The 80% reduction in the teaching grant from central government to universities and the introduction of higher fees are linked with preparations to privatise much more of higher education in Britain.
At the end of October Lord Browne, former boss of BP whose higher education review recommended higher student fees, gave a speech at BPP. He said of fees, ‘if prices rise too high, there is room for new providers to enter the market and deliver higher education more efficiently’. Who these new providers would be is quite transparent: BPP is Britain’s largest private higher education provider. BPP was granted degree awarding powers by the Labour government in September 2007. BPP sells professional legal and financial courses, owns four law schools, business schools and human resource training schools. BPP also owns Mander Portman Woodward (MPW) which runs private fifth and sixth form colleges. BPP was bought by the US higher education company Apollo Global in the summer of 2007 for £368 million. Apollo Global operates in 40 US states, Puerto Rico, Mexico, Chile, Canada and the Netherlands, selling courses from school to graduate to doctoral level. Apollo Global is a joint venture, set up in 2007, between Apollo Group Inc. and The Carlyle Group. This Group personifies the stealth and influence of high finance.
The Carlyle Group is based in Washington DC and is a private equity firm controlling $91 billion with over 1,300 investment partners in 71 countries. In 2007 it was ranked the world’s largest private equity firm, but is currently the second biggest. Carlyle’s main business is speculation in mergers and takeovers, finance, land and property. It invests in defence and aerospace, energy and power, health care, telecommunications, the media and transportation. Among the brands that Carlyle owns are Dunkin’ Donut and Baskin-Robbins. It recently joined a consortium to buy Hertz, the world’s biggest car rental firm. Carlyle owns Small Smiles Dental Centres, the largest chain of dental clinics for children in the US.
When the Labour government privatised British Ministry of Defence research laboratories, Carlyle bought a 34% stake in the newly formed QinetiQ in 2002 for £42 million. Within five years Carlyle’s investment was worth £300 million.
In Fahrenheit 911 Michael Moore alleges that both the Bush and Bin Laden families are connected to Carlyle. The first president Bush and his Secretary of State James Baker served as advisors to Carlyle. Before he became the second President Bush, George W was director for an airline catering company that Carlyle had bought. Current and former employees of Carlyle include: a former director of Lehman Brothers; Karl Otto Pohl, former President of the German Bundesbank; Olivier Sarkozy, half-brother of the current French President; Frank Calucci, former US Secretary of Defence and a former Chair of Carlyle; Arthur Levitt, chair of the US Securities and Exchange Commission under President Clinton; two former Prime Ministers of Thailand; a former President of the Philippines and the former Prime Minister of Britain, John Major, chair of Carlyle Europe from 2002 to 2005.
Carlyle itself has major owners including the California Public Employees’ Retirement System and the governments of Abu Dhabi and the United Arab Emirates. Carlyle operates joint ventures with Goldman Sachs.
This November, Times Higher Education Supplement said that the examination board Edexcel may apply for degree-awarding powers. Edexcel is owned by Pearson, which also owns the Financial Times, The Economist and Penguin books. Pearson describes itself as ‘the world’s leading education company’, publishing under names such as Prentice Hall and Longman.
Another US company, based in New York, Kaplan, says it reaches over one million students worldwide – it also sells degree programmes in Britain. It provides university level education through online distance learning. Kaplan Open Learning is an affiliate of the University of Essex and this university validates its degrees. Kaplan Business School teaches University of London degrees and Foundation Degrees. Kaplan owns the Dublin Business School. It is a wholly owned subsidiary of the Washington Post Company.
With the new proposed fees regime, some universities will fail, meaning that they do not get sufficient income from fees and research funding to cover their costs. On 4 November the right wing think tank Policy Exchange (‘the think tank for the new politics’) published a report, Higher Education in the Age of Austerity, wherein it complains that there are currently only five private providers holding degree awarding powers. It concludes that failing universities will ‘probably’ be taken over by major players such as BPP and Kaplan. There will now be a scramble by companies to position themselves for this market and the opportunity for profits it affords. We are witnessing the creation of educational multinationals.
Trevor Rayne
