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The Influence of the Model on Higher Education in the United Kingdom: Before and After the 2008 Economic Crisis

Reshaping the model: Higher Education in the UK and the Anglo-Saxon neo-liberal model of capitalism since 1970

L’enseignement supérieur au Royaume-Uni et le modèle de capitalisme néo-libéral anglo-saxon depuis 1970
Catherine Coron

Résumés

Cet article a pour but d’analyser l’évolution du modèle britannique d’enseignement supérieur depuis 1970 et de déterminer l’influence du modèle néo-libéral sur cette évolution. Il commence par définir les principaux concepts que mobilise l’étude. Une première partie évoque les étapes majeures de l’évolution du système universitaire britannique sur la période étudiée. Puis les caractéristiques les plus importantes du modèle économique de capitalisme anglo-saxon que l’on peut appliquer au système d’enseignement supérieur au Royaume-Uni sont rappelées. Cette étude conclut que malgré certains avantages financiers obtenus suite à la place croissante prise par la loi du marché dans l’enseignement supérieur, en faveur du budget du gouvernement et des bénéfices à l’exportation, le modèle britannique pose tout de même bien sur le long terme des problèmes humains, sociaux et économiques. L’objectif final étant d’aider ceux qui utilisent, comparent et amassent les données des statistiques internationales sur l’enseignement supérieur, de façon à ce qu’ils puissent mieux comprendre les principales caractéristiques culturelles du système universitaire britannique.

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Introduction

1According to the OECD, an economic institution which has developed a particular expertise at comparing the different global educational systems :

Education systems vary considerably from country to country, including the ages at which students typically begin and end each phase of schooling, the duration of courses and what students are taught and expected to learn. These variations greatly complicate the compilation of internationally comparable statistics on education.1

2This is the reason why trying to help solve these difficulties of international comparisons is the main target of this article which first tries to define and study the evolution of the British model of higher education since 1970. Then, it considers the main characteristics of the Anglo-Saxon economic model of capitalism and sees whether this model has influenced the key developments in higher education in the United Kingdom since 1970. The goal of this paper is finally to help those who use, compare and compile international statistics on higher education, so that they may understand better the main cultural features of the British higher education system over the period.

3Before starting our study of the British education system, let us first define two central notions: economics and higher education in order to see if it is both possible and relevant to deal with a British “neo-liberal model” of higher education. In other words, examining the link between education and economics as well as the definition of economics may help us understand the evolution of the British model of higher education as it may help us identify the semantic links between the two terms.

4Research in the economics of education started at the beginning of the sixties with the works of Theodore W. Schultz, Edward Denison, Gary S. Becker and Jacob Mincer who formulated the human capital theory. Gary Becker defined human capital as follows :

  • 2 Gary S. Becker, “Human Capital”, The Concise Encyclopedia of Economics, Library of (...)

Schooling, a computer training course, expenditures on medical care, and lectures on the virtues of punctuality and honesty are also capital. That is because they raise earnings, improve health, or add to a person’s good habits over much of his lifetime. Therefore, economists regard expenditures on education, training, medical care, and so on as investments in human capital. They are called human capital because people cannot be separated from their knowledge, skills, health, or values in the way they can be separated from their financial and physical assets. Education, training, and health are the most important investments in human capital.2

  • 3 Theodore W. Schultz, “Investment in Human Capital”, American Economic Review, 51, March (...)

5Schultz specified that with human capital “laborers have become capitalists not from a diffusion of the ownership of corporation stocks, as folklore would have it, but from the acquisition of knowledge and skills that have economic value."3 These definitions clearly show how education and economics are interrelated.

  • 4 Roger E. Backhouse and Steven G. Medema, “Retrospectives on the Definition of Economics, J (...)

6According to Roger E. Backhouse and Steven G. Medema, the authors of a study on the definition of economics, “Economists are far from unanimous about the definition of their subject”.4 However all definitions agree upon the fact that economics is a social science, and furthermore, some definitions seem to converge towards a certain number of common features. As early as 1890 Alfred Marshall in his Principles of Economics wrote that :

  • 5 Alfred Marshall, Principles of Political Economy, London: Macmillan, 1890 [1920], 8th edit (...)

Political Economy or Economics is a study of mankind in the ordinary business of life ; it examines that part of individual and social action which is most closely connected with the attainment and with the use of the material requisites of wellbeing. . . . Thus it is on the one side a study of wealth ; and on the other, and more important side, a part of the study of man.5

  • 6 N. Gregory Mankiw, Principles of Economics, Fort Worth: Harcourt Publishers, 2nd edition, (...)
  • 7 Robin Bade and Michael Parkin, Foundations of Microeconomics, Boston: Addison Wesley, 2002 (...)
  • 8 James D. Gwartney, Richard L. Stroup, Russell S. Sobel, and David A. MacPherson, Microecon (...)

7Much later in 2001, N. Gregory Mankiw explained that “Economics is the study of how society manages its scarce resources”.6 The following year Robin Bade and Michael Parkin defined it as the “social science that studies the choices that individuals, businesses, governments, and entire societies make as they cope with scarcity”.7 Finally, in 2006 James D. Gwartney, Richard L. Stroup, Russel S. Sobel, and David A. MacPherson argued that it was “the study of human behavior, with a particular focus on human decision making”.8 All these definitions consider human personal, individual and collective choices as essential. As Alfred Marshall put it the study of human behaviour should be at the heart of economics as a science precisely the way behavioural macroeconomics currently organizes its research. So, higher education systems and the way individuals decide whether they will enter them, what studies they choose to follow and the impact their studies and training may have on the whole economic system are closely linked to the wider economic sphere and should not be restricted to the scope of the labour market.

The British model of higher education

  • 9 Before that period, reforms were mostly focused on primary and secondary education
  • 10 Kirstine Hansen and Anna Vignoles, “The United Kingdom Education System in Compara (...)

8The evolution of the British system of higher education can first be characterized by a great number of reforms which started in the nineties9 and whose goals were to considerably widen access to higher education in spite of the introduction of tuition fees in 1998 : “In the late 1980s around 20% of the age cohort participated in HE in the United Kingdom. This has risen to more than one third in the early 2000s”.10 According to a research study which was published by the London School of Economics in 2006,

  • 11 Romesh Vaitilingan, Human Resources, The Labour Market and Economic Performance, Centre fo (...)

