Homeopathic education from 'alternative providers'.

Are you a student at an 'alternative provider'? You could be forgiven if you're not sure - the terminology is deliberately obscure (and pedagogically suspect). 'Alternative providers' are usually private corporations which happen to be in the education business, teaching mostly HNDs awarded by the giant vampire squid that is Pearson Education, though a small number are non-profit set-ups.

Like 'alternative medicine', 'alternative providers' of education (I hate the idea that we 'provide' education like a workhouse overseer ladling out porridge to waifs) appear not to work. Andrew McGettigan's explosive article in the Times Higher Education Supplement points out that a shockingly low number of students at one particular institution submit work or attain the qualification, despite being funded as full-timers for two years and having five years in which to complete the course. Recruitment material strongly promotes the state funding available to students recruited from the EU, while the quality assurance bodies have little or no access to retention and progression statistics.

The USA has long had a system of private provision of higher and further education, and a shorter but notorious history of provision by for-profit organisations. Most notorious of all is Phoenix, which started off as a decent enough degree-completion outfit, but later became the biggest 'university' in the US when it listed on the stock exchange, with half a million students at any one time. The problem was that only 40% of those students left with a degree: the rest stayed, on average, enrolled for four months. Phoenix is only the worst and most prominent example of these vulture colleges.

Why do they exist? Simply as a means to channel taxpayers' money away from the state and established non-profit HE institutions towards corporate America: it's an ideological move. The free-marketeers are convinced that for-profit organisations are efficient and competitive. Perhaps they are, if the bottom line is all you care about, which I don't think should be the case with education. Every penny of shareholder dividend and executive pay (and Phoenix's profit margins, despite massive student drop-out rates, were around 27% while 18% of the budget was spent on teaching) is removed from research budgets, equipment provision, student support and so on. Economies are made be removing the essential bits of the university experience: being taught by highly-qualified educators at the cutting edges of their fields. Instead, you increase class sizes, cut contact hours, teach from a website or textbook, and dump complicated subjects. Business English ahoy! This also means – pleasingly for a government and indeed political establishment across parties that doesn't recognise non-market thought as valid – that critical thinking will be very much off the menu. Forever.

The quieter motive of course is to lance what right-wingers see as the liberal boil: universities (as Mr Gove's assault on university teacher-education demonstrates) are thought to be hotbeds of opposition to the onward march of market progress.

The providers of for-profit education are, however, not free-marketeers. Like Serco, G4S and co., they pose as competitive capitalists, while making all their money from the state. The UK recently followed the US in providing state monies to private education providers. In the US, companies like Phoenix simply sucked on this cash pipe and forgot to even pretend that they existed for educational purposes. The cash didn't follow on attainment, just enrolment, so there was no incentive to ensure only students with potential for completion were enrolled, nor to ensure they stayed on the courses and gained their qualifications.

As one Phoenix student puts it, the organisation is

"kind of like a car dealership. They want to get you in the door," and "want you to have success with the car. They want it to go well for you. But if it doesn't, they've already been paid."

Instead, turnover became key: far more was spent on recruitment and marketing than on academic support. The shareholders aren't interested in attainment or whether their students should be taking on debt to pay for uncompleted or dubious qualifications, just as McDonald's shareholders couldn't care less about their customers' cholesterol levels as long as they keep ordering more.

The same happened in the UK. Hundreds, perhaps thousands, of private providers sprang up once the Tories and their Lib Dem colleagues authorised state funding. They employed agents across the EU and in the UK to recruit students, many of whom rarely if ever darkened the classroom door or troubled to submit work. The colleges were happy – they've been paid – and so were the students, who acquired a chunk of cash they had little intention of repaying either. So much cash disappeared for so little educational return that even this government had to suspend a swathe of these dodgy organisations, but the push is still very much on, and some very ill-advised universities and FE colleges have even supported this venture for no reason I can see. At least some of us traditional institutions still have a pang of conscience when Admissions recruit students whom we know aren't up to it: for the private providers, such people are the ideal customer. I'd love to see one or two of them invoke the Sale of Goods act and other consumer protection legislation, seeing as they've been turned into consumers.

This is one of the most cynical and scandalous stories of recent times, but it's also invisible (the banks and the DWP tend to dominate the few investigations into financial corruption, but we should be furious about it. For political reasons, a government decided that our money could be handed out to fly-by-night shysters to exploit vulnerable students and reward fake ones. I mention banks because they're a prime equivalent. Blinded by ideology, the government believed that the free market leads to 'best practice'. The banks stole from us, from each other and from the government via mis-selling, manipulation and crime (that's you, HSBC). They couldn't help it: that's what capitalism is. It's not about level playing fields and honour. Companies spot advantages and take them. The private providers of education were offered free money without regulation or responsibility, and they took it. That money was taken from funding for reputable universities and FE colleges with a history and reputation for fairness and student support. Higher Education funding is being reduced, and increasing chunks of it are being reserved for these vampire colleges. Massive debts have been loaded on to taxpayers and good educators have been weakened, all because a government blinded by theory (and their personal shareholdings) abandoned students and embraced rip-off merchants. They aren't educators. They're tax miners who happen to be doing a little educating along the way (to flog the 'alternative' point to death, they're taking our money to provide homeopathic levels of education).

There's an election in May. Just saying.