Source: Alamy

Red tape, right fit: reform would open door to fraudsters, says Privy Council

Officials from the Privy Council, the Queen¡¯s body of advisers, have rebuked the government over plans to relax restrictions on the use of ¡°university¡± and other higher education terms in company names, warning that bogus institutions could take advantage.

In February, the Department for Business, Innovation and Skills launched a public consultation on business names as part of its Red Tape Challenge to cut bureaucracy.

The government maintains a list of ¡°sensitive¡± words and expressions (currently numbering 161) for which permission must be granted before they can be used in company names. They include ¡°university¡±, ¡°polytechnic¡±, ¡°charter¡± and ¡°chartered¡± (many publicly funded universities have Royal Charters).

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¡°Repealing the regulations could simplify and speed up the registration process for all start-up companies,¡± the BIS consultation says. It notes that under current rules, a pub near a campus wanting to call itself ¡°The University Arms¡± would have to apply to BIS for permission.

Officials at the Privy Council ¨C which advises the Queen on the granting of Royal Charters and grants university title to public institutions ¨C took exception to BIS¡¯ plans, as shown by consultation responses obtained by ³ÉÈËVRÊÓƵ under the Freedom of Information Act. ¡°We were disappointed that the Privy Council Office (PCO) was not consulted directly over the possible deregulation of sensitive names and wish to strongly object to the potential removal of ¡®Charter¡¯ and ¡®Chartered¡¯ as sensitive words,¡± says its response.

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The PCO submission, written by Ceri King, head of secretariat and senior clerk, adds: ¡°I note that your list of consultees did not include any of the 129 universities in [the] UK, and only included a minority of the 900 or so Chartered bodies.¡±

To gain university title, institutions must have degree-awarding powers and meet criteria on student numbers and governance.

¡°University¡± and ¡°polytechnic¡± must continue to be protected, the PCO warns. ¡°Without protection it is possible that¡­an organisation could call itself a university without meeting the criteria, thereby devaluing the title. It would also be much more difficult¡­to identify and¡­close down bogus universities.¡±

BIS is expected to issue its response to the consultation within days. It is thought unlikely that there will be any change to the protections for higher education terms.

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A BIS spokesman said: ¡°There are a number of words that quite clearly are very contentious. We¡¯ve obviously borne that in mind.¡±

john.morgan@tsleducation.com