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Executive summary

Rationale and purpose

1. This document sets out HEFCE’s policy for addressing unsatisfactory quality in higher education institutions and further education colleges that are eligible for HEFCE funding from academic year 2013-14. The policy comes into play when institutions:

  • receive a judgement of ‘does not meet UK expectations’ in the Quality Assurance Agency for Higher Education’s (QAA’s) Higher Education Review process, or
  • fail to make the necessary improvements through the QAA follow-up process following a judgement of ‘requires improvement to meet UK expectations’.

Both scenarios demonstrate that the quality of an institution’s learning opportunities, information, enhancement, or academic standards is considered unsatisfactory. The policy comes into effect following the introduction of the new QAA Higher Education Review in 2013-14.

2. HEFCE has a statutory duty to ‘secure that provision is made for assessing the quality of education provided in institutions for whose activities they provide, or are considering providing, financial support’. In exercising this duty and in considering quality assurance outcomes in the exercise of our other functions, we aim to ensure that students receive higher education provision of sufficient quality and that England’s reputation for high-quality higher education is maintained.

3. HEFCE’s initial ‘Policy for addressing unsatisfactory quality in institutions’ (HEFCE 2009/31) commenced in 2009. Through consultation on this policy HEFCE gained agreement from the higher education sector that we should become directly involved in quality assessment (rather than operating our statutory duty through the QAA) when an institution fails to progress in response to an unsatisfactory judgement.

4. The QAA’s new Higher Education Review was introduced following HEFCE’s ‘A risk-based approach to quality assurance: Consultation’ (HEFCE 2012/11), while the need for an update to the unsatisfactory quality policy was signalled in ‘A risk-based approach to quality assurance: Outcomes of consultation and next steps’ (HEFCE 2012/27).

5. This revised policy for addressing unsatisfactory quality maintains a proportionate approach that gives institutions appropriate warning, and time to make adjustments, where the quality of their provision falls short. The time available for such improvement is limited, however, in the interests of students and of the reputation of UK higher education. The interest of current, prospective and past students affected by judgements of unsatisfactory policy will be of primary concern in the operation of the unsatisfactory quality policy.

Key points

6. The policy for addressing unsatisfactory quality in universities and colleges forms part of the regulatory landscape for higher education, as described in ‘Operating Framework for Higher Education in England’, published in July 2013. The operating framework sets out the context within which the unsatisfactory quality policy operates; however it refers to the time frame up to and including academic year 2012-13. The update to the operating framework document will refer to this revised unsatisfactory quality policy.

7. This policy applies to higher education institutions and further education colleges with higher education provision in England. It does not apply to alternative providers of higher education, as the Secretary of State remains responsible for decisions relating to specific course designation.

8. The unsatisfactory quality policy has two stages:

  1. When an institution receives a published QAA review judgement of ‘does not meet UK expectations’ or ‘requires improvement to meet UK expectations’ in one or more areas, the first stage in addressing the identified issues is led by the QAA.
  2. When the issues remain unresolved HEFCE will take the lead in a second stage: improvements will be expected and, in exceptional circumstances, sanctions are applied. 

Flowcharts in Annexes A and B demonstrate the process: Annex A shows the first stage, while Annex B demonstrates the second stage.

9. HEFCE is involved at the second stage because we have a clear regulatory duty to ensure that institutions receiving public funds provide value for money and are responsible in their use of these funds, as described in the terms and conditions for payment of HEFCE grants to higher education institutions: ‘Model Financial Memorandum between HEFCE and institutions’ (HEFCE 2010/19). We also seek to promote the collective student interest. A key element in our judgement of whether an institution achieves value for money is the quality of the provision provided to students. If this is shown to be inadequate, we have an obligation to act. Where HEFCE is responsible for risk assessment, a judgement of ‘does not meet UK expectations’, or failure to make improvements following a ‘requires improvement’ judgement, will also result in HEFCE considering whether this affects the risk status of the institution concerned.

10. When HEFCE takes the lead, an institution will have a second opportunity to resolve the unsatisfactory quality issues raised in the first stage. After the HEFCE involvement the institution will be re-reviewed by the QAA. If it does not obtain judgements of at least meeting UK expectations in the relevant areas at that point, the HEFCE Board will consider further actions and sanctions, paying particular attention to the interests of students and the reputation of English higher education.

11. Although this policy sets out a range of actions that may be taken once HEFCE is involved, these are not exhaustive or definitive: we will consider each case of unsatisfactory quality individually, while applying fairness and consistency in similar cases. Ultimately, HEFCE has the right to withdraw funding from an institution, but we would only take this action in exceptional circumstances. HEFCE and the Charity Commission also have responsibilities to consider whether a regulatory response is needed in terms of an institution’s status as an exempt or registered charity, whose student beneficiaries may be affected by judgments indicating unsatisfactory quality.

12. At all times the needs and interests of students are of great importance. Institutions have a responsibility towards the students learning with them: the needs of students who are likely to be adversely affected, either by the identified problem or by any actions taken under the policy, must be met.

Action required

14. No action is required in response to this document.

Date: 30 October 2013

Ref: HEFCE 2013/30

To: Heads of HEFCE-funded further education colleges, Heads of HEFCE-funded higher education institutions
Heads of HEFCE-funded sixth-form colleges, National Union of Students

Of interest to those
responsible for:

Quality assurance

Enquiries should be directed to:

Zoe Mackey, tel 0117 931 7078, e-mail