How will #Brexit Impact Further and Higher Education in the UK?

As the UK stands on the verge of an agreement on the withdrawal from the European Union (EU), or a no-deal situation, what impact is going to be felt by our education establishments when the UK finally leaves?

Well of course no-one knows the answer, but I’ve given some thought to those aspects of education that could feel the greatest impact.

Firstly let’s consider the current situation with regard to funding. The Education and Skills Funding Agency (ESFA) funds further education and training, and apprenticeships in the UK, and the Higher Education Funding Council funds higher education.

Further funding for education and training comes from the EU’s Growth Programme which includes:

• The European Social Fund (ESF), the EU’s programme for supporting employment, skills and training in member states.
• The European Agricultural Fund for Rural Development (EAFRD) which supports rural businesses to get started, grow and expand, and also improve knowledge and skills.
• The European Regional Development Fund (ERDF) which supports innovation, research, the digital agenda, SME support and the low carbon economy in member states.

There is also additional EU funding from:

• Horizon 2020 which is the EU’s framework programme for funding research and innovation.

The Withdrawal Agreement between the UK and the EU means that the UK will continue to participate in all EU funded programmes for 2014 to 2020.

During 2014 to 2020 the UK is receiving around £4.3 billion of ESF investment, which includes £182 million for the Youth Employment Initiative (YEI).

This money finances the enhancement of education and training with the objective of getting skilled and qualified young people into work and reducing the number who don’t complete their training and drop out.

Examples of ESF funded projects in the current funding period are:

• Enhancing equal access to lifelong learning for all age groups in formal, non-formal and informal settings, upgrading the knowledge, skills and competences of the workforce, and promoting flexible learning
• Education and training to support young people aged 15-24 who are not in education, employment or training (NEET) or at risk of becoming NEET in the Local Enterprise Partnership (LEP) area
• The delivery of Information, Advice and Guidance (IAG) to young people
• Delivery of education and training that helps unemployed and inactive people to enter into employment and sustain employment
• Delivery of a responsive apprenticeship brokerage service to meet resident and employer needs

In the funding period 2014 to 2020 the UK will have received £2.6 billion of ERDF investment. The types of organisation that can apply for ERDF and ESF funding are not for profit organisations, local authorities, higher and further education, community organisations, public funded bodies and the public and private sectors.

Examples of ERDF projects are:

• University and independent training provider funding for SME business development, support to entrepreneurship
• University funding for research and innovation processes in SMEs
• Local authority funding for energy efficiency and demonstration projects in SMEs
• University funding for life sciences hub to facilitate innovations and support commercialisation

Horizon 2020 programme

According to a report produced for UK universities, the Horizon 2020 programme contributed £1.86 billion to the UK economy and generated more than 19,000 jobs in 2015.

The total amount awarded to UK universities since 2014 has been more than £9.7 billion. In 2014/15 the Higher Education Statistics Authority found that all academic disciplines received funding from the EU, with the University of Oxford receiving the most funding, £60.3 million.

However, in the last year the amount of Horizon 2020 funding allocated to universities dropped and there are concerns that UK universities are being excluded from funding opportunities leading up to Brexit.

So a lot of EU money is invested in the UK to support the work of all types of education and training organisations, both in the private and public sectors.

The UK government has guaranteed to underwrite existing EU funding agreements until 2020, however there is a lot of concern regarding the funding of such vital projects once the UK finally leaves the EU.

Discussions between the UK and EU have suggested that EU funding may be made available to the UK equal to any payments that the UK pays into the EU, but isn’t the point of Brexit that we don’t pay money to the EU?  

More likely is the UK government setting up a UK Shared Prosperity Fund (UKSPF) which will be similar to the range of EU funding that includes ESF, ERDF etc, but of course at this stage there is no word of how much this will actually be. 

One thing is for sure, if ESF funding stops and there isn’t a seamless adoption of replacement funding there could be millions of people who will terribly disadvantaged.

Erasmus+

Erasmus+ is EU funding which helps raise standards in education and training, lower unemployment and supports social mobility and opportunities for students and staff across Europe. Since 2014 over 100 colleges in the UK have received about 82 million euros for vocational and mobility projects.