Higher education has historically been the preserve of higher socio-economic groups in England and Wales and, although participation has risen substantially in recent decades, the relative position of lower socio-economic groups in terms of participation is still poor. The policy response has been to expand higher education further, in an attempt to widen access to previously under-represented groups. But in order to finance this expansion, tuition fees have been introduced, and there are obvious concerns that this will act to depress demand for higher education among poorer students.11

  • 12 Ibidem, 13.
  • 13 Ibidem, 15.
  • 14 Ibidem, 15.The proportions were respectively of 27% and 4% in the eighties according to th (...)
  • 15 Top-up fees are defined by the Cambridge Business Dictionary as “in the UK, money that stu (...)
  • 16 The total number of first-year students was approximately one million in 2004-2005 (...)
  • 17 Derek Gillard, “Education in England : a brief history”, HMSO, 2001, <http://www.educatione (...)

9This is the reason why this article will try to examine the impact of the neo-liberal model of capitalism on the access of lower socio-economic groups to higher education. The second main feature is that the United Kingdom spends relatively little on education compared to other OECD countries (4.9% of GDP in 2002 as compared to an OECD average of 5.7%).12 The third main feature of the British system is what Kirstine Hansen and Anna Vignoles define as “the extent to which an individual’s ability to enter university is strongly related to parental education and income”.13 The British system of higher education tends to reproduce the existing social model and widen inequality. There is a participation gap between the rich and the poor : “currently in the UK 48% of young people from professional, managerial and skilled non-manual backgrounds enter university, whilst only 18% from a skilled manual or unskilled background do so”.14 The British system has also remained highly selective in spite of an attempt to reverse the trend in 1963, when the Labour manifesto promised to abolish selection. Fees were introduced in 1998 and became top-up fees15 in 2004 (see the chronology, Annex 1). This introduction was denounced by the Universities and Colleges Admissions Service (UCAS) which revealed that 15,000 fewer students16 had started university in 2012-2013 compared with the previous year.17 In 2005, a report from the Centre for Economic Performance (CEP) also highlighted the increase in higher educational inequality :

  • 18 Romesh Vaitilingan, Human Resources, The Labour Market and Economic Performance, C (...)

Educational inequality has risen : young people from the poorest income groups have increased their graduation rate by just 3 percentage points between 1981 and the late 1990s, compared with a rise in graduation rates of 26 percentage points for those with the richest 20% of parents.18

  • 19 Greg Clark, “Making the higher education system more efficient and diverse”, Department fo (...)
  • 20 See chronology in Annex 1.
  • 21 OECD, Education at a glance 2012 : Highlights, 53.

10The 2004 Higher Education Act started a process which paved the way to the coalition government’s decision to ask graduates “to pay more towards their education than what they have in the past”.19 Under the coalition government in 2010, higher education institutions offered fewer places than under the Labour government and largely increased the amount of tuition fees in spite of the Liberal Democrat pre-election promises.20 Finally, according to the OECD 2008-2009 findings, the United Kingdom comes in third place as the country with the highest average of annual tuition fees after the United States and Korea.21

11The fourth characteristic of the British system of higher education is a process of centralisation. From 1889 until the seventies, the State exerted its centralised control thanks to university funding while respecting university autonomy.

  • 22 Peter Wilby, “Margaret Thatcher's education legacy is still with us”, The Guardian, Monday (...)

12In April 2013 Peter Wilby, an education correspondent for various newspapers, stated in The Guardian that “Margaret Thatcher’s education legacy was still with us”.22 Thus 1970 was the date chosen as the opening time for this study of the development of a British neo-liberal model of higher education.

  • 23 Here is the list of the different Secretaries of Education from Margaret Thatcher to Micha (...)

13Before 1970, higher education governance and organization had been mostly unchanged since World War Two. Higher education institutions received a third of the financial resources they needed in block Treasury grants distributed through a committee totally composed of academics. The rest came from tuition fees which were paid in full on every student’s behalf by his or her local authority which, in turn, sent the bill to the Treasury. Central government had a very limited control over the process and higher education was run like a public service. Changes actually started in the seventies with Margaret Thatcher who had herself been appointed Education Secretary in 1970 by Ted Heath. She was followed by Kenneth Baker, Education Secretary from 1986 to 1989, and Michael Gove who was appointed Coalition Secretary of State for Education in May 2010.23 According to Peter Wilby, after 1979 the treatment of universities could be compared to

  • 24 Ibidem.

Henry VIII’s dissolution of the monasteries. In the first big public spending cuts of the 1980s, they suffered more than any other public service. Academics lost security of tenure, so that they could be sacked as easily as other salaried employees. The university grants committee was replaced by a funding council, on which academics were reduced to a minority. The council made annual "contracts" with universities to provide student places in line with national needs for "highly qualified manpower". The government’s grip over higher education was never to be relaxed : it became, over the following decades, ever tighter and more bureaucratic, as mechanisms were invented to measure teaching and research "quality".24

  • 25 This is a reference to Bacon and Eltis’ “physical crowding-out thesis” which was widely cr (...)
  • 26 Derek Fraser, The Evolution of the British Welfare State : A History of Social Policy sinc (...)
  • 27 Conservative Party, 1979 Manifesto, <http://www.margaretthatcher.org/document/110858, (...)
  • 28 “Against that background, my predecessor announced five weeks ago that the Government are r (...)

