Lord Phillips of Sudbury
There we are: he is an optimist from the Fens. I hope that he will take heed of all that has been said. I have just a small last point. The bureaucratic consequences of the Bill are horrendous, and the amendment has a wonderful simplicity about it. It simply removes overseas students from the tentacles of I do not know how many aspects of our modern, burgeoning bureaucracy.
Lord Stevenson of Balmacara (Lab)
What an excellent debate this has been, my Lords. I have counted 16 speakers on one side, and one on the other. I congratulate the noble Lord, Lord Bourne, on putting his head above the parapet. Although I think he picked up some of the arguments, I did not think his heart was entirely in it, but he put up a brave show. There was lots of vigorous nodding on the Front Bench, but all to no avail.
This amendment seeks to exempt bona fide overseas students from the provisions relating primarily to housing and health charges because I do not think, despite the fact that the amendment says so, that bona fide students are caught by the measures on bank accounts and driving licences, but I would be grateful if the Minister would confirm that when he responds.
This amendment has received considerable support from around the House. We should not really be surprised at that. I took part in a debate about nine months ago that was led by the noble Lord, Lord MacGregor, whose committee had reported on just this point. That debate was again virtually unanimous in recommending that the Government’s then policies should be reviewed carefully to ensure that they supported the arrival and proper education of students from overseas, but here we are.
There seem to be two main thrusts to the arguments which have been made by noble Lords today: first, that this series of measures is one of a number of hurdles and burdens that, taken together, represent an attack on our universities, making it more difficult for students from overseas to study here and thereby endangering one of our most successful exports; and secondly, that the measures are unworkable, possibly discriminatory and overly bureaucratic, will not achieve what they set out to do and should be withdrawn. We have a great deal of sympathy with both those arguments, and we will be listening carefully to what the Minister has to say on the questions that have been raised this afternoon, and I am certain that we will be returning to this matter on Report.
At Second Reading, I referred to the recent BIS publication International Education: Global Growth and Prosperity. Its introduction states:
“There are few sectors of the UK economy with the capacity to grow and generate export earnings as impressive as education”.
It goes on:
“Overseas students who come to Britain to study make a huge contribution to our economy”.
As we have heard, the most recent estimates are that overseas students paid about £10.2 billion net in tuition fees and living expenses in the UK. They boost the local economy where they study as well as enhancing our cultural life and broadening the educational experience of the UK students they study alongside.
This BIS report makes it clear that attracting international students is not an easy matter and that we have many competitors. If the numbers of international students in higher education is to stay as it is or even to grow, there are a number of things we must do right. The report picks out that,
“we must show that the UK values international students, will provide a warm welcome and support while they are here and will keep in touch after they go home".
The questions for the Minister when he comes to reply are, first, whether the measures proposed in the Bill support the assertion made by the Government that the UK is open for international students and that they are welcome to come here; and secondly whether the measures in this Bill help, not hinder, both that general supposition and the reality faced by overseas students in gaining a visa and making a success of their studies here.
There are a number of other questions that I hope the Minister will respond to. He has a good record, not of answering across the Dispatch Box, but at least in writing to us, and I hope he will pick up the various points that have been made. As I was listening, the questions that struck me included: has the department an assessment of the continuing viability of certain STEM courses in particular, of courses offered in higher education in general, and of certain institutions as a result of the decline in student numbers that we think will happen if these measures are introduced? This was spoken to very positively by the noble Baroness, Lady Williams, and others. The noble Lord, Lord Cormack, wanted to know more about the impact on soft power. Have the Government made an assessment of the reduction of soft power as a result of these measures? Has the Minister talked to the CBI about its call for changes in the way in which the visa arrangements operate for various important aspects of supporting the economy? Has the department made an assessment of competitor countries, such as Canada and Australia, and their measures for supporting overseas students? If it has done that, will the Minister put a copy of the evidence in the Library so that we can look at it, because it would make interesting reading? What assessment has the department made of the point made by the noble Lord, Lord Phillips, about personal contact? That is something that we all have experience of and recognise. He said that we cannot measure it in economic terms, and he may be right, but I think you probably could value it. It is certainly important in terms of the world that we live in.
In the commentary circulated after Second Reading, the Minister did not really engage with the issues that have been raised this afternoon. He wafted away rather airily some of the points made by several speakers and did not feel that the discouragement of international students would affect the way they choose the UK, although we have heard differently today. I think the view around the Committee is that these additional procedures and costs will create the impression that it is harder to secure a visa to study in the UK than it is in other countries. Even if that is not the case, it will add significantly to the up-front visa cost compared to our competitors. What evidence is there that the Home Office recognises the risks it is taking in relation to our competitiveness in this market?
