Welcome to the March 2022 edition of Higher Education Today, looking at current topics and questions facing higher education.
This is the first edition of our re-launched newsletter which is shorter and focuses on quick read articles. We hope you like the new format. If you have any suggestions for topics to be covered in future editions please do get in touch.
We hope you find the newsletter interesting and helpful.
M&A activity in the UK education sector over the last 24 months has remained robust despite the obvious global challenges. Buy-side interest continues to be strong from private equity investors keen to invest in a relatively stable sector, as illustrated by TDR Capital’s investment in BPP University, and from trade buyers eager to expand their operations and consolidate market share. Against a backdrop of increasing M&A activity in 2022, we have highlighted some of the more pertinent aspects of education M&A processes.
The regulatory environment
The vast majority of education M&A will involve some level of engagement with the education sector regulators, whether this be the Office for Students, the Department for Education or the Education & Skills Funding Agency. The depth of this engagement will largely depend on the nature of the target (for profit or not for profit), the identity of the buyer and the transaction structure. M&A processes that involve transferring assets from education providers that are registered charities will also require early engagement with the Charity Commission, alongside the education regulators.
Transaction structuring and planning
Education M&A processes are often multifaceted and involve a variety of stakeholders, from pupils and their families/students to unions and local community groups so time spent planning and structuring a transaction is essential. Timeframes may need to be built into the transaction structuring for a split exchange and completion where change of control approvals are required from the relevant education regulators.
Operating in the education sector, especially as an education institution (as opposed to an education services provider) inevitably brings with it ongoing compliance requirements. New ownership structures and changes to the legal form of education institutions, especially in higher education, are of particular interest to the education regulators and new market entrants should be aware that post-completion they may be subject to a higher level of regulatory scrutiny.
If you would like more information about this topic or to discuss corporate education matters more generally, please contact Rachel Soundy.
There are significant numbers of children in the UK who for legitimate protection reasons enter the care system and become looked after children. Statistics from the Department for Education illustrate that the ability of looked after children to access higher education is extremely limited. Only 13% of young people with at least one year’s care experience progressed to higher education by the age of 19 in 2018/19 compared with 43% of all other young people. Just 1% of young people who have experienced care attended top-ranked universities and higher education institutions in 2018/19 compared with 11% of their peers. What can higher education institutions do to support the access and inclusion of looked after children and care leavers?
Tailored and flexible support
A report for the Centre for Transforming Access and Student Outcomes by King’s College London found that the paths to higher education amongst people with care experiences are likely to be very different to the route taken by other students. The report proposes that universities need to be more flexible in their admission process and application criteria, including outreach initiatives, and offer more tailored support for care experienced students. As the transition from care into independent life can be extremely challenging universities could offer enhanced support networks for student, including particular help around finances, pastoral care and safeguarding.
Addressing the stigma
The existence and impact of stigma that young people experience as being in care or as care leavers prevails. This was very much echoed in the recent All-Party Parliamentary Group For Looked After Children and Care Leavers report. Those in care and care leavers participating in that inquiry convey the judgements they experience and the tangible disadvantage they encounter when simply seeking to progress through life including through education.
Universities looking to support the access and the progression of care leavers through higher education are increasingly looking to address this stigma via staff training to enhance the understanding of what being in care means, the legalities of state parenting and how this relates to the student and their support needs. Higher education institutions are also developing specific policies and strategies to attract, support and maintain the progression of students with care experience. Outreach and in-reach pastoral programmes are being enhanced by offering staff specific safeguarding and trauma informed training.
Care Leaver Covenant
The Care Leaver Covenant, which is a national inclusion programme to support care leavers to live independently that, to date, 70 universities have signed up to, contains further practical advice for higher education institutions looking to support care leavers. Suggestions include promoting scholarships and financial help on offer but avoiding using terms like "hardship", encouraging young people to tick the box on their UCAS application form that they are in care so that their additional needs may be identified at the outset and providing free accommodation for the duration of a student's study. While the latter is a significant financial investment, the Unite Foundation (set up by Unite Students) is working with universities across the country to provide free student bedrooms for care experienced students.
If you would like more information about this topic or to discuss access and inclusion in education matters more generally, please contact Deborah Jeremiah.
Are you attending The PIE Live at The Brewery in London on 22-23 March 2022? Rachel Soundy will be presenting on Wednesday 23 March at 12.15pm in the Great Hall on TNE Partnerships: navigating towards successful outcomes, alongside speakers from London Bank University, Swansea University and COBIS.
If you would like to discuss any of these topics in more detail, or to find out how we can help your organisation, please contact our Higher Education team.