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July 04, 2011

Oxford 2, Cambridge 2 - One way England's universities might use their AAB options

Oxford sitesHow might England's universities use the government's offer of unlimited student loans to finance students with AAB grades at A-level to best effect? Here is one of what ministers must hope will be many ideas for expansion by leading universities.

Despite some defects, Oxford and Cambridge remain national treasures. The intellectual intensity, the research prowess, the prestige, the brands, the alumnae, the penumbra of hi-tech firms and capital, the high quality teaching. Quite apart from all the other stuff, their economic value to the country is immense.

But it has to be said, their success is built in large part on public money. The huge sums of research funding, in particular, flowing into the universities from taxpayers are essential in allowing them to continue to recruit the brightest and produce the best work. So it is reasonable to ask, is the taxpayer getting the best bang for its buck?

The answer is no. It's not that Oxford and Cambridge don't do their current job well. It's just that they - we - are not exploiting the huge opportunity that their strengths offer.

There is a global contest for intellectual talent, invention, expertise, capital and the kind of hi-tech, hi-knowledge intensity business that emerges from that heady mix. Oxford and Cambridge are our two biggest cards in that game, and we are not making the most of them. We can't afford to keep on neglecting two of our most valuable assets.

So I make the following modest suggestion.

Look forward a decade. Why not have universities of Oxford and Cambridge that are both twice the size they are today?

Oxford and Cambridge already cover most disciplines. So what I am suggesting is new campuses that largely covered the same range of disciplines as they already have. But they would allow the universities to develop additional sub-disciplines that they don't currently have much expertise in.

Here's a map of Oxford. The red rings show a handful of locations around the city where a new campus, additional to the existing facilities, could be built on largely greenfield sites.

Oxford sites

It is striking how close much of this space is to the city centre.

In Cambridge, which is smaller, the nearest opportunities seem in fact to be slightly further out.

Cambridge sites

Clearly, it is possible to build a new campus in an attractive location in both cases. In addition, there is surely enough wealth in the colleges that - combined with cheap private investment in what must be one of the surest bets in history - the new campuses could be built without any public money. Once built, both campuses could be confident of a large stream of income from tuition fees under the AAB regime now introduced by the higher education white paper. So long as they could also keep up the quality of staff and postdocs, they could also expect substantial research income. Overseas students would provide a helpful safety net for the new investment.

And of course, it's been done before. From a historical perspective, these campuses would be not such much Oxford and Cambridge 2 but Oxford 3 and 4.

Now there is no doubt that a new campus would - to some extent - alter the ambience of the universities. There is an idea in Oxford and Cambridge that everything has to be compact, that students and academics should always be able to shuffle around between classes in a few minutes. That is certainly an attractive feature for a university. But is it really essential? On the Shanghai Jiao Tong campus, I am told students use bikes simply to get from one end of the engineering faculty to the other.

And as regards facilities, consider the library. A new campus would not mean a lengthy trip for half the students and faculty to reach the library. It would mean a second, large library, with some overlap, but also with an extended range of material reflecting the interests of the sub-disciplines established on the new campus. Yes, sometimes you would have to go further. But other times, you would be able to get what you needed in 30 minutes instead of 30 days.

A new campus would not be like tacking on a large new facility at the edge of town - always a disappointing prospect. It would create a new destination, with its own attractions and, perhaps, new colleges seeded from the existing ones.

Consider the huge benefits that would flow to England if these expansions were done right.

First, the universities themselves would be strengthened. It hardly needs saying that having twice as many fellows, professors, postdocs and students would increase the intellectual firepower of the universities and create new opportunities for cross-fertilisation within and between disciplines. They would also leap unambiguously to the top of the various world league tables, burnishing their brands.

Second, the economic pull of the universities would be strengthened. The surrounding areas would attract more hi-tech investment, more venture capital interest.

Third, there would be increased cluster effects, speeding the extraction of economic value from the public investment flowing into the universities. The network effects mean that if we ended up spending twice as much public money on them, we should expect to get back substantially more than twice the economic impact.

Fourth, there would be increased income from overseas students.

And fifth, there would be twice as many places available at Oxford and Cambridge for AAB students from within the UK. The social elite would suddenly be a lot bigger, with increased scope for social mobility. Put the right policies in place and we can ensure that all these new places are not swallowed up by the wealthy and privately-educated.

Of course, this idea raises issues from a planning point of view. It is not just new campuses that would be required but additional housing and suppoort services, and expanded commercial and industrial space in nearby areas. Indeed, if planning restrictions were lifted now, these cities could already exploit the economic potential of the universities much better. If the universities and the government want a new campus, the city councils are going to have to explain why their city should continue to receive so much public money if they are determined to stand in the way of economic develoopment.

To those who would champion the retention of the (nice, valuable) green fields in these areas, I point to the rise in tuition fees and the strikes over public sector pensions yesterday. We are in an age of austerity. How much longer can we afford to go on squandering our best opportunities? Why is your field more valuable than my pension/education/job/healthcare?

A second objection comes from a regional point of view. The ongoing investment of research and teaching finance in Oxford and Cambridge would inevitably come at the cost of other regions. Why continue to pour money into the South East with its overheating property market and crowded land when it should instead be going North or West?

