Posted by: Kash Farooq | August 3, 2011

The End of the Open University As We Know It – Clearing up a few points

There a few things I’d like to clarify regarding my previous post about the massive 250% Open University fee increase planned for September 2012The Open University

Firstly, there was a suggestion that even if you are studying for fun (rather than for a career change, or for your first degree), you could always apply for the government backed loan and pay it back gradually. As the OU website states:

You’ll only begin to repay the loan after three years, and only if you are earning more than £21,000.

And there is more detail on the website:

Once you earn over £21,000, you pay nine per cent of your income above £21,000. So if your salary is £25,000, you pay nine per cent of £4,000 which is £30 a month.

So, the repayments do look manageable.

However, there is a catch. To qualify:

You’ll need to be studying for a qualification that’s higher than any you already have.

Source: OU PDF. There is also more information in a PDF available from the Department for Business Innovation and Skills website

Example: You did your first degree 20-30 years ago. Now you want to try something completely different. You cannot you afford £2500 per year for 60 points. And unfortunately you don’t qualify for a loan either.

Example: You did your first degree 3 years ago and are struggling to get a decent job. You have realised that the degree choice decision you made at 18 was the wrong one. Now you want to to study for a degree that has better job prospects. You cannot afford £2500 per year for 60 points. And you don’t qualify for a loan either.

Secondly, I want to address some points from this comment:

If you already earn a decent salary, but don’t expect to earn more as a result of your course (ie “learning for fun”), then I’m not entirely sure why you should be subsidised. “It’s fun” is not really a convincing justification for public subsidy. Will removing the subsidy discourage learning for fun? Quite possibly. But if the prospective student on a middle income doesn’t think a course is worth its true cost, I’m not entirely sure why society as a whole should think otherwise.

Couldn’t this argument applied to anything that is regarded as a public service? For example: “I never visit a library – why should my taxes subsidise people who do use libraries?” and “I don’t swim– why should my taxes subsidise people who go swimming?”

I think it comes down to if you think The Open University should be regarded as a public service or not. Personally, I think it is a public service in the same category as libraries and swimming pools. Perhaps I’m being overly idealistic!

Realistically, we don’t get to chose where our tax is spent. I’d hope and want it to be spent on improving society as a whole. I hope it’s not just going to be used to rescue the banks, pay for bonuses, and to pay for Trident.

Another point from the same comment:

…the policy removes a subsidy from upper and middle earners. In financially austere times, that seems reasonable.

As explained at the beginning of the post, if you already have a degree, then you don’t qualify for the loan. It doesn’t matter if you earn £100K per year or £15K. You can’t get a loan.

It is definitely the end of studying for the love of studying. And you have to hope the 18-year old you picked the right degree too.

Edit: I’ve been made aware of The Open University Student Budget Account – a way of  borrowing course fees direct from the OU. This could help greatly in making paying for OU courses. It is still £2500 per 60 points, but at least OUSBA would allow you to spread the cost.




  1. Hi Kash, thanks for your response.

    I certainly had forgotten that loans weren’t available to people who already had a degree. I would argue that a perpetual student should not be receiving a large subsidy every year indefinitely, although it does seem a little harsh to limit people to one subsidised degree per lifetime.

    I don’t think the “subsidised fun” criticism can be applied to *any* public service. We don’t have socialised schooling, healthcare, roads or rubbish collections because they are “fun”. I think there are lots of different possible justifications for state action. Some that come to mind are:
    – Where collective action might be more efficient (all sorts of infrastructure, the NHS)
    – To protect the weak and unfortunate (police, NHS, social security)
    – To protect wider society from the consequences individual failure to act (rubbish collection, environmental health)
    – To promote equality of opportunity (schools)

    Libraries, swimming pools and the OU all offer some combination of public good and leisure activity. Libraries combat the exclusion of those who have no other way of accessing literature, information or a broadband connection. They also subsidise the hobbies of plenty of people who don’t really need it. Similarly swimming pools improve the health of lots of people who can’t afford gym membership, but also that of many who probably could. Is that a good thing? Possibly, if economies of scale mean the extra costs aren’t too high and if it broadens public support for the subsidy to the needy.

