January 2024 – View From A Bridge – management, education and personal thoughts

Selling England by the Pound

The Sunday Times article about differential entry grades for international students¹ to Russell Group university degrees sparked the usual defensive response from the UK higher education sector. There was plenty of obfuscation and claims that the newspaper was guilty of poor journalism but with little engagement about the core claims. There does, however, seem to be some substance to the claim that universities are working with commercial partners in ways that are not entirely transparent and do not seem equitable in terms of academic and language standards.

Specifically, International Year One (IYO) offerings (generally through private partnerships with universities, accept international students who fail to get the academic or language requirements for direct entry to a university undergraduate programme. If they pass the IYO course they progress to the second year of the degree programme in the university proper which means the IYO is accepted as the first year of the degree. The IYO courses are not open to UK students so they do not have this opportunity if their grades are below the direct entry requirement and so they are disadvantaged.

A Trick of the Tail

The issue, is not well defined by the newspaper, but it seems clear that international students can buy their way directly onto year one of UK university degree course via an International Year One programme operated by a private partner. The students can do this when they are not academically qualified to enter that programme directly and this opportunity is denied to UK students. Finding evidence for this is not easy because many International Year One’s advertised are Delphic, coy or deliberately elusive about stating the requirements.

What is consistent is that pathway operators are clear about the intention of International Year One courses:

Kaplan say:

“If you don’t meet the entry requirements to go to a UK university directly, degree preparation courses like an IYO can help you reach the level needed to start a bachelor’s degree….After successfully completing an IYO, you progress straight to the second year of a bachelor’s degree, so you save time and money.”

Study Group International Study Centre – Cardiff University says:

“The International Year One is an intensive programme that leads to year two of an undergraduate degree at Cardiff University. The programme is tailor-made for international students who are not ready to apply direct to the University, but don’t want to delay their studies.”

INTO University of Exeter

“Specifically designed for international students who show academic promise but who do not meet the University’s academic and/or English language requirements for direct entry to Year 1 of an undergraduate degree.”

There seems no doubt from the pathways providers that IYO is a substitute for year one of a three-year undergraduate degree and that those enrolled do not have to have the qualifications published by the university for direct entry to that degree. It is also true to say that this privilege is not available to UK students. Indeed, international students who are academically strong enough and have achieved the English language levels to enter direct need not have bothered because their achievements save them neither time or money.

The Sunday Times has representatives of several pathway operators rather proudly noting that it is a “back door”, that “you don’t have to worry too much about how difficult it is” and “..British students don’t have this kind of privilege.” One might argue that this is just sales talk but if so, it is a reminder that some commercial operators are not operating to the best standards in preserving the UK sector’s much vaunted reputation for integrity and quality. The operators’ representatives quoted are effectively trashing the brand of the university in question by indicating that this is a privileged, easy and hidden route to their awards.

Invisible Touch

Having established that the Sunday Times is correct about the nature of the International Year One it’s worth a look at the extent of the differential. As noted above the university and pathway websites are less than forthcoming, perhaps because they realise that it doesn’t reflect well on quality standards for admissions. The Sunday Times quotes its sources for a chart showing various anomalies between direct entry and International Year One requirements but they are not publicly accessible.

The Sunday Times also directly quotes pathway representative sfor INTO Exeter saying, “So your son that’s studying A-levels — to get on to the [International Year One] programme it would be two Cs and a D.” They note, “Applying through the Ucas system, the students would need AAB at A-level, she said.”

One publicly available source confirms a similar differential at another INTO partner, Queen’s University Belfast. The university website indicates that the BSc Economics degree requires ABB at A-level:

Source: Queen’s University Belfast website (28 January, 2024)

The INTO Student Portal shows the progression possibility to the Business Economics BSc from the International Year One in Management and Finance and that the entry requirement for the International Year One in question is DD at A-level:

Source: INTO Student Portal website (28 January, 2024)

Against this background it seems incomprehensible that the Russell Group of Universities has issued a statement trying to obscure and obfuscate the situation. Queen’s offers, through its private partner INTO, an International Year One that allows “progress to Year 2 of a professionally accredited undergraduate degree at Queen’s University Belfast.” It is not available to UK students.

From Genesis to Revelation

The Sunday Times was unwise to bring the terms Foundation Programme and International Year One to the table in the same article. It seems perfectly reasonable that there should be Foundation level, pre-degree, preparatory programmes for students who do not have the required language level or academic qualifications for direct entry and/or may not have the 13 years’ schooling expected. There may be different things to be worried about in terms of Foundation programmes and particularly the covert nature of the agreements between university and private partner on the language and academic grades required to pass before degree entry.

