The Department for Business, Innovation & Skills (BIS) has published a consultation on proposed changes to the designation of alternative providers of higher education for the purposes of students' eligibility to access loans and grants from the Student Loans Company. The deadline for responding is 23 January 2013. The stated purpose of the proposed changes is "to create a more level playing field of regulation between similar providers". This is to include "introducing more robust and transparent requirements on quality assurance, financial sustainability and management of governance." It is not proposed that conditions be imposed on alternative providers (ie those not in receipt of direct funding from the Higher Education Funding Council for England) to require them to submit to the Student Complaints Scheme operated by the Office of the Independent Adjudicator (although this is encouraged), nor is a change proposed to require them to comply with the tuition fee cap or any requirements relating to the Office for Fair Access. The consultation document is also silent on alternative providers being subject to the Freedom of Information Act 2000.

What is proposed is that from the academic year 2013/14, new courses being designated by the Secretary of State as eligible for Student Loans Company funding will have to meet new designation criteria relating to: 1. financial sustainability, management and governance; 2. quality assurance; and, 3. course eligibility requirements. There is to be further guidance on the quality assurance requirements but it appears to be that alternative providers will need to agree to a review process by the Quality Assurance Agency, including access to the QAA's Concerns procedure. In addition to this, the course must be validated by a UK awarding body if the provider does not have its own degree awarding powers. HEFCE is to advise BIS on applications and the Secretary of State is to make the final designation decision. Conditions will be imposed relating to quality assurance, monitoring and change of control of the provider. An accountable officer is to sign a document to confirm the provider's agreement to the terms of the designation. The proposals also recommend a condition of designation relating to student numbers; the consultation specifically seeks views on different models relating to controlling student numbers at alternative providers.

In addition to these conditions applying to new courses from the academic year 2013/14, BIS proposes to start a review of existing course designations from April 2013. BIS is to keep a register of designated providers and courses. The consultation also asks for any other comments, specifically noting obligations under the Equality Act 2010. The consultation gives a reminder that the designation conditions will not relate to non-European Union students as they are not entitled to funding from the Student Loans Company.