    I would think the main difference between the OU on one hand and libraries and swimming pools on the other is the marginal cost to the taxpayer of each new service user. We subsidise swimming pools but not personal trainers. We subsidise schools but not personal tuition. We subsidise waste collection but not cleaners for citizens’ homes.

    I admit I actually have no idea, but looking at the fees I guess the marginal cost to the taxpayer of each OU student taking 60 credits prior to this change could have been over £1000 pounds a year. When many of those people are just doing it for their own enjoyment, or for their own economic gain, I’d say that’s a legitimate thing to examine when the state needs to save money.

    Anyway, putting aside the fact that no one will ever approve of 100% of what government spends our money on (I’m with you on Trident), decisions about public services like libraries and universities should probably come down to an equation involving variables like:
    The marginal cost to the state of each new service user (we subsidise swimming pools but not personal trainers),
    The minimum number of people required to make it economical,
    The proportion of those who really need the service verses those who don’t but appreciate a subsidy for something they enjoy.

    Despite all that, I am not really taking a position on these OU fees increases and certainly have misgivings about the new tuition fees policy in general. And I do think learning and the love of learning is a wonderful thing. But we do need to bear in mind that the cost of taking 60 credits with the OU has not changed. All that has changed is who is paying it. But if you are particularly focussed on learning for the love of learning, and you’re saying “I shouldn’t be paying the full cost of this expensive thing that I do mainly for fun”, you need quite a good argument why other people should chip in.

  2. ‘But we do need to bear in mind that the cost of taking 60 credits with the OU has not changed. All that has changed is who is paying it.’

    But is that really true?, I can sort of understand how running a fixed site university course might cost £21000 over 3 years, but I can simply not see how such how a distance learning course can cost £15000

    Does the the OU publish accounts?.
    Where does the money go pretty sure it doesnt go to the tutors or the markers.
    Why does the OU even do research? , why does it need anything more than one basic admin buildings (they can hire warehouses as needed), its not that their are undergraduate labs.

    Sorry this stinks of the OU management trying to protect their own jobs rather than their students (which is the same for any business but the OU shouldnt be acting as one)

  3. Yelling Melon wrote:

    “I admit I actually have no idea, but looking at the fees I guess the marginal cost to the taxpayer of each OU student taking 60 credits prior to this change could have been over £1000 pounds a year. When many of those people are just doing it for their own enjoyment, or for their own economic gain, I’d say that’s a legitimate thing to examine when the state needs to save money. ”

    It’s worse than that. The (erstwhile) subsidy for OU modules was much bigger than the course fee paid by the student. Not sure of the details, but I think it was 2 or 3 times as big. So a student paying, say, £700 for a 60-point module was getting a subsidy of perhaps £1500 or more.

    Jon S wrote:
    ‘I can sort of understand how running a fixed site university course might cost £21000 over 3 years, but I can simply not see how such how a distance learning course can cost £15000′

    The OU may not need to physically house its students or a lot of its staff, but it has costs that ordinary universities don’t have.

    I’ve taught in a conventional university and am now a tutor for the OU, and have been involved in course development for the OU. There is no comparison between the thoroughness of the course development process in the OU and the generally haphazard process that happens in ordinary universities. The OU can’t, in general, use standard textbooks, because they are written with conventional universities in mind. Distance-learning materials are different and have to be created specially. (And the OU does it superbly – I’ve seen the cobbled-together materials produced by some other distance-learning providers). Print runs of OU texts will be smaller than print runs of ordinary texts (and they are updated/corrected regularly, so the OU can’t print 10 years’ worth in one go).

    As an OU tutor I’ve had much more staff development than in my ordinary university (because the job’s unusual). They need to pay my travel costs paid to go tutorials etc. There has to be a department devoted solely to handling students’ assignments, etc.

  4. Found some of the accounts

    Quite surprised that staff costs are £275 million out of £425 million.

    Doesnt break it down until how much of this is tutors or people who write books. Anything that doesnt need a face to face presence with students can be off-shored to India (Milton Keynes might as well be New Delhi for a distance learner) that should save quite a bit. All distribution management can be sub-contracted to Amazon.

