21:59 - The House divided: - Ayes: 244 / Noes: 307 - Question accordingly negatived.
Mr John Denham (Southampton, Itchen) (Lab)
I beg to move,
That this House believes that the Government should publish a White Paper on higher education in England, setting out the full detail of its plans for higher education funding and student finance before asking Parliament to vote on whether to raise the fee cap; is concerned that major questions about how the Government’s market in higher education is intended to work remain unanswered; is concerned that recent graduates will be responsible for repaying loans for up to 30 years because the teaching grant is being cut by 80 per cent.; and urges the Higher Education Minister to bring forward publication of the White Paper.
The motion’s aim is clear: the coalition wants this House to vote to increase university fees before Christmas, but we say that the House should not vote before the Government publish their promised White Paper and before they answer the many crucial questions about how the new policy is meant to work. Can there ever have been a debate like tonight’s? When was the last time that a Minister—a Secretary of State and a member of the Cabinet—came to the House to defend a policy that he drew up on the same day on which he told the BBC that he might not even vote for it? And the hon. Member for Bermondsey and Old Southwark (Simon Hughes) is clearly an advocate for the duvet strategy, as he tells his Lib Dem colleagues, “Let’s pull the bed clothes over our heads and stay there until this nightmare is over.” It is humiliating for the Secretary of State, but it takes the arrogance and cynicism of this Government to new depths. Millions of parents and millions of future students are desperately worried about the cost of degrees, but all the Secretary of State is concerned about is saving face for the Liberal Democrats. Now the Deputy Prime Minister is at it, too; he has written today blaming the National Union of Students for putting students off university. This is the man who, in his own contribution to widening participation, said in April that fees of £7,000 a year would be a “disaster”. He has no shame.
The coalition will make English students and graduates pay the highest fees of any public university system in the industrialised world; they will pay up to £39,000 in fees and maintenance loans for a three-year course. This is the biggest change in university funding since the University Grants Committee was set up in the 1920s, and it will end funding for the vast majority of undergraduate degrees; there is to be an 80% cut. The Government want a crude higher education market in which student choice and student choice alone shapes the universities system. They have used the excuse of a limited contribution to deficit reduction in the short term to bring in a profound change of funding for the long term. But last week the Minister for Universities and Science admitted that £28 in every £100 loaned to students would have to be written off, and the Institute for Fiscal Studies and the Higher Education Policy Institute have both questioned whether the policy will save any money in the long run. Will the Secretary of State admit that, as the Office for Budget Responsibility report published yesterday said, the cost of borrowing to fund student loans will rise from £4.1 billion a year this year to £10.7 billion in 2015-16, leading public sector net debt to increase by £13 billion by 2015?
Simon Hughes (Bermondsey and Old Southwark) (LD)
The right hon. Gentleman and I might have our differences and our arguments, but will he make it clear that the policy that his Government introduced and the policy currently proposed by this Government have in common the same core issue, which is that there are no fees up front? He has not said that clearly so far, and the NUS tried to pretend that it is not the case. If we are going to have a serious debate, it must be on the basis that there is agreement that no student, full-time or part-time, will pay any fees up front. Can he be absolutely clear about that?
Mr Denham
I will come in a moment to the core issue that divides us. The hon. Gentleman is right to say that the fees system that we introduced has no up-front fees—[Interruption.] No, the fees system introduced by the previous Labour Government has no up-front fees. The proposals introduced by this Government do not have up-front fees, but let me explain to him what the fundamental difference is between the policy of the previous Labour Government and that of this coalition Government. We took higher education public funding of universities to record levels, and the fees that we introduced brought extra money to the universities on top of record levels of public funding. The coalition Government’s proposals are based on an 80% cut in public funding to higher education, and the fees that graduates will pay under their plans merely replace the money that has been cut from higher education; they do not generate additional money. That is a massive difference between the policy of this Government and the policy of the Labour party.
Mr Denham
Mr Deputy Speaker, you know me well enough to know that I enjoy debating in the Chamber and I enjoy taking interventions. I am well aware of the huge number of Members on both sides of the House who want to speak, so I will take some more interventions, but just not now. I will make a little progress before I take the hon. Gentleman’s intervention, because I am going to make a point that is relevant to him. These plans have huge implications for the devolved Administrations. The cuts will lead directly to reduced funding for Scotland, Wales and Northern Ireland, making their decisions on university funding far more difficult.
This is an enormous decision with profound long-lasting implications. It must not be taken lightly and it should not be taken without all the relevant information being placed before the public and this House, but that is just what the Government want hon. Members to agree to; they want us to vote for a huge rise in fees while they keep every hon. and right hon. Member in the dark about key details of the policy.
Before I set out the key questions, may I say a few words about Lord Browne’s report? He was asked to write his report by the previous Labour Government and we should be grateful to him and his team for the diligence with which they set about their work. However, Lord Browne had two central presumptions with which we do not agree. First, we do not agree that 80% of university teaching grants should be cut or that the cost of most degrees should fall entirely on the shoulders of graduates, with it being relieved only if after paying for 30 years they still cannot clear the debt. Secondly, we do not agree that the university system should be shaped by student choice alone.
By common consent at home and abroad, England enjoys a world-class higher education system—not just in the disproportionate number of the world’s leading research universities but in the richness and diversity of provision across more than 100 universities and many further education colleges. That did not happen by accident. Successive Governments have been prepared to invest in higher education, but they have also allowed a high degree of institutional autonomy. It is the willingness to trust the academic and professional leadership of universities that has produced the excellence England enjoys today. It should not be lightly set aside.
Mr MacNeil
As the right hon. Gentleman will be aware, the Conservatives and Liberals want to increase tuition fees. Labour introduced tuition fees and the Scottish National party abolished them. On St Andrew’s day, will he tell us whether he wishes that when he was in government he had followed the example of the SNP?
Mr Denham
No, I do not. As I have already said, this party put record levels of funding into English universities and the fees raised extra money on top of that. The strategy that has been followed in Scotland has been one of systematically under-investing in universities, to the long-term damage of the university system in that country. I believe that that is a mistake.
Mr Denham
I would like to make a bit more progress, for the reasons that I have given.
In defending the current system, let me say that it is not perfect. Student choice should be one, but only one, of the means by which it can be improved. On these key points, we do not agree with Lord Browne. There is nothing in the immediate economic circumstance that justifies betting the whole house on a higher education market for which there is neither justification nor evidence.
Of course, the coalition says, “You set up Browne, you should support him.” Let us be clear, however, that the coalition is not implementing Lord Browne’s proposals either. He says that his proposals are a complete package to be taken as a whole, but in significant respects the Government’s plans differ from his. He said that student numbers should rise by 10% over the next three years, that fees should not be capped and that there should be a clawback to deter unnecessarily high fees and that the right to go to university should be determined by academic qualifications. He proposed higher grants for middle income students. On all those things, the coalition has said no to Lord Browne. Last Thursday, at the Universities UK conference, Lord Browne signally failed to endorse the Government’s plans, although he was given every opportunity to do so. The coalition’s proposals are not Lord Browne’s. They are a bastardised, compromised, coalitionised parody of the Browne report.
What are the Government planning to do? Beyond the cuts in teaching grant and the huge rise in fees, it is far from clear. So two weeks ago, I sent the Business Secretary a series of questions that needed to be answered. I copied that letter to every Member of this House. I thank him for replying last night, but if his reply is the best he can do, he would have been better sending it second class without a stamp. He has failed to answer almost every important question. He says in his letter that waiting for the White Paper would be “unfair” to prospective students and their families, but students need to know exactly how they will be expected to pay back their debt. He says that universities need certainty, but they do not just need to know what the fee levels will be. They need to know what the access rules will be, what their responsibilities will be to fund outreach activities, how many students they will be competing for and how many institutions can offer degrees. None of those questions has been answered.
Steve McCabe (Birmingham, Selly Oak) (Lab)
I am grateful to my right hon. Friend. Has he seen the Business Secretary’s comments in the autumn 2010 edition of the Lib Dems’ “Scottish News Extra”? The Business Secretary likened tuition fees to the poll tax and said that they were an unfair weight around students’ necks. He went on to say:
“It surely cannot be right that a teacher or care worker or research scientist is expected to pay the same graduate contribution as a top commercial lawyer.”
Is that not exactly what he is going to do to students here?
Mr Denham
As it happens, I am familiar with the autumn edition of “Scottish News Extra”. My hon. Friend, wanting brevity, left out the best bit. They are still at it. The next bit of the article says:
“The Lib Dems want to scrap tuition fees across the UK”.
They are utterly shameless in what they will say, which can be contrasted with what they will do.
Let me return to the questions that the House has a responsibility to have answered before the vote. Last week, the president of UUK, Professor Steve Smith—I have summarised his speech, I hope accurately—said:
“Students, their families, and our universities, deserve to know the full details of what is planned.
The Government has promised a White Paper. But this has already moved back in its planning from before Christmas to next March. We then expect an HE Bill in 2011. But this is too long to wait for critical details…First, what does the Government plan to do about student numbers?”
He went on:
“The second unanswered question is the future of the teaching grant. How much will there be left in the budget and how will it be targeted…Thirdly, what provision will there be to support programmes such as widening participation?”
The Secretary of State says that he does not want to
“rush to judgement on the sorts of issues outlined in”
my letter,
“such as the future regulatory landscape and the parameters for supply side reform.”
Those issues will determine the market in which fees must be set. They are crucial to the decisions that universities have to make in the next three months. Although the Secretary of State does not want to rush to judgment, he wants this House to rush to judgment on introducing the highest fees of any public university system in the industrialised world.
Clive Efford (Eltham) (Lab)
I am sure that my right hon. Friend is aware that the Liberal Democrats stood at the last election on a policy of abolishing tuition fees over a six-year period. After legislation, that would have taken us well into the next Parliament—way beyond the period that the coalition has set for dealing with the deficit. Does not that demonstrate that their volte-face on tuition fees is purely political opportunism that means that they completely misled the British people during the election?
Mr Denham
I would have more respect for the Liberal Democrat position if they had not signed up to a total change in the philosophy of funding higher education. As I made clear, this is not a short-term measure because of budgetary pressures while the deficit is dealt with. It is the ending of the public funding of most university degrees. Surely if there was one principle that the Liberal Democrats were defending when they made that pledge, it was the idea that undergraduate higher education should be publicly funded.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Will my right hon. Friend give way on that point?
Mr Sheerman
Has my right hon. Friend seen last week’s article by Sir Peter Lampl in The Times? He is a man who has done more for higher education than almost anyone in this country and who is totally unbiased in his politics, and he describes this double hammer blow to higher education as a disaster in a sector where we were world leaders.
Mr Denham
I did see Sir Peter Lampl’s article in The Times. It was a devastating critique of what is being proposed and it is all the more significant coming from somebody who supported the Labour Government’s introduction of top-up fees a few years ago. He is not a blind opponent of graduate contributions but somebody who has assessed the evidence of what enables students from poorer backgrounds to get to higher education and believes that this change will be damaging. Let me be quite clear: universities need to plan for 2012-13. Decisions will have to be taken by universities in the early months of next year, but only the Secretary of State’s indolence stands in the way of a full White Paper and draft legislation in January that would allow the House to consider the changes as a whole.
Let me take the issues in turn. How will graduates repay their debt? The Secretary of State said in his letter that
“we have put our costings and calculations in the public domain”,
but I had to submit a Freedom of Information Act request for the models before the Government published a so-called ready reckoner. The Library has now discovered that BIS uses a more complex model that has not been published. The Library told me:
“The ready reckoner version which has been published is a simplified version”.
So much for openness.