Pathway operators mentioned in the article, INTO University Partnerships, Kaplan, Study Group and Cambridge Education Group (shown as OnCampus), all cut their teeth on Foundation Programmes. These have come under increasing pressure over time for competitive reasons and as the Chinese students who underpinned the growth of the early 2000s have declined. The International Year One response utilizes the gap between 5.5IELTS and 6.0IELTS with the former being the lowest level allowed for a visa to start a degree in the UK and the latter being the lowest most universities will accept for direct entry.

Language testing is complex and the gap between 5.0IELTS and 6.0IELTS is suggested to be that between a “modest user” and a “competent user”. One suspects that the UK visa regulations relating to degree study were simply chosen to reflect the Common European Framework of Reference of Languages (CEFR) which bands IELTS 5.5 to 6.5 together in the B2 category). In practical terms, however, most universities settled on 6.0IELTS for entry because it was a level which reflected teaching and learning priorities.

Calling All Stations

It is, of course, not only Russell Group universities that do this with International Year One and given the maelstrom in which INTO, Study Group, Kaplan, and CEG found themselves thrown it seemed only fair to have a quick look at Navitas. Of the big five the Australian giant does not work with any Russell Group universities but has built a decent UK portfolio since 2000, having been the first movers on pathway courses in Australia in the 1990s.

At Anglia Ruskin University, Navitas offer what they call a First Year Pathway (FYP) and say “Upon completion of the first year…you will seamlessly progress to the second year of your chosen degree with the University”. The language and description is a little meandering but we can be sure agents know what they mean and what commission comes with it. They are specific that “First Year with ARU College is only available for EU and International Students” and that it is for those who “don’t meet the entry requirements to enter university level study directly.”

Finding the entry criteria for the First Year Pathway is complex (so I would be happy to hear from ARU if I have this wrong and will correct it) but it looks as if the answer is “(EU & International nationals ONLY): 40. UCAS Tariff points at A/AS level.” This compares to ARU’s standard entry requirement of “96 UCAS tariff point from a minimum of 2 A levels (or equivalent)”. Basically this is the difference between AA at A-level and DE at A-level.

The Lamb Lies Down on Broadway

There are times when the UK higher education sector seems as aimless and innocent as a lamb deciding to take a nap on a busy thoroughfare. There are just too many occasions when it expects to be protected from harm while placing itself in perilous situations where it might be flattened by an oncoming juggernaut. It has allowed itself to be positioned as venal, arrogant and detached which makes it vulnerable to almost any action the Government of the day wants to take.

The Sunday Times piece comes on top of a number of reports and news items that just suggest universities are not in full control of their brand, their degrees or their finances. The recent National Audit Office report on private education providers franchised by universities had undertones of fraud and organised crime which were disturbing. The sense that international recruitment was allowed to spiral out of control with millions being paid to agents and reliance on international students is also strong.

There seems little doubt that all of these factors will play into the Migration Advisory Committee thinking as it reviews the graduate and student visa routes. Everyone has already seen the commentary from the chair of the Committee concerning low-quality students enrolling more for the option to work post-study than for the education. One might even think that the timing and placement of the Sunday Times story was intended to ensure that the terms of that Review are as tough and directive as possible.

NOTES

The title of this blog and the sub-headings are all taken from albums by Genesis. One take on the title “Selling England by the Pound” is that the band did not want to be thought of as “selling out” to America. But bassist Mike Rutherford has also been reported as saying it “..was partly about increasing commercialization and the sense that something was being lost in England.” It seems apt given the increasing incursion of private entities into UK higher education.

The Sunday Times appears to have access not only to taped interviews but also to “grade entry requirement documents”. This blog does not attempt to fully replicate the work or assertions of the newspaper article or to endorse all of its assertions, graphics or quotes.
I am grateful to Susan Fang for her insight on a specific issue related to this blog. Her insight and prompt response was extremely helpful. Any text or misunderstandings are entirely mine.

Image by Catherine Stockinger from Pixabay

Universities and the Ten Percent Rule

Vice-chancellors proclaiming substantial organizational efficiencies, cuts and savings is the latest trend in the UK higher education sector and some would say it’s not before time. Their thinly veiled threats of catastrophe have largely failed to persuade the government to change course on home student fees or constraints on international recruitment, so they are reaching for the next tool in the box. Some would say they are likely to find a hammer and try to use it on a job where handcrafting is required but they do their best.

