Who gets to access undergraduate study in the context of Levelling Up? The political economy of higher education

It is becoming clear that higher education faces some potentially momentous changes in the coming months – although, as is often the case, we can’t be clear of the direction of that change. The largest policy challenge is set by the Levelling Up agenda (DLUHC 2022) and subsequent policy reforms set in train by the former universities minister Michelle Donelan and the Office for Students (OFS) consultation that followed the publication of the Levelling Up white paper, designed to facilitate a shift away from undergraduate study and towards ‘skills’. Taken together, these policy changes formed part of the Government’s response to the Augar review of higher education financing (DfE 2022; Donelan 2022). On top of this, a new set of challenges has become apparent since that flurry of policy activity: the cost-of-living crisis, including the return of the spectre of inflation eating into University finances; and a leadership change at the top of government, with no certainty that higher education will be seen as a high priority for the new regime.

So, what do these changes mean for who gets access to undergraduate study in the context of levelling up? And how are these changes likely to impact us at Sheffield Hallam and within the Sheffield Institute of Education? As noted above, we don’t know how urgent the Truss government will consider these issues to be – early indications are that they are pro-free market and pro-growth. Much of their discourse about higher education has tapped into ‘culture wars’ attacks, such as ‘left-wing academics are cancelling academic freedom’ and the perennial (but never defined) portrayal of some programmes of study as ‘Micky Mouse degrees’ (Donelan, 2022). But we do know that any future government will continue to want to reduce the cost to the exchequer of the higher education and skills system. Here are three possible scenarios:

Scenario 1 changes to the nature of the student body

The government response to the Augar report (2019) (Donelan, 2022; DfE 2022, Office for Students (OfS) 2022) offers a series of policy solutions that are intended to redirect some potential applicants away from degree-level study (by removing eligibility for student loans for those with low A-level grades), with attendant negative implications for the diversity of the student body given the known association between socioeconomic background and educational attainment. Other proposals would lower the repayment threshold and lengthen loan repayment periods, both of which would negatively impact lower income and female graduates disproportionately, according to the DfE’s own impact assessment of the reforms (DfE 2022b).

If these reforms are accepted (currently proposals are out for consultation and some require parliamentary approval which could be problematic and time-consuming), this offers the prospect that a future Universities Minister is going to stand up in Parliament and declare the reduction in the number of graduates from low-income and some Black, Asian and minority ethnic (BAME) backgrounds and other underrepresented groups, such as care-leavers, a successful policy outcome.

Scenario 2 changes to the business model of the institution

Even if the worse does not come to pass in that regard, we cannot yet know for sure whether Government will seek to save public money (which underwrites student loans and is thus exposed by non-repayment) by reintroducing student number controls; or indeed allows inflation to further erode the real value of the current maximum fee of £9,250 per year to fall. Estimates are that – even before the 10-15% inflation rates we will face in the next few years – real funding per student equates to around £6,500 per year because of inflation since the new cap was introduced in 2016 (Research Professional, 2022).

In this scenario, the market effect of inflation would dictate that to survive universities will have to look at other more lucrative sources of income that do not depend on the public purse such as fees from international students, postgraduate and professional qualifications, increasing research income e.g., from applied research and knowledge exchange activities including commercial spin-offs. These activities and income streams could either subsidise the current level of undergraduate provision or become substitutes for them. This would imply a fairly drastic programmatic review, including as options the reduction of student numbers accepted across some programme areas, or even the closure of provision in some disciplines.

Scenario 3 pivoting towards the skills agenda

Given the current government’s focus on skills provision at levels below undergraduate (levels 3 and 4) universities like Sheffield Hallam, which are less selective and less research oriented than Russell Group and other research institutions, could revert to offering provision at sub-degree level, through Higher National Certificates and Diplomas (HNCs/Ds), Foundation degrees (Fds) and degree apprenticeships in partnership with further education, training providers and employers. Such collaborative provision – with some level 4 teaching ‘franchised’ to further education partners as part of university validated courses leading to university awards – was common before 2012, from which time further education colleges were encouraged to compete against higher education for these numbers as the demand-led market was ratcheted up (HEA 2014).

Any of these scenarios will probably lead to a narrowing of access to and participation in undergraduate programmes after decades of relative widening. Even if the rhetoric of levelling up doesn’t appeal to the current government, the underlying problem of how to fund the higher education and skills sectors – during a period when demand from a demographic bulge in the number of 18-year-olds is high – will have to be addressed at some stage.


Department for Education (2022) Higher Education policy statement and reform, Published 24 February 2022. HM government https://www.gov.uk/government/consultations/higher-education-policy-statement-and-reform

Department for Education (2022b) Higher Education policy statement and reform consultation: equality analysis, Published 24 February 2022. HM government https://www.gov.uk/government/publications/higher-education-reform-equality-impact-assessment

Department for Levelling Up, Housing and Communities (2022) Levelling Up the United Kingdom White Paper, Published 2 February 2022. HM Government https://www.gov.uk/government/publications/levelling-up-the-united-kingdom

Donelan, M. (2022) ‘Higher and Further Education Minister Michelle Donelan speech on the Augar Review’, available at:  https://www.gov.uk/government/speeches/higher-and-further-education-minister-michelle-donelan-speech-on-the-augar-review (Accessed 22 February 2022)

Higher Education Academy (HEA) (2014) Evaluating the impact of number controls, choice and competition: an analysis of the student profile and the student learning environment in the new higher education landscape, Higher Education Academy, York, August 2014. https://www.heacademy.ac.uk/sites/default/files/resources/impact_of_number_controls_choice_and_competition.pdf

Colin McCaig is Professor of Higher Education Policy, based in the Sheffield Institute of Education Research and Knowledge Exchange Centre (SIRKE). His most recent book comes out in October: McCaig, C, Rainford, J and Squire, R (Eds) (2022) The Business of Widening Participation: policy, practice and culture, Emerald Publishing ISBN 9781800430501

 The Business of Widening Participation by Colin McCaig (emeraldinsight.com)








One response to “Who gets to access undergraduate study in the context of Levelling Up? The political economy of higher education”

  1. colinmccaig Avatar

    Yes, I do realise that we no longer have a ‘Truss government’… one of the perils of writing about policy in these strange times.

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