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UK: new guidance on refunds applies to students, says CMA

Guidance by the UK's Competition and Markets Authority that says consumers could be given partial refunds for services missed because of Covid-19 applies to students, The PIE News has learnt.
May 5 2020
5 Min Read

Guidance by the UK’s Competition and Markets Authority that says consumers could be given partial refunds for services missed because of Covid-19 has led some in the sector to question if this means students at UK universities will be able to claim refunds for tuition fees under consumer protection law.

Last week, the CMA released a statement on consumer contracts, cancellations and refunds, which said where consumers had not been given all the services they paid for they should be eligible for partial refunds. 

“Students shouldn’t have to pay the same if their learning is negatively impacted”

A press spokesperson for the CMA confirmed to The PIE News that this guidance would apply to students, including both international and domestic students at UK universities. 

The UK’s universities minister, Michelle Donelan, has said that students who are continuing their courses online will not be “entitled to reimbursement if the quality is there”. 

However, courses with practical elements – such as lab work or training with camera equipment – may be impossible to teach online, meaning that contracts might not be performed as agreed.

If universities are forced to transition to online learning, this could impact the rights for students as consumers,” said Laura Rettie, vice president of global communications and brand at educational consultancy, Studee.  

“The CMA has issued guidance around what consumers should expect when receiving services online, and if unhappy with the level of service they receive, in theory, students in the future could be within their rights to ask for a discount or refund if they’re unsatisfied.

“Students shouldn’t have to pay the same if their learning is negatively impacted by moving online, just as they wouldn’t be expected to pay full price for any other paid service they receive that isn’t satisfactory,” Rettie added. 

The CMA said is currently investigating three sectors of “particular concern” – weddings and private events, holiday accommodation and nurseries and childcare providers.

It would not comment in detail on how its guidance might apply to the HE sector, although it did confirm it would apply to students. 

“The Universities Minister has made it clear that we only expect full tuition fees to be charged if online courses are of good quality, fit for purpose & help students progress towards their qualification,” a spokesperson for the DfE said.

The spokesperson said that if universities want to charge full fees they will have to ensure that the “quality is there”.

“In short, if students don’t get what they’ve been promised, then consumer protection law can apply,” said Nick Hillman, director of HE think tank HEPI.

Hillman stressed, however, that the situation is complex because students don’t always pay fees themselves, and student loans are partly written off by taxpayers.

In April, Universities UK released a statement that said students should not expect tuition fee refunds; a position that was mirrored by the UK universities minister. 

However, a UUK spokesperson told The PIE that they are expecting further guidance on issues relating to consumer protection from the Office for Students and the CMA.

“We will continue to engage with both the OfS and CMA as they publish more details, helping to ensure that any new information is as clear as possible for our members,” a spokesperson said. 

A spokesperson for the OfS told The PIE that its role was not to decide whether or not a particular HE provider has complied with consumer law.

“What we require is that all higher education providers registered with us have due regard with relevant guidance about how to comply with consumer protection law as they develop and implement their policies, procedures and terms and conditions.

“Clearly, higher education providers will want to consider guidance from CMA and others during the pandemic; it is for them to interpret this guidance, seeking legal advice where necessary,” the spokesperson said.

UUK added that if students feel the alternative arrangements put in place are inadequate, they should complain through their university in the first instance. This includes students who have difficulty continuing with their learning, for example, because of illness, caring responsibilities or lack of access to IT. 

“Every university will have established process for managing complaints and will be mindful of the extenuating circumstances,” a spokesperson said.

“If students are not satisfied with the response from their university, they can escalate their complaint.”

Students in England and Wales would complain through the Office of the Independent Adjudicator, while students in Scotland can complain to the Scottish Public Services Ombudsman. Students in Northern Ireland can take their complaint to the Public Services Ombudsman.

A spokesperson from the OIA told The PIE News that it bears in mind consumer law when looking at individual cases. 

“But we look much more holistically at the steps a university or other higher education provider has taken to mitigate the impact of disruption on the student, and whether the outcome for the student has been reasonable in all the circumstances.”  

As a result of the disruption caused by the crisis, students around the world have been calling for tuition fees to be refunded. University World News reported that there has been a petition to South Korea’s constitutional court to set a legal basis for reducing tuition fees in a time of crisis.

And in the US, undergraduates have sued more than 50 schools, demanding partial tuition, room-and-board and fee refunds after they shut down, according to a report by Bloomberg.

“It’s a really difficult time for universities. The situation we find ourselves in isn’t the fault of universities”

UUK stressed that in the current financial year (2019-20) the sector is facing losses in the region of £790 million from accommodation, catering and conference income as well as additional spend to support students learning online.

While the government has announced a package of measures to ease financial disruption for the sector, tuition fee refunds would constitute more problems for institutions.

“It’s a really difficult time for universities. The situation we find ourselves in isn’t the fault of universities,” said Rettie at Studee.

“But it’s not the fault of the student either, who could be paying off student loans for tuition for decades to come.”

The study travel industry, too, has been feeling the financial strain as a result Covid-19, with industry professionals telling The PIE that the sector is at risk of imploding unless language students are obliged to accept vouchers instead of being given refunds for cancellations of their overseas study experience.

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