Meta Lessons In Making Statements

In a play direct from the Meta universe the strident tones match those from the Mark Zuckerberg book of corporate tough talk. At the end of 2022 the Meta share price had fallen 64% in the year and he declared 2023 a “year of efficiency”. By December 2023 the share price was up 178% as he “..responded to investor concerns about out-of-control spending.”

Costs at Meta for 2023 came down around 10% (a range of $89-95bn compared to predictions of $94-100bn). In a curious twist of fate, cue drum roll, Coventry University has announced that it plans to reduce costs by £40m in 2023/24 which is, um, around 10% of the University’s core expenditure (£447m) in 2022/23. It reminds me that one of the earliest lessons I was ever taught in the corporate world was that every manager should know where 10% of savings could come from in case there was a pinch in profitability at year end.

Over at the University of East Anglia (UEA), as noted in a previous blog, the organization seemed to be facing financial meltdown and possible “compulsory redundancies” in March 2023. The Annual Report and Financial statement from the year close on July 2023, just three months later, notes “..all the necessary £30.1m cost savings have been achieved” and all that with no compulsory redundancies. As if by coincidence staff and other operating expenses (excluding depreciation, amortization and other finance costs) was £294m which suggests a saving of, um, about 10%.

Moving to the south coast we see the University of Brighton making £17.9m in savings which, given normal operating expenditure (excluding financial expenditure) of £197m is, let me see, just under 10%. It is interesting to see assertions that the number of compulsory redundancies, 22, was not reduced “dozens of staff resigning to take up posts elsewhere”. Perhaps the University management decided to take the further savings windfall when it became available – or perhaps that’s just too cynical to contemplate.

Up the Amazon

It seems plausible that institutions are making a lot of noise to establish a negotiating position that will minimize resistance when they cut costs and 10% feels manageable. They might be better off considering something from the beginners guide to negotiation which can be summarized as “always open unreasonably in the eyes of the other side.” Perhaps a stretch target of 20% in cost-saving might make a substantial difference that allows room for genuine restructuring and reinvestment.

It would be particularly helpful if they saw cost control as an ongoing and positive step towards a better future rather than a defensive measure to cover poor forecasting and poorly judged investment. An example of the positive approach is that in 2001 Jeff Bezos, who penned an annual letter to shareholders for over 20 years, noted, “Focus on cost improvement makes it possible for us to afford to lower prices, which drives growth.” Another common theme from Bezos is that failure is important and necessary but it’s unlikely that he would have welcomed significant errors in forecasting revenue and costs in the core business.

This distinction is important because another common theme emerging from university annual reports is that some in the sector have acknowledged that they have been predicting badly and spending beyond their means for a while. As UEA notes, “Student recruitment numbers for 2022/23 were significantly lower than originally planned. This is on top of an accumulated 3,000 fewer students than planned throughout the Covid years, as experienced by many others in the Higher Education sector.” Coventry University’s 2022/23 Annual Report says, “The operating deficit has occurred as a result of costs growing faster than income.”

An Apple A Day

Since the start of the century international student recruitment has become a critical factor in most calculations about finances. The problem is that when the government or an external market provides an opportunity to gorge on international student mobility it can lead to over-indulgence. While one apple a day can be good for you and easy to digest, the outcome of eating too many too quickly is likely to be bloating and gas which seems apt given the growth in non-academic staff and some of the hot air from the sector.

Those with longer memories will recall that the late, sometimes lamented, Higher Education Funding Council for England noted in 2016 that predictions of increases in international student fee income, “…may be based on overly optimistic forecasting of international student growth. Plus ca change and all that because it is reasonably clear that this pattern has continued. However, the responsibility for this lies with individual institutions to plan, implement and review their activities rather than the hapless Office for Students to tell them what to do.

In that respect it is entirely appropriate for universities to consider taking a hatchet to costs if government policy has taken an axe to the tree of international student flows. It seems reasonable to believe that in years of plenty there is a likelihood of institutional bloat and almost inevitably there is a need for corrective action at some point. The real question is whether university management, having miscalculated trends in the first place, can be trusted to make the right cuts.

Alphabet Soup for Data

Which leads to thinking what the new business model might look like as the dependent visa issue bites and if the Migration Advisory Committee review of international student visa leads to further action reducing the competitiveness of UK higher education. Professor Tim Dunne, Provost and Senior Vice-President at the University of Surrey since 2022, had a go at this in a recent blog and made an interesting observation that “Many large post-1992 universities, such as Manchester Met, Liverpool Hope, and Leeds Beckett, have less than around 5% of their students paying overseas fees.” This suggested a way forward in the search for a new model,

A big problem with this notion is that MMU’s 2022/23 Annual Report notes that international students were 12% of the student population and international student fee income (excluding EU because MMU don’t separate it) is 17% of total full time student fee income. MMU has already beaten its 2026 international student recruitment target of 2,500 by 20%, in having 3,017 full-time, international, on-campus, new entrants last year. Times move quickly and this situation reflects what has happened in a number of institutions.

