The Queen (on the application of Bloomsbury Institute Ltd) v The Office for Students
| Jurisdiction | England & Wales |
| Judge | Mr Justice Cavanagh |
| Judgment Date | 12 March 2020 |
| Neutral Citation | [2020] EWHC 580 (Admin) |
| Date | 12 March 2020 |
| Docket Number | Case No: CO/3231/2019 |
| Court | Queen's Bench Division (Administrative Court) |
[2020] EWHC 580 (Admin)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Cavanagh
Case No: CO/3231/2019
Jessica Simor QC, Chris Buttler and Eleanor Mitchell (instructed by Ronald Fletcher Baker LLP) for Bloomsbury Institute Limited
Monica Carss-Frisk QC, Tristan Jones and Tom Coates (instructed by Paul Huffer, Head of Legal Services, Office for Students) for the Office for Students
Hearing dates: 11–13 February 2020
Approved Judgment
Introduction
The Claimant (“Bloomsbury”) was founded in 2002. It is a college which provides higher education to its students. It has approximately 2,000 students. It was known, until 2019, as the London School of Business and Management. The College specialises in Business, Law and Accountancy. The college is a private, rather than a public, college, but it has never declared any dividends to its shareholders. Any profits have been reinvested in the college.
Bloomsbury's mission is to serve disadvantaged students. A very high proportion of Bloomsbury's students, approximately 85%, are mature students, averaging in their mid-thirties (a student qualifies as a mature student from the age of 21 onwards). 66% of Bloomsbury's students are BAME. 16% are disabled. 90% of them come from families earning less than £25,000 per annum. Many of them have come to higher education from a non-traditional route. Indeed, in 2018–2019, 88% of Bloomsbury's students were enrolled on 4-year degree courses which included a first year, a Foundation year, during which students were trained in study techniques etc so as to provide them with the skills necessary to embark upon degree-level study. It was only in the second through to the fourth year of these courses that the studies were at degree-level. These Foundation courses were designed for students who do not have A Levels. 80% of the students on these courses at Bloomsbury do not have A Levels.
As well as its four-year courses, Bloomsbury has offered two-year accelerated learning degree courses and traditional three-year undergraduate degree courses.
The college is based in Bloomsbury, London, and, through a partnership arrangement, makes use of facilities belonging to Birkbeck College, London University, such as Birkbeck's library, though Bloomsbury also has buildings of its own.
When Bloomsbury began, it offered Higher National Diploma courses. In recent years, however, Bloomsbury has exclusively offered degree courses. Since 2008, Bloomsbury has offered degrees validated, in turn, by Cardiff Metropolitan University, the University of Newport and, most recently, the University of Northampton. However, in 2017, Bloomsbury applied for permission to become a degree-awarding body.
As a private college which offers degree-level courses to its students, Bloomsbury comes within a category of higher education institutions which are known as “Alternative Providers” or “APs”. APs are providers which do not receive recurrent direct grant funding from funding councils (as more traditional public universities do). They may be operated on a charitable, not-for-profit, or on a for-profit basis.
In order for a higher education provider such as Bloomsbury to survive, it must be able to be designated for the purpose of enabling its students to access student loans from the Student Loans Company (“SLC”). It is not a requirement for higher education providers that they are so designated, but in practice it is impossible for them to attract sufficient students to be viable unless they are designated, because, if they are not, prospective UK students cannot obtain loans to cover tuition fees and living expenses at the college and will inevitably look elsewhere. In reality, without such designation, a college such as Bloomsbury cannot expect to continue in operation (the University of Northampton has said that it will not validate degrees for new students at Bloomsbury).
Student loans are available for the first Foundation year of a four-year degree course in the same way as they are available for the three years of a traditional undergraduate degree course.
In 2011, Bloomsbury's courses were designated by the Secretary of State for Education, enabling its students to obtain student loans from the SLC. In the last year or so, as I will explain, responsibility for deciding whether a higher education provider should be designated for student loan purposes was transferred from the Secretary of State to the Defendant (“the OfS”). The OfS was created by the Higher Education and Research Act 2017 (“HERA”) to act as a single regulator for higher education providers.