For all the talk of fairness, it is clear that middle-income graduates will pay the most. Library analysis shows that graduates repaying fees of £7,000 a year and a maintenance loan who work in middle-income graduate jobs will have to pay back 84% of a whole year’s gross earnings whereas those in the top 10% of earners will pay back less than half a year’s gross earnings. Million Plus reports today that the changes will leave between 60% and 65% of graduates worse off with middle-income earners being hit the hardest.
The coalition says that the threshold for repayment will be set at £21,000, but that is in 2016 prices. In real terms, that is the same as the £15,000 threshold that started in 2006 and is due for review next year. That is not generous: it is sleight of hand. Lord Browne said the threshold should be uprated every five years in line with earnings. The ready reckoner published by the Department assumes that it will be uprated every five years in line with earnings, but the Minister for Universities and Science, the right hon. Member for Havant (Mr Willetts), says only that there will be periodic uprating. I asked the Secretary of State whether that uprating would be laid down in law, but his letter is silent on that point. Even the dubious claims made about fairness depend on regular uprating in line with earnings, but if it is not in law it means nothing. The House must see draft clauses, not vague promises, before it is asked to vote on the fee cap.
Andrew Percy (Brigg and Goole) (Con)
I have always been opposed to tuition fees, including when they were introduced by the Labour Government. Does the shadow Secretary of State recognise that people such as he and I are in a particularly difficult position? We can do one of two things: play this issue for shameless politics or attempt to come up with an alternative. It is his job to ask questions, but when will he tell us his alternative?
Mr Denham
We have made it very clear that there are choices to make about the pace of deficit reduction. We would deal with the deficit but would not choose to make the reckless cuts across public services that the hon. Gentleman supports. There are also choices to make within Departments and we would not cut higher education funding by 80%. Neither would we want a system of graduate repayment that put all the burden on middle-income graduates. There are choices to be made and the hon. Gentleman should consider these matters carefully.
Emily Thornberry (Islington South and Finsbury) (Lab)
Will my right hon. Friend give way?
Mr Denham
I must make some more progress; many Members wish to speak in the debate.
Let me address fair access. The proportion of students coming from lower-income backgrounds has steadily increased, but education maintenance allowances are being scrapped for 600,000 students and Aimhigher is being ended. The ladders of opportunity are being chopped down as we debate tonight. What will happen to the widening participation money that institutions receive because it can be more expensive to support students from non-traditional backgrounds to successful graduation? Will they still get it or will they have to take it from their fees?
The Government want universities to fund outreach. How much of that is meant to come from increased fees, essentially charging students extra for the privilege of being encouraged to go to university? The Government say that universities can charge £9,000 in exceptional circumstances; will the Secretary of State tell the House tonight what “exceptional” means? Will universities that currently do well on widening participation be able to charge £9,000 or will it be only those that do not? Will universities be punished for failing to meet their access agreements?
How will the national student scholarship work? Is the £150 million for one year or for three? Will the Secretary of State tell the House how many students it will cover and at what income level? Will it even cover the students on low incomes who are already in the system? The House needs to know the answers to these questions. If it pays for a free year, will that be just for the most expensive courses in the most expensive universities? If so, why should a student taking a £27,000 course get their fee cut to £18,000 while a student taking a £24,000 course will still have to pay £24,000? Where is the fairness in that? If it is available only for some universities, where is the fairness for poorer students in other places?
We all want the Government to ensure fair access, but until these questions are answered all this is only warm words—and the Secretary of State will not answer. All that he will say is that if the fee cap is raised, he
“would expect to write a letter of guidance to the Director of Fair Access.”
Shuffling off responsibility like that will not do. He must know what exceptional circumstances means—he just will not tell us. But if he wants to hide behind the director of fair access, let him write to Sir Martin Harris today asking him to bring forward proposals in the new year so that the House can consider them before the fee cap comes to a vote.
Universities are over-subscribed, so it matters to students how many places there are. The fees that universities charge will depend on how student numbers are controlled and distributed. The Secretary of State says:
“We will need to continue the type of student number restrictions that the previous government imposed in order to control public spending costs”.
That is an extraordinary response because student numbers are tightly controlled both overall and by institution. If that does not change, they will not get their market. There will be no competition and no incentive to change. It will be the worst of all possible worlds with the highest fees, little or no new money for universities and no change. It makes a nonsense of everything the Government have said and we need to know what they really have in mind.
Will there be new private universities competing with public universities and will they get public funding as Browne proposed? The Secretary of State has said:
“We will set out proposals on new providers of higher education in the White Paper”,
but the House should know before we vote on the fee cap. What about part-time students? Yesterday the Government slipped out an impact assessment which said that
“we estimate that around two thirds of part-time students will not be eligible for fee loans. At the same time, the withdrawal of teaching grant might mean that fees are increased across the board (including for students not eligible for fee loans). This could have a negative impact on part-time participation overall.”
Is this what he means by a fair deal for part-time students? What about universities that train teachers? Their funding will be cut and their MPs will be asked to raise fees before Christmas, but the Department for Education’s proposals on funding teacher education will not be published until after Christmas.
We have no guarantees on fair payments, no guarantees on fair access, no guarantees on fairness for part-timers and no guarantees on student numbers. There are all these unanswered questions but the Secretary of State wants to push the vote through so that the hon. Member for Bermondsey and Old Southwark can come out from under the bedclothes. These questions could all be answered by a White Paper before we vote, but the Business Secretary does not have a good record on White Papers. He promised us a growth White Paper in October, but it did not happen. It was then promised for November, but it did not happen. Yesterday, the Chancellor confirmed what officials had already told the Financial Times—that it was not going to happen because there was nothing to put in it.
With higher education we do not know whether the Business Secretary does not know what to put in a White Paper or does not want to tell us. He could publish the White Paper, produce draft legislation on repayments and have the vote on fees all in January. We all have plans for Christmas, but this is the day for him to tell the House that he cares more about the future of our great universities and our young people than he does about the chance to appear in a celebrity edition of “Strictly Come Dancing”.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Mr Speaker has decided not to select the amendment.
The Secretary of State for Business, Innovation and Skills (Vince Cable)
I urge the House to oppose the motion. I agree with the right hon. Member for Southampton, Itchen (Mr Denham) that this is a very serious and big issue. It arouses strong emotions—there are people out on the streets protesting about it—and I think we deserve something a little better than this anticlimactic procedural motion about whether to proceed with a vote before or after a White Paper. Surely, this is an opportunity for him to set out alternatives.
Vince Cable
I will deal with interventions later.
The right hon. Member for Southampton, Itchen gave a revealing answer to an intervention from one of my colleagues, in which he acknowledged that there are alternative ways of allocating funding in my Department and in the Government. He did not tell us what they were, but we should examine those choices in detail. The House could reasonably expect, in this massive issue that arouses massive emotions, to hear some indication of what the main Opposition party envisages as an alternative to what the Government are doing.
It has never been explained in the House, but we hear on the grapevine that an alternative idea—the graduate tax—is doing the rounds. Personally, I was instinctively quite attracted to that idea, and we had it very carefully examined. I do not know exactly what the proposal is—whether it is what has been called a pure graduate tax or a system of graduate contributions of the kind we are introducing, which relates payment to the ability to pay. I do not know what the Opposition propose. What is their alternative?
The right hon. Gentleman and his colleagues set up the Browne commission process to examine the options in detail and in general principle. It roundly condemns the alternative that I believe he favours—although I am not quite clear. His Government were in power for 12 years, overseeing student financing and acting on the basis of the Dearing report, which comprehensively demolished the arguments for the alternative the right hon. Gentleman now says he favours, so what is that alternative? What is it?
Vince Cable
I am not giving way at the moment; I may do so later.
What is the Opposition’s alternative? It is perfectly legitimate to ask questions and we shall try to deal with them. What is not legitimate is to create this enormous moral furore, with absolutely no alternative strategy whatever.
Vince Cable
I shall deal with interventions in a moment.
I remind the right hon. Member for Southampton, Itchen that Members from all parties are skating on thin ice when it comes to student financing. He was in the House at the time, so he will remember the pledge on which he campaigned. The right hon. Gentleman quoted our pledge, so I shall quote the pledge on which he campaigned:
“We will not introduce top-up fees and have legislated to prevent them.”
He and his colleagues then voted to do just that.
Vince Cable
Wait a moment. I shall deal with interventions later.
There was no coalition agreement. The Labour Government had a majority of 167. There was no financial crisis. At the time, the Chancellor of the Exchequer was going round telling us that Britain was outperforming every Government since the days of the Hanoverians. There was no economic crisis, yet the Labour Government introduced a system that transferred the burden of paying for universities from the state to individual graduates. They introduced it. We are now dealing with a real crisis and we are trying to deal with it in a coalition context. That is the issue the right hon. Member for Southampton, Itchen has to address.
Mr David Lammy (Tottenham) (Lab)
Does the right hon. Gentleman want to withdraw that last statement? It is wrong to suggest that the current arrangements withdraw funding from the state. He knows that his cut of 80% does that.
Vince Cable
What on earth were top-up fees designed to achieve? They were designed to get graduates to pay instead of the state—that was the whole point.
Emily Thornberry
If the right hon. Gentleman could have his time again, would he be for or against student fees?
Vince Cable
In the context in which we are now operating—an extreme financial crisis—I am introducing a policy that is a great deal more progressive than the one Labour left behind.
There is a problem, and before I move to the specifics, I shall deal with where the Opposition are coming from, particularly their new leader. Last week, he told the press that he was “tempted” to join the student demonstrations. He has had three days praying in the wilderness, dealing with the devil and deciding whether he wants to succumb to temptation. I do not know whether he has, but if he does, and if he addresses the students, I have been trying to imagine what he will tell them. I think the narrative would go something like this: “We feel your pain. We feel your sense of betrayal by the Government and the Liberal Democrats. We have applied our socialist principles, and we are going to produce a fairer system and lead you to the promised land. What are we offering you? What is our policy? Our policy is delay.” The policy is delay—procrastination. There is a new mantra for the National Union of Students executive: “What do we want?” “Delay.” “When do we want it?” “Well, maybe next year—probably.” That is the alternative on offer.
I shall now deal with the core issue—the right hon. Member for Southampton, Itchen himself identified it: how do we finance higher education? The last line of his motion is the only one with any substance; it relates to money and the 80% cut in the tuition grant. That is a serious issue, so let us try to deal with it.
The right hon. Gentleman was an education Minister so he knows perfectly well that there are three separate funding streams for higher education: student support, research and tuition. When we look at the picture as a whole, we see that at the end of the Labour Government about 60% of all student funding came from the state and the other 40% came from the private sector, from graduates and overseas students. As a result of the changes we propose, approximately 60:40 will become 40:60. It is a mixed economy and the state contribution is being reduced.
The question is whether that number is right. Should it be more or should it be less? If the state is to contribute, where should the money come from? The issue we all have to face is this: when we came into government, and I came into this job, I knew that my predecessors were going to cut the Department that I lead by between 20% and 25%. That was the Institute for Fiscal Studies’ analysis, which has never been denied. It is clear from the logic of not having protected Departments that that would have happened. That was in a Department, 70% of whose funding goes to universities. If the Labour Government were not going to cut the tuition grant for universities, we have to ask where the money would have come from.
I shall set out the range of alternatives. A 50% cut in further education was one possibility; another was a 40% cut in science and another was a 45% cut in the innovation and enterprise budget. We know that the previous Government would not have gone down several of those routes; they committed themselves to increasing the science budget by even more than us. I think the Labour spokesman on science made that very clear at our Question Time last week. The Opposition were not happy that we had maintained the science budget; they want to go even further. At BIS questions, they constantly raise the issue of regional development agency funding—they want to spend more money on that. Where will the money come from? Is it from the cuts they were committed to?
