Related to the DfE proposal and consultation: Strengthening oversight of franchise provision in HE
The DfE consultation paper published in January 2025 aims to strengthen oversight of higher education that is delivered by a provider (‘the delivery partner’) on behalf of another provider (‘the lead provider’).
The DfE want to ensure that subcontracted or “franchised” provision is better protected from the risks of misuse of public money and poor quality.
For the most part, franchised delivery partners should meet the same requirements as other higher education providers if they want their courses to be designated for student finance.
In addition to the DfE paper, the OfS also published a consultation in July 2025, on the same topic with a focus on how to effectively monitor and assure the quality of education delivered through franchise arrangements using a new Condition of Registration.
This consultation closed for feedback on Wednesday 1st October.
Differences in regulatory approach
| OfS Proposals (July 2025 Consultation) | DfE Proposals (Jan 2025 Consultation) | |
| Primary focus | Puts greater regulatory responsibility on the lead provider (university) that enters into subcontractual arrangements. | Requires delivery partners (the franchisees themselves) that meet a certain size threshold to register directly with the OfS. |
| Who is regulated? | The lead provider is subject to a new condition of registration (E8). | The delivery partner is required to register and be regulated by the OfS. |
| Trigger for oversight | The new condition applies to lead providers with 100 or more students studying via subcontractual arrangements. | The requirement for direct regulation applies to delivery partners with 300 or more students. |
| Incentive for compliance | If a lead provider fails to meet the new E8 condition, the OfS can use its existing regulatory powers against that provider, such as issuing fines or revoking its registration. | If a delivery partner with 300+ students fails to register with the OfS, its courses will not be eligible for student finance. |
| Regulatory oversight | A lead provider must ensure that its own governance and control processes are robust and that it is effectively managing any risks associated with its franchise partners. | A registered delivery partner must comply with the full OfS regulatory framework, which covers areas like quality, finance, and consumer protection. |
The Data
Franchised provision has grown rapidly in recent years.
- Between 2018/19 and 2022/23 the number of students studying at a franchised provider more than doubled, from 50,430 to 135,850.
- By 2022/23, students at franchised providers represented 5.7% of all students in the higher education sector.
- 80,045 of students studying at a franchised provider were studying at a provider that was not registered with the OfS.
- As of 2022/23 there were 96 lead providers using franchised providers to deliver education on their behalf, contracting with 341 delivery partners, of which 237 were unregistered.
- Franchised delivery partners differ widely in scale, with some of the larger providers delivering education for over 10,000 students and some of the smaller providers delivering education for fewer than 5 students.
- In 2022/23, the largest 10 unregistered delivery partners accounted for 58% of all franchised students at unregistered delivery partners.
This consultation is not a surprise to the sector but has sparked lots of debates, with the main focus on the potential 300+ student number. And while this is important, it perhaps is masking a more important message.
Three little words can say a lot – I hate you, I love you, I miss you, I’m lost and where did I save my what3words!
In the 24-page DfE consultation document, there are 3 little words mentioned – just 3 times and in just one paragraph. These 3 words may be seem minor, but they carry a lot of weight and, if your strategy is to keep and grow your partnership with a Lead Provider over the next 5 years – they also carry a lot of urgency.
These three little words are “in good time“.
Before we explain the implications of “in good time“, we first need to explain the event timelines to you.
The proposal is that each year in September, the DfE will review, decide and approve providers for student loan company funding that have 300 students or more registered with them as part of a partnership or franchise with a Lead Provider.
As part of the criteria for student loan funding, the provider must be registered with the OfS or have applied to the OfS for registration – and here is the important bit – “in good time“.
These regulations will come in to force from April 2026 – just 7 months from now and by the event timelines, “in good time” for a 2028/29 student funded cohort is also April 2026. We have added an example in the grid below:
| 2028/29 | Student funded cohort starts |
| Sept 2027 | DfE decide which providers are approved for SLC funding (OfS registered or application made in good time) |
| April 2026 | DfE deem an application must have been made |
What this means, is that if you are a provider who has partnerships or franchises with a Lead Provider (University) and has or expects to have 300 or more students by 2028/29 registered for the lead provider’s course(s), you must have put in a full and viable application to register with the OfS by April 2026, otherwise you will be deemed as having not prepared and leaving it too late.
However, if the consultation, which is due to be published any time now, remains the same, courses delivered by providers who submitted a registration application to the OfS in good time, but have not received an outcome from the OfS by the September 2027 decision point will still remain designated for student finance in the implementation year (2028/29).
DfE wording:
We propose to define “in good time” as no later than the 1st of May in the year preceding the September decision. Applications to the OfS will only be considered as having been submitted in good time if the application meets all criteria set out in published guidance from the OfS and in force at the time the application was submitted. For example, at the first decision point in September 2027, if a provider submitted an application to the OfS before 1 May 2026 but had not yet received an outcome, courses they deliver will remain designated for student finance for AY 2028/29. If a provider submitted an application to the OfS on or after 1 May 2026 but has not yet received an outcome, courses they deliver will not be designated for student finance for AY 2028/29.
The full schedule of events
| 2025/26 | The data year |
| April 2026 | Changes made to regulations come into force |
| April 2026 | “in good time” application date |
| September 2027 | Decision point (for SLC funding approval) |
| October 2027 | Appeals decisions (for 2 years only (2027 and 2028) as part of transition period) |
| November (each year) | DfE publishes list of franchised providers whose courses are designated for student finance the following AY |
| August 2028 | The implementation year |
| 2029/2030 +++ | Correction Year(s) they exceed 300 students |
Does this affect your organisation?
Start preparing your OfS registration application ‘in good time’ to protect your partnerships, safeguard student finance eligibility and avoid being left behind when the new rules come into force.
Illuminare Education has a team of quality and compliance experts well versed in OfS Conditions of Registration and the requirements of a ‘complete and viable’ registration application. Our clients benefit from curated support in developing, completing and managing an OfS Registration Application.
Contact anita@illuminareeducation.com for more information.