    The idea that the OU can be a rival to British campus universties and charge £15000 is just a joke

  5. Interesting post. Considering how fast technologies evolve these days, it does seem a bit harsh to limit people to only one subsidised degree per lifetime, especially as the loan needs to get paid back.
    I’m one of those people who, 20 years or so after graduating, needs to retrain completely for various reasons, mostly due to health. And because of my health problems, I don’t have much money.
    I would argue for allowing loans for a second degree, after a certain lapse of time, and providing the new qualifications are job oriented.
    (Note, since I’m not in the UK I wouldn’t be eligible for a loan there anyway. It’s the principle of the thing that I’m suggesting)

  6. Yep, this is probably the end of my studying with the OU.
    I have been slowly working towards a degree for may years now. Slowly because I am not that good at studying and have little time thanks to doing shift work.

    The large loan I would have to go for is a great deterrent considering I could possibly never make it and would probably never earn that much more anyway.

    • As Kash’s previous post mentioned, if you are currently counting your modules towards a degree, you will be able to keep studying until 2017 at the current subsidy level. The fees will only rise enough to keep up with inflation. You do need to take and pass a module every year to qualify, but it can be a 10 credit one if you like.

  7. I’ve just kind of stumbled across the OU and can’t believe that I have never considered studying with them before. I have always had a real passion for physics/science/astronomy even though it has nothing to do with my 9-5 job. When I looked at the costs for studying I was surprised at how expensive it was so am I right in thinking that I have missed the boat on getting the cheaper rates?

    • I’m afraid so.

      If you don’t need to get a qualification, but just want to learn about astronomy and planetary science, I highly recommend the S282 and S283 course materials. You can get hold of these books from various locations. Search for “buy” in my “Guide to studying with the Open University”. Of course, you won’t have the assignment deadlines to keep you going, but if you can self-motivate, try that option. There are also loads of free education resources from places like MIT available for download.

    • Not quite, as far as I know. You are eligible for the old fees as long as you are enrolled on a named degree course (including the Open Degree) by 31st Aug 2012. There are short course modules starting in June and July which can count towards a degree, so sign up now and you should still make it.

      A few degrees have no free choice credits and can’t include short courses, so for those you have missed the boat. Computing with Business for example.

      • Looking at the OU website, they say:
        “Our qualifications have up to three start points in the year, October, February or April.”
        Unfortunately, I think that means that it may be too late now, i.e. even if you do a short course in June/July/August you won’t be registered for a degree until October (after the deadline).

  8. Interesting debate here. However, I think one of the key points that hasn’t been taken up is that the cost of OU courses is not going up in Scotland, Wales or Northern Ireland – that to me is very divisive. Click on the course details for any course, and change the fees calculator to one of the other countries, and you will see the difference. I know this is true for standard universities too, but it seems contrary to the whole raison d’etre of the OU, which was set up to provide education to those who could not afford to go to standard universities. Maybe it has forgotten this ethos along the way.

  9. Mand
    The reason OU fees are not increasing in Wales,Scotland and NI is that those devolved governments have not (yet at least) changed the fees system and cut university teaching funding the way that the UK governemnt has done for England. You seem to be blaming the OU in your last sentence but it is not the OU’s fault – the Government is the one that has withdrawn the funding, so the OU has to make up its lost income and student subsidy by raising the fees to compensate.

  10. I have read this post and the previous post whilst searching for forums with advice on OU degrees. Is the general consensus that an OU degree is worthwhile to do? I am 32, work full time and have two children so it would be a huge commitment. The cost and the study hours are my main concerns. Does anyone have any experience of studying at the OU whilst working full time?

    • SJ, I have studied with the OU myself at Masters Level. It is possible to achieve a degree whilst working full time and with kids, but as you say it IS a commitment. However OU degrees are well recognised by employers and the fact that you have work experience alongside your degree can be seen as a positive factor by employers too. It all depends what your motivation is – and what degree you do. Choose something related to your future occupation and yes it probably IS worth it.


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