"...programming skills assessed only via examination..."
At university I was finding out the hard way that maybe I wasn't cut out to be a programmer (am now a sys admin). Part of that voyage of discovery was the first year exams, one of which was pretty much designing and coding on paper for 3 hours. I think I got an E for that one. I wasn't the greatest fan of having to do something rather computer-centric, without an actual computer. Aside, yes I know in the very old days that's how people did stuff, but I'm pretty sure we'd moved on from that in the 1990s.
On the flip side to all this it's obvious that the coursework element to such a subject, moreso when it is actually coding, is just far to easy to subvert via a multitude of methods. Quite what the best answer to this problem is I'm not sure. I guess there is the concept of coding within a time limit in some sort of closed condtions, though I've managed to screw up such things myself too (the pressure, the pressure!).