SHORT-CHANGED GRADUATES OFFERED MONEY-BACK GUARANTEE

Were you over-charged for your degree? Students at a London university have become the first to be promised a refund if they fail to find work after graduation.

The London School of Business and Finance (LSBF) has become the first higher education institution to offer a money-back guarantee on its degrees. Graduates who are not in a job with career prospects within six months of graduating will be awarded £2,500 in compensation.

Courses at the private university cost £9,500 a year and last three years at undergraduate level and two years at postgraduate level.

Graduate Fog thinks the introduction of this refund policy is hugely significant — and it is no coincidence that it comes at a time when graduates and employers are questioning the value of a degree. It is a clear acknowledgment that universities are beginning to understand that there must be a relationship between what they are charging and the value of the qualification to their graduates.

I have written before about the mistake universities are making basing their fees on what it costs to run their institutions, not on what the value of their qualifications is to graduates. As students are now customers, the two will have to become aligned. The price tag must reflect the value to a customer — or they won’t get their wallet out.

A spokesperson for the LSBF told Graduate Fog:

“We recognise that the current job market is a tough one for graduates. As well as preparing our graduates to be at the top of their game and be work ready, we also wanted to give our students the extra advantage of guaranteed employment.”

But the big question is – what constitutes being ’employed’? How bad do things need to be for a graduate to be able to claim their refund? When Graduate Fog asked asked whether those doing unpaid internships six months after graduation would be entitled to the refund, the LSBF spokesperson confirmed that they would:

“Although unpaid internships can afford valuable work experience and provide a route in to a business, they do not constitute a paid position, as per the LSBF graduate job guarantee. Therefore, LSBF would use the graduate guarantee in this example and the student would receive their specified refund.”

Similarly, graduates who are temping, working in bars or waiting tables would also be eligible to claim. They have promised that anybody who “is not employed in a position that is relevant to their degree or career aspiration” would be awarded the refund.

This attitude is refreshing — and directly contradicts the policies of many other higher education institutions, which are happy to fudge their figures and include their graduates in unpaid internships under the bracket “employed.”

Whilst the university doesn’t offer a full refund, this policy can only be good news for graduates who are grappling with record levels of debt and youth unemployment — especially if it is the first of many to adopt a ‘money-back guarantee’ policy.

LSBF predicts that other universities will follow suit, telling Graduate Fog:

“We believe graduate guarantees will become more common place after next year’s hike in tuition costs is introduced. With university fee prices soaring, students are rapidly transforming into educational consumers, who will shop around for the best return of value and investment on their money.

“This will result in greater competition between establishments and force private and public providers of higher education to diversify their products by introducing more flexible, long-term payment options or putting in place a graduates guarantee, with emphasis on employability.”

Should more universities offer money-back guarantees?
If your university had offered a refund like this, would you have claimed it? Do you think universities should go even further and offer a FULL refund to graduates who are unable to find work? Should courses with poor employment rates be forced to give refunds?


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