There is a choice. We understand that. What could have happened, although the Opposition have been very quiet on the subject, is that instead of raiding the universities, they could have made drastic cuts in the further education budget. That was the real choice: the further education budget for vocational training for young people who do not go to university. It is almost certain—indeed, it was being put in place when I joined the Department—that cuts in further education were already in train. The right hon. Member for Southampton, Itchen has quite properly spoken of the substantial increase in funding for universities under his Government, but he did not point out that the further education budget did not increase at all. I think it actually fell in real terms. That reflects Labour’s priorities.
Mr Denham
That last point is wrong. Does the right hon. Gentleman accept that this whole argument is a farrago of nonsense because it is based on a premise about the level of the BIS budget that is wrong, as has been set out clearly by my right hon. Friend the shadow Chancellor—[Interruption.] I do not want to prolong the intervention. The problem is that the coalition Government insist on denying what they are constantly told. The vote on fees will be a vote not on the policy of the Opposition but on his policy. Why will he not answer the questions that I properly put this evening? Why is he spending all his time doing anything other than answering the questions that I put?
Vince Cable
I will explain in a few minutes why I do not think delay is the sensible option. The right hon. Gentleman acknowledges, and his Opposition motion states, that this is essentially an issue about money and priorities. That is why I am persisting with the question.
It is possible that the Labour Government were not intending to cut further education. There were other options available. They could have cut universities without cutting the tuition grant. How could they have done that? They could have done so by drastically reducing the number of students, a course of action that, I believe, the National Union of Students prefers. But clearly it would be wrong, and the right hon. Gentleman knows perfectly well from experience and research that increasing the number of university students is one of the best ways of promoting social mobility. So I assume that that is an option that the previous Government would not have taken.
We are left with one other basic option. What we could have done—it would have been an easy way out and we would have avoided many of the difficulties that we are having politically—is to have taken the money out of the budget and let the universities get on with it, not raised the cap. The student representatives might well have applauded that. We would have avoided all the difficulties that we are discussing tonight, but the effect would, of course, have been to starve the universities of funding, and our world-class universities would have been undermined.
Given the funding constraints, which the right hon. Gentleman faced as well, we had no alternative but to ask well-paid graduates to make a contribution later in life to the cost of university education.
Hugh Bayley (York Central) (Lab)
I do not need to remind the right hon. Gentleman about the pledge to scrap tuition fees, but perhaps I do need to remind him that the Liberal Democrats’ manifesto said that policy
“is affordable even in these difficult economic times, and without cutting university expenditure”.
The right hon. Gentleman is widely regarded as an expert on economic affairs and the downturn. Did the Lib Dem manifesto get its economics so very badly wrong, or would a lesser policy of maintaining the status quo be affordable?
Vince Cable
The hon. Gentleman may have forgotten, but I think he was a Member of the House when his party committed itself to not increasing tuition fees, under conditions where there was no financial pressure at all. We face severe financial constraints. That is the reality.
Vince Cable
No. I will continue.
We were driven to the logic of the Browne report, which the right hon. Member for Southampton, Itchen and his colleagues set up. In responding to it, we have done two things. First, one of the questions that I asked Lord Browne, which it never occurred to the right hon. Gentleman and his colleagues to ask, was how do we make the system more progressive? I had to ask Lord Browne that because it was not part of his terms of reference. As a result, the Browne report has come out with a series of recommendations, many of which we have accepted, that make the system significantly better than the one that we inherited.
Let me deal with one of those measures, which relates to part-time students. The right hon. Gentleman talked about part-time students, but he forgot to mention that their fees were left unregulated by the previous Government. He has not mentioned that two thirds of part-time students are postgraduates. That explains the anomaly and his question. For part-time students reading for their first degree, under the changes that we are going to introduce, there will be no up-front fees, which was the arrangement left behind by the previous Government. Part-time students get a significantly better deal under our proposals than they would have done under the Opposition.
Frank Dobson (Holborn and St Pancras) (Lab)
Will the right hon. Gentleman give way?
Vince Cable
I will take the intervention when I have finished the point. I am interested in the right hon. Gentleman’s views.
The second point that Browne adopted at our request in order to make the system more progressive was significantly to raise the threshold. The right hon. Member for Southampton, Itchen asked legitimate questions about the pricing of the threshold and what that means in real terms. Those are valid points, but he did not point out that when the Labour Government introduced their threshold they did not increase it at all. So we are making a perfectly valid comparison between £21,000 and £15,000, whether those are in today’s prices or 2015-16 prices. It is a significantly better system in which large numbers—roughly 25%—of low-paid graduates will be better off under our proposals than under the system that we inherited from the Labour party.
Frank Dobson
I have the honour to represent Birkbeck college. Has the right hon. Gentleman just said that people who already have a degree and go to Birkbeck for another one will not get any help?
Vince Cable
The arrangements for second degrees under the existing regime are quite different, as the right hon. Gentleman knows, from the arrangements for first degrees. The proposal is that we treat first degree part-time students considerably more favourably than they are treated under the existing arrangements. If he checks back with Birkbeck college and with the Open university, he will note that those universities regard our proposals as a significantly better arrangement than the one they currently have.
Shabana Mahmood (Birmingham, Ladywood) (Lab)
The Secretary of State is obviously having a difficult time answering questions about his policy in any detail. Let us try a straightforward question—yes or no. Is he going to vote for it? [Interruption.]
Vince Cable
Thanks to the shouting of the hon. Lady’s colleagues, I could not hear a word she said. Would she like to repeat the question?
Shabana Mahmood
I am happy to repeat the question. The right hon. Gentleman is obviously having a difficult time answering any questions about this policy. I am asking a straightforward question—yes or no. Is he going to vote for it?
Vince Cable
I have made it absolutely clear in all the interviews that I have given today that my wish and strong inclination is to vote for a policy that I believe in passionately—[Interruption.] This is a policy that I believe in. It is a significantly better policy than I inherited. It is right.
The hon. Lady knows, because it operates in her party as well as in mine and in the Conservative party, that decisions on who votes are taken collectively. We will take a collective decision—[Interruption.] The hon. Lady asked me a question. I am trying to give her an answer. [Interruption.] Does the hon. Member for Kingston upon Hull East (Karl Turner) want an answer or not? We will make a decision based upon the coalition agreement as it affects my colleagues and our Conservative coalition partners. That is how we will vote, and we will do it in a disciplined way, but my own views are clear. [Interruption.] This is a significant—
Mr Deputy Speaker (Mr Nigel Evans)
Order. Would hon. Members now please be quiet? I am finding it incredibly difficult to listen to what the Minister has to say, and if I cannot hear him, neither can they.
Vince Cable
Opposition Members will discover, when the regulations are introduced—
Vince Cable
No, I will not give way again. I have answered the question.
We will decide how we are going to approach the matter, under the coalition agreement. I am clear that the policy is significantly better than the one that we inherited. I am responsible for it and I have every intention of continuing to promote it.
Vince Cable
No, I will not give way again. I have dealt with the issue.
The issue of the Browne commission was raised, and I have made the point that I asked the commission to produce a policy that was significantly more progressive than the one that we had, and Lord Browne has done so. We have not accepted the commission’s report in its entirety, however; we have made significant changes to make it a better policy.
Vince Cable
Will the hon. Gentleman sit down and let me finish the point?
The Browne report—a report commissioned by the right hon. Member for Southampton, Itchen and his colleagues—recommended no limit on caps. I do not know whether the right hon. Gentleman remembers that. No limit was proposed, but we have proposed to limit the cap to a manageable and reasonable level that reflects the costs of universities. The report also suggested that—
Vince Cable
No, I am not giving way again.
The report also suggested that caps should be lifted without appropriate conditions for universities, but we are going to introduce those conditions. Let me explain them. We have responded in the circumstances that I have described to the need to make financial decisions; we have produced an outcome that a Labour Government would almost certainly have followed in very similar terms; and we have produced a policy that is more progressive than the one we inherited and better than the Browne report.
The right hon. Gentleman poses a question about delay. What are the merits of delay as opposed to proceeding immediately? There are several reasons why it is desirable to make progress. First, the Browne commission was itself an extensive consultative process, and the right hon. Gentleman knows because he helped to set it up. There was substantial discussion and public hearings, and he probably deserves some credit for having established an extended process that was so open. Many of those debates have already been had, therefore, and the evidence is available on which to make decisions.
The second point is a practical one, which I am sure that the right hon. Gentleman understands. If the cap is going to be introduced for the academic year 2012-13, it has to be introduced quickly. There is a practical reason, and that is why we have to proceed, but there are a series of issues—he has listed some—on which we clearly need to consult and reflect further. He quite rightly says that we need more detail on the national scholarship scheme, and we have suggested that an arrangement could be used to benefit students from low-income families by providing free tuition through, let us say, the first year of their university career.
There are different ways of approaching the problem, and we would like to talk to the National Union of Students and to university bodies about the best way of giving incentives through the scholarship scheme to low-income families. The current arrangements do not work well, as the right hon. Gentleman knows because he presided over the policy for some years. We have not achieved the level of participation in higher education by families from that background that we should have. After his period in office, 57% of all pupils in higher education came from advantaged areas, and only 19% came from disadvantaged areas. Surely, after the failure of programmes such as the bursary scheme, it is right that we reflect on and consider the best way of using Government money to achieve higher participation.
The right hon. Gentleman asks also about the access conditions, and again it is surely right that we consider all the evidence available. I will write to the regulator about how the situation can be improved, but, if the right hon. Gentleman’s party has anything to tell us from its experience in government, I shall be very interested to hear it, because his Government set up the regulator six years ago, I think. As a result of that experience, the relative position of low-income students trying to get into the top third of universities has deteriorated. Their conditions of access failed as a matter of policy. Surely it is right that we consider further how we can make the policy work, and we shall do so.
Mr Denham
Before the right hon. Gentleman moves further beyond the Browne report, I must note that he referred to one issue that was at the core of the report: the uprating of the threshold. He and the Minister for Universities and Science have not yet said whether Browne’s proposal to uprate the threshold every five years in line with earnings will be made a statutory commitment. The Secretary of State has published figures that, he claims, show the system to be progressive—based on uprating by earnings every five years. Will he now tell the House whether that will be a statutory commitment?
Vince Cable
I can confirm that it is our firm intention to do exactly that. Whether the measure requires embedding in a statutory instrument is a matter on which we will seek advice, but I am very confident and very happy to have that commitment—the uprating by earnings of the threshold—made firm by law. How it is done—through a statutory instrument or subsequently—is a matter on which we clearly need advice. The right hon. Gentleman is quite right to ask the question, but he should perhaps remind Labour Members that he had an opportunity to uprate thresholds and never did so when in government, despite the fact that his Government’s financial position was more comfortable than the current one.
Clive Efford
The right hon. Gentleman is missing one important point in this debate. Throughout the country, students are demonstrating not because of his technical arguments, but because the Liberal Democrats made a point of saying one thing to them at an election and started to say something completely different within hours of the ministerial cars turning up. Students are listening to what he says tonight, and what they want to hear is, is he going to vote for the proposal, yes or no?
Vince Cable
I thought that that intervention might be worth waiting for, but the hon. Gentleman merely echoes his next-door neighbour on the Opposition Benches, the hon. Member for Birmingham, Ladywood (Shabana Mahmood), to whom I have given an answer.
I have sought to answer in correspondence some of the questions that the right hon. Member for Southampton, Itchen has asked, and I am happy to debate the technical points and to correspond further with him, because my colleagues should rightly have as much information as possible. That is how we intend to approach the debate. He said that the costings and calculations were not made available, but they have been made available—to him, his colleagues and the Institute for Fiscal Studies. The models are very complex ones that produce different outcomes depending on assumptions, and we are very happy to share them. We could have hidden them in a black box and pretended that the outcomes were true, but we have shared the assumptions and analysis and are happy to continue to do so.