14Given Margaret Thatcher’s commitment to reduce state intervention and rely on the private sector and market forces to restore prosperity in Britain, she was expected to take the state out of higher education institutions during her premiership. Derrick Fraser states that at the beginning of the Thatcher administration there was support for the rolling back of the State, especially from economists who commented that the welfare state, “...took a disproportionate share of resources and thus crowded out25 economic investment in more productive areas.”26 However, the 1979 conservative manifesto devoted only a small paragraph to higher education mentioning that “excellence had to be maintained” and that they had to address “the special problems associated with the need to increase the number of high-quality entrants to the engineering professions.”27 However, during the Thatcher years and even after, the British central government established a tighter control over universities than ever before. Before that period, academic teachers were considered as “experts” by the governmental authorities and supposed to know best and be trusted to act, not only in students’ interests, but also for the common social and national good. The government’s role was only to provide financial and material resources. Under Margaret Thatcher’s leadership, however, the British government started considering higher education as though it were an ailing, near-bankrupt sector of the economy. They started to challenge the views of academics, to ask value for money, to impose a business-like type of management and to focus on what they considered as student-customer satisfaction.28

  • 29 Derek Gillard, “Education in England: a brief history”, HMSO, chapter 8, 2011, <http://www (...)
  • 30 This is an allusion to The U.S. sociologist George Ritzer’s thesis of ‘The Mcdonaldization (...)
  • 31 Christian Garland, “The McDonaldization of Higher Education ? : Notes on the UK Experience” (...)
  • 32 The proposal had been much controversial as the 2001 election campaign manifesto stated th (...)
  • 33 Department for Business and Skills, Are there Changes in Characteristics of UK Higher Educ (...)

15Derek Gillard, an honorary member of the London Education Associates Foundation and a specialist in curriculum studies and the management and administration of education in the United Kingdom, even refers to a “marketization process” for the period from 1979 to 1990.29 In 2008, the term “macdonaldization”30 of higher education in the United Kingdom was also coined by Christian Garland in a paper published by the University of Texas.31 This process of marketization took place in a political context aiming at the expansion of the number of students that had been predicted by the Robbins report in 1963 and it finally led to the 2004 Higher Education Act which allowed universities to charge variable top-up fees, thus increasing the unfairness32 of the system. The fees were again increased in 2006 and in spite of the creation of funding packages for students from less-affluent backgrounds, “more affluent students brought forward their enrolment in HE, over the 2005-2007 period” even though “students from less affluent areas have exhibited the least response to the reform package”.33

  • 34 Department for Education and Skills, The Future of Higher Education, (2003), HMSO, (...)
  • 35 Universities UK, Patterns and Trends in UK Higher Education 2012 – Higher Educatio (...)
  • 36 Ibidem.

16Education Secretary Charles Clarke expressed the view that the purpose of UK higher education should be about “harnessing knowledge to wealth creation”34 in the 2003 government White Paper. This led to the 2004 Higher Education Act which enabled universities to set their own tuition fees. These were known as ‘variable tuition costs’ and were introduced from academic year 2006-2007. More recently, under the coalition government, in 2012, a new publication from Universities UK, the representative organization for the UK’s universities, which was entitled Higher Education ; Analyzing a Decade of Change stated that “Universities are a core strategic asset to the UK and play a critical role in driving economic growth and social mobility”.35 It also mentioned that “universities are on track to generate £17 billion of annual export earnings by 2025” but that “despite the steady rise in student numbers, the UK remains behind many competitor countries in terms of the percentage of highly skilled individuals in its workforce”.36 These conclusions emphasize the close links between higher education and the state of the British economy in the mindset of the government.

  • 37 See Catherine Coron, La Formation : priorité et nécessité économique pour le gouvernement (...)

17They also highlight the structural weakness of the British system in terms of high skills shortages since 1960.37 The British system is highly globalized and there is a great number of international students but the number of British students who can take advantage of its quality is not high enough. Indeed, the number of young people not in education has risen in the recent decade as we will see in the second part of this article. For instance, in 2010 an article in The Guardian pointed out that

  • 38 Christina Meredith, “Unskilled Britain”, The Guardian, Thursday 4 March 2010, <http (...)

Engineering UK (formerly the Engineering and Technology Board) has highlighted the shortfall in UK engineers. In the highly skilled nuclear sector, more than 1,000 experienced apprentices and graduates will be required every year until 2025 to replace those who are retiring.38

  • 39 Caroline Detchenique, “A new Centre for Doctoral Training (CDT) in Nuclear Energy”, Imperi (...)

18In 2010, Imperial college and Rolls-Royce jointly opened the Rolls-Royce Nuclear University Technology Centre (UTC) dedicated to research and training in nuclear technology. The UTC started developing the next generation of nuclear scientists and engineers who will help to secure the British nuclear sector’s long-term high skills needs. In January 2014, the Centre for Nuclear Engineering (CNE) established in the Department of Materials at Imperial College London in partnership with the University of Cambridge and the Open University was awarded nearly £4M by the Engineering and Physical Sciences Research Council (EPSRC) to set up a Centre for Doctoral Training (CDT) in Nuclear Energy.39 However the Nuclear Energy Skills Alliance (NESA), which was created specifically to monitor the current and future skills needed in the nuclear sector, mentioned in its 2012/13 report that

Research shows that a nuclear new build programme will require between 110,000-140,000 person years of skilled nuclear work -the equivalent employment requirement of three London 2012 Olympics. This translates into a demand for around 1,000 new apprentices and 1,000 new STEM, (science, technology, engineering and maths) graduates, throughout the civil nuclear industry and supply chain, each year to 2025.40

19The main trends of reforms in the British higher education system appear clearly when we study the chronology which can be found in Annex 1. It is clear from the great number of reforms implemented between the end of the eighties and 2010 that a reshaping of the model was at work. What’s more, in spite of the constant necessity to widen its access and extend the number of students mentioned in all governmental reports, the creation and increase up to £9,000 in 2010 of top-up fees appears rather paradoxical. The chronology also highlights that in spite of the implementation of the Research Assessment Exercises (RAEs) the different governments could not really address the issue of research quality because the system kept on evolving. Finally, the various changes in the names of the governmental departments in charge of higher education are both striking and meaningful. Indeed, from 1964 when the Ministry of Education was renamed the Department of Education and Science (DES) to 2009, when the Department of Innovation, Universities and Skills (DIUS) was abolished after just two years of existence and its responsibilities transferred to a new Department of Business, Innovation and Skills (BIS). Its name was changed four times and finally higher education was thus merged with employment, skills and business. What these changes in terminology reflect is that successive governments, whether they were Labour or Conservative, shared the view that the British higher education system was meant to play a crucial part in the economy of the nation. The extent to which higher education can contribute to the growth of the British economy is precisely what the second part of this article seeks to determine.

