In this blog, Andy Westwood, Vice Dean for Social Responsibility in the Faculty of Humanities and Professor of Government Practice looks at what the recommendations within the Augar Review could mean for Greater Manchester.

• Many news headlines on the recent Augar Review focused on tuition fee cuts and extended repayment terms. But alongside those recommendations was a big change to the technical and vocational education system at sub-degree level.
• Greater Manchester has one of the largest student populations in Europe, but provision of technical training and education is patchy.
• Reframing and refunding this ‘missing middle’ could help meet objectives within the UK Industrial Strategy of meeting the technical skills shortage in the UK.
• There is also massive disparity between regions, with the UK as a whole seeing less than half of young people entering into higher education while in some regions almost two thirds do.
• The Mayor and GMCA plan to address some of these major social and economic challenges and spatial inequalities in the GM Industrial Strategy published today.
• But questions then remain on how such a radical shake up of the higher education sector in Greater Manchester will be delivered.

Coverage of the recent Augar Review was dominated by universities – the proposed tuition fee cut from £9,250 to £7,500, extending the repayment term from 30 to 40 years and reducing the loan repayment threshold from £25,000 to £23,000. But without the same level of attention, the Review also recommends redistributing significant resources to a ‘missing middle’ between further education and universities. Augar notes that current incentives for learners and providers ‘are stacked in favour of the provision and take-up of three-year full-time undergraduate degrees and against the provision and take-up of Level 4/5 courses – and of part-time and adult study generally.’ The big policy change then is to recommend ‘a stronger technical and vocational education system at sub-degree levels to meet structural skills shortages’.

So what impact might these recommendations have in Greater Manchester? Like England as a whole, the city region is dominated by higher education and by a large and growing full time university population. A recent Financial Times article describes Manchester as the UK’s clearest example of a new educational-industrial complex. According to the GMCA, Greater Manchester has one of the largest student populations in Europe with around 96,200 people studying at five Higher Education Institutions, of which 17,500 are international students.

But in meeting Augar’s ‘missing middle’ of higher technical education – as well as its potential links to productivity – the city region is more of a laggard. As the recently published Greater Manchester Independent Prosperity Review shows, there is ‘no clear route through vocational training to higher levels’ and provision of education and training ‘is patchy, fragmented and lacks co-ordination’. Greater Manchester’s productivity is low at 89% of the UK average in 2016, falling from 92.2% in 1998.

Part time higher education is in rapid decline, but so too are enrolments in the Level 4 and Level 5 courses that Augar identifies as the ‘missing middle’. This, the panel believes, is the layer of higher education that is key to addressing ‘the UK’s weak productivity performance’ and that it is a better policy intervention than further expansion of full-time students studying degrees. The OECD (2017) agrees, pointing to the UK’s ‘longstanding problems in technical education, especially at ‘higher’ levels (level 4 and above), and an over-reliance on graduate education, often leading to ‘non-graduate’ work’.

Augar recommends filling it by ‘reforming and refunding’ FE colleges – and rationalising them, believing ‘that there are some areas, particularly large urban areas, where the number of FE colleges is still too high. Manchester, for instance, saw its provider base shrink little after the area reviews: there are still nine separate FECs in the Greater Manchester area.’ That review in 2016 was jointly led by DFE and GMCA recommended a series of mergers – including with universities – and reducing the number of colleges to six.

Augar’s interest in expanding higher technical provision fits with both the UK and GM industrial strategies. The 2017 Industrial Strategy Green Paper, published by BEIS, describes ‘a shortage of high-skilled technicians below graduate level,’ and a ‘historic weakness of technical education in the UK’. GMCA, with its long running interest in FE and skills, is also interested in higher technical provision and the rationalisation and specialisation within FE. The recent Independent Prosperity Review is also clear that GM’s skills needs are unlikely to be satisfied solely through graduates from its universities:

‘Currently, some 39% of graduates remain in the city region six months after graduation, although not enough is known yet about lifetime pathways for people born in the city region. The evidence from this Review shows that poor skill utilisation is a significant contributor to poor productivity performance in the city region.’

Graduates tend to be more expensive and there is less certainty about what they study and where they work. Augar notes that overall some £8 billion is spent on 1.2 million undergraduates in universities while only £2.3 billion is spent on 2.2 million students at 18 or above in FE. That’s roughly a quarter of the amount on twice the number of students.  According to Alison Wolf, a member of the Augar Review panel, ‘this imbalance looks even harder to justify in the light of regional inequalities’ noting that ‘among young people in their late 20s, over half of the London-schooled went to university’: it’s under 30% in the North East and the South West’. It is around 35% in Greater Manchester and across the North West. The Financial Times noted, in the UK, that half of young people do not enter into higher education but in many regions it is closer to two thirds.

The Inclusive Growth Analysis Unit at the University of Manchester observes that ‘by the time the 1994/5 birth cohort were 19, 50% of those in state-funded schools in Trafford had entered university, compared with 31% in Tameside and 33% in Salford. Within Manchester Local Authority, higher education young participation rates for electoral wards ranged from 8% in Benchill to 55% in Didsbury. Trafford had a low rate of 14% (Bucklow) and a high of 76% (Bowdon), while in Tameside no ward was below 18% or above 34%’.

So for reasons of social equity as well as economic growth GM may be tempted to support the more balanced approach across FE and alternative forms of higher education recommended by Augar. The Mayor and GMCA plan to address some of these major social and economic challenges and spatial inequalities in the GM Industrial Strategy published today. More alignment with Augar’s approach will be likely if new technical provision can be focused on growth sectors such as advanced materials, health innovation, clean growth and the digital and creative sectors.

Questions must then be asked about delivery. Which institutions will drive this activity? What courses and qualifications will be most suitable? How will it link to and stimulate R&D in these same sectors? How can they create new pathways for local learners of all ages and in all ten authorities? Will the people and skills be ‘stickier’ in the GM economy and better utilised by its firms? The Institute of Technology (IoT) programme provides one option to fill this ‘missing middle’ identified by Augar. But there are none currently planned in GM or the North West. Both DFE and GMCA will want to revisit this but other models and collaborations are also desirable as we have a poor track policy record in creating institutions in this space.

But Augar’s diagnosis of a ‘missing middle’ and the productivity boost it might help bring to Greater Manchester is the more significant and this primary function is more important than any form. Filling it with new collaborations between FE and HE may strengthen, rather than weaken, Greater Manchester’s ‘educational industrial complex’. It may also make it fairer.