Stephen Williams (Bristol West) (LD)
Debates at elections and the Browne report’s methodology have been mentioned several times, but is not one of the fundamental flaws in the deliberative process that Lord Browne went through the fact that, although the report could have been published before the general election, the then Secretary of State, Lord Mandelson, deliberately made sure that we could not have a constructive debate during the campaign, because the Labour party knew that the report paved the way for a rise in fees?
Vince Cable
Well, my hon. Friend knows the background, as he was shadowing the portfolio at the time and spoke to the individuals involved. He makes that point, and it is useful that I finish on this note—
Vince Cable
No, I will not take any more interventions.
The right hon. Gentleman and his hon. Friends commissioned the Browne report knowing perfectly well that what would follow from it was a recommendation significantly to increase the cap level for universities. That is what they were committed to, and that is what they would have done. We know, because of the financial position of the country and the commitments made by the former Chancellor and by my predecessor, that there would have been deep cuts in this Department resulting in a very substantial reduction in the support for universities, the consequences of which were inevitable.
It is sheer dishonesty and opportunism—[Interruption.] It is dishonest and opportunistic for the right hon. Gentleman and his colleagues to pretend that they would have done anything other than introduce recommendations to increase the graduate contribution, but with one significant difference from what we have done, because it never occurred to them that the graduate contribution should be made significantly more progressive. That is what we have done, and that is the proposition that I will be putting to the vote before Christmas.
Mr Deputy Speaker (Mr Nigel Evans)
Order. As hon. Members can see, a large number of hon. Members wish to contribute to the debate. The Speaker has therefore imposed a five-minute limit on speeches.
Hugh Bayley (York Central) (Lab)
Spending money on universities is not wasteful or unnecessary public expenditure. We need universities because they drive economic growth through the skills they impart to students and the new knowledge they unlock through research. The UK has some of the best universities in the world. One of the reasons the UK experienced stronger economic growth over the past decade than other countries in the European Union is that we have better universities and so a better knowledge base for our businesses.
York has two exceptionally good universities, and they have helped to drive economic growth in the local economy. Between 1997 and 2009, the number of jobs in York grew from 44,000 to 60,600—a 38% growth, far outstripping the national or regional average. Many of those jobs are high-tech, high-skill jobs, but they bring lower-skill jobs in their wake. The importance of universities is not lost on our economic competitors. State investment in universities grows apace in India, China and many other countries. Indeed, other OECD countries, which, like the UK, are having to cut their public expenditure, are also, almost without exception, increasing spending on higher education because they know that it will aid recovery.
Only the UK and Romania are cheese-paring their universities. I have first-hand experience of cheese-paring, because I was an academic at the university of York in the late 1980s and early 1990s, when the last Conservative Government cut funding. Two years ago, Chris Patten, a former chairman of the Conservative party, made a speech in which he said:
“In just over a decade we doubled the number of students and halved the investment in each”,
which led to
“poorer pay, degraded facilities, less money to support the teaching of each student”.
I did not sign the National Union of Students pledge before the last election, even though I am a former vice-president of the NUS, because I knew that universities badly need extra money. I thought that a modest increase in what students pay after graduation would have been fair had there also been an increase in Government funding, but I cannot support the Government in increasing fees by some £5,000—almost £6,000—and cutting the tuition grant to universities by 80%.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Does the hon. Gentleman welcome the announcement made by the Welsh Government that fees will not be at full or near-full cost for Welsh-domiciled students, which achieves one of the key pledges of the One Wales agreement between his party and mine?
Hugh Bayley
I have not seen that statement, but I will look at it closely.
I cannot support the Government’s plans because they are reducing state funding for universities. That is a betrayal of the country’s future and a betrayal of the future of this country’s young people, especially young women. The Liberal Democrat manifesto pledged:
“We will…Tackle the gender gap at all levels of scientific study and research”.
The Library’s research paper on higher education funding, published on 23 November, reveals that women make up more than 80% of the bottom half of graduates by lifetime income and just over 1% of the top 30%. Yet the same paper says that average repayments as a proportion of lifetime income are more than twice as much for the bottom 50% as for the top 10%. That reveals how regressive and unfair the Government’s proposals are to women.
Under Labour, higher education funding increased by 25% and undergraduate numbers increased by 20%. The number of young people from York going to university for the first time increased from just over 2,000 in 1997 to more than 3,000 in 2008. York’s two universities received more than £150 million in capital from the Government between 2000 and 2010, rising from £500,000 a year at the start of the period to £28 million at the end. Now that legacy is being swept away by Lib Dem and Conservative spending review policies. It is no surprise that there is anger on the streets of this country—the big society seems to be finding its voice.
Mr Rob Wilson (Reading East) (Con)
I welcome Lord Browne’s report and the six principles on which it was based, in particular those of increased student choice and of everyone having the potential to benefit from higher education, no matter what background they come from. It was an excellent piece of work, and was set up by the previous Labour Government, but it has apparently been rejected by Labour in favour of a graduate tax—although I have difficulty understanding what the Labour party’s policy is, because it seems to be using a blank sheet of paper, and I am not sure what is on it at any given time.
Lord Browne specifically rejected a graduate tax, and the case against a pure graduate tax is damning. The shadow Secretary of State complained that graduates will be repaying loans for up to 30 years, yet they would pay his graduate tax for the rest of their working lives, resulting in some graduates paying the cost of their courses many times over. In addition, most graduates would have to repay separately any debt incurred for living costs while studying.
There are serious questions about the ability of a graduate tax to produce the necessary revenue to fund higher education. Faced with the record budget deficit left by Labour, a graduate tax would mean the Government having to spend an additional £3 billion a year for at least the next five years. According to the Browne review estimates, a graduate tax would not produce enough revenue to fund higher education until 2041-42. Importantly, a graduate tax would not give universities any additional incentive to focus on the quality of the teaching or student experience that they offer. The Browne review concluded that
“the graduate tax significantly weakens universities’ independence”
and that their relationship with students would matter “much less”. That cannot be the modern, forward-looking, 21st-century higher education system that we want for this country.
The shadow Secretary of State complained recently, as he did tonight, that the Government’s reforms will
“create a market in which solely student choice, shapes the size of universities and courses on offer.”
I wonder what he fears from a model under which students are fully empowered and can make informed decisions about the type of higher education that is best for them. Labour has always disliked personal choice because it instinctively prefers command and control structures, operated from the centre. Is the Labour party really suggesting that successful and popular universities should continue to ration places, forcing ambitious students to settle for their second or third choice? Universities are at their best when they are not dependent on Government for too much of their funding. Without some sort of market, there is no pressure for universities to improve their teaching quality or their student support to attract more students.
Mr Wilson
No, I will not because I have only one minute and 45 seconds left.
I say to my right hon. Friend the Secretary of State that the reforms must not be half-hearted. If we are continually to drive up quality throughout the sector, there must be no student numbers cap for individual institutions. We must not be in a position under the new system where the state steers students into university courses that they do not really want to do and forces them to settle for second best. In the past, that has been done for the best, if misguided, intentions, but it is wrong to keep underperforming universities in their current form at the expense of the quality of the higher education that the student receives.
Facing up to the reality of higher education finance involves very hard choices, which the Opposition do not seem to want to take. It also provides a great opportunity to reform our university system for the benefit of all students and society in general. Faced with higher contributions after graduation, students should demand more from their university. Prospective students will rightly think much more carefully about their choices and demand more information about their university, such as its teaching quality, student support and the employment destinations of other graduates. That will force universities to ensure that their courses really offer value for money and provide evidence of that fact. Once some universities start to account for their performance, if others fail to follow suit students and parents will ask what they have to hide. That will be an incentive for universities to become more innovative, for example by offering shorter degree courses.
Paul Farrelly (Newcastle-under-Lyme) (Lab)
Seven years ago, I helped to co-ordinate the Labour Back-Bench opposition to variable tuition fees and a market in higher education, both before a White Paper that was published a whole year before the vote and subsequently. I did it on a point of principle. I felt that I had not come into politics to make it more difficult for people like me, from my sort of background, to go to university, or to put young people who were qualified and determined to go to university, as I was, in a situation in which the price of a university course became just as much a part of the equation as what to study and where to go.
The Prime Minister and the Chancellor may not quite be on that wavelength, but I hope that the leader of the Liberal Democrats will realise that today there are still many young people in Sheffield, as in areas such as mine, on whom there is pressure to go out and work and contribute to the family income at 16. That is why the prospect of debt is important. It is another argument used to put pressure on young people not to go to university.
Labour Back-Bench pressure had real results on the market in higher education, which Liberal Democrats in particular might heed before rushing for an early vote on fees. First, right up until Labour’s White Paper went to print, the Russell group had expected fees of £5,000. It was no magical typesetting fairy that secured the cap at £3,000, it was simply Back-Bench strength and Government fear of defeat. As everyone was charged £3,000, no real market was created.
Mr MacNeil
As a student in the late ’80s and early ’90s, I followed people who are now Labour MPs in marches against loans, and then I saw those same people move on from the National Union of Students, become Labour MPs, get on television and advocate tuition fees. Was it a mistake for Labour ever to introduce tuition fees, and is the argument about whether they should be £3,000 or £6,000 just a matter of scale?
Paul Farrelly
The scale is certainly important. The level of debt that students acquire is fundamental to the argument about where the Government are going.
The second thing that we achieved was to secure better student support, through grants and new bursaries. Those changes to support were vital in offsetting the deterrent effects of higher fees on less well-off students. That is why anyone on the Government Benches who has concerns—not just Liberal Democrats—should insist on seeing the whole package in a White Paper before rushing to a vote on fees alone.
Thirdly, we gave MPs an opportunity to debate the matter by securing as part of the compromise the democratic handle that now exists, so that the cap could not be raised by the stroke of a Minister’s pen or by a Committee upstairs, hand-picked by the Whips. Instead, we ensured that there had to be a vote on the Floor of the House, so that we were all accountable for our votes.
Those days seem rather distant now, but after 2001, we had an enormous majority—I think about three times the size of the coalition’s majority now. Yet on Second Reading, 74 Labour MPs, including myself, still opposed the proposals, which is 17 more than there are Liberal Democrats in the House now. Every Liberal Democrat joined us in the Lobby, as well as all but one Conservative, and the Government scraped through by five votes, such was the level of concern.
I am rehearsing this trip down memory lane not to make myself popular with Whips with long memories but to prick the consciences of every Liberal Democrat, in particular, and to show what can be achieved by standing up and being counted. If most of the 57 Liberal Democrat Members who signed their election pledge stuck to their guns, we would once again prevent a market in higher education. They have much more leverage than we did, but seven years ago, Labour Back Benchers changed the policy enormously by taking up the battle.
I shall talk about the evidence later—anyone who cares about equality of opportunity will know that sound evidence should underpin sound policy—but as a slight detour, I shall shine some light through the fog of excuses that the Lib Dem leadership have been using to cover themselves. They said that the financial situation they found in government was worse than they expected when they made their manifesto pledge, but that is patently untrue, because the Treasury’s own numbers showed a movement of £5 billion to the better in projected debt from April to May this year.
Neil Carmichael (Stroud) (Con)
What did the hon. Gentleman expect when Lord Browne produced his report, because it was set up by Lord Mandelson, who I understand is becoming more and more popular in the Labour party? What did the hon. Gentleman and his hon. Friends think Lord Browne would say?
Paul Farrelly
I would have expected Lord Browne’s report to be put to the House, so that hon. Members could make their minds up on whether they agreed with it or not. I certainly did not expect a report that was not totally independent. It was shaped by the new coalition because the expectation was for an 80% cut in teaching grants. The notion that the report was truly independent is a fallacy.
The Liberal Democrats also said that we face Greek contagion, and how the promise of not 25 or 50% cuts, but 80% cuts in teaching must soothe the bond markets. They have tried to shift the goalposts. At Prime Minister’s questions recently, the Deputy Prime Minister, in a there-you-two-go-again moment, said:
“We all agree…that graduates should make some contribution”—[Official Report, 10 November 2010; Vol. 518, c. 281.]