The influence of the Anglo-Saxon model of capitalism

20University is the place where the part of the labour force with the highest levels of educational attainment gains all the theoretical knowledge required to improve the performance and competitiveness of the economy. This positive impact of a better skilled labour force on the economy was mentioned by the OECD :

Changes in technology, and particularly the advent of information technologies, are making educated and skilled labour more valuable, and unskilled labour less so. Government policies will need more stress on upgrading human capital through promoting access to a range of skills, and especially the capacity to learn ; enhancing the knowledge distribution power of the economy through collaborative networks and the diffusion of technology ; and providing the enabling conditions for organisational change at the firm level to maximise the benefits of technology for productivity.41

  • 42 Christopher J Nock and Catherine Coron, “Post-Crisis Anglo-Saxon Capitalism”, in M (...)

21However there are some limits to this process. For instance the great expansion and even “massification” of higher education in Britain did not prevent the youth long-term unemployment rate from increasing from 10.1% in 1990 to 21% in 2012 as noted by the OECD.42 A comparative survey of the unemployment rates by educational attainment in 2012 which measured the impact of higher education on the level of labour market participation was published by the OECD in 2014. It showed that the British system of higher education was rather efficient in so far as it could be considered as a form of social protection for students by granting them possible access to the labour market. As a matter of fact, the unemployment rate of persons aged 25-64 as a percentage of the labour force came just after Germany, in the lowest group, and was much lower than the OECD average, as illustrated in table 1. Besides, unemployment being much higher for the part of the labour force without higher education, it seems that expanding the access to university has become a crucial issue which the British government has much difficulty to address.

Table 1. Unemployment rates by educational attainment 2012

As a % of the labour force

Less than upper secondary education

Upper secondary education

Tertiary education

United Kingdom

10.5

5.6

3.6

United States

14.3

9.1

4.6

Germany

12.8

5.3

2.4

France

13.8

8.3

5.1

OECD average

13.4

7.7

5.0

Source : OECD, OECD Employment Outlook, 2014, 276.

22The links between the British model of higher education and its economy will now be analysed thanks to a thorough investigation of the British model of capitalism in order to try to get a more detailed view of the economic impact of educational attainments.

A market-led model

  • 43 Bruno Amable, The Diversity of Modern Capitalism, Oxford University Press, 2003, 13-14.
  • 44 Martine Azuelos, « Introduction », in Martine Azuelos (ed.), Capitalisme anglo-saxon et monde(s) a (...)
  • 45 “Inspired by the contributions of Karl Polyani, we choose to view social rights in (...)
  • 46 Ibidem, 22.
  • 47 OECD, Education at a Glance: OECD Indicators, 2014, 208 and 224.

23Bruno Amable has identified the Anglo-American or “Anglo-Saxon” model of capitalism including the education system as being “market-led”. He also refers to Soskice and Hall’s classification opposing Liberal Market Economies (LMEs) and Coordinated Market Economies (CMEs) : “In LMEs coordination is based on market mechanisms, thus favouring investment in transferable assets whereas in CMEs it is mainly achieved through non-market means – the so-called strategic coordination – favouring investment in specific assets”.43 Martine Azuelos in the introduction of a recent issue of Lisa e-journal has also questioned and defined this model of capitalism as “market-led”.44 And among the main characteristics of the Anglo-Saxon neo-liberal model of capitalism as defined by Gosta Esping-Andersen, we may find a very low degree of “de-commodification”.45 This phenomenon is due to the low level of government funding of higher education which consequently “will tend to strengthen the market”.46 Since the eighties, public funding in higher education has remained at a lower level than the OECD average.47 In April 2004, the Association of University Teachers (AUT) published a research paper mentioning that in 1994-5 public spending in higher education in the United Kingdom had slightly increased compared to its level ten years before. Table 2 documents the evolution from 1994-5 to 2003-4 :

Table 2. UK Public Spending on education and science as a proportion of UK GDP

Higher Education

HE & student support*

Total education

Science budget

1994-95

0.64%

1.08%

5.10%

0.18%

1995-96

0.66%

1.02%

4.90%

0.18%

1996-97

0.60%

0.94%

4.70%

0.17%

1997-98

0.58%

0.89%

4.50%

0.16%

1998-99

0.55%

0.84%

4.50%

0.15%

1999-00

0.59%

0.80%

4.40%

0.15%

2000-01

0.60%

0.79%

4.60%

0.16%

2001-02

0.62%

0.77%

4.90%

0.18%

2002-03

0.63%

0.79%

5.10%

0.18%

2003-4 estimate

0.63%

0.78%

5.30%

0.20%

*includes mandatory awards and access funds, and a small element of student support in further education.

Source: AUT analysis of HM Treasury, Public Expenditure Statistical Analyses (series) ; http://www.ost.gov.uk/​setstats/​2/​t2_1.htm ; <http://www.hm-treasury.gov.uk/​economic_data_and_tools/​gdp_deflators/​data_gdp_fig.cfm>, in Association of University Teachers (AUT), “UK higher education, public spending and GDP”, April 2004, 3, <http://www.ucu.org.uk/​media/​html/​spendingandgdp1.html>, accessed in May 2013.

  • 48 BBC, “UK economy ends the year with a spurt”, Wednesday 26 January 2005, <http://news.bbc (...)
  • 49 Mona Chalabi and George Arnett, “Education Spending: How does the UK compare?”, The Guard (...)
  • 50 Nicholas A. Barr, Higher Education Funding, LSE Research Online, 2004, 4, <http://eprints (...)

24From 1995 to 2004 public spending on higher education remained constant and that of student support decreased severely, from 1.08% to 0.78%, which probably implied that students had to take part-time jobs or received financial support from their families. Furthermore, student support was drastically reduced, much before the financial crisis, at a time (2004) when the GDP growth rate reached 3.1% enabling the UK economy to end the year with “a spurt”.48 So in spite of a very favourable economic context, the government decided to reduce its budget devoted to universities. Then, with the economic crisis, and ensuing austerity measures implemented by the coalition government, the budget devoted to higher education was again drastically cut between 2010 and 2013.49 Even though there is no direct link between government spending and growth since, as Nicholas A Barr points out “increased spending [does not] automatically increases economic growth, the quality of higher education and its ability to adapt to changing economic conditions are critically important”.50

The Marketization of Higher Education

25A second characteristic of the model was the marketization process which occurred at the beginning of the period of our study, in the seventies, with the laws of the market becoming predominant in the economy, in spite of the movement towards more and more centralisation and control from the government. The developing marketization process within the context of British higher education can be explained by the growing influence of the laws of the market and demands for labour by firms on British universities from 1997 and 2010, which also led to a development of science and less funding for humanities. In a neo-liberal economic context this phenomenon also favoured the individual rather than the nation, as Kathleen Lynch underlines :

  • 51 Kathleen Lynch, “Neo-liberalism and Marketisation: the implications for higher education (...)

