The e-University (UKeU) was established five years ago by ex-Education Secretary David Blunkett in an effort to offer higher education courses to students around the world. He, along with the Higher Education Funding Council for England (Hefce) which oversaw the project, believed that e-learning would be of particular benefit to the UK.
However, in a report issued by the Commons Education and Skills Select Committee, the scheme was seen to have been the result of intense optimism brought about by the dotcom boom. Initial plans forecast as speedy growth of up to 110,000 students within six years of the operation and GBP 250,000 in a decade, bringing a total profit of over GBP110m after ten years.
The reality of the initiative was a mere 900 students signing up for the online degrees, at a public cost of GBP50m. As a result the project was scrapped after just six months of its launch.
The committee also found a flaw in the research behind the scheme, reporting that only GBP4.2m was spent on worldwide sales and marketing. A further GBP14m went on developing the technology with Sun Microsystems, consuming a quarter of the appointed expenditure, but this was used by just 200 students, with the rest preferring to take advantage of existing university websites.
The report went on to condemn the decision to give a GBP44,914 performance-related bonus to the UKeU’s former chief executive John Beaumont, as he had failed the conditions of the grant which required 50% funding from private-sector partners. Only one other investor beside Sun was signed up, achieving a mere 0.5% of the required funds.
The report concludes that many lessons can be learned from this latest failure, and that the government should not approach future investment in potentially risky schemes with trepidation.