The trouble is that the Liberal Democrats never agreed that there should be a contribution. When the Business Secretary announced the U-turn, the Lib Dem website was still advertising, in the “What we stand for” section, their six-stage plan to abolish fees entirely. We know through leaked documents that the Lib Dem leadership planned to ditch the pledge all along if the coalition dream came true—as the first casualty, with no hard bargaining. I am sorry that the Deputy Prime Minister and leader of the Liberal Democrats is not in the Chamber because that is not new politics; that is time-dishonoured, old-fashioned cynicism. The only thing that has changed is that the Lib Dems are finally in government. No wonder students are demonstrating and no wonder that Lib Dem voters feel betrayed.
The new policy is not only a breach of faith, but according to the evidence, a large leap in the dark. Under Labour, the participation of people from less well-off backgrounds at university did not decrease, but frankly, neither did it rise dramatically. What seems to have occurred is common sense: improvements to student support helped to offset the deterrent effect of fees, debt and its perception. It has also become more normal for young people to want to go to university. There is similar evidence from overseas of what happens when fees are introduced—from Australia, Canada and New Zealand —yet there is also plenty of evidence of the harmful effects on participation from big increases in fees.
At some of our universities, participation has a shockingly low base, likewise in some of our professions, including medicine—the same is true of the US Ivy league—yet those are the places and courses that will charge the highest fees. Comparatively, our fees will be more than the general level in Australia, New Zealand and Canada, yet when Canada lifted the fee cap on courses such as medicine, there was a large fall in participation. It is hard to see what in the coalition’s policy will improve participation, but I fear that much of it will make the situation worse.
Mr John Leech (Manchester, Withington) (LD)
I welcome the opportunity to speak in this Opposition day debate. When I heard that it would be on the important issue of the future of higher education funding and the contribution that graduates will be expected to make, I thought that we would finally get to hear what the Labour policy on that is. The Leader of the Opposition supports a graduate tax, and the shadow Chancellor of the Exchequer does not support that, so this was Labour’s first opportunity to make it clear how it would fund higher education. What a disappointment the Opposition motion is. It is bluster and waffle, and contains absolutely no policy. It is yet another example of shameless opportunism and opposition.
The coalition Government should take no lessons on tuition fees. It is worth reminding the House time and time again that it was the Labour Government who introduced tuition fees, after making an explicit manifesto commitment that they would not do so, and with an enormous Commons majority. It was also the Labour Government who were responsible for setting up the Browne review, with the explicit intention of increasing fees. But because they knew that it would be unpopular, they cynically delayed the outcome of the review until after the election to avoid losing votes.
Nobody should be duped into believing that Labour would not be proposing increasing tuition fees if they were still in government. The only difference would be that a Labour Government’s proposals would be an extension of the unfair and regressive tuition fees introduced by the previous Labour Government. All graduates would have been worse off, and we would not be expecting our wealthiest graduates to pay a reasonable contribution.
This evening, I want to make it very clear that I do not support a rise in tuition fees, and I have made it clear publicly that I will vote against any attempt to lift the cap on fees. Call me old-fashioned, but unlike the Labour party, I actually support free education and I believe that a first degree should be free. That is why I supported our policy to scrap tuition fees. The House should be clear that things would have been different under a Liberal Democrat Administration, rather than a coalition Government, but we have to face the fact that 66% of people voted in the election for parties that were committed to increasing tuition fees, so in coalition discussions it was always going to be difficult to win the argument on tuition fees and force them to be scrapped.
Fiona O’Donnell (East Lothian) (Lab)
It is forecast that 30 cm of snow will fall tonight in my constituency. That is relevant because Lib Dem members are delivering the leaflet I am holding. Will the hon. Gentleman call off the leafleters until we see where the Secretary of State’s intentionometer settles?
Mr Leech
I am not sure how to respond to that. I do not even know which constituency the hon. Lady represents. In any event, I will vote against an increase in fees, even though I know that my right hon. Friend the Secretary of State has worked incredibly hard to come up with proposals that will make the system fairer than the current fees system. Nobody will pay back any fees until they earn more than £21,000, there will be no up-front fees for part-time students and additional support will be made available for poorer students.
I will vote against tuition fees simply because I believe that an increase in the cap will discourage some young people from going to university in the future. Under these proposals, the 25% least well-off graduates will be better off than under Labour’s current system, but the flaw in my right hon. Friend’s proposal is that no one goes to university thinking that they will be among the least well-paid 25% of graduates, so it will put some off.
I certainly will not support this lazy Opposition motion. It does not offer any alternative to an increase in tuition fees. It is not about any need for the Government to clarify its position—it is simply about party political point scoring. It is the Opposition who need to clarify their position, not the Government. The Labour party needs to come clean on its plans for higher education funding and student finance, so that its sudden cynical conversion to opposition to increased fees can be exposed for the sham that it is.
Joan Ruddock (Lewisham, Deptford) (Lab)
Does the Minister know what Antony Gormley, Mary Quant, Damien Hirst, Bridget Riley and Sam Taylor-Wood have in common? They are all past students of Goldsmiths college in my constituency—[Interruption.] I am sorry; it was not a joke. All have become leaders and innovators in their chosen field and brought honour to the arts in the UK. It is what Goldsmiths college, which has been part of the university of London for 100 years, is good at.
Today Goldsmiths college has more than 5,500 undergraduates, more than 3,000 postgraduates and close to 1,000 members of staff, and it is one of the top five employers in Lewisham. But for how long? Goldsmiths’ focus is on the arts, humanities and social sciences, and because of that, it can expect to lose most, if not all, its teaching funding—a staggering £16.5 million. Even as I say it, I can scarcely believe it. I say that as a science graduate who has always championed the cause of greater science funding.
It cannot be a question of either/or. Institutions such as Goldsmiths and the Trinity Laban conservatoire of music and dance, of which I am a director, have no options. Even now, they are unable to calculate the precise implications of the Government’s draconian spending cuts on their future funding or the fees they will need to charge.
Joan Ruddock
I accept what my right hon. Friend says—he is correct, and of course it is a disgrace.
The Higher Education Funding Council cannot give these institutions the answers to those questions, and no doubt the Minister cannot tell them either—although I invite him to prove me wrong when he responds. These colleges’ fees structures will need to be decided by March next year, which is a mere four months away. [Interruption.] The Minister can clearly change the timetable, because it is his timetable that means that they have to decide in four months. How does an institution cope with the requirement to make up the loss of possibly all its teaching funding? What significant changes will it have to make to what it offers and how it offers it? It will have to rethink its whole modus operandi.
Yesterday, I spoke to constituents of mine who attend a variety of colleges making up the University of the Arts London. They told me of their own experiences. Some had been able to go to sixth form colleges and do A-levels in arts subjects only because they received the education maintenance allowance that the Government now intend to abolish.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
Does my right hon. Friend share my concern, which a lot of young people have also expressed to me, that the scrapping of Aimhigher and the EMA and the terrifying prospect of £9,000 a year of debt will put off thousands of young people even thinking that university is for them?
Joan Ruddock
My hon. Friend is correct, and I am sure that in her constituency, as in mine, there are many young people who really believe that all their hopes and aspirations have already been dashed because those ladders of opportunity have been cut away.
The students of whom I was speaking are today doing part-time jobs, which are increasingly difficult to find, in order to purchase many of the materials they need for their specialist courses. They already feel the burden of current levels of student debt, and told me that they could not possibly contemplate paying three times the current fee levels. The same is true for the students of Goldsmiths and for the many school children in my constituency who now despair of getting a university education.
Goldsmiths is known internationally for its creative and innovative approach to teaching, being ranked ninth in the UK for its world-leading, four-star research. I can only guess what fees of £9,000 a year will do to the aspirations of today’s young people. I cannot comprehend what the loss of teaching funding could do to Goldsmiths college. Frankly, I am astounded that coalition Ministers can propose such action and that Lib Dem Members could vote for it.
Jim Shannon (Strangford) (DUP)
Does the right hon. Lady agree that those who graduated and got their degrees in previous years would not have been able to do so if the tuition fees proposed by the coalition Government had been in place?
Joan Ruddock
Indeed I do.
Have the Minister and his Front-Bench colleagues no understanding of the long-term cultural benefit to society that comes from the arts, humanities and social sciences? Do Ministers not even comprehend the economic value of the cultural industries that thrived and grew so much in the past decade? Under coalition plans, university education will become the preserve of the rich, diminishing the diversity and talent of our creative and cultural sectors, and impoverishing us all. Ministers should hang their heads in shame.
Iain Stewart (Milton Keynes South) (Con)
In the few minutes available to me, I want to focus on two aspects of the debate that are of critical importance, but which are often overlooked in the heat—rather than light—generated by the Opposition. They are support for part-time students, and the Government’s wish to make the higher and further education sectors more flexible.
Both the Open university and the new University Centre Milton Keynes are close to my constituency, so I, too, have a strong local interest in the issue. Both institutions have welcomed the Government’s broad approach. In a speech to the Universities UK conference last week, the vice-chancellor of the Open university, Martin Bean, said:
“I believe we are on the brink of creating a more diverse, flexible and open system of higher education in this country which will provide greater choice and opportunity for young students and adult learners alike and which will have a strong focus on quality. This is a significant step forward.”
I completely agree with that sentiment. In our current economic climate, we need to have imaginative new solutions that will deliver focused, relevant and timely higher education at a lower cost.
Pamela Nash (Airdrie and Shotts) (Lab)
Does the hon. Gentleman agree that we are talking about an ideological decision that is not based on reducing the deficit? Repayments will not start until 2015, thereby not reducing the deficit during this Parliament.
Iain Stewart
I am not going to take any lectures from the Opposition about cutting money to universities when my right hon. Friend the Secretary of State’s predecessor, the noble Lord Mandelson, cut some £900 million from the university budget just before the election.
What we are focusing on is what will be relevant for our higher and further education sectors. We must develop higher education options that respond to the fast-changing global economic environment. Long gone are the days when people got one degree that set them up in a job for life. People will have to retrain and reskill many times through their working lives. People will have more portfolio careers and will need more flexible training options to engage with our fast-emerging economic competitors. Improved support for part-time students is critical to encouraging people to study at lower intensities, combining work and studies in different proportions. I welcome the move to put in place a single, integrated system of finance and support.
I would like to raise one or two points of detail that my friends at the Open university have raised with me. The first, and most significant, is the definition of the intensity of a part-time course. The Government have announced that they will reduce the current level to the equivalent of one third of a full-time course, and that is a huge step forward. I must point out, however, that the Open university has more than 100 courses—they involve 25,000 students, mainly in science, technology, engineering and maths—that have an intensity level below one third. The Open university would like the intensity level to be set at about a quarter. I appreciate that that might be difficult to attain in a single step, but I hope that the Minister will at least consider averaging out the intensity level for the duration of a course, because students often want to start off at a lower intensity level until they become more comfortable with the subject, after which they can increase the proportion as the course progresses. I hope that that is a constructive comment that the Minister can take on board.
The Minister for Universities and Science (Mr David Willetts)
I will of course undertake to look at the specific point that my hon. Friend has raised on behalf of the Open university. Will he also accept from me that, contrary to what we were told by the Opposition, it is already the case that we will be helping two thirds of first degree part-time students with our proposal to extend access to fee loans to them? The only way in which the Opposition can attain their figures is by including, for example, part-timers doing a second degree, and the only reason that they are not included in the policy is that it was the Labour Government’s ELQ—equivalent or lower qualifications—policy that excluded them in the first place.
Iain Stewart
My right hon. Friend makes an important point. I know the impact that the previous Government’s changes to ELQs had on the Open university. It had to take a multi-million pound hit.