The real issue is that the sector is constantly referring to enrollment data that is at least 18 months old and which doesn’t take into account the likely impact of current year activity. It is really shambolic at a point when most universities seem to take pride in completing and publishing their financial statements within five months of the year end. The data is available and should be shared promptly to give external decision makers, students and the public timely information about the state of the sector.

Micro Talent Management, Soft Landing?

One helpful case study that some universities might like to study as an alternative to macho talk about cutbacks is that of Apple. The strategy seems to be to prioritize hiring quality over quantity in the first place, take an holistic view of talent, and always look to the long term needs of the organization. The company is not immune to the pressures of the market but CEO, Tim Cook, seems to run a business that reflects his suggestion that layoffs are “a last resort”.

As the sector becomes increasingly disrupted by alternative options, generational changes and other competitive pressures it seems likely that universities could and probably should be run more like businesses. This is a subject for a different blog but it is important to reflect that some of the best corporates take good care of their employees and see errors in forecasting or cost control as a management failing.

NOTES

It is ironical that Mister Ten Per Cent is the title of a British comedy film from 1967 where the inimitable Charlie Drake plays an amateur playwright whose earnest drama becomes a comedy success. In his ignorance he has also signed away 10% of the proceeds from the play to so many people that he owes 110% of the revenue. A salutary tale.

The sub-headings are inspired by the names of the Big Five tech companies. Crunchbase indicates that in 2022 “more than 93,000 jobs were slashed from public and private tech companies in the US” with more than 191,000 being cut in 2023. In 2023, Amazon cut 16,080 roles, Alphabet cut 12,000 and Meta cut 10,000. As noted, Apple seems to have a different approach to hiring and investment and has been much better able to withstand mass layoffs. This may offer some food (sic) for thought.

Image by Pete Linforth from Pixabay

Keeping Ahead of the Game

We’ve been hearing a lot about the parlous state of finances for UK universities and the Times Higher Education had another run around the issue with a “red alert” that the Open University has posted a £25m operating deficit. In the same piece Coventry University is reported as having a £2.4m deficit but “does not consider this to be material uncertainty that would cast doubt on the group’s ability to continue as a going concern”. The next university quoted is the University of Wolverhampton whose deficit has improved to £11.9m from £27.8m the year before which seems to rather undermine the point.

With university financial statements coming thick and fast a quick review suggests that the picture is significantly muddied by accounting for pension changes. However, there is also a growing acknowledgement that several have been travelling far too hopefully on predicting student number growth. The big unknown for the future is international student recruitment but one would think that there has been fair warning of declining numbers in the coming year or two.

As it happens the Open University seems a strange example to choose because it is almost wholly a distance learning university and unlike any other UK institution. What their plight might say about the distance learning market during a cost-of-living crisis and encroachment by new operators is for another day. But for now a quick review of just a few, more traditional institutions suggests that planning well and adjusting to market condition is vital, that diversity of income is a bonus, that travelling hopefully is not recommended and that the university pension scheme will remain a headache. There is even a small insight into how the pathway market might have treated them and their commercial partners last year.

University of East Anglia

Anyone looking at the situation for UEA this time last year was probably contemplating the story lines of Deep Impact and Armageddon converging on Norwich. It’s not clear if the new VC, Professor David Maguire has aspirations to Bruce Willis style asteroid drilling and detonation but the Annual Report and Financial statements 2022/23 is quickly to the point by noting that the accumulated years of multiple deficits came from “the root cause being a decline in planned student fee income without commensurate reduction in costs.” Maybe Professor Maguire is more aligned with Wilkins Micawber who told us in David Copperfield, “Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty-pound ought and six, result misery.”

The university had an undrawn £100m line of credit with NatWest Bank at the end of the financial year and “remains confident that it has in place adequate funding to support the operational and development plans, and to provide a reserve for managing financial risks.” The proposed cost saving of £30.1m was achieved without compulsory staff redundancies (although one should not underestimate the anxiety and upset felt by many members of staff) and there is “a pathway to breakeven in 2025/26”. It all sounds reasonably upbeat and may be a reflection of what all institutions could do if they assessed potential risks effectively and acted more decisively to get ahead of the potential problems.

While the university has been mending its finances the joint venture with INTO has continued to present difficulties. During the year “..the University has provided cash to INTO to the amount of £1.7m to support its operations” which is additional to the £3.5m CBIL scheme loan from the COVID period. There seems to be some way to go before the problems there are unravelled.