Neo-liberalism offers a market view of citizenship that is generally antithetical to rights, especially to state-guaranteed rights in education, welfare, health and other public goods (Chubb & Moe, 1990 ; Tooley, 1996, 2000). The citizen is defined as an economic maximiser, governed by self-interest. There is a glorification of the ‘consumer citizen’, construed as willing, resourced and capable of making market-led choices. In this new market state, the individual (rather than the nation) is held responsible for her or his own well-being.51

  • 52 The UK coalition government was formed with members from both the Conservative and the Li (...)
  • 53 Roger Brown, “Markets Rule, OK ? The Coalition Government’s Higher Education Reforms in (...)
  • 54 HPEIR estimates the actual entry rate in the current year of people who had not previousl (...)
  • 55 Department for Business Innovation and Skills, “Participation Rates in Higher E (...)

26Following the publication in 2011 of the White Paper Higher Education : Students at the Heart of the System, the coalition government52 started a series of radical reforms of the British higher education system, and more particularly of higher education. They consisted in “a massive (80%) reduction in the direct public funding of university teaching”, “the introduction of genuine price competition, covering both tuition and living costs, and involving both direct market and quasi-market measures”, and “the modification of entry rules to permit private and “for profit” providers”.53 This clearly shows that the British model of higher education is becoming more neo-liberal than ever. The Government raised the cap on tuition fees for new students to £9,000 in 2012/13 and cut most ongoing direct public funding for tuition in England. This shifted the balance of higher education funding further away from the state and towards the individual who benefits. Students can take out publicly subsided student loans to pay for these higher fees. There is uncertainty about the final size of this subsidy and the Government’s estimate of it has increased considerably since the reforms were first announced. This also affects the size of any savings in public expenditure and the extent of the shift in costs from the state to the individual beneficiary. Finally, the impact on students’ participation was measured by the Higher Education Initial Participation Rate54 (HEIPR), which has published participation rate levels since 2004. It found that there was actually a decrease in participation from 49% in the 2011/12 period to 43% in the 2012/13 period. The decrease in HEIPR is largely due to students choosing not to defer entry in 2011/12 resulting in reduced participation from 19 year olds in 2012/13, the year that tuition fee levels increased.55

  • 56 ‘Social inclusion’ is often used to describe the opposite effect to ‘social exclusion’. I (...)
  • 57 OECD, UNITED KINGDOM – Country Note – Education at a Glance 2012 : OECD Indicat (...)

27As Louise Dalingwater mentions in her paper in the current issue of LISA e-journal, neo-liberals believe that “education is a tradable and marketable commodity”. This phenomenon had an impact on social fairness, mobility and inclusivity.56 As a matter of fact, the number of students left behind by the system is high and growing. In 2010, the proportion of 15-29 year-olds who were Neither Employed nor in Education or Training since 2008 (the “NEET” population) accounted for 15.9% of this age group, which was around the OECD average (15.8%) but up from 13.3% in 2000 and 14.8% in 2009.57 This reveals that another feature of the British neo-liberal model of higher education is that it tends to decrease the part of the labour force which may get access to knowledge, a feature which is clearly not beneficial to the British economy.

Conclusions

  • 58 Ibidem, 3 and 5.

28Under the cumulative effects of a high level of selection, a marketization process, the increase of fees and the decrease of government funding which tends to deter some students from attending university, we may come to the conclusion that the British system of higher education has followed the neo-liberal model of capitalism and implemented a marketization of higher education. However, in spite of all the financial advantages this process may have on the government’s budget and the export surplus it may create there are definitely some human, social and economic long-term drawbacks. The OECD, in its comparative study of 2012 came to the conclusion that even if the proportion of students enrolled in higher education in the United Kingdom had increased “by about 8 percentage points between 2006 (70%) and 2011 (78%)”, it still remained behind the OECD average increase (81% to 84%) during the same period”.58

29The system of tuition fees tends to strengthen social competitiveness as well as selection within the British academic system which is one of the main characteristics of the neo-liberal model. It has also a strong impact on students’ participation.

30Higher education in the United Kingdom remains a rather unequal system. One of the main characteristics of the British model consists in its decreasing level of government funding in spite of a tighter control and centralization from the State. This has tended to strengthen its reliance on the market, a process which has gained momentum in the aftermath of the financial crisis. However, expanding the access to university to a wider number of students has become one of the most crucial issues confronting the British government. Massification has become one of the most severe challenges to the further development of higher education in the United Kingdom as the additional costs are not paid by the government. It also seems that competition, one of the main characteristics of the neo-liberal model is still prevalent and accepted within British society in spite of the social inequalities it may create.

  • 59 Michael J Sandel, What Money can’t buy : the Moral Limits of Markets, The Tanner Lectures (...)

31As a concluding remark we may raise the question whether it is really possible and desirable to consider higher education in so far as it facilitates the diffusion of knowledge and therefore facilitates the transition to a knowledge economy, from a merely economic perspective. Shouldn’t human actors come first when assessing the whole system? Shouldn’t we consider the human aspects of higher education which should be more central and influential than the market and which Michael J Sandel denounces in his book What Money can’t buy : the Moral Limits of Markets.59

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Annexe

Annex 1 : Higher Education Reforms Chronology

1963. The Robbins Report on higher education recommended a substantial expansion in higher education to cater for all who had the necessary ability. The principles and recommendations of the Robbins Report formed the basis for the development of the university sector for subsequent years. The report anticipated that by 1980 most higher education would be provided by universities or teacher training institutions.

1964. Labour manifesto promised to abolish selection.

1964. DES : The Ministry of Education was renamed the Department of Education and Science and the Minister became the Secretary of State.