Mr Gareth Thomas (Harrow West) (Lab/Co-op)
Will the hon. Gentleman take this opportunity to join me in asking the Minister whether he will clarify a point about the Higher Education Funding Council for England, which this year is getting targeted funding of some £71 million to support part-time students and another £142 million to widen student participation? Will he ask the Minister whether those targeted allocations will be continuing at the same level over the course of the comprehensive spending review period? Is not the Open university, for example, entitled to some clarity on those questions as well?
Iain Stewart
I would have more sympathy for the hon. Gentleman’s intervention if he had not cut £900 million out of the HEFCE budget earlier this year.
The second point that I wish to make relates to the national scholarship programme, which has already been mentioned. I very much welcome it as an incentive to help students from more disadvantaged backgrounds, but will my right hon. Friend clarify whether, when the details are firmed up, it will explicitly encompass part-time students on lower incomes, and mature students as well a school leavers, within its scope? I hope that the Minister will be able to clarify that as well.
Time prohibits me from exploring some of the other points that I would wish to raise. I shall conclude by making a few observations about making the higher and further education sectors more flexible. The University Centre Milton Keynes, which the Minister has visited, is based on the new concepts of cloud higher education, or University 2.0. These are exciting and innovative concepts, based on a partnership model that involves further education, a variety of universities, the civic community, the third sector and local business. There is much interest locally in taking this project forward and making it work.
I strongly commend the Government for setting out to make this sector more flexible and responsive, and I hope that by addressing some of the points of detail that I have raised tonight, we can make that vision a reality.
Pete Wishart (Perth and North Perthshire) (SNP)
I should like to start by saying just how proud I am that, in Scotland, under a Scottish National party Government, we will not be introducing these pernicious tuition fees. We will not follow the example of the Conservatives, the Liberals or Labour by burdening our students with crippling debt. We will do all that we can to ensure that in Scotland, education remains free. It will remain free to us because it is important to us. Scottish education was built on the foundation of being free, and our universities were built on that principle. It is a tradition, a history and a culture that we cherish, and we will not give it away lightly. Tuition fees, introduced by Labour and taken up with relish and aplomb by the Conservatives and their Liberal minions, are something that we will not—
Pete Wishart
I will give way to the hon. Gentleman, but I want him to say how sorry he is for introducing tuition fees, and to congratulate the SNP Government on getting rid of them.
Ian Murray
I do not know what I have done to make everyone begin to be rude to me, but the Secretary of State started it, so perhaps I have done something wrong.
Let me compliment the hon. Member for Perth and North Perthshire (Pete Wishart) on the start of his speech. Will he comment on the massive amount of communication in which he has engaged with the Scottish people, which is similar to the communication in which the Liberal Democrats have engaged? Would he, too, lie to students at a general election by saying that he would write off all the student fees? Would he lie to students to get elected, and then turn his back on that pledge as well?
Pete Wishart
It will not surprise you to learn, Mr Deputy Speaker, that I am disappointed by the hon. Gentleman’s intervention. I expected a little contrition on Labour’s part, even if it consisted only of the words “We are sorry for introducing tuition fees”. If you were a student in Scotland and you had a choice, who on earth would you support? Would you support the Labour party, which introduced tuition fees, wanted to increase them exponentially and initiated the Browne report, or would you consider the SNP, which had nothing to do with tuition fees and even went as far as abolishing Labour’s graduate endowment? That was our commitment to free education in Scotland, and I make no apologies for it.
Pete Wishart
I am sorry. I do not have enough time.
How do we differ from the London parties? We believe that education should be based on the right to learn, not on the right to pay. We do not share their view that funding higher education should be a matter for the student. We believe that higher education makes a valuable contribution to our communities which enhances our societies, and we therefore believe that higher education funding should come from the state.
I see that some Members are beginning to twitch. They are all thinking, “If Scotland is not going to introduce these pernicious fees, what is Wishart going on about?” They are thinking, “Surely the SNP only votes on Scottish issues, and is leaving this legislation alone.” That is true, but these pernicious fees will have a significant impact on Scottish higher education. They could have disastrous consequences for our universities. It is the job of every Scottish Member of Parliament in the House of Commons to defend and protect the Scottish interest, and I make no apologies for doing just that job.
I see that some Liberal Democrats are present. Do they realise—do they understand and appreciate—the impact that tuition fees will have on their higher education? In case they do not know what will happen, I will tell them. Because English universities will be awash with tuition fees—appropriations from their students—we will be at a competitive disadvantage. The fact that we will not have the same development and resources to provide research facilities to attract international students could have disastrous consequences. Moreover, because tuition fees come from the students themselves, they will not be subject to the departmental Barnett consequentials. As the budget for English education rises, our share, determined through the Barnett consequentials, will fall. Of course English students will see Scotland as an attractive prospect.
Hugh Bayley
I do not know whether the hon. Gentleman has read the note from the Library, but it tells us that in the five years since top-up fees were introduced in England, the number of applications to English universities has increased by 16%, whereas in Scotland it has increased by only 8%. Why does the hon. Gentleman think more students are choosing English universities?
Pete Wishart
I was going to give a figure myself. I would be interested to hear the hon. Gentleman’s view on it, although I am not able to give way to him again. Because the SNP Scottish Government have rejected the idea of tuition fees, fee refugees from England are going to Scotland to take places at Scottish universities, thus denying university places to Scottish students, and that will increase. That is because students who might otherwise be facing a lifetime of Clegg debt will, of course, look at Scotland as an attractive option.
Pete Wishart
I will not give way as I am running out of time.
I want to be as generous as possible to all the other political parties represented in this House, as I always take what they have to offer in debates very seriously. We know the Tories’ position. The Minister for Universities and Science is described as “Two Brains” and it is Tory thinking that runs through those two brains. Of course tuition fees is a Tory idea. We know that; that is the sort of thing they do—they hurt the poor and they make sure students will have to pay for their courses—but Labour, for goodness’ sake, introduced tuition fees and voted to increase them exponentially, although, thankfully, they were defeated in that. Labour also initiated the Browne review, but now in opposition they let out a howl of protest about what the Tories are going to do, yet we have no idea what they would plan to do.
The Liberals are the comedy act in this turn. Breaking this pledge might be the biggest suicide gesture in modern political history. We have seen the leaflet that was handed out in Scotland opposing tuition fees just at the point when they are going to introduce them, but we should not mock the hon. Member for Manchester, Withington (Mr Leech) because he is the good guy now. We have to get the Liberals with us to ensure this measure can be beaten. It is up to them; they can ensure that this is seen off. It is up to the Liberals to make sure they do that.
The Scottish Government will not be cajoled or bullied into following this course of action. We are going to have to consider our response, given what this Government are going to do. We have ruled nothing out other than these tuition fees. We must defend our universities by making sure they are protected and they remain world class, but we will oppose this. We make no apologies for ensuring that Scottish universities are maintained and protected, and that we have the best universities in the world.
Malcolm Bruce (Gordon) (LD)
I do not deny for a minute the passion of the hon. Member for Perth and North Perthshire (Pete Wishart), but as was pointed out in an intervention, his party promised it would abolish student debt. There was no coalition; there was a minority Government. Yet within a week they said, “We only promised this because we didn’t think we’d win the election. We couldn’t afford it; it was uncosted and it was undeliverable.”
Malcolm Bruce
No, I will not give way.
I also want to make it clear that, interestingly, the abolition of tuition fees in Scotland was delivered by the Liberal Democrats and Labour working together, and the abolition of the graduate contribution was delivered by the Scottish National party and the Liberal Democrats working together. We are not at all a party that comes to this issue embracing the principle of tuition fees; we are a party that has engaged with genuine integrity in a coalition, which has led to our being faced with deep and difficult decisions that none of us finds easy or comfortable, and we are not pretending that we do.
I also want to make it clear that as a result of devolution and the Calman reforms that are coming, the Scottish Parliament and Scottish politicians can decide to have free university education in Scotland for as long as we can prioritise that within the budget. There is not an obligation upon the Scottish Parliament to follow suit. As the hon. Member for Perth and North Perthshire rightly said, it is equally true that we will have to ensure that we can maintain our universities to world-class standards and fund them, as is also the case for the universities in England and Wales. The difficult question to be faced is that we must consider not only how we can fund them today, but how we can fund them in five, 10 and 15 years’ time. I completely accept that we can take a decision to do this for free, but if we do I doubt whether we will be able to maintain our universities’ world-class status, or 40%, 50% or 60% participation. Most importantly, if the Liberal Democrats were to disengage from this process I doubt that the students would welcome the consequences of our not having been there.
Ian Paisley
Does the right hon. Gentleman accept that the doubting Thomas performance from those on the Government Front Bench that we have witnessed tonight has done nothing to convince the students outside—or, indeed, the ordinary public—that this Government actually have a policy on fees that is fit for purpose? Does he also agree that it is the duty of the Government not merely to attack the Opposition policy, but to come up with a policy that they are convinced of themselves—that has the conviction of the Government and that takes this House forward on a note of conviction, not of attack?
Malcolm Bruce
What is clear is that the Government have a policy, whereas the Labour party absolutely does not. I have the utmost respect for the right hon. Member for Lewisham, Deptford (Joan Ruddock), who spoke with genuine commitment and sincerity, and I take the point that she is making. But what does she say to people who tell her that under this system they will not be able to go to university, that they could not have gone to university or that their children will not be able to go? Does she say, “You are absolutely right. You should despair. Just despair”? Does she not say that they should have a proper look at what is actually being proposed? I accept entirely the cultural fear that people have of debt, but there are no fees to be paid up front, increased maintenance support—grants and loans—is available and people pay the money back only as and when they earn salaries that are rising. People from poorer backgrounds should seriously reflect that that gives them more opportunity to go to university than ever was the case before.
Joan Ruddock
Frankly, the right hon. Gentleman insults the intelligence of my constituents, who understand very well that there are to be no up-front fees to pay, as indeed there are not at the moment. It is the overall burden of debt for a lifetime that they are afraid of, and rightly so.
Malcolm Bruce
What I would stress to the right hon. Lady and to the students if they will engage and listen—the ones that I have spoken to have done so and have accepted this—is that this is a much more progressive arrangement than exists at the moment and than the Labour Government set up. The repayments are generally lower—for 20 to 25% of people they are significantly lower—but for the higher earners they are higher. Consequently, this is a much more progressive system. The truth is that if a parent or young person is considering going to college or university, they face no up-front fees. If they come from a poorer background, they can obtain a higher maintenance grant than is currently available and larger loans than are currently available, on a fairer rate of exchange, and repayments start only when they are earning—
Malcolm Bruce
I am not going to give way. The repayments are entirely related to what people earn.
Malcolm Bruce
I can tell the hon. Gentleman that I had the privilege of going to a privately funded school and university, but I did not get the opportunity to go to Oxford or Cambridge because my father was not prepared to pay further fees for me to do the entrance exam, to delay further and then to pay for me through one of those universities. I have no regrets about going to the very good Scottish universities from which I have graduated, but the point is that if I was in that situation today, I could decide for myself that I could go to Oxford or Cambridge because I could get the funding and I would pay it back when I had got the benefit of that education.
This is simply a matter of calculating that an education is a benefit to the entire state—the state should therefore facilitate it, support it and maintain its quality—but it is also a benefit to the individual. Some individuals will use that benefit in ways that are less commercial—they will do things that do not earn them a great deal money—but they will therefore not pay anything like the whole of that investment back; they will not be required to do so. They would be if there was a graduate tax—
Malcolm Bruce
I am not going to give way. Secondly, people can also make the calculation, “I made the investment, I made the repayment and if I choose to seek commercial benefit from it, it is only reasonable that I should pay a contribution back.” In one way or another—this argument applies even if we opt for free tuition and free fees—the individual pays it back through general taxation. The difference here is that we are trying to connect it to the actual education.
