HIGHER and further education's wish for 1998 must be that the planning blight of 1997 will end. 1997 was a year of waiting - for the election, for reports, for white papers and for money. It was also a year of wrangles - over fees, loans, applications and access policies. Everyone has been thoroughly distracted from such important matters as what kind of education is to be offered, what sort of research is to be done and how universities and colleges should develop in the next century.

Waiting for the government to take a lead is sensible for further education. Much of the new government's policy will impact on the colleges. The New Deal, designed to get the young unemployed into work or education, will be an enormously expensive programme that cannot help but bring new money into colleges as it gets going early in the year.

The Lifelong Learning white paper was through its second draft before Christmas and education secretary David Blunkett was planning to go over it during his holidays if he can spare the time from wrangling about welfare. Publication is pencilled in for late January. It is expected to set out what will be expected though details of the University for Industry may have to wait for an advisory report in February.

The Qualifications and Curriculum Authority, which has been pretty quiet since it was set up last summer, is expected to come on stream with some important decisions on qualifications frameworks at subdegree level early in the year.

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The release of young workers for training under the provisions of the Teaching and Higher Education Bill will, if it is not fatally weakened by Confederation of British Industry-inspired amendments, provide yet more opportunities for colleges.

For higher education the wrangling will have to go on for a bit in order to get the bill more acceptable. But the white paper will have little to say in this sector and, however bossy the government may sometimes seem, however determined that universities be accountable, their courses up to "standard", their graduates useful to employers, neither ministers nor officials have much real interest in what this means in practice. They will be only too happy to have higher education do the thinking for them - while reserving the right to criticise and interfere.

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Nineteen-ninety-eight should see higher education begin to move forward again. The Quality Assurance Agency is getting into its stride - indeed it may already be going forward with a speed and lack of finesse that will produce rows later. The Teaching and Learning Institute to accredit the training of academics was due to get a chairman and board this week.

Institutions may be tempted to put off any medium -term planning until after the government's first real budget, due sometime after the across-the-board review of government spending is completed in July. But this would be a mistake. The Higher Education Funding Council for England has already advised universities to plan for 1999-2000 on the assumption of a steady state. The government has told the House of Commons select committee that net savings from fees will feed through into higher education but may only reach Pounds 100 million by 2000. It will be best to plan for the worst while hoping for the best.

In doing so universities will need to build further on some of the initiatives developed during the hard years of the 1980s and 1990s. If there is indeed to be no curb on charges for any but full-time home and EU students, there will be scope to build up short courses, postgraduate work and part-time programmes. The proportion of university students who are full-time can be expected to shrink.

Work is needed with the QAA to restore the credibility of British qualifications overseas. Franchising which is clearly money-led and insufficiently rigorously controlled should stop. Assessment arrangements need overhauling. The old University of London model where students study wherever they are but take exams that are set centrally and marked in London should be more widely used - though even that is not proof against cheating unless students are carefully identified and supervised when they take the papers.

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Instead of just waiting helplessly to see if more government money is forthcoming for research and fighting bitterly over how such government funds as there are are allocated, universities will be eager to develop income-generating consultancy and applied research. Universities are becoming more interested in and more expert at helping start up and spin out companies. Many now have their own consultancy companies and, thanks to lessons, for example, from Oxford where the rules governing conflict of interest turned out to be too loose, are getting better at managing commercial activities without compromising academic integrity or putting the university in financial jeopardy. The regional development authorities, once they get going, should help to oil the wheels for new companies by mobilising local risk capital which universities themselves do not have.

All these developments and more need to get going again, and fast. While UK higher education has been distracted by domestic matters, competitors in the international higher education market have not been similarly bogged down. The Australians are moving aggressively to capture the Asia Pacific market. Melbourne University's bid to join the top rank of world universities suggests the emergence of a global elite is proceeding apace. Universities around the Pacific rim are looking more to the United States than the UK for successful university models.

The Americans are becoming increasingly aggressive in buying up and defending intellectual property, not least now the Federal Bureau of Investigation and the Central Intelligence Agency, seeking a post-cold war role, are helping companies protect secrets. The commercial imperialism of large US corporations coupled with the growth of new academic-linked bio-tech and software businesses threatens to engulf not only world markets for products but world markets for top talent. Britain has been good at producing such people and bad at turning their work to profit. That endeavour needs renewed concentration.

On the teaching side too the Americans have their eyes on the English-speaking market. David Puttnam, among others, has repeatedly warned of the US edutainment industry's ambition to sell distance- learning packages into the world market. Now, US universities are joining Microsoft, IBM and others to produce and validate learning packages. If you can work for a Harvard MBA from home in Bognor Regis why enrol at Poppleton?

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Such threats may be dismissed on the grounds that teaching materials are culture-specific or that people will not toil over the Disney package on the Ancient Greeks (an invented example) if it is not accredited. But taking such a view risks passing up an opportunity. The cost of going to university is rising. Unemployment is falling below the point where it acts as recruiting sergeant for universities. Quick updating will be more in demand. People will want to study at home. They may prefer home-grown materials, particularly given this country's media skills, but if there are none to be had they will go elsewhere.

Nineteen-ninety-eight should be the year when British universities resume their innovative ways. As one British vice chancellor said recently: "If we don't watch out our higher education will be relegated to an expensive niche in the world market: we will find ourselves confined to providing the academic equivalent of walnut-fasciaed Rovers."

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