By a decision dated 23 May 2019, the OfS refused Bloomsbury's application for registration. These judicial review proceedings are a challenge to this decision. On 25 June 2019, the OfS agreed that Bloomsbury can continue to teach existing courses for existing students (known as “teach-out”) and thus should have course designation for a further three-year period, but the effect of the registration decision is that Bloomsbury is no longer able to provide higher education courses to new UK students funded by the SLC.
The effect of the registration decision is, therefore, that Bloomsbury cannot take on any new UK students, unless they are wholly self-funded, and so it is likely that its student body will gradually wither away. Staff redundancies will be necessary and, in all probability, Bloomsbury will have to close.
I will deal with the reasons why registration was refused in much greater detail later in this judgment. In essence, however, it was primarily because the OfS decided that Bloomsbury had not satisfied one of the conditions for registration, Condition B3, which was concerned with securing “successful outcomes for all of its students”. The OfS did not consider that Bloomsbury had performed sufficiently well in relation to two criteria or “indicators” relevant to Condition B3, namely student continuation rates from year one to year two (“continuation rates”) and rates of progression to professional employment or post-graduate study (“progression rates”). Bloomsbury was also held to have failed to satisfy one other criterion, E2, which is concerned with the quality of Bloomsbury's “management and quality arrangements”, but this was essentially (though not entirely) attributable to Bloomsbury's failure to satisfy Condition B3. The case was presented before me, on both sides, on the basis that the real reason that Bloomsbury had been refused registration was because it had failed to satisfy Condition B3.
Bloomsbury challenges the OfS's decision on registration on a large number of grounds. Central to them, however, is Bloomsbury's contention that the Defendant had assessed Bloomsbury's compliance with Condition B3 by reference to pre-determined numerical thresholds for continuation rates and progression rates that were applied universally to all providers.
Bloomsbury also submits that the OfS erred in law in relying on confidential Decision-Making Guidance, drawn up by the OfS's Director of Competition and Registration, Ms Susan Lapworth, which contained the pre-determined thresholds. Bloomsbury says that these should have been made public and consulted upon: the OfS erred in law in not publishing the thresholds in advance, in not informing Bloomsbury (or any other higher education providers) that these pre-determined thresholds would be used, and in failing to consult about the thresholds and other matters. Bloomsbury also submits the use of these thresholds was ultra vires, in light of the OfS's scheme of delegation, because Ms Lapworth did not have authority to set them, and that they were implemented in breach of the OfS's Public Sector Equality Duty (“PSED”). Bloomsbury further submits that the use of the thresholds was contrary to the OfS's published Regulatory Framework (on which consultation had taken place), and the guidance provided by the Secretary of State for Education.
In addition, Bloomsbury submits that the decision to refuse registration was irrational and disproportionate. Bloomsbury says that the OfS failed sufficiently or at all to take account of the special nature of Bloomsbury's student body and the inevitable struggle that the student body would have to achieve the continuation rates and progression rates. Moreover, Bloomsbury submits that the OfS acted irrationally in refusing to grant registration when registration had been granted on previous occasions on the basis of essentially the same data, as the regulatory changes introduced by HERA were not supposed to have resulted in significant changes to the tests to be applied for designation. Bloomsbury also relies on the fact that an internal recommendation had been made within the OfS in September 2018 that Bloomsbury should be registered. Still further, Bloomsbury complains that the OfS should not have made use of the thresholds without consulting the Quality Assurance Agency for Higher Education (“QAA”).
The other grounds of challenge relied upon by Bloomsbury are based on the European Convention on Human Rights (“the ECHR”), introduced into UK law, of course, by the Human Rights Act 1998 (“the HRA”). Section 6(1) of the HRA provides that, “It is unlawful for a public authority to act in a way which is incompatible with a Convention Right”. Bloomsbury contends that the refusal to register the college was a breach of Bloomsbury's rights under Article 1, Protocol 1, of the ECHR (“A1/P1”) and/or the refusal of registration breached Article 14 of the ECHR, when read with A1/P1 and/or Article 2 of Protocol 1 (“A2/P1”). Article 14 is the non-discrimination article.
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