I suggest that our approach has an implication for quality. Two things will drive university quality up: the demands of students and competition from other universities, nationally and internationally. It is fair enough to criticise our policy, with which many of us are not entirely comfortable. However, I suggest to Opposition Members that to be credible in doing so it behoves them to come up with a viable alternative as to how they can ensure that our world-class universities will continue to have access to the funding that will maintain them as such and ensure that the students who go to them will have enough influence to ensure that they get the quality of education that they deserve. That is what this is about; this is a difficult decision, but Opposition Members need to engage much more intelligently in the debate.
Anas Sarwar (Glasgow Central) (Lab)
It is a great pleasure to follow two fellow Scottish Members, although we had a rather delusional performance from the hon. Member for Perth and North Perthshire (Pete Wishart). It is understandable—he is still feeling a bit dizzy after the economic crisis in Ireland, on which they are modelling Scottish independence.
Let us return to the debate at hand. Anyone who has witnessed the huge and largely peaceful demonstrations against the coalition’s plans will appreciate just how important the issue we are debating is for thousands of students, school pupils, teaching staff and parents. I shall surprise hon. Members by saying that I agree with the Deputy Prime Minister. Before the election, he said:
“If we have learnt one thing from the economic crisis, it is that you can’t build a future on debt.”
Now that he is in government, he conveniently forgets that our future is our young people. The coalition Government are hitting them with record levels of debt as they leave university.
The future prosperity of our country depends on the UK’s being a skill-based economy. To drive that, we must invest in higher and further education, not cut teaching grants by up to 80%. The plan is, in effect, a Tory-led privatisation of our higher education system.
Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)
My hon. Friend raises the important point of the 80% cut in the teaching grant. Does he agree that that is a profound retreat from state funding of the British university system?
Anas Sarwar
I absolutely agree with my hon. Friend and that is why we need a wider debate on the role of the state in educating our young people.
Anas Sarwar
Not just now; I will give way in a wee moment. I am coming back to the Scottish angle, and I am sure that the hon. Gentleman will want to intervene on that point.
The question is who benefits from a university education. Is it, as the coalition believes, only the student who benefits, which means that they should pay most, if not all, of the costs? Or does the country as a whole benefit from a well-educated work force driving our economic prosperity? That is the ideological debate we need to have in this House.
No matter where one goes in the world, unrivalled importance is attached to education. When the Business Secretary and the Prime Minister had their bonding session in China, they might perhaps have learned the Chinese proverb: “If you are planning for a year, sow rice. If you are planning for a decade, plant trees. If you are planning for a lifetime, educate.”
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
On investment, will my hon. Friend join me in asking the Minister why only his Government, along with the Romanian Government, are cutting university spending at a time when every other OECD country is increasing investment in its higher education system?
Anas Sarwar
I absolutely agree with my hon. Friend and I hope that the Minister will respond to that point when he makes his speech.
Right hon. and hon. Members may be forgiven for thinking that this issue solely affects England, but that could not be further from the truth. The proposals will have profound and far-reaching consequences for the rest of the United Kingdom. I have two universities in my constituency in Scotland and 80% cuts in higher education funding in England mean that Scottish universities stand to lose at least £400 million a year. It also has consequences for Scottish students who wish to study in England and English students who wish to study in Scotland.
Mr MacNeil
Does the hon. Gentleman feel that it was a mistake that the Labour party first introduced tuition fees in this country—and will he say sorry?
Anas Sarwar
I thank the hon. Gentleman for that intervention but I will take no lectures from a Scottish Government and an SNP who stood at the election promising to scrap student debt for every student across Scotland and who failed on every single promise. The hon. Member for Perth and North Perthshire asked why young people would ever vote for the Labour party in Scotland, but he should look at the polling data for the general election and the opinion polls for the Scottish elections that are coming up. We outpolled the Scottish National party in the youngest bracket—18 to 24-year-olds—and I think that that will be reflected in the results in May.
I also want to take the opportunity to say that the Scottish Government must stop dithering.
Mr Willetts
I am grateful to the hon. Gentleman for allowing me to intrude on this Scottish argument. Do we not have here a very clear comparison of the two systems? Does he accept that we have fees and loans in England and a very different system in Scotland? Contrary to what we heard, will he confirm that it is therefore very significant that we have 4,900 English domiciled students going to Scottish universities but 11,500 Scottish students coming to English universities? What does that tell us about the two systems?
Anas Sarwar
Indeed. The Minister does not recognise that the decisions taken by his coalition Government will have a massive impact in Scotland. We cannot have this dithering from the Scottish Government; we cannot allow a situation in which students go to university in Scotland without knowing how they will pay for that education when they leave. Even the most hardened right-wing Government Members have to admit that far from being fair and progressive, these plans are some of the most unthought-through, unfair and aggressive that the coalition Government have announced so far.
Mrs Madeleine Moon (Bridgend) (Lab)
The point that my hon. Friend is making about the cuts of 80% in teaching grant is the important issue of the day. If our students are to have quality education, they must have quality teaching. Cutting the teaching grant is not the way to encourage people to stay in university teaching or to encourage our universities to expand. In Wales, the university teaching grant will be cut by only 35% to ensure that good academics stay in our universities.
Anas Sarwar
I thank my hon. Friend for that intervention and agree wholeheartedly. Under the coalition’s plans, a couple with three children and one income of £35,000 could save £100 a week for 20 years and still not be able to pay for their children to go through university. It is not wealthy people who will be penalised; instead, the firefighters, teachers, police officers and small business owners will suffer.
Anas Sarwar
I have given way plenty of times but I need to carry on.
It is time that the Liberal Democrats stopped being so shameless on this issue. As we have heard already, in the past few days, the Business Secretary has been delivering leaflets—not personally, but he has been quoted in them; perhaps he should go out and deliver them and then he might get the reaction in the Scottish streets. A headline on the leaflet reads “Cable attacks unfair UK university fees”, and the text goes on:
“Liberal Democrat Business Secretary Vince Cable has launched a scathing attack on…unfair tuition fees which still have to be paid by Scottish students studying elsewhere in the UK. He likened tuition fees to the infamous poll tax, as the fees are seen as an unfair weight around students’ necks…The Lib Dems want to scrap tuition fees across the UK, as they did in Scotland in 1999”.
Wake up and smell the coffee! I signed the pledge to vote against these fees and I will honour that pledge.
Eric Ollerenshaw (Lancaster and Fleetwood) (Con)
May I declare an interest in this fascinating debate? Like the hon. Member for York Central (Hugh Bayley), I represent two universities and I want to lead the debate on to them.
Lancaster university is a multi-million pound business that reached the top 10 of English universities; indeed, last year it was top in performance in physics. It makes a massive contribution to Lancaster and the wider Lancashire economy and it hopes to develop and proceed in what it perceives as a global market. That point has not been mentioned tonight. It wants to provide the best tuition and facilities.
Before the election, the pressure for an increase in fees came from universities. The previous Government faced that issue by cutting a certain amount, which Lord Mandelson did, and, to be fair to them, by setting up the independent Browne review. There might be an argument about whether that was kicked into the long grass to prevent Lord Browne from saying anything before the election because Labour needed to compete in so many university seats, but I would not suggest that. Labour set up the review and waited for the report. As a result, the whole of the previous Cabinet did not sign up to the pledge, although many Labour MPs—116, I think—did. I went to university debates in my area and I did not sign the pledge, but every single opponent of my candidature did—except the British National party, but I do not think that it was offered the opportunity to sign, thank God.
That was the situation. Now, universities say that they want a system that can fund them. I do not want to go into the deficit argument, but I think we all accept that things are tight.
Damian Hinds (East Hampshire) (Con)
Is my hon. Friend aware that 40 years ago there were 600,000 students in higher education, 20 years ago there were 1 million and today there are 2.4 million? That is a very good thing, but when there are such fundamental changes we have to think again, as we have on pensions and social care and as we are doing now on higher education.
Eric Ollerenshaw
And as we found out under the Labour Government, fees do not seem to hinder people wanting to go to good universities.
As an ex-teacher, the test for me is how we can increase social mobility. I shall repeat points that others have made, because they are important and they are being lost in the issue of marches and the encouragement by some Members of what they call direct action—something from the old days of the 1980s. That is the hypocritical line they are selling some students. At least we have maintained no up-front fees—as has been said by previous speakers. More important, a lot of students will pay far less in the future because the threshold has moved to £21,000, which is about £540 less.
Eric Ollerenshaw
May I finish this point?
It seems to me that what has been left out of the debate is the Government’s commitment to finding £150 million for a national scholarship scheme, and I congratulate Ministers on that. The coalition has been trying to do what the Labour Government talked about but never achieved—joined-up government, through our proposals for the pupil premium and for the national scholarship scheme. We are going even further, by demanding that universities that want to charge the highest rate should do much more—not just through scholarships, but through the work being done by charities and voluntary groups, such as the Social Mobility Foundation—to encourage pupils from disadvantaged backgrounds at least to try to aim a bit higher.
Eric Ollerenshaw
No, I want to finish this point and I have very little time.
The coalition is trying to deal with disadvantage not just in higher education, but in secondary and primary education. In these difficult times, we are attempting to make links between them and provide a world in which we have top-class education. Our top universities will still be competing with the best universities in the world, but with the increased involvement of children from disadvantaged backgrounds. That includes part-timers. Unlike the right hon. Member for Lewisham, Deptford (Joan Ruddock), I do not believe the scare stories about kicking down the ladders. We are trying to put up ladders in very difficult times.
Paul Blomfield (Sheffield Central) (Lab)
Having enjoyed the irony of being lectured about dishonesty by the Business Secretary at the outset of the debate, I congratulate the Minister for Universities and Science on his honesty in setting out the context for consideration of this issue in his response to questions following his statement to the House on 3 November. He made it clear that the Government’s response to the Browne review was only partly driven by the need to deliver the cuts demanded by the Chancellor. He said that it was about
“delivering reform as well as saving public money.”—[Official Report, 3 November 2010; Vol. 517, c. 944.]
However, as with the decisions being made on the economy, it does not have to be like this. There are choices, and the Government are making the wrong choices. The choice is not just about funding; it is a fundamental remodelling of our university system, which follows a worrying ideological trajectory that was perhaps best described by the hon. Member for Reading East (Mr Wilson), who is no longer in the Chamber. It will transfer the cost of teaching from the state to students themselves. It will make our universities some of the most expensive in the world. It will withdraw all public funding from the majority of courses in the majority of our universities and will send a statement to all those who are teaching or studying the arts, humanities and social sciences that their courses are not worthy of support. It will introduce a market that encourages the best universities to charge up to 50% more for their courses.
What will be the impact of that new model? We know from research and from experience in the States that debts of up to £50,000 for fees and maintenance will deter those who cannot easily contemplate huge debts, those from families without experience of higher education, those from the poorest families and those from families on average incomes. The impact will be felt strongly in areas where we already need to do more to widen participation.
My hon. Friend the Member for Newcastle-under-Lyme (Paul Farrelly) highlighted the case of medicine. The BMA’s modelling suggests that medical students will graduate with debts of about £70,000 and that the proposals will hugely damage efforts to encourage those from lower socio-economic groups to study medicine.
Greg Mulholland
I thank the hon. Gentleman. I opposed the introduction of fees under the previous Labour Government. I would be interested to know if he did, too. He represents many students, as I do. Away from party politics, does he agree that whatever the merits of the different cases that have been argued here, the Government have not convinced people that their arguments are the right ones, and that it is important that there should be a delay in the process so that whatever is eventually proposed, students, academics, universities and all of us can support it?
Paul Blomfield
I certainly agree that there should be a delay in the process. We are on the verge of the most fundamental reform of our higher education system in more than 50 years, and it is an outrage that we are putting the cart before the horse by being asked to make a decision on the financial framework for our universities before we have had a debate on the higher education White Paper to conclude what sort of university system we want.