University of Exeter

A tone of realism infuses the University of Exeter annual report and financial statement 2022/23 with a recognition of the challenges but apparent acceptance that “we must..continue to identify ways to increase efficiency and financial sustainability”. A decline in new student entrants from 13,013 to 11,185 is presented as a “planned return to more normal levels of Home Undergraduate entry, following two extraordinary years affected by the reaction to the Covid pandemic’s impact on exams.” An operating surplus for the year of £29m is about level with the year before.

International student fee income increased by nearly £22m to £135.8m while Home and EU student fees fell by just over £10.7m but funding body grants and research grants were up by over £25m. Perhaps surprisingly the number of research staff was down 16 and while academic staff numbers rose by 161 the number of professional service staff rose by 179. It’s worth noting that the number of staff listed as being paid over £100,000 (and excluding employers pension contribution) has increased year on year from 187 to 222 with 31 in the £130-140k bracket compared to 12 the year before.

The role of INTO Exeter in the University of Exeter’s finances is relatively limited but the accounts show that the university’s share of operating surplus went down £150k to £840k which might suggest that the joint venture was less productive in the year.

University of Stirling

Looking north of the border the University of Stirling sounds bullish but there might be some question marks around the direction in which the finances are travelling. The underlying operating surplus is down from £15.4m to £8.7m, net debt is up £7.4m to £27.8m and net liquidity days are down from 233 to 180. Research income growth was virtually static and the tuition fee income was driven by a 23.7% increase in, largely postgraduate, international students (which presumably contributed significantly to income from residences etc). Basically, home/EU tuition fees were down over £4m and non-EU fees were up nearly £9m which may be a vulnerability if UK visa issues reduce recruitment significantly. The Vice-Chancellor’s salary (excluding benefits and pension contributions) went up from £295k to £363k.

The joint-venture with INTO looks to have had a better year with income up just over £500k and the pre-tax loss for the year down to £305k while the net liabilities have grown by just over £250k. Over the longer term, the joint-venture has struggled to return to levels of enrolment achieved in 2018 while debt to 50% owner INTO University Partnerships (IUP) has grown. The University of Stirling created a company called UoS Education Limited whose primary purpose £3.8m of joint-venture trading debt to the university was converted into a loan facility of £4m.

University Pension Scheme

The impact of the USS Pension Scheme and the impact of revaluation is a key theme throughout the university accounts reviewed for this blog and in the financial statements of other institutions. The scheme is a running sore for the sector and it is difficult to believe that it can survive in its current form over the long term. The recent turnaround in the scheme’s value is almost wholly due to changing financial market conditions. While it is usually better to be lucky than good, Dame Kate Barker, chair of the USS Trustee Board made the point that “it is not possible to predict with any certainty where long-term interest rates, asset values and expected investment returns will be at future valuations (in three or six years’ time).”

The arguments are for experts to make but if there is a genuine crisis coming to UK university finances it seems likely that there will have to be further consideration of the scheme in much the same way as most UK private schemes have changed. The Pension Protection Fund indicates that 90% of defined benefit schemes do not accept new members and 53% have stopped offering the scheme to anyone. In the context of public sector schemes a recent commentator in the Financial Times suggested that “..a pension — however generous — can’t be spent today, and the government should allow all public sector workers to choose higher pay, in exchange for a lower DB pension in retirement.” Probably unpopular but possibly worth thinking about.

Image by Alexa from Pixabay

You Must Remember This

One prediction for 2024 is that the ongoing legal dispute between INTO University Partnerships (INTO) and the University of South Florida (USF)¹ is likely to provide hours of insight and legal argument. It appears that the mediation of November 2023 was unsuccessful² and there is plenty of continuing legal activity in the early part of 2024. As ever, the summary below is taken from published documents and makes no observation on the arguments made by either side.

The Fundamental Things Apply

Things get moving early in the year with a JAWS hearing on a USF Motion for Summary Judgement on Thursday 4 January³. INTO had been granted a continuance on a hearing of the Motion back in September 2023⁴ but their next motion to delay the hearing further was denied on 4 December 2023⁵. The motion seeks a summary judgement against “(…the “INTO Entities”) on Count I, Breach of Contract, and Count VI, Breach of Duty of Good Faith and Fair Dealing, of the Second Amended Complaint (“SAC”)”.⁶

A range of legal arguments have been made on both sides and the tone is set early in the most recent submissions. INTO’s filing suggests that the summary judgement should be denied because USF’s “..allegedly “unambiguous” interpretation of the contracts at issue is still unsupported by the contract language and violates the core tenets of contract law”.⁷ On the other hand USF’s response to that filing starts with the line, “The INTO Entities’ response ignores basic contract law.”⁸

In this context, it is interesting for a lay-person to read an article written for the Bar Association of San Francisco which starts, “If you wish to be taken seriously by the court, whether in oral or written argument, never malign or belittle your opponents or their position.” As previous blogs have noted the various flourishes, acid comments and hyperbole in the written submissions for this case seem to ignore that advice with monotonous regularity.

