After one month working in the UK I am starting to be able to shed some light to this interesting and complex question. In my view, British government managed to introduce the advantages of a free-market model with incentives at department level. This system minimizes bureaucracy and spread pressure and expectations appropriately to academics, regardless of their position.
Let us compare the British and Spanish higher education systems with a simple formal model. Let us imagine that we have k single-department universities in both countries with n students and m academics. Revenues of the universities come from 2 sources: first the tuition fees of the students (p) and second government subventions (k*s). Institutional costs can be simplified to academic salaries (w*m). Assuming that the university is a nonprofit organization with the objective of giving a social service in knowledge generation and transfer without making losses, the revenues should equal the costs p*n + s = w*m.
A first difference between UK and Spanish higher education systems is the level of control about the parameters. In Spain the government controls and gives specific regulations to all the parameters –especially p, w, m, s; giving little capacity for university managers to influence n. Instead the British government gives a maximum p and creates competitive rules for getting s. The rest of the parameters n, w and m highly depend on the university managers.
The Spanish government invests a great amount of resources to manage all the bureaucracy that entails the supervision and evaluation of university professors ("acreditaciones" and "sexenios"). Spanish government makes an extensive and continuous evaluation of university professors. However, once the professor achieves a position of civil servant there is little incentive to make a high effort. UK goverment instead only provides some guidelines about the capacities an academic should demonstrate (i.e. PhD, PGCert,...). In addition in the UK all academics are subject to be fired with a three-month notice.
In Spain there is not evaluation at university level and the subvention is split by university size. In our example each university would receive s. The UK government makes a quality control named REF to all the universities. In our case the k British universities compete for the government budget k*s. Only few of them will achieve public funding. Let assume that 50% best universities in research will share equally all funding, and the rest will get nothing. So top universities will receive 2s and the rest will receive 0. Here a summary of the effects of those measures for the academic job market:
- As the universities have capacity to negotiate salaries (w), there will be a high competition to attract best academics, which will immediately increase their salaries. This inflation of salaries will take place just before the evaluation of the universities. This is probably one of the reasons to justify why the evaluation of departments takes place every 6 years.
- Universities not getting public funds will require their professors to teach more hours and/or have lower salaries.
- Top professors have a huge incentive to keep working hard as more publications and projects will be directly linked to promotions and significant salary increases. The market of top professors also opens some space for young professors without extensive curriculums.
- All academics have similar levels of incentives and pressures regardless of their position.
- There is less bureaucracy as the universities make the evaluation of the staff in order to assure being competitive enough in the REF.
In the light of these results it seems that Spanish government should regulate in line with the British experience. Unfortunately I don’t think we are going to see a reform (of this style) in the Spanish system in the following years. First, it would require that well-established professors loss their job security (in exchange of a likelihood of getting significant salary increases). Second, a free-market reform could entail that some universities in poor areas will immediately die if they loss access to subventions, failing to provide a similar amount of public services to all territories, which is an explicit objective of the Spanish constitution.