Unfortunately, at the current time the UK government has not announced any commitment to remain in Erasmus+. However, there are other Non-EU countries who participate in Erasmus+ so hopefully the UK will be able to play a similar part as these countries do.

There are currently around 147,000 EU students studying in the UK, contributing £5.1 billion to the UK economy, with many industries depending on foreign students to fill jobs, in fact over 20,000 UK jobs are dependent on foreign students.

The UK government has said that EU students applying to study at English, Welsh and Scottish post 16 educational organisations in 2019 and 2020, will continue to pay the same fees as domestic students and will be eligible for the same loans and grants.

This will remain the situation for the duration of their course, whether it a degree, apprenticeship or further education qualification.

Attracting EU Students After Brexit

As universities become increasingly more dependent on EU and international students, as the population of 18 year olds in the UK falls, there is concern over how attractive UK universities will be to EU students following Brexit.

Currently international students averagely pay 61% more than UK and EU students to study here. It is the excellent reputation of our universities that attracts large numbers of international students, however when those from the EU are faced with higher costs they may well decide to study nearer home.

Other Brexit concerns for the education sector are staffing, demand for education, supply chains and cash flow. 57% of schools and colleges currently employ EU Nationals, so they will be relieved to hear that the government has announced that EU citizens who already have ‘indefinite leave to remain or enter’ the UK can stay without taking any action.

Others, and their families, will be able to apply for ‘Settled or Pre-Settled Status’ so they can continue living in the UK after 2020. However, attracting new staff may well be more of a problem due to the removal of the freedom of movement between the UK and the EU.

Colleges, independent training providers and universities are also commercially funded by employers providing training for their staff and by the apprenticeship levy which is paid by those employers whose PAYE is in excess of £3 million.

They are required to pay into their levy the sum of 5% of their PAYE bill. This money can only be spent on putting employees through an apprenticeship programme. It is topped up by government funding.

As many employers, particularly in the retail sector, reduce employee numbers, pause employment, investment and unnecessary expenditure the amount of money going into levy pots reduces.

Non-levy paying employers such as SMEs tend to reduce or stop staff development, a short sighted action, but never the less when cash flow is difficult reducing expenditure can be a matter of being in business or losing the business.

Threats and Opportunities

There certainly is a lot of gloom and uncertainty around the UK’s exit from the EU, but where there are threats there are usually opportunities.

As the UK prepares to negotiate free trade agreements around the world, further and higher education are well placed to strengthen their position on the world stage.

Areas of provision that can gain from wider collaboration with other countries are science, innovation and research, the use of a reputable education brand overseas and delivering education in other countries.

Already we have many schools, colleges and universities with bricks and mortar establishments in places such as Saudi Arabia, Dubai and India, and virtual campuses with limitless reach are increasing in number.

You only have to look at Future Learn, which is a private company owned by The Open University with over 3 million learners, to see how virtual delivery is developing at a face pace.

Future Learn has hundreds of partners delivering online courses, including universities, colleges and organisations such as the Chartered Institute of Building Academy, the NHS Leadership Academy and London College of Fashion.

At eLearning Marketplace we work with educational partners in several ways to enhance their funded provision or to provide additional commercial opportunities.

Partners are delivering online content as part of funded programmes, such as apprenticeships, and they are reselling our online courses to their students, employers, parents and global audience.

Exchange Rate Benefits

Although the annual Ecclesiastical survey, which looks at the opportunities and challenges faced by the education sector,  found that 48% of the education sector considers that Brexit will have the biggest impact on student numbers, the drop in the pound has meant that the UK has become more competitive and attractive. In particular Asian students who had previously thought of going to a US university are now looking at the UK as an alternative destination.

Clearly no-one knows the future, and there are certainly a lot of uncertainties about the next couple of years and post Brexit, however the UK post 16 education and training sector is extremely good at what it does and faces change and challenges with agile ability.

Innovation and ambition is the key to grasping opportunity and creating the future, so let’s envisage a bright future for a sector that is highly valued.

“We have found eLearning Marketplace to be very helpful with great customer service. Using the online courses has helped engage our learners and gives them the knowledge they need in a more interactive way”. – Curriculum Manager, Total People

Carolyn Lewis, Managing Director, eLearning Marketplace Ltd