That No One Can Deny

Already up and running, with a lot more to come, is the taking of depositions under oath and on the record. There must be a lot of management time, effort and probably stress (as well as lawyers fees) going into briefing and preparation for these.

INTO’s lawyers are taking depositions from 14 USF related individuals⁹ with a start on December 12, 2023 and continuing from January 5 to January 25, 2024. These include Glenn Besterfield, who was center director for INTO USF when it opened in 2009. He later became dean for the Office of Admissions and associate vice president for student success at USF before moving on to become Dean of Enrolment Management at the University of North Florida in spring 2023.

For USF the count runs to 12 INTO related individuals¹⁰ with ex-global COO Anmar Kawash and ex-CFO Jon Holmes among them. The depositions start on January 4 and end with INTO founder Andrew Colin on Wednesday, March 13.

As Time Goes By

It is no surprise that this depth and breadth of activity led to a third extension of case management deadlines on 14 December¹¹. The Order indicates that discovery closes on March 29, 2024, with expert discovery closing on June 14, 2023 and the “Deadline to have dispositive and Daubert motions¹² heard of [Friday], August 23, 2024.” This seems set for the long haul.

In its Annual Report to July 2022, INTO noted as “contingent liabilities” that it had “provided for legal fees up to 31 July 2022 in relation to this ongoing litigation. Further legal fees are expected to be incurred in FY23 in respect of this dispute and have been included in forecasts for this period.” It looks like FY24 will have more of the same.

For the University of South Florida their financial audit for the year to July 2022 said, “The University is involved in several pending and threatened legal actions. The range of potential loss from all such claims and actions, as estimated by the University’s legal counsel and management, should not materially affect the University’s financial position.” To give this some context USF’s operating revenue for the year was $894m.

NOTES

The title and sub-headings of the blog are from “As Time Goes By” made famous by Dooley Wilson in the film Casablanca which was released in 1942. Dooley was a singer and drummer but not a pianist so the tinkling of the ivories was dubbed in. The song was written by Herman Hupfeld who was born nearly 130 years ago on 1 February 1894. Even as time goes by, class is permanent.

The background to the court case between INTO University Partnerships and the University of South Florida has been outlined in several previous blogs. As before, the terms INTO and University of South Florida are used as short forms for the range of corporate plaintiffs and defendants. Full details and all public documents reference in this blog can be found through https://hover.hillsclerk.com/html/case/caseSearch.html the Hillsborough County Clerk of Courts search facility. Insert 22 for the year, CA-Circuit Civil for the Court type and 006001 for the case number.
Filing # 188238925 E-Filed 12/18/2023 01:13:33 PM (point 4. of Exhibit 25 – Affidavit of Shawn J. Rabin)
Filing # 187809851 E-Filed 12/11/2023 08:28:02 PM
09/14/2023 11:07:38 AM Electronically Filed: Hillsborough County/13th Judicial Circuit
12/04/2023 12:13:13 PM Electronically Filed: Hillsborough County/13th Judicial Circuit
Filing # 179813559 E-Filed 08/16/2023 03:28:09 PM)
Filing # 188161134 E-Filed 12/15/2023 06:08:23 PM
Filing # 188693985 E-Filed 12/27/2023 11:55:52 AM
Filing # 186997655 E-Filed 11/29/2023 02:20:27 PM
Filing # 186594368 E-Filed 11/21/2023 12:05:10 PM
12/14/2023 10:05:23 AM Electronically Filed: Hillsborough County/13th Judicial Circuit
A Daubert motion is a specific type of motion in limine¹³. It is raised before or during trial, to exclude the presentation of unqualified evidence to the jury. Daubert motion is used to exclude the testimony of an expert witness does not possess the requisite level of expertise or used questionable methods to obtain data. It is the outcome of 1993 Supreme Court case, Daubert v. Merrell Dow Pharms., 509 U.S. 579 (U.S. 1993).
Always interesting when a footnote needs a footnote but the term was new to me. In limine is a Latin term meaning “on/at the threshold”. In this context it relates to a pretrial motion requesting that certain evidence be found inadmissible.

