Is Ofqual worth £2M?

How much would you spend to get your product ‘government-endorsed’? Zero? Nothing? Zilch? That’s exactly how much exam owners pay to get their qualifications and assessment regulated and approved in England. A bargain? Or could be even better? 

Ofqual is England’s exam regulator. It reports directly to the UK parliament, not a government department. It ensures that assessments are fair, valid, and reliable. The nexus of England’s exam sector - giving public confidence on assessment integrity.

This week, Ofqual published their wage costs, reported as £2M per annum. England’s school education budget for 2025-26 is £63.7billion. So £2 million is 0.032% of the spend - a minuscule amount, almost an accounting rounding error. Is it worth it? 

Spending just £2M out of £64bn expenditure is a bargain. But it could be even better. 

I estimate Ofqual-regulated exam owners (‘Awarding Organisations’) have annual revenue of around £5.3bn. While not wholly attributable to assessment, again, £2M seems incredible value in comparison.

But there’s been drift and inertia. The regulator lost its way in allowing too many start-up End Point Assessment (EPA) providers to kick-off their regulated journey. Companies with no accounts. Negligible assessment experience, if any. And usually no awareness of what regulation actually entails for a business. Perhaps an Owners’ And Directors’ Test or other financial/ governance hurdle would help? 

The exam sector cannot deliver an appropriate market correction. A regulator could set better thresholds for quality, finances, perhaps an Owners’ And Directors’ Test? 

Too many exam owners are chasing a market that cannot deliver a ‘correction’. Regulating 255 organisations on a flat £2M budget is unsustainable. That’s about 10 hours of management time per organisation per annum. 

Regulating 255 organisations on £2M is only 10 hours of management time per organisation per annum.

Just like the music industry, it’s never been easier to start an exam business, but increasingly difficult to gain meaningful commercial traction. The exam sector is littered with zombie and lifestyle companies. But the growth in exported qualifications is a good news story for UK plc. Paradoxically, this means the regulator’s work is being diluted, and only under-serves the growth-driving, exporting awarding organisations. In fact, the recent export numbers actually suggest a plateauing.

Internationally-delivered qualification certificates regulated by Ofqual 2019-24

Plateauing exports can point to a distracted regulator and a need for market correction.

So how could the regulator boost its resources? By increasing its remit. Outside of school exams, there is a patchwork of millions of high-stakes exams – many delivered digitally. A myriad of domains such as citizenship, driving theory, key stage and reference tests, are delivered/ overseen via government organisations such as STA, DVSA, MCA, SIA, Home Office. Not forgetting international exams delivered in the UK, including PISA, TIMMS, and PIRLS.

The high quality standards for exams and assessment the regulator rightly demands for school exams must be leveraged for these other exam programmes. All assessment, exams, and testing overseen by government should be handled by Ofqual. This isn’t state overreach. It’s a rationalisation. It’s unreasonable to expect leading assessment expertise and operational delivery to reside in government departmental silos. 

Assessment expertise across government should be overseen by one agency. Reduce operational duplication, level-up assessment quality, and support the market. 

While cross-government initiatives can be challenging, the notion of levelling-up assessment quality while slimming down operational overhead should be explored. Although the regulator’s leader rarely speaks publicly on export, and is laodicean on growth catalysts such as digitisation, an expanded remit to remove intra-departmental pain must surely be appealing? Nevertheless, I have minimal expectation that the impending Francis Review will be remotely interested. Despite an appetite to rationalise government and boost growth. 

So, is Ofqual worth £2M of government money? I believe it’s had great value. But encroaching erosion and dilution of its work due to an imperfect market requires attention. Deploying stricter rules on market entry and participation will strengthen the sector. An expanded remit to level-up all assessment quality benefits learners, exports, and greater public trust in assessment.