1970-74. Margaret Thatcher appointed Education Secretary

1976. Jim Callaghan’s Ruskin College speech began ‘The Great Debate’ about education.

1978. Oakes Report : management of higher education.

1986. First Research Assessment Exercise (RAE)

1987. White Paper Higher education.

1988. The Education Reform Act created the Polytechnics and Colleges Funding Council (PCFC) and the Universities Funding Council (UFC).

1988. White Paper Top-up loans for students.

1990. Education (Student Loans) Act 1990 introduced ‘top-up’ loans for higher education students and so began the diminution of student grants.

1991. White Paper on higher education : recommended expansion of student numbers.

1992. Further and Higher Education Act 1992. It unified the funding of higher education under the Higher Education Funding Councils (HEFCEs), introduced competition for funding between institutions, abolished the Council for National Academic Awards.

1992. DFE : the Department of Education and Science was renamed the Department for Education.

1994. Labour Party Opening doors to a learning society : education policy document prepared for the party’s annual conference in 1994 – Tony Blair’s first as leader.

1995. DfEE : the DFE was renamed the Department for Education and Employment.

1996. Tony Blair’s Ruskin College lecture : given on 16 December 1996 to mark the twentieth anniversary of Jim Callaghan’s Ruskin College speech

1997. Dearing Report Higher Education in the learning society : recommended wider participation in higher education. The National Committee of Inquiry into Higher Education was the first fundamental review of higher education since the Robbins Report of 1963, its key recommendations included :

  • changes in institutional and student funding

  • further expansion

  • a framework for qualifications

  • support for an interdisciplinary arts and humanities research council.

1997. The Quality Assurance Agency for Higher Education (QAA) is established to provide an integrated quality assurance service for UK higher education.

1998. Education (Student Loans) Act 1998 transferred provision of student loans to the private sector.

1998. Teaching and Higher Education Act 1998 established the General Teaching Council (GTC), abolished student maintenance grants and required students to contribute towards tuition fees. It introduced measures to change financial support for students, including :

  • tuition fees to be paid by all except the poorest students

  • the replacement of the maintenance grant for living expenses with loans

  • the availability of a supplementary hardship loan

  • bursaries for students entering teacher training or health and social care courses.

1999. White Paper ‘Learning to succeed’ proposed a new structure for post-16 education and training.

2001. DfES : the education department was renamed the Department for Education and Skills.

2002-03. Roberts Review of research assessment recommends revising the RAE with a new method for assessing the quality of research. The new RAE process is then announced in February 2004.

2003. White Paper The future of higher education controversially proposed allowing universities to charge variable top-up fees and formed the basis of the 2004 Higher Education Act.

2004. Higher Education Act 2004 : allowed universities to charge variable top-up fees. It took forward the proposals in the 2003 White Paper ‘The Future of Higher Education’ with the aim of widening access to HEIs and helping them remain competitive in the world economy. Measures included :

  • the introduction of variable tuition fees

  • creation of the Office for Fair Access and Arts and Humanities Research Council

  • the re-introduction of maintenance grants for students from lower-income households

  • the designation of the Office of the Independent Adjudicator, an independent body to review student complaints not related to matters of academic judgement.

2005. National Student Survey (NSS) began

2006. University top-up fees : UCAS revealed that 15,000 fewer students had started university compared with the previous year.

2006. Government announced that the RAE will be replaced after 2008 with a new assessment system. The following year initial proposals were published for the Research Excellence Framework

2007. Education department split in two : Department for Children, Schools and Families (DCSF, Ed Balls), and Department of Innovation, Universities and Skills (DIUS, John Denham).

2008. Sale of Student Loans Act 2008 allowed the government to sell off student loans.

2009. DIUS abolished after just two years : responsibilities transferred to new Department of Business, Innovation and Skills (BIS).

2010. Academies Act 2010 : provided for massive and rapid expansion of academies.

2010. Browne Report Securing a Sustainable Future for Higher Education : recommended major changes to higher education in England, including a proposal that more funding should flow through students’ tuition fee loans rather than through HEFCE. The aim is to increase quality by increasing competition between HEIs. This involves raising the cap on tuition fees to £9,000 and changing the system of loan repayments. These recommendations were mostly ignored.

2010. Higher education : fewer places and vastly increased tuition fees, the latter despite Liberal Democrat pre-election promises.

2011. White Paper Higher Education : Students at the Heart of the System took forward the Browne Review proposals.

2011. Opportunity, Choice and Excellence in Education, HFCE.

2014. Forging futures : building higher level skills through university and employer collaboration. A joint publication from the UK Commission for Employment and Skills (UKCES) and Universities UK (UUK) examining the ways in which universities and employers can work together to improve higher level skills.

Source : Author’s own compilation adapted from Derek Gillard, Education in England : a brief history, HMSO, <http://www.educationengland.org.uk/​history/​timeline.html> and HFCE’s website, <http://www.hefce.ac.uk/​about/​intro/​abouthighereducationinengland/​historyofheinengland/​>.

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Notes

1 OECD, Education at a Glance Highlights, OECD publishing, 2012, 7, <http://dx.doi.org/10.1787/eag_highlights-2012-en>, accessed in March 2014.

2 Gary S. Becker, “Human Capital”, The Concise Encyclopedia of Economics, Library of Economics and Liberty, 2008, <http://www.econlib.org/library/Enc/HumanCapital.html>, accessed in February 2014.

3 Theodore W. Schultz, “Investment in Human Capital”, American Economic Review, 51, March 1961, 3.

4 Roger E. Backhouse and Steven G. Medema, “Retrospectives on the Definition of Economics, Journal of Economic Perspectives, American Economic Association, vol. 23, N°1, Winter 2009, 221, <http://www.jstor.org/stable/27648302>, accessed in July 2013.

5 Alfred Marshall, Principles of Political Economy, London: Macmillan, 1890 [1920], 8th edition, 1.1, 1-2.

6 N. Gregory Mankiw, Principles of Economics, Fort Worth: Harcourt Publishers, 2nd edition, 2001, 4.

7 Robin Bade and Michael Parkin, Foundations of Microeconomics, Boston: Addison Wesley, 2002, 5.

8 James D. Gwartney, Richard L. Stroup, Russell S. Sobel, and David A. MacPherson, Microeconomics : Private and Public Choice, 11th edition. Mason, OH: Thomson, 2006, 5.

