Minister accused of offering false funding hope to universities after withdrawing ‘bailout’ promise

Martin Shipton

A new Welsh Government minister has been accused of offering false hope to the post-school education sector in Wales after withdrawing comments that suggested an emergency fund was going to be available to bail out universities facing a shortfall estimated at £100m.

Vikki Howells, who was appointed Minister for Further and Higher Education last month, was challenged over the funding crisis by Plaid Cymru’s education spokesperson Cefin Campbell. He told MSs on Tuesday October 15: “We know from reports that the UK Government is already developing a rescue plan for English universities who are facing—many of them—financial uncertainty. This plan includes £1bn bail-outs, fee rises, as well as further cuts to courses and staff.

“Considering the financial hole that faces many of our Welsh universities, thought to be £100m, the pressure is growing on you as a government to work with our universities to find solutions that will protect jobs, students and our wider economy.

“So, I’m just wondering—I’m trying to tease this out of you, in regard to a number of options that you would want to consider, perhaps—if you can give us a steer of your way of thinking. You could well consider as a government that you’d want Welsh universities to be eligible for the same UK scheme. Maybe it would prefer to develop its own rescue package; it might be happy for some Welsh unis to go bust or to force mergers upon them.

“Or it may match any potential fee rise brought forward in England. So, it would be interesting to understand how your thinking is at the moment, because, let’s not beat around the bush, Welsh universities face serious challenges, and the clock is ticking.”

Transformation fund

Ms Howells responded: “I’m aware that the UK Government has this emergency fund that they’re bringing into play. Medr [a new body which oversees all post-16 education and research in Wales] is going to have its own funds to support our institutions here in Wales, and I’m pleased to say it’s going to be a more positive kind of fund.

“It will be called a transformation fund, so it has a positive title and a positive ethos in terms of not just bailing out universities that may be in financial trouble, but working with them to see how they can transform the work that they do, to encourage them to be more financially self-sufficient in these difficult times moving forward.”

‘Amendments’

On Wednesday October 16, however, Ms Howells modified her position, stating in a letter to Llywydd [Presiding Officer] Elin Jones: “Having reviewed my comments in plenary last night in response to the question from Cefin Campbell, I would like to put on record some amendments to what I said about potential support for the higher education sector in Wales.

“I would like to reiterate my absolute commitment supporting a sustainable higher education sector, with strong institutions able to deliver on our ambitions for students and research, and driving economic growth in Wales.

“During my response to the question, I made reference to a specific ‘transformation fund’. I would like to clarify that the policy in this area remains at a very exploratory stage, and we are still working through what, if any, potential support mechanism may look like, in partnership with Medr and institutions.

“Although I’m aware of wider calls for an Emergency Fund, support for the higher education sector in England is solely a matter for the UK Government.

“I would also like to reiterate my statement in the chamber that we do not believe there is any Welsh institution that is at risk of failure.

“I wanted to write to you as Llywydd at the earliest opportunity so that there is complete clarity on this important issue for Members and the wider sector, and I will return to update the Senedd on this once the further development work is complete.”

‘False hope’

Responding to Ms Howells’ letter to the Llywydd, Mr Campbell said: “Just as they’ve given false hope to patients with their non-existent cross border health plans, they’ve also misled the higher education sector by spuriously raising expectations.

“Welsh universities need a cast iron guarantee from the Labour Welsh Government that they will be given the support they need, not just to survive but to prosper. Giving the false impression that support is imminent will erode the confidence of the sector in Labour’s seriousness about getting to grips with the perilous state of Welsh universities’ finances.”