Like the hon. Gentleman, I signed the pledge to vote against any increase in tuition fees. Unlike my neighbour, the Deputy Prime Minister, the right hon. Member for Sheffield, Hallam (Mr Clegg), I do not regret it. I did not make the decision lightly, but I made it with the intention of keeping it. On 12 October the Business Secretary casually dismissed the pledge with some obscure reference to “skid marks”, but let me remind Lib Dem Members that their pledge was no manifesto small print.
In university seats such as mine, the Liberal Democrats fought the election on the issue. As the president of Sheffield Hallam university students union said,
“Before the election, we couldn’t get the Deputy Prime Minister out of our Union . . . now we can’t get him in.”
The outcome of individual elections was determined by that pledge. Just days before the election, what was it that the Deputy Prime Minister said?
“The Liberal Democrats are different. Not only will we oppose any raising of the cap, we will scrap tuition fees for good . . . Use your vote,”
he said to students,
“to block unfair tuition fees and get them scrapped once and for all.”
Now we know that while the Deputy Prime Minister was making that heartfelt appeal, he was planning to ditch the commitment.
I accept that most Lib Dem Members who were kept out of the loop by the Orange Book faction that now leads their party signed that pledge with honest intention, and I urge them to keep to that honest intention. If they vote in favour of the proposals, not only will they be dashing the hopes of thousands of young people, but they will be destroying the confidence of those young people in democratic politics. This was the election in which the Liberal Democrats tried to seize the moral high ground, talking about honesty, trust, integrity—
Paul Blomfield
No, I will not lose any further time.
Voting in abstention, knowing that Conservative votes will push the measures through, will also be seen to be deeply cynical, so I urge Liberal Democrat Members to honour their pledge, join Opposition Members and vote down the proposals.
David T. C. Davies (Monmouth) (Con)
We should be very grateful to Opposition Members for showing us the difference between opposition and naked opportunism, because tonight we have had more naked opportunism than we would get at a convention of lap dancers. Opposition Members know perfectly well what the problem is, because they caused it. It is a debt of £1 trillion, which doubled long before the banks crashed, and a deficit of £168 billion a year. That is the problem we face.
David T. C. Davies
I will give way once and only once. The hon. Lady had better consider whether it wants to be heard.
None of us, from either side of the House, wishes to penalise students, but students join a long list of people who are lobbying us at the moment: the police, the armed forces, pension policyholders, Equitable Life policyholders and people with infected blood. They and many others all have a good case, and to all we note the same problem: we simply do not have the money, because, as Labour’s former Chief Secretary to the Treasury said, “The money has all gone.”
Susan Elan Jones
The hon. Gentleman seems to forget that in Wales the Labour-led Administration are already leading the fightback against the disgraceful policy that his party proposes. He often forgets what the majority consensus is in Wales, so will he please acknowledge that point this evening?
David T. C. Davies
The hon. Lady and I are both well aware that the Welsh Assembly Government had nothing to do with the £1 trillion debt, and I shall make it my business to ensure that they never do have any such responsibility.
The NUS could do itself a favour if it gave a few lessons to its students before encouraging them to negate their life chances by bunking off school. It should tell them about the £1 trillion debt, stop scaremongering and inform them that nobody will pay a penny up front. It is worth making that point again and again, because when I went to Monmouth comprehensive recently I found that the pupils who had taken time off from school were not all aware of that fact. No one on the Government Benches, or anywhere else, wishes to penalise people who want to go to university. That is why there will be no fees up front—I say it again. Not only that: we will not expect anyone to pay back a single penny until they earn £21,000 a year.
I do question—it is a personal view, with which I often find myself expressing in this House—whether it is wise for more than 50% of the population to go to university to do degree courses of three and sometimes four years when some of them will receive lectures, as one young lady told me, of only five hours a week. I question that. Not many others do, it is true, but, as long as we have that situation, it has to be paid for.
I take issue with one other point that the NUS makes. I do not disagree that it benefits all of society when people go to university, but it benefits all of society when people leave school and go and get a job, as I did. I did not go to university; I paid my taxes after I left school, and I did not disbenefit society by doing so. Some Opposition Members might sneer, but let me tell them that at the age of 21 I decided that I needed extra qualifications, so I went off and got a heavy goods vehicle licence, which cost me £1,000 of my own money in 1992—and that was a lot of money. It cost me a lot, so I made sure that I turned up on time, did not have a hangover and worked hard for those two weeks, because I knew that nobody was going to help me out if I failed.
One consequence of the scheme before us, which nobody wants to bring about, is that everyone will now ask themselves such questions: “If I’m going to pay for tuition, is this going to get me a better job? Can I afford to go out to the student union bar tonight? Can I afford to miss that important lecture? Because, at the end of the day, this is my money, not just taxpayers’ money.” That is an important point.
None of us wanted to see this situation, but it has been forced upon us. The coalition Government are made up of people of many different political hues, let us not pretend otherwise, but one thing unites all Government Members. We are prepared to face up to the difficult decisions that Opposition Members will not face. We are not prepared to allow tomorrow’s generation to pay for the mistakes of yesterday’s politicians.
Mr Gareth Thomas (Harrow West) (Lab/Co-op)
This has been an interesting debate, but what is clear at its end is that the Government are set to railroad through this House and the other place their plan to treble fees for students and their families. As my hon. Friends the Members for York Central (Hugh Bayley), for Newcastle-under-Lyme (Paul Farrelly), for Lewisham, Deptford (Joan Ruddock), for Glasgow Central (Anas Sarwar) and for Sheffield Central (Paul Blomfield) have underlined, it is now clear that Ministers lack the political courage to spell out the full implications of the Chancellor’s unprecedented 80% cut in university teaching grant.
Each time there has been a major change in the way in which universities are funded and students supported, there has been a full and proper debate in this House, with Government having set out their proposals in full before a vote. Parents are surely entitled to expect Parliament to have considered in detail the arrangements for student maintenance, yet we have merely a pencil sketch before us, as opposed to the painted canvas that a White Paper could have offered. The Deputy Prime Minister worries that potential students are being confused and put off. Well, let him publish the Government’s White Paper and clarify once and for all what is intended.
Such a White Paper might be able to answer some of the many questions that students, their parents, universities, and now even MPs on the Government’s own side, such as the hon. Member for Milton Keynes South (Iain Stewart), are asking. As my hon. Friends and, in his own sweet way, the hon. Member for Reading East (Mr Wilson), who is no longer in his place, pointed out, how student numbers are controlled matters, because it sets the boundaries of the market. Draft those measures wrongly, and the pressures pushing fees higher will be even more considerable. On what basis will universities be allowed to set the so-called exceptional fees of £9,000? We have been told by the Deputy Prime Minister that these plans are a great leap forward because of the national scholarship fund, the more equal treatment for part-time students and the increase in the threshold for starting repayment being lifted from £15,000 to £21,000. Yet we do not know what is being cut to fund the national scholarship fund. Aimhigher has gone already, and other “widening participation” money is set to go too, perhaps. The fund is not looking quite so generous now. While equal treatment for part-time students might be a good thing, many vice-chancellors are now predicting that fees for part-time courses are set to increase dramatically, so I hardly think that part-time students will be jumping for joy either.
Is not the truth, as the Higher Education Policy Institute and the 2010 global higher education rankings confirm, that if these proposals go through, English students will be taking on levels of student debt not seen in any other country in the world, and England will have the most expensive public higher education system in the world? Is not the truth also, as Sir Peter Lampl of the excellent Sutton Trust, which has done so much to try to widen participation in higher education, put it, that
“we are about to embark on a university funding regime in England that is totally out of line with that of any other higher education system in the Western world”?
The Chancellor tells us that debts are a very bad thing. He says that we should not borrow too much and that we should see the national finances as being like the family budget. Then the right hon. Member for Havant (Mr Willetts) comes along and says that any family with ambition who wants a university place, or any 16 or 17-year-old or mature student who wants to better themselves, will have to burden their future family finances with years of higher debts. You really do not need two brains, Mr Speaker, to see that these proposals seem set to discourage extraordinary students from families on ordinary incomes from going to university. We know the penchant of Conservative Members to join exclusive university clubs, and now we know that they want to do to universities what the Bullingdon club used to do to restaurants.
Then there are the Liberal Democrats. We knew before today that their leader, the Deputy Prime Minister, had knowingly hawked his tuition fee pledge from one constituency to another, while all the time he and the other Orange Book Liberals wanted to ditch it. We now know, as of today, that the Secretary of State for Business, Innovation and Skills is willing to abstain—in an unprecedented scenario, to put the interests of his MPs before those of students and their families and our universities. In short, he is willing to put his party’s interest before the national interest.
In families and across universities up and down the country, these unanswered questions mean the difference between whether the brightest and the best will be able to go to the university of their choice to do the course that they want and is most suited to them. The Government should publish a White Paper to end this confusion. I commend our motion to the House.
The Minister for Universities and Science (Mr David Willetts)
We have learned a lot about Labour’s approach in this debate. We have learned that it wants delay; we have learned that it wants careful consideration; we know that it needs more information; and we know that it wants to go slow. As my right hon. Friend the Secretary of State would put it, it wants to go slow, slow, slow-slow, slow. That is the only thing that Labour is offering. That does not just reveal the inadequacy of Labour’s approach to education; it matters, because if the changes that we propose were not in place in 2012, there would be a real financial challenge for our universities. The Secretary of State has made clear our commitment to delivering those changes.
By contrast, we heard from the shadow Secretary of State—
Mr Willetts
No, I have only five minutes.
We heard from the shadow Secretary of State that the speed of deficit financing is a matter of choice. He hinted that he would be willing not to make the public expenditure savings and to borrow the money instead. If he is willing to borrow the money instead, we know what Labour’s approach is—it is willing to impose debts on future generations. There is one difference between our approach and Labour’s: Labour’s approach is indiscriminate and would hit everybody, rich or poor, male or female, and ours means that people will start paying back only when they are earning more than £21,000 a year. That is why our approach to university financing is progressive and Labour’s is indiscriminate and unfair.
Of course, the £21,000 threshold that we propose is far higher than the £15,000 threshold that we inherited from Labour. That is not the only feature of our proposals that is fair and progressive. We are increasing the maintenance grant so that it helps families that earn up to £37,000 a year. The national scholarship programme is worth £150 million. Two thirds of first-time students who study part time will also benefit from our proposals.
Labour is completely disingenuous. It is not carefully waiting for more information or a White Paper, but simply playing for time while it tries to work out what on earth its policy is and whether its leader has the guts to follow the advice of his own shadow Chancellor:
“Oh, and for goodness’ sake, don’t pursue a graduate tax. We should be proud of our brave and correct decision to introduce tuition fees. Students don’t pay them, graduates do”—
quite right—
“when they’re earning more than £15,000 a year, at very low rates, stopped from their pay just like a graduate tax, but with the money going where it belongs: to universities rather than the Treasury.”
I could not have put it better myself. The only difference is that under our proposals, the threshold is not £15,000, but £21,000. We know which is the right approach.
Mr Willetts
No, I will not give way.
We know what Labour does when it is under pressure. In its last public spending document before the election, it proposed £600 million of savings from higher education. There was no waiting around for a White Paper then, no consultation and no careful consideration; just one paragraph on £600 million of cuts. By contrast, we have a proper set of proposals to reform higher education, which, contrary to what the Opposition said, will not mean catastrophic losses in funding for universities. Money can get to universities in many ways, and under our proposals it will get there through the choices of students. We will provide them with the extra money to make those choices, and that is—
Ms Rosie Winterton (Doncaster Central) (Lab)
claimed to move the closure (Standing Order No. 36).
Question put forthwith, That the Question be now put.
Question agreed to.
Main Question accordingly put.