Image by Mohamed Hassan from Pixabay

A Look Before You Leap

Recovering from the gluttony of Christmas dinner and resolving to resist the lure of nibbling on leftovers is a little like universities making new year resolutions to be slightly less greedy and indiscriminate about international student recruitment. We all know that it makes sense to lose the excess pounds, focus on high quality, nourishing food, and cease acting with the incaution of a drunken sailor. But the temptation of finishing the mince pies, the bottle of egg nog and the turkey sandwiches, while avoiding the gym is sometimes overwhelming.

Maybe that’s why it’s up to Governments to decide who has been naughty or nice and who deserves a visit from the Ghost of Christmas 2024. The last few months of 2023 saw a lot of political posturing and positioning in the four main recruiting countries and the impact of some changes are already being felt. A quick look at the implications suggests that for the big four recruiting countries international recruitment at the latter end of 2024 will be a Nightmare Before Christmas for some but a Miracle on 34^th Street for others.

The good news for student recruiters is that it’s a leap year so they have a whole extra day to work out their response.¹

United Kingdom

The gift of post-study work in September 2019 gave UK universities the keys to the student recruitment larder but they appear to have been caught eating too much low-quality pie. This has left the sector vulnerable to Government action and it is likely to find the coming recruitment cycle difficult. Enroly Data Insights in November 2023 indicated “..overall deposit payments are down by 52%, CAS issuance is down by 64% and visa issuance is down by 71% when compared to January 2023.” While the year-on-year comparison has its limitations there seems little doubt that changes in Government visa policy on dependents is already biting.

News in early December that a review of the Graduate Route to “prevent abuse” and “protect the integrity and quality of the UK’s outstanding higher education sector” may not augur well for the medium term either. Although the Migration Advisory Committee (MAC) is not likely to report on the issue until near the end of 2024, when a general election is either under way or already over, one suspects that any new Government, will accept its recommendations. MAC recommended against the graduate route before it was introduced and there is no reason to believe they won’t do so again.

MAC’s starting point seems clear from the Annual Report 2023 where it notes that there are “..a very different set of students accessing the route than might have been expected based on student patterns in 2019 when the route was announced.” The largest growth has been “predominantly been in institutions that charge the lowest fees” and “been strongest at the less selective universities”. Anyone who understands international recruitment would have predicted these outcomes and it is quite extraordinary that Government supporters of the Graduate Route did not understand these as likely outcomes.

A possible saviour for the current length of post-study work visa might be that the recent restrictions on dependents make a serious enough dent in international student numbers before the main intake in autumn 2024. Aligned with an unwillingness to invest further in the higher education sector this could find the narrow path that allows the next Government to see how net migration figures play out for at least another year before imposing further constraints. One suspects, however, that the ideological setting of MAC will demand more in terms of quality recruitment and a requirement to move to a different visa after study.

Canada

The growth in Canada’s international student recruitment numbers has been remarkable. According to Erudera, study permit holders nearly doubled from 2016 (410,570) to 2022 (807,750) with international students in tertiary education increasing by around 150,000 from 2015/16 (228,924) to 2020/21 (373,599). The strength of recruitment from India has been a feature of the market for many years so it was well placed to capitalize on the boom of recent years.

Many observers would reflect that the magnitude of the growth has come at a cost to processes and reputation. Claims of “bureaucratic mismanagement” were being called out as long ago as 2017 and there have been reports of universities accepting 99% of international students who apply and/or having visa rejection rates around 80%. Issues around aggregator platforms allowing institutions to absolve their responsibilities for agents and the sheer volume of applications causing delays in visa processing or allowing fraudulent applications through have also been prominent.

It does look as if the Canadian federal government has responded to the various scandals around students starving, dying and being misled about their study choices but in the wrestling match with powerful provinces it is difficult to see a comprehensive response taking hold. One response to a possible international enrolment cap was from Alexandre Lahaie, a spokesperson for Quebec’s Immigration Ministry saying that “Quebec does not intend to impose a cap on the number of foreign students in its jurisdiction…..Although issuing study permits is the responsibility of the federal government, education is the exclusive power of Quebec,”. The pace of change can be slow as reflected by the cost-of-living financial requirement for students going up recently for the first time since the early 2000s.

While the IRCC has signalled a new Trusted Institution framework in 2024 and the International Education Strategy is due a refresh in mid-2024 experts reflect that this is a “challenging policy area”. It is difficult to see that a minority Government facing an election no later than October 2025 is likely to want to upset the apple cart, particularly when some suggest Prime Minister Trudeau’s own role as party leader is under scrutiny. One suspects that any changes to policy on international student recruitment in 2024 will be about tidying up around the edges and minimizing friction rather than significantly reducing intakes.

