Following the publication recently of the Innovation, Universities, Science and Skills Committee Report on the withdrawal of funding for the majority of students in England studying for a qualification that was equivalent to, or lower than, a qualification that they had already achieved (available at
http://www.publications.parliament.u.../cmdius/187/18
702.htm) I am writing to you with an updated briefing which describes in detail the background, progress and outcome of the debate, the latest position on the financial impact this policy will have on the OU, and the next steps we are taking to replace the lost funding for teaching.
The briefing can be viewed at
ELQ update - Alumni - The Open University.

In brief, the Committee report has concluded that the Government's decision to cut ELQ funding is "premature and not based on hard evidence of its likely effectiveness" and that the policy change will remove the flexibility in the system that allows employees to acquire new skills.
As you know, the University has consistently raised concerns about the discouragement of students from upskilling or reskilling - and the subsequent impact on individuals' career development, on higher education institutions and on the wider economy. The recently announced Review of Higher Education will give us another opportunity to raise those concerns.

While it is pleasing to see the Committee agree with many of the concerns that we and others raised after the funding change was announced, and we should all do we can to ensure that the Committee's recommendations for the implementation of the policy are adopted, we must also understand that a wholesale retreat from the policy is unlikely. The Secretary of State for Innovation, Universities and Skills, John Denham, has already indicated that he does not accept the judgment of the Committee on priorities. It was apparent to him early this year how unpopular the decision would be and implementation has nevertheless gone ahead.

This means that we have to plan for what we know for certain. What is certain is that we are committed to holding all course fees in 2008/09.
However, our budgets will be adversely affected in the years to come and we must do all we can to replace the lost funding for teaching. We are, therefore, looking at the viability of all courses, and it is likely that some will be affected. However, The Open University offers an enormous range of courses and we remain confident that we will maintain a very large and comprehensive range of high-quality courses in the future.

Professor B. M. Gourley
Vice-Chancellor

The Open University is incorporated by Royal Charter (number RC 000391), an exempt charity in England & Wales and a charity registered in Scotland (number SC 038302)

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Royston Morgan