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How Could GATS Affect Public Funding of UKHE

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How Could GATS Affect Public Funding of UKHE Trading it away: how GATS threatens UK Higher Education Steven Kelk & Jess Worth 1 1 Introduction..........................................................................................................................2 2 What is GATS? Key elements and controversies.................................................................6 2.1 Summary.............................................................................................................................................6 2.2 Introduction to GATS ........................................................................................................................8 2.3 The GATS2000 timeline.....................................................................................................................9 2.4 Key controversies ............................................................................................................................12 3 Is UKHE covered by GATS?.............................................................................................20 3.1 Summary...........................................................................................................................................20 3.2 The ‘public services’ exemption.......................................................................................................21 3.3 Higher Education and Article I.3......................................................................................................22 3.4 UK Higher Education and private institutions.................................................................................30 4 How GATS could affect UKHE funding.............................................................................33 4.1 Summary...........................................................................................................................................33 4.2 GATS and ‘subsidies’.......................................................................................................................36 4.3 GATS and cross-subsidisation..........................................................................................................45 4.4 GATS and future domestic policy changes......................................................................................49 4.5 Who wants access to the UK market? .............................................................................................51 4.6 Conclusion........................................................................................................................................52 5 How GATS could affect UKHE institutions and regulation ............................................54 5.1 Summary...........................................................................................................................................54 5.2 Quality..............................................................................................................................................57 5.3 Regulation ........................................................................................................................................65 5.4 But what about the benefits?.............................................................................................................72 5.5 Conclusion to sections 4 and 5.........................................................................................................76 6 How GATS could affect academics.....................................................................................78 6.1 Conditions and Quality.....................................................................................................................79 6.2 Academic freedom............................................................................................................................80 6.3 Range of subjects..............................................................................................................................81 6.4 Consolidation and Homogenisation .................................................................................................81 7 How GATS could affect students......................................................................................83 7.1 Impact on funding: the student perspective......................................................................................83 7.2 Character of HE................................................................................................................................87 7.3 Conclusion........................................................................................................................................88 8 Recommendations...............................................................................................................89 1 Introduction 2 Political shifts and technological advances have contributed to a situation where Higher Education (HE) is no longer exclusively the preserve of the nation state, and traditional assumptions about the form, delivery, content and purpose of HE are being challenged. The term ‘borderless education’ has been coined to encompass a broad range of activities and developments, which cross (or have the potential to cross) the traditional borders of higher education, be they geographical, sectoral or conceptual.1 One of the issues at the very heart of this debate is the desirability (or otherwise) of subjecting HE to the strictures of international ‘free trade’ agreements. Supporters of such a proposition argue that the development of a lightly-regulated, competitive global market in HE is a benign inevitability, and as a consequence should be positioned within a global trading framework, where the market can be both fostered and kept free of trade-distorting government intervention. Opponents of the idea maintain that the role of education as a public good is threatened by its transformation into a commodity to be bought and sold on the free market. They argue that many contemporary free trade agreements (FTAs) exacerbate social and economic inequalities and promote the primacy of the market over and above the right of governments to regulate in the public interest. Recently the debate has intensified because of attempts to expand the World Trade Organisation’s General Agreement on Trade in Services (GATS). This treaty, which promotes free trade in services, has an extremely wide coverage and there is a distinct possibility that as a result of current negotiations UK Higher Education (UKHE) will become bound by its rules. (Throughout this paper, we use UKHE to refer to degree-awarding institutions in the UK that are publicly funded through the relevant national funding council.2) Our analysis suggests that university administrations, academics and students should all be concerned. We come to the overall conclusion that GATS is a highly inappropriate framework within which to seek the internationalisation of HE. We use the word internationalisation, rather than globalisation, because it ‘reflects the historic tradition of engagement across national borders which has been one of the defining characteristics of the academic profession.’3 Throughout this paper, therefore, we use the word internationalisation to refer to a desirable process within which relationships between national HE sectors are advanced in a co-operative, ‘not-for-profit’ manner, with educational priorities acting as the primary driving force. We contrast this with the competitive, commercial and profit-driven processes often associated with economic globalisation, and argue that, in a world where HE is already undergoing rapid restructuring, GATS is likely to steer the sector (both domestically and internationally) down an effectively irreversible, inflexible and excessively market-oriented road, thus severely compromising the viability, ideals and character of UKHE. Perhaps the most fundamental observation we make is that, while most of the advantages associated with the internationalisation of HE already lie outside the GATS framework, a significant number of dangers specific to the GATS trade regime lie within it. As a consequence, endorsing GATS as a framework in which to pursue the internationalisation of HE is taking a largely unnecessary risk. We divide our analysis into several sections. In Section 2, we provide a brief introduction to GATS, looking at its structure, the motivation behind its existence and some of the key controversies that are dogging the agreement. We outline 11 general concerns about GATS, and show how each could impact on UKHE. We then address the central question of the extent to which UKHE is currently protected by the so-called ‘public services’ exemption in GATS, and find that the exemption is of highly limited relevance to UKHE. This is likely to be of particular significance given that UKHE stands on the very cusp of liberalisation under GATS. 3 Next, we look at the implications of subjecting HE to GATS rules. Given the pivotal nature of this issue for all UKHE stakeholders, we devote Section 4 to the potential for GATS to have a profound negative impact on the financial viability of UKHE. Following on from this, Sections 5-7 consider GATS from the perspective of university administrations, academics and students respectively; many (but not all) of these concerns are emergent from the funding-related issues described in Section 4. The distribution of stakeholder concerns across three separate chapters should not obscure the significant areas of common concern between
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