The Language of Regulation

Gary Attle, Partner and Head of Education and Governance at Mills & Reeve LLP, explains terminology brought in by the Higher Education and Research Act 2017.

The Higher Education and Research Act 2017 (HERA2017) heralded in a new language for those working in this sector. We highlight in bold some of the new words and concepts in this briefing note. Their meaning and impact are likely to unfold over time.

A new regulator – the Office for Students – was established by HERA2017 and OfS set out what it was going to do in a Regulatory Framework. This was published in February 2018 and presented to Parliament.

We have previously highlighted and examined the concept of “reportable events”. As defined by the OfS, these are:

“any event or circumstance that, in the judgement of the OfS, materially affects or could materially affect the provider’s legal form or business model, and/or its willingness or ability to comply with its conditions of registration.”

There has been considerable debate in the sector over what is (or is not) – and what should (or should not) – be included in this concept. Readers will be aware that the OfS issued new guidance on 26 March 2020 with a revised explanation of what is included within the scope of this concept during the coronavirus pandemic.

Reportable events (whatever their scope) are circumstances which must be reported by a registered English Higher Education Provider to the regulator, the OfS. By contrast Notifications are complaints or concerns raised by others with the OfS which may be of interest to them. As the OfS website makes clear, the OfS has no direct role in dealing with disputes between students and higher education providers. However, the OfS will receive complaints from students, staff and other people and organisations. We would expect that a Notification would need to engage the OfS’s regulatory jurisdiction in some way for it to be considered by the OfS.

OfS will take such information into account in its general monitoring of registered providers as it confirms in paragraphs 145/6 of the Regulatory Framework:

“The OfS will also draw on information volunteered by providers and others, including whistleblowers, as well as any wider experience it gains through contact with that provider.

The OfS will seek input from students – this may be insights from lead indicators from the national student surveys, complaints raised with the OIA, or by inviting information from individual students and student bodies.”

Lead indicators are various chosen datasets which, as explained in the Regulatory Framework, “will provide signals of change in a provider’s circumstances”.  The Regulatory Framework said (paragraph 136) that these were likely to include:

  • overall student numbers and patterns that might suggest unplanned and/or unmanaged growth or contraction
  • applications, offers and acceptances for students with different characteristics
  • changes in student entry requirements and the qualifications profile of students on entry
  • continuation and completion rates
  • performance in the Teaching Excellence Framework
  • degree and other outcomes, including differential outcomes for students with different characteristics, or where there is an unexpected and/or unexplained increase in the number of firsts or 2:1s awarded
  • the number, nature or pattern of complaints to the OIA
  • graduate employment and, in particular, progression to professional jobs and postgraduate study
  • composite financial viability and sustainability indicators based on annual financial statements and forecasts

The OfS will consider the lead indicators – and other information – and consider “whether the provider is at increased risk of a breach of one or more of its ongoing conditions of registration.

These indicators are extremely important to how the OfS exercises its regulatory jurisdiction. This was recently exemplified in what the OfS described as a “landmark victory” when it successfully defended a judicial review challenge in the High Court: R (on the application of Bloomsbury Institute Limited) -v- the Office for Students [2020] EWHC 580 (Admin), 12 March 2020. The legal proceedings had been brought by Bloomsbury Institute Limited which is a for-profit provider of business, law and accountancy courses. OfS had refused its application to be registered.

While this was a case of the OfS exercising its regulatory jurisdiction in respect of an institution seeking to get onto the Register of English Higher Education Providers, reference was made by the Judge to the Regulatory Framework and the lead indicators, in particular Student continuation and completion rates and rates of progression to professional employment or post-graduate study.

These datasets were included in the Condition B3 requirements of the conditions of registration and OfS had concluded that Bloomsbury Institute Limited had failed to satisfy the requirements. The institution had not been able to show that the OfS had erred in law in the application of its regulatory jurisdiction on the facts of that case.

The OfS has powers of intervention for institutions which are on the Register including:

  • enhanced monitoring of providers
  • imposing specific ongoing conditions of registration
  • imposing formal sanctions:
    • Monetary Penalties
    • Suspension from the Register
    • Deregistration

Each of these concepts will require close examination to understand their meaning and impact on registered higher education providers.