9 Before that period, reforms were mostly focused on primary and secondary education.

10 Kirstine Hansen and Anna Vignoles, “The United Kingdom Education System in Comparative Context”, in Stephen Machin and Anna Vignoles (eds.), What's the Good of Education ? : The Economics of Education in the UK, Princeton: Princeton University Press, 2005, 15.

11 Romesh Vaitilingan, Human Resources, The Labour Market and Economic Performance, Centre for Economic Performance, London School of Economics and Political Science, 2006, 20.

12 Ibidem, 13.

13 Ibidem, 15.

14 Ibidem, 15.The proportions were respectively of 27% and 4% in the eighties according to the same sources.

15 Top-up fees are defined by the Cambridge Business Dictionary as “in the UK, money that students pay to a university in addition to the money provided by the government”, <http://dictionary.cambridge.org/dictionary/business-english/top-up-fees>. Actually, they are also “differential” fees and every university is entitled by law to set its own level of tuition fees.

16 The total number of first-year students was approximately one million in 2004-2005. It increased until 2009-2010, to about 1,200,000, but dropped slightly, to under a million in 2012-2013. Source : Higher Education Statistics Agency, <https://www.hesa.ac.uk/stats>.

17 Derek Gillard, “Education in England : a brief history”, HMSO, 2001, <http://www.educationengland.org.uk/history>, accessed in May 2013.

18 Romesh Vaitilingan, Human Resources, The Labour Market and Economic Performance, Centre for Economic Performance, London School of Economics and Political Science, 2006, 20.

19 Greg Clark, “Making the higher education system more efficient and diverse”, Department for Business, Innovation and Skills, HMSO, 2012, <https://www.gov.uk/government/policies/making-the-higher-education-system-more-efficient-and-diverse>.

20 See chronology in Annex 1.

21 OECD, Education at a glance 2012 : Highlights, 53.

22 Peter Wilby, “Margaret Thatcher's education legacy is still with us”, The Guardian, Monday 15 April 2013, <http://www.theguardian.com/education/2013/apr/15/margaret-thatcher-education-legacy-gove>, accessed in August 2013.

23 Here is the list of the different Secretaries of Education from Margaret Thatcher to Michael Gove : in March 1974, Reginald Prentice was appointed Education Secretary under Harold Wilson’s Labour government. He was followed in June 1975 by Fred Mulley. In September 1976, Shirley Williams was in charge of Education under Jim Callaghan’s Labour government. In May 1979 under Margaret Thatcher’s Conservative government Mark Carlisle was Secretary of Education, he was followed in September 1981 by Sir Keith Joseph, in May 1986 by Kenneth Baker and finally in July 1989 by John MacGregor. Under John Major’s Conservative government, Kenneth Clarke was appointed in November 1990 Kenneth Clarke, then John Patten in April 1992 and Gillian Shephard in July 1994. In May 1997, David Blunkett became Education Secretary under Tony Blair’s Labour government. He was followed by Estelle Morris in June 2001 Charles Clarke in October 2002, Ruth Kelly in December 2004 and Alan Johnson in May 2006. In 2007, Gordon Brown appointed Ed Balls in his Labour government.

24 Ibidem.

25 This is a reference to Bacon and Eltis’ “physical crowding-out thesis” which was widely criticized and has since been rejected. “It tried to demonstrate a causal relationship between the growth of the public sector and the decline of the economy.” See Kevin Hickson, The IMF Crisis of 1976 and British Politics, London: Tauris Academic Studies, London, 2005, 186.

26 Derek Fraser, The Evolution of the British Welfare State : A History of Social Policy since the Industrial Revolution, Baisingstoke: Palgrave Macmillan, 2009, 305.

27 Conservative Party, 1979 Manifesto, <http://www.margaretthatcher.org/document/110858>, accessed in January 2015.

28 “Against that background, my predecessor announced five weeks ago that the Government are ready to increase financial provision for the universities, provided they demonstrate real progress in implementing and building on the changes that are needed. Those changes include better management, improved standards of teaching, selectivity in research funding and rationalisation of small departments.” […] “My predecessor but one, my right hon. and learned Friend the Member for Warrington, South (Mr. Carlisle), encouraged moves to change the balance between science and the humanities in higher education. In 1979, the proportion studying science was 45 per cent, with 55 per cent on humanities courses. Today, it is almost 48 per cent science. By 1989, it may be more than 50 per cent science. This trend reflects the needs of our society today. For our society to be rich and prosperous, we must produce more technologists and engineers. From their talents, inventiveness, skills and energies will come the continuing wealth of our country”, Kenneth Baker, Hansard, 1986, vol. 100, col. 382.

29 Derek Gillard, “Education in England: a brief history”, HMSO, chapter 8, 2011, <http://www.educationengland.org.uk/history>, accessed in February 2013.

30 This is an allusion to The U.S. sociologist George Ritzer’s thesis of ‘The Mcdonaldization of Society’ in which he puts forward the theory of an ever more instrumentally rationalized labour process mirrored in an equally instrumentalized sphere of consumer ‘choices’ essentially already made, so that standardization and ‘efficiency’ become the unifying functional paradigm for society as a whole. In applying such a theory to higher education, there is intended a deliberate provocation aimed at contributing to critical debates on the substance and purpose of the university, and that over-used but misrepresented concept, ‘knowledge’. Ritzer theorizes from what has been described as a neo-Weberian standpoint to analyse the social processes he identifies in four essential aspects as ‘McDonaldization’ : efficiency, calculability, predictability, and increased control through the replacement of human labor with technology. See : George Ritzer, The McDonaldization of Society 5, Thousand Oaks: Pine Forge Press, 2007.

31 Christian Garland, “The McDonaldization of Higher Education ? : Notes on the UK Experience”, Fast Capitalism, University of Texas, 2008, 4.1, <http://www.uta.edu/huma/agger/fastcapitalism/4_1/garland.html>, accessed in July 2010.

32 The proposal had been much controversial as the 2001 election campaign manifesto stated that Labour "will not introduce top-up fees and has legislated against them." (See Stuart Alley and Mat Smith, "Timeline : Tuition fees", The Guardian, January 27, 2004, <http://www.theguardian.com/education/2004/jan/27/tuitionfees.students>, accessed in January 2015). This system was considered by many MP’s and academics as unfair because the fear and economic weight of debt would potentially deter students from lower-income backgrounds from entering university for financial reasons.