Australia

While the Australian government has rattled its sabre over the issues of international student recruitment the smart money seems to be on plenty of light touch regulation and monitoring along with touches on the tiller for employability without significantly damaging intakes. The Australian Migration Strategy released in December 2023 looked a pretty nuanced document that provides plenty of space to “…lift the standards for international students and education providers while ensuring graduates help meet skills shortages and do not become permanently temporary.”

Study Australia leapt on the Strategy to suggest a join up between clear post study pathways, genuine student requirement, requirements on education providers and high-quality education agents. By maintaining special initial stay periods for Indian nationals they have kept faith with a key market while setting IELTS at 5.5 for university foundation and pathway programs at the same time as moving levels for Temporary Graduate and Student visas upwards balances access with quality.

In contrast to the UK and Canada there seems to be a coherence in the Migration Strategy which respects the strength of its higher education sector as a critical part of national branding and infrastructure while addressing issues in the private VET sector where some “have systematically exploited Australia’s education system and broken migration law.” Issues of graduate employability are addressed with the responsibility of institutions being noted and a study commissioned “..to better analyse international student outcomes and pathways into the labour market, with deep tripartite consultation of unions, employers, and training and education providers.”

Some are concerned that the measures put in place to date will have a dampening impact on recruitment but the sense is of a more reassuring picture than that being offered by the UK. Placed alongside some speculation that the Canadian juggernaut might be losing pace this is likely to make the Australian picture pretty benign for international students. 2024 looks like it should be another good year.

United States of America

For the growing sending markets the USA is a highly desirable country with a well-regarded higher education sector. There is also every sign that US universities seeking to increase international recruitment have upped their game in terms of focus, competitive awareness and professionalism. Even the Government has played its part with exceptional numbers of visas processed in 2023, amendments to H-1B visas and steps towards modernizing the visa process more generally.

The India numbers were material in driving international enrolments in Fall 2023 and the chief executive of the Institute of International Education was positively gleeful in suggesting, “Made in the USA is something that these students and families want on their diplomas.” It should be very difficult to be negative about the potential for the US to substantially grow international enrolments in 2024. The real question is what might disturb that and what might happen next.

A presidential election in November 2024 already has some pundits claiming that a re-election for Donald Trump would lead to, “A mass deportation operation. A new Muslim ban. Tariffs on all imported goods and “freedom cities” built on federal land.” Study Portals data from 2016 suggests that more than 50% of international students were “far less likely” to study in the US than they were before Trump’s election. It is difficult to see why the outcome would be any different in the coming year.

Trump’s views on higher education institutions suggest there may be even wider implications for the sector. The noise around the election is bound to rise and the rhetoric is almost certain to ramp up in a way that begins to make alternative countries look a more stable option. Relationships with India could also become a bit sticky if the threatened “retribution” on reciprocal taxation looks like becoming a reality.

Summary

The world offers many options delivering courses in English and most are finding ways of making post-work study a possibility with some going further in terms of possible routes to citizenship. In the face of uncertainty many agents and students have a tendency to consider their options and look for the route of least resistance to meet their needs. The evidence of the past few years is that options are kept open and decisions can be delayed for much longer than ever used to be the case.

We also seem to be seeing Governments viewing higher education and its capacity for international recruitment as a work-force planning component in the face of changing population demographics. While university leaders are quick to proclaim quality education as the key driver of global interest there is growing evidence that low cost, post graduate employability and routes to citizenship are much more important for the growing markets. All this at a point when the enthusiasm for university education is under pressure from disenchanted youth, apathetic public and cash-squeezed Governments.

More than ever before there is a need for joining up the dots in the way that the Australian Migration Strategy seems to do (although everyone recognizes that implementation is something different). The UK seems to lurch from policy to policy without much apparent insight into the consequences and Canada appears to be slow moving and in thrall to competing interests across Federal and Provincial governments. The US runs the risk of finding its historical attraction and dominant position undermined by more nimble players while internal, political factionalism prevents any realistic hope of long-term, strategic planning for growth.

Notes

Royal Museums Greenwich tell us that “the first leap year in the modern sense in Britain was 1752, when 11 days were ‘lost’ from the month September with the adoption of the Gregorian calendar by Britain and her colonies. After 1752 we adopted the system still in use today where an additional day is inserted in February in years wholly divisible by four, other than years ending in 00 with the exception of those divisible by 400 which are still leap years (like 2000).”

Image by Mohamed Hassan from Pixabay