To me, this is a serious problem. (Though of course this government does not have a regional policy; to the current crop of ministers, this is presumably a non-issue). Again, one answer is because we can get a bigger economic bang for our buck in the Golden Triangle. A second answer is that we should use other mechanisms to support the rest of the country, for example by moving the seat of government to the North.

A third answer is to consider an even more radical proposal, that the new campuses should be located far from home. Why shouldn't Cambridge or Oxford expand to somewhere near Birmingham, for example? This would lose some of the network benefits but leave intact many of the others listed above. It would also of course be harder to pull off. But, hey, these are the smartest people in the country. They can do it.

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Comments

Good idea in principle, and certainly worth some thought. Of course, none of the 'spaces' shown here around Oxford would work - it's all flood plain (and most flood every year!)..

In terms of space for new campus universities there will, of course, soon be several more vacant sites formerly used as military bases.

Thanks David. I don't know much about the local geography (or foundations), but if compactness is really critical, maybe stilts would be worth it? And the airbase idea is very interesting.

Interesting idea.

I think risk of damaging brand Oxbridge too high. Running an institution of that sort of scope and remaining at the very top would be tremendously difficult. They have all the AAB students they want/need for now, give or take a small margin to play with.

And its not Oxford and Cambridge that are looking seriously at Shanghai Jiao Tong. I think it will be HEIs of a distinctly different character that might attempt something like that.

And apart from flood plains and military bases, there are ready-to-go university campus' owned by institutions already 'at risk'. Although they'd probably feel a bit tacky for Oxbridge? Also as you say in the third point - Oxford is never going to seriously expand outside of Oxford. Much of the brand premium comes from their setup there - the College system and the idea that you absolutely never will need to take a non elitist mass-transit monorail from a seminar to a lecture.

I can't see any of the top dozen of the Russell Group 'going for growth', William. The trend is the other way, if anything. We all know that in business, faced with financial uncertainty, cutting payroll is the surest way to re-trench and re-balance the budget. For instance, Imperial has recently been re-structuring in the biosciences, presumably to get out of research areas where they don't think they are 'world-leading', and you would have to think that means cutting the undergrad programmes in those areas too.

http://draust.wordpress.com/2010/12/09/concentration-its-not-what-you-think/

So... the inclination at the main UK research Univs, I predict, will be 'sit tight, refine, power down the weaker bits and hence evolve upwards'. As Mark Leach suggests, I think it will be elsewhere in the sector that people will try to gamble on new ventures.

@Mark, @Dr Aust Very interesting to hear your thoughts. I accept your assessment of the way the wind is blowing at the moment. Two points:

1. It is very early days. The market will develop in unexpected ways and I think we can't be confident of anything right now. As the picture of policy and markets clarifies, so institutions can get more confident and less defensive.

2. I'm not trying here to say what will happen. Instead, I'm concerned with what should happen.

Oxford's V-C says that, at the moment, they spend £16,500 per year tutoring each undergraduate. Therefore, even when fees go up to £9,000, they will need to continue to draw on endowment income to a great extent in order to fund undergraduate teaching. Each extra student they take on would be at a loss, unless these new students are taught more cheaply (in the manner of students at non-Oxbridge universities), or all Oxford students are taught more cheaply (by getting rid of the labour-intensive tutorial system).

For non-Oxbridge Russell Group universities that can afford to expand nearby (not those in central London, but Warwick, maybe?), this proposal might make more sense.

But would it really make sense for any university to invest in new land, buildings, faculty, etc., on the basis of a government policy that is so easily reversed or altered?

Hi Michael. Powerful points but perhaps less than conclusive?

1. Campus teaching *should* be cheaper than the existing arrangements. How much of that £16,500 is maintaining historic buildings, for example?

2. Say Oxford starts charging overseas undergraduates a market rate of maybe £30,000 a year. Each produces a margin of £13,500, which is roughly enough to subsidise two domestic students on £9k.

3. Oxford *can* go out and get additional endowments, indeed it is very good at it by British standards already. Oxford 2 could provide a concrete focus for improved fundraising.

4. Political risk is real. I agree the politicians would have to explicitly back the expansion and possibly provide some legislative comfort.

I take your point about Warwick. I went there and, unless the recent expansions have used it all up, it has a huge swathe of land adjacent to the existing campus that was given to it by Coventry City long ago. So yes, Warwick 2 seems a much more likely proposition, though as this doesnt have the economic spin offs Im looking for, its much less interesting.

Is the idea that this new university would use the Oxbridge name to ensure a stamp of quality? I'm not sure why the institutions themselves would take this expansion on, given that it would risk both their name and financial security. This new university would also strain the research council budgets even further (Oxbridge seem to each take over 10% of the HEFCE money, so another institution of similar size would be a serious squeeze).

In my view, a better way to make sure that we get more exciting research might be to pay for more, rather than less.

Also, a question: how much do you think it would cost to build and staff this new campus?

And in direct response
1. Apparently, capital costs are about £750 per student (and the Cambridge number is 17.1k) http://www.cam.ac.uk/univ/notices/educationcost.pdf. Most of the historic buildings are accommodation blocks or churches rather than buildings used for teaching or research, so that seems reasonable, but I don't know whether I've read that report correctly.


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