Profit-making university is just the start, minister says

Lecturers' leaders claim the record of profit making institutions in the United States show they cost students and taxpayers dearly

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The Independent Online

The Government is today signalling a growth in the number of UK universities operating on a profit making basis.

It follows BPP University College of Professional Studies becoming the first university in the UK to offer a wide range of university courses on a profit making basis.

BPP offers courses in law, accountancy, business and health course and has more than 36,000 students on it books.

It officially became a profit making university when it registered with Companies House on Tuesday. Up until then, the only profit making university in the UK was the University of Law - which has an international reputation for providing top class law degrees - but was granted university status when it operated as a charity before being taken over by a commercial concern.

The move towards “for profit” universities came in for criticism last night from lecturers' leaders who claimed the record of profit making universities in the United States showed they had cost students and taxpayers dearly.

A report by the US senate education committee found that for profit companies had spent significantly more on marketing and recruitment than they did on teaching students and that billions of dollars of taxpayers' money was “squandered” and companies prioritised shareholders' profits over facilities for students.

“We have serious concerns that this move could open the floodgates for more for-profit companies to become universities,” said Simon Renton, president of the University and College Union.  “A quick glance across the pond warns us of the risks associated with that sort of move.

”In the States for profit companies have swallowed billions of dollars in return for derisory graduation rates, crushing levels of debts and degrees of dubious value.  We would ask the Government to think hard about awarding for-profit companies university titles and consider the UK's proud reputation for university excellence.“

However, Universities Minister David Willetts said: ”We welcome BPP's announcement.  This is an important step towards increasing the diversity of the higher education sector. A wider range of higher education providers helps broaden access, focuses attention on teaching quality and promotes innovative learning methods.“

Professor Carl Lygo, chief executive of BPP University College of Professional Studies, added: ”I am delighted that BPP university becomes the UK's first independent private university dedicated to business and the professions.

“We give students what they want and need: practice-facing programmes which will equip them for the world of work.  It's a culture of professionals teaching professionals - all our staff have practical professional real-world experience which hugely enriches classroom experience.”

Up until last year, the University of Buckingham was the only private university operating in the UK - but it was run as as a charitable concern.

BPP runs postgraduate degree courses, MBAs, summer schools and training courses in addition to its undergraduate degree courses.  It has schools in London, Bristol, Birmingham, Cambridge, Leeds, Liverpool and Manchester plus other regional centres across the UK and also offers a range of flexible study options - including part-time programmes, accelerated course and online distance learning courses.

The decision to award BPP for profit status as a university chimes with developments elsewhere in the world as globally private institutions outnumber public ones - with 30,555 private higher education institutions representing a 55.7 per cent share of the total private higher education institute provision.