The Office of Fair Trading targets universities

The OFT is investigating universities’ terms and conditions.

The Office of Fair Trading, apparently at the request of the National Union of Students, has started an investigation into whether some of the sanctions imposed by universities on students, which may prevent them from progressing or graduating if they owe the university money, are unfair in relation to consumer protection legislation:

The OFT has opened an investigation under the Enterprise Act 2002 considering the terms and conditions used by some universities to prevent students from graduating or enrolling onto the next academic year or using university facilities if they owe monies to the university which relate to non-academic debts such as for accommodation or childcare, or if they engage in conduct (unrelated to academic performance) of which the university disapproves. It is considering whether such contract terms and/or practices breach the Unfair Terms in Consumer Contracts Regulations 1999, the Consumer Protection from Unfair Trading Regulations 2008 and certain other consumer protection legislation.

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As reported in the Independent the NUS is quite keen on this:

The NUS vice president for Welfare Colum McGuire said: “This has been on our radar for a while and we’ve been hoping to get some action taken. We’re really excited for the full investigation.” McQuire continued: “This came to our attention from students and unions across the country.”

It will be interesting to see how this plays out. It will be particularly important that the OFT gets a clear view on the issue of “non-academic debts” some of which, whilst they may not be explicitly academic in nature, are nevertheless inextricably linked to a student’s whole university experience. The OFT will also want to learn more about the ways in which conduct “unrelated to academic performance” can sometimes have a profound and negative impact on university life and is therefore not merely a matter of disapproval.

Writing in Outlaw.com, Pinsent Masons’ legal blog, Nicola Buchanan is pretty sure that the OFT will find universities’ actions wanting and that we will need to look at alternative approaches:

The OFT will publish initial findings in October and are likely to find the withholding of degrees for non-academic debt unfair. Universities should start planning now, and should take a leaf out of commercial organisations’ books if they are to find new and effective ways to recover non-academic debt.

So we will see where the investigation goes. The cautionary note in all of this though is really “be careful what you wish for” as the alternatives to the current set up may be far less pleasant for all concerned as Gary Attle has observed in Fusion, the Mills and Reeve blog:

We do wonder whether there may be another law at work here, namely the law of unintended consequences. What will be the consequences if universities, as academic communities, are constrained in using self-help measures in appropriate situations to manage their financial responsibilities. Will it be in the interests of students if universities are forced to resort instead to other credit control measures and debt collection procedures like commercial businesses and landlords?

Surely no-one wants to end up here?

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Speaking with difficulty

New advice from the Charity Commission sows some confusion.

The Charity Commission has recently published some new guidance which is intended to help trustees protect their charities against “abuse by extremists.” This guide/toolkit though seems to offer a particular challenge to universities which are subject to legislation on external speakers dating back to 1986 which was designed for a quite different purpose.

Let’s start with the new guidance from the Commission on “Protecting your charity against abuse by extremists”:

The guide, which is available on the regulator’s website from today [Tuesday 22 January 2013], explains trustees’ duty to prevent their charity being used to promote extremist views or terrorist ideology.

The toolkit also suggests steps trustees can take to minimise risks associated with particular activities, such as organising public events and debates and circulating information.

It is aimed in particular at charities that host regular events involving external speakers, and those with educational purposes that distribute material and information. Examples include charitable think tanks and debating societies, students’ unions, schools, colleges and universities and religious charities.

OK, so far so general. But when we get to the detail of the guidance it becomes clear that the Commission things get a bit interesting. Whilst any illegal views or action is, of course, unacceptable, charities are required to consider whether allowing a particular speaker to present their views may be inconsistent with public benefit as this extract from Chapter 5, Section E of the guidance indicates:

Under charity law, charities must comply with the public benefit requirement. Views or activities which are violent or which encourage violence cannot be for the public benefit because they are illegal. In addition, there are other extreme views and activities, particularly activities which seek to radicalise or use radicalising materials which may be inappropriate for a charity to host or promote. Such views may not be in furtherance of the charity’s purposes, or may breach the rules on political activities. Other extreme views may help to create an environment conducive to terrorism. In addition, promoting views which are harmful to social cohesion, such as denigrating those of a particular faith or promoting segregation on religious or racial grounds, or which seek to radicalise by making claims to which violence is subsequently presented as the only solution may well be inconsistent with the public benefit requirement even though such views might fall well below the criminal threshold. All these pose unacceptable risks to a charity.

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But if we look now at The Education (No. 2) Act 1986 there is a very direct requirement on universities to ensure and promote freedom of speech. This dates from a time when Conservative ministers were being prevented from speaking on university campuses by the actions of well-organised groups of students and the government was therefore keen to ensure they were protected and enabled to present their views. The Act provides that:

(1)Every individual and body of persons concerned in the government of any establishment to which this section applies shall take such steps as are reasonably practicable to ensure that freedom of speech within the law is secured for members, students and employees of the establishment and for visiting speakers.
(2)The duty imposed by subsection (1) above includes (in particular) the duty to ensure, so far as is reasonably practicable, that the use of any premises of the establishment is not denied to any individual or body of persons on any ground connected with—
(a)the beliefs or views of that individual or of any member of that body; or
(b)the policy or objectives of that body.

So there is a positive duty to ensure that speakers are not prevented from speaking because of their views or beliefs or the policies of the organisation.

In addition, universities have to have in place a code of practice which sets all of this and there are further specific obligations:

A duty on every individual and body of persons concerned in the government of the institution to take such steps as are reasonably practicable (including, where appropriate, the initiation of disciplinary measures) to secure that the requirements of the code of practice are observed.

A duty to ensure that the use of any university premises is not denied to any individual or body of persons on the grounds of their beliefs, views, policies or objectives.

Whilst it is clear that the 1986 Act does not extend to speakers who break other laws or incite violence, nevertheless it does appear to require universities to adopt a rather different position to that set out in the Charity Commission’s guidance. Whilst this legislation and the Commission’s guidance are separated by over quarter of a century of change in HE and are intended to address very different challenges, the apparent conflict between them is, I fear, going to cause some real problems for universities before too long.