the ‘NO FEES for trainees’ campaign launched by this web site at the beginning of January were published today. High Fliers, the organisation that has been monitoring graduate recruitment since 1995, updated its forecast for 2015 graduate recruitment to suggest the market is still growing and that Teach First will be the largest single employer of new graduates in 2015. But, they don’t count the 30,000 graduates entering training to be teachers in their survey partly because to do so would demonstrate how teaching dominates the graduate labour market.

The second piece of evidence was a research report by Income Data Services for the NASUWT on pay in teaching. This shows pay on entry falling behind. Governments have always been reluctant to accept that by imposing an extra year of unpaid preparation on would-be teachers that affects the decision of some that would become teachers when there are plenty of other graduate job opportunities. Making trainees pay fees just adds insult to injury and further reduces the incentive to teach. It have pointed out before that if the Ministry of Defence can pay trainee officers at Sandhurst, the DfE should be able to pay all trainee teachers rather than impost a levy on training through the fees.

With the labour market for graduates now recognised as buoyant, the fee remission is something that can be achieved quickly and relatively cheaply for government and could make a difference to recruitment. Yes, some individuals would have become teachers and be prepared to pay for the privilege, but the same is true for army, navy and air force officers, not to mention civil servants and many others in the public sector.  We don’t expect them to, so why teachers?

After the recruitment crisis of 2000-2003 teachers’ pay rose in relation to the private sector, partly because Ministers took the brakes off the progression through to the Upper Pay Spine. It may have been reasonable during the recession for public sector pay to be kept down, but once pay starts becoming uncompetitive something has to be done or a teacher recruitment crisis develops. The warning signs have been there since 2012, as readers of this blog know.

With most graduate jobs located in or around London traditionally it is in the capital that pay pressures have been likely to exert the greatest effect. But, with new businesses able to start in bedrooms these days and then turnover many thousands of pounds through a single computer pay and conditions have become a national issue that the government’s broadband strategy will only make worse.

Schools can offer what salaries they like these days, and we will try to monitor this trend. Schools may seek to use their reserves to offer higher salaries and savvy trainees will undoubtedly use the evidence from today’s reports to negotiate higher starting salaries, especially if they know that they are in a shortage subject. Schools that register their vacancies with www.teachvac.co.uk will be told about the size of the market and can respond accordingly.

At the end of this month we will know the initial recruitment figures for 2015 training places and can compare the situation with January 2014. Any deterioration will be bad news. Cut tuition fees now.