33 Department for Business and Skills, Are there Changes in Characteristics of UK Higher Education around the Time of the 2006 Reforms, BIS Research Paper Number 14, September 2010, 2 and 13.

34 Department for Education and Skills, The Future of Higher Education, (2003), HMSO, 6, <http://www.educationengland.org.uk/documents/pdfs/2003-white-paper-higher-ed.pdf>, accessed in June 2014.

35 Universities UK, Patterns and Trends in UK Higher Education 2012 – Higher Education Analyzing a Decade of Change, in Focus, Higher Education Statistics Agency, December 2012, 2, <http://www.universitiesuk.ac.uk/highereducation/Documents/2012/PatternsAndTrendsinUKHigherEducation2012.pdf>, accessed in May 2013.

36 Ibidem.

37 See Catherine Coron, La Formation : priorité et nécessité économique pour le gouvernement travailliste de Tony Blair, PhD Thesis, Université Paris III – Sorbonne Nouvelle, 2003, 120.

38 Christina Meredith, “Unskilled Britain”, The Guardian, Thursday 4 March 2010, <http://www.guardian.co.uk/commentisfree/2010/mar/04/uk-skills-shortage-foreign-worker>, accessed in May 2011.

39 Caroline Detchenique, “A new Centre for Doctoral Training (CDT) in Nuclear Energy”, Imperial College website, <http://www3.imperial.ac.uk/newsandeventspggrp/imperialcollege/engineering/materials/newssummary/news_20-1-2014-16-4-38>, accessed in May 2014.

40 Nuclear Energy Skills Alliance Annual Review 2012/13, <https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/226071/nuclear_energy_skills_alliance_annual_review_2012_13.pdf>, accessed in March 2014, 15.

41 OECD, The Knowledge-Based Economy, Paris, 1996, 7, <http://www.oecd.org/science/sci-tech/1913021.pdf>.

42 Christopher J Nock and Catherine Coron, “Post-Crisis Anglo-Saxon Capitalism”, in Martine Azuelos (ed.), Capitalisme anglo-saxon et monde(s) anglophones : des paradigmes en questions, LISA/LISA e-journal, vol. XIII-n°2, 2015, 11-12, <http://lisa.revues.org/8179>, accessed in May 2015.

43 Bruno Amable, The Diversity of Modern Capitalism, Oxford University Press, 2003, 13-14.

44 Martine Azuelos, « Introduction », in Martine Azuelos (ed.), Capitalisme anglo-saxon et monde(s) anglophones : des paradigmes en questions, LISA/LISA e-journal, vol. XIII-n°2, 2015, <http://lisa.revues.org/8179>, accessed in May 2015.

45 “Inspired by the contributions of Karl Polyani, we choose to view social rights in terms of their capacity for ‘de-commodification’. The outstanding criterion for social rights must be the degree to which they permit people to make their living standards independent of pure market forces. It is in this sense that social rights diminish citizens’ status as commodities.” Gosta Esping-Andersen, Three Worlds of Welfare Capitalism, Princeton University Press, Princeton: New Jersey, 1990, 3.

46 Ibidem, 22.

47 OECD, Education at a Glance: OECD Indicators, 2014, 208 and 224.

48 BBC, “UK economy ends the year with a spurt”, Wednesday 26 January 2005, <http://news.bbc.co.uk/2/hi/business/4208499.stm>, accessed in January 2012.

49 Mona Chalabi and George Arnett, “Education Spending: How does the UK compare?”, The Guardian, Tuesday 25 June 2013, <http://www.theguardian.com/news/datablog/2013/jun/25/education-spending-uk-compare>, accessed in January 2014.

50 Nicholas A. Barr, Higher Education Funding, LSE Research Online, 2004, 4, <http://eprints.lse.ac.uk/archive/00000288>, accessed in November 2011.

51 Kathleen Lynch, “Neo-liberalism and Marketisation: the implications for higher education”, European Educational Research Journal, Vol. 5, No 1, 2006, 3.

52 The UK coalition government was formed with members from both the Conservative and the Liberal Democrat Parties on 11 May 2010.

53 Roger Brown, “Markets Rule, OK ? The Coalition Government’s Higher Education Reforms in context”, Liverpool Hope University, Oxford Lecture 14 November 2011.

54 HPEIR estimates the actual entry rate in the current year of people who had not previously entered higher education at each age from 17 to 30.

55 Department for Business Innovation and Skills, “Participation Rates in Higher Education: Academic Years 2006/2007 – 2012/2013 (Provisional)”, Statistical First Release, ONS, 28 August 2014, 4.

56 ‘Social inclusion’ is often used to describe the opposite effect to ‘social exclusion’. It usually results from positive action taken to change the circumstances and habits that lead, or have led, to social exclusion. It is about enabling people or communities to fully participate in society. Source : Charity Commission, The Promotion of Social Inclusion, UK government, 2001, 2, <https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/359358/socinc.pdf>, accessed in May 2014.

57 OECD, UNITED KINGDOM – Country Note – Education at a Glance 2012 : OECD Indicators, 2012, 6.

58 Ibidem, 3 and 5.

59 Michael J Sandel, What Money can’t buy : the Moral Limits of Markets, The Tanner Lectures on Human Values, delivered at Brasenose College, Oxford, 11 and 12 May 1998.

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Catherine Coron, « Reshaping the model: Higher Education in the UK and the Anglo-Saxon neo-liberal model of capitalism since 1970 »Revue LISA/LISA e-journal [En ligne], vol. XIV-n°1 | 2016, mis en ligne le 31 mai 2016, consulté le 05 décembre 2023. URL : http://journals.openedition.org/lisa/8865 ; DOI : https://doi.org/10.4000/lisa.8865

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Catherine Coron

Catherine Coron est maître de conférences à l’Université Panthéon-Assas Paris 2, où elle enseigne l’anglais appliqué à l’économie et à la finance. Ses recherches portent sur l’impact économique de la formation et de l’éducation au Royaume-Uni, ainsi que sur le capital humain, la formation des entrepreneurs, le modèle britannique de capitalisme et la notion de bien-être économique. Elle est l’auteur de nombreux articles sur ces sujets. Elle est membre du CERVEPAS.

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