Private college scandal: money for nothing

http://www.theguardian.com/commentisfree/2014/may/22/private-college-scandal-money-for-nothing

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David Cameron did not come across as an extremist, but during his first flush, his administration exuded a heady determination to make its mark fast – and worry about the consequences later. Michael Gove rushed his schools legislation through in no time, which is why – within just a couple of years – he had been able to convert the majority of England's secondaries into academies. With less panache, Andrew Lansley unveiled a complete blueprint for a rewiring of the NHS with such haste that it soon had to be rewired itself. Within that giddy first year, established expectations of social security were chucked out of the window and, of course, the university fees that Nick Clegg had once vowed to abolish were not merely increased but more than doubled, as part of a wider redesign.

Student protests made sure that this last burst of devil-may-care radicalism was very much noticed. But – with much less attention – a second burst of bright ideas blew another quiet gale through the tertiary education sector, the effects of which are only now becoming plain. David Willetts, a thoughtful minister though a man whose instincts were formed in Nigel Lawson's Treasury and Margaret Thatcher's policy unit, took a look at England's many second-rate universities and colleges, and concluded that this was yet another market crying out for the magic of competition. Clear bureaucratic restrictions out of the way and, in line with the trusty post-Thatcher theory, new "providers" would spring forth to answer "customer" demand for high-quality, low-cost courses, shaking up lacklustre former polys and techs, in the same way that Richard Branson and the mobile phone moguls are remembered as having shaken up BA and BT.

The theory remains open to debate. But no one can pretend that all is well with the practice, after the Guardian's exposé of the way in which the London School of Science and Technology is receiving public funds for students who appear to believe they do not need to turn up. There are students, it must be acknowledged, who say that the institution is serving them well. But the college can get paid while classrooms are less than full, and students can get money to pay their way through courses they've no real intention of studying. They leave with real debt though, and yet if, as is surely likely, their "education" fails to do much for earning power, then under loan rules, the burden is picked up by the taxpayer.

LSST is probably not unique – other cases of private colleges in similar situations could soon come to light. How is this possible? Because in his rush to kick-start a private college boom, Mr Willetts initially decided against thorough checks on what the institutions were up to, while also keeping them free of the strict quotas that rationed loan-funded places at public institutions.

Students and parents who may have recently read – in baffled disbelief – reports that the huge hike in fees may ultimately fail to save the public purse any money, may now think they can spot why. Subsidised loans for students who aren't really studying provides them with their explanation – and Mr Willetts provides them with their villain.

It would be wrong to jump to the conclusion that the attendance of students is the sole or even the principal problem with the new system of finance without the full facts. The public accounts committee has called in the National Audit Office, which should be able to get to the bottom of just how much money is involved. It is also true that things have evolved since the coalition's first spell, with a move towards checks on private institutions and also plans to remove the cap on places at public colleges. That should at least correct one pro-private bias, even if it creates other funding problems.

So the fervour of the early push for private provision may already be over. But what a remarkable tale of the cavalier disregard shown towards public money – whenever that money is spent by anything other than a public authority.

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