English regulator issues first refusal on provider loan access

England’s sector regulator has issued its first decision to refuse permission for a college to be included on the register of providers – which means new students enrolling at that institution will not be able to access publicly funded student loans.

The Office for Students published a notice on 4 July saying that the Bloomsbury Institute Limited, which states on its website that it offers business, accountancy and law degrees awarded by the University of Northampton, had failed to meet registration conditions on two grounds: quality, and management and governance.

An OfS notice for the institute’s students says that new students starting courses after 31 July “will not be able to access student finance through the Student Loans Company”. But existing students will be able to access SLC funding to allow them to complete their courses.

Providers must apply to be included on the register of OfS providers. If they are not included, their students cannot access SLC funding.

While all universities have been included on the OfS register, a number of for-profit providers are still awaiting decisions on their applications. These include two of the biggest for-profit colleges in terms of their numbers of students with SLC funding, St Patrick’s College and GSM London.

The publication of the OfS notice on Bloomsbury Institute Limited suggests that decisions are imminent.

Under former Conservative universities minister Lord Willetts, the number of for-profit providers accessing SLC funding was dramatically expanded after 2010, with the National Audit Office and Public Accounts Committee raising concerns about dropout rates on some of these colleges’ courses and a lack of control over taxpayer spending on such colleges.

The OfS has now taken over control of sector regulation – and the extent to which it is willing to refuse access to the register of providers where it has concerns is seen as a key test of its ability to exercise its powers.

The OfS says in its notice on the Bloomsbury Institute that on quality, it looked at data on continuation rates and rates of progression to graduate employment. These showed that “the institute has failed to demonstrate that it delivers successful outcomes for all of its higher education students, which are recognised and valued by employers and/or enable further study for all of its students”, the OfS says.

On management and governance, the OfS says it took the view that “the institute’s student outcome data and a lack of credibility in its student and financial forecasts mean that there is insufficient reliable evidence to determine that management and governance arrangements are adequate and effective”.

A spokeswoman for the institute said: “We are disappointed with this decision and believe that the OfS has failed to fully appreciate the challenges some of our students face.”

She added: “We hope that Bloomsbury Institute will be offered a place on the new register when we make a fresh application to the Office for Students in the next academic year.”

Meanwhile, a GSM London spokeswoman said: “GSM London’s application is still under consideration and we have been working closely with the OfS to provide all the information they require for this process. We expect a decision to be made shortly and it would not be appropriate to comment further ahead of that being made.”

john.morgan@timeshighereducation.com