On the detailed points, residential accommodation has attracted the most attention. There is no suggestion from what we have read from the Government that they have any interest in how this system must look to prospective students. As we have heard, international students already face difficulties in securing accommodation and are often made to pay large fees and advance rent payments. As the noble Lord, Lord Patel, reminded us, this Bill may result in landlords refusing even to consider international students as tenants or charging higher rents or additional fees to cover the extra hassle and administration costs. Does the Minister not agree that this clause could cause considerable anxiety and could add to the perception that the UK is unwelcoming?
In the Minister’s commentary, he said:
“I do not think the measures would discourage private landlords from letting to international students”,
because,
“landlords in our university towns and cities are familiar with their clientele and know that they represent a sound and stable choice of tenant for their properties, in the main for at least an academic year if not longer”.
So that is okay then. To his credit, the Minister conceded in his commentary that certain categories of student accommodation would be exempted from the landlord’s provisions and said,
“we will look closely at the rationale for doing so when we consider this in Committee”.
I look forward to his further thoughts on this important point this evening.
Some noble Lords raised the position of international students who need to arrange accommodation in advance of their arrival. In the commentary, the Minister said:
“The Government intends to make regulations under the Bill which will provide for overseas students to be able to arrange accommodation in advance of taking up their studies in the UK, and for such tenancies to be entered into conditional on the production of the relevant visa or residence permit when the student arrives and takes up residence”.
It would be useful if we can have further information on that because it is clearly a very important point.
Given that overseas students with the requisite visa are often offered accommodation owned or administered by the university which is offering them a place, why does the Bill not recognise this and simply exempt all such university-provided accommodation, including the currently exempted halls of residence?
A number of noble Lords expressed concerns about the proposed introduction of the NHS charges. The main argument seems to be that international students and staff already make a significant contribution to the UK economy. International students bring in over £10 billion a year, while international academic staff pay taxes and national insurance while they are here.
The Government’s plans are for a health surcharge for access to NHS services of about £200 in general and £150 a year for students. As the noble Earl, Lord Howe, said in his letter to all noble Lords, over a working life, the payment of taxes and NI contributions usually provides a contribution to the NHS but new arrivals have not yet done so, and are not likely to be able to build up the long-term commitment and contribution that those permanently settled here have made. We do not object to the principle, since it is legitimate for those who are coming to partake in the system to make a contribution, particularly when the NHS is under pressure, but it is legitimate to press the Minister on whether a one-off cost, payable in full at the time that the visa is obtained, is actually in the best interests of our commitment to overseas students. That is the question.
A couple of other questions were raised during the debate, and I shall mention them for completeness. Has the department done any research to test whether this new system will discourage undergraduate and postgraduate applications and, if it has, will the Minister place a copy in the Library so that we can look at it? As the noble and learned Lord, Lord Hope, said, given that the Bill deals mainly with illegal immigrants, not those with leave to be present, why is Clause 33 really necessary? The point here is that the students are already covered by the visa application. Surely that can be considered sufficient on this point. Can the Minister when he responds, or separately in writing, give us the argument for the £50 discount on students? It is £200 for most people but £150 for students. If there are reasons for that, I would be interested to know what the economic argument would be, given the disproportionate use that is made of the NHS by students. Fifty pounds seems an odd figure to have chosen.
Fees, charges and living costs already make the UK a relatively expensive destination for study. As others have said, the Government cannot on the one hand impose new procedures and costs for prospective overseas students and on the other blandly claim that we are “open for business”. As the noble Lord, Lord Tugendhat, said, it would be wrong to think of this amendment as special pleading for the students. This is actually about our standing in the world, our history and our culture, and about our economy going forward.
Taken as a whole, the requirements for students who wish to study in the UK are in many cases much more stringent than in our competitor countries, particularly when you take into account language requirements, academic progression, limits on study time, the ability to bring in dependants and police registration. These new challenges will have an effect. Do the additional cost and hassle, and the impression that we are tightening up, justify the risk? Perceptions, as the noble Lord, Lord Cormack, reminded us, are important in this matter. Are we, as the noble Baroness, Lady Williams, said, killing the golden goose?
I look forward to hearing the Minister’s response. However, like the noble Lord, Lord Hannay, I believe that we will need to return to this issue on Report.
Lord Taylor of Holbeach
Well, my Lords, this subject certainly engenders good and powerful debates. If arguments are repeated, perhaps noble Lords feel that they are worth repeating. I have to repeat my arguments. I am afraid that the Government cannot accept the amendment, but perhaps I can help noble Lords by telling them why that is, and why we feel that, despite our policy of welcoming the brightest and the best with no limit on numbers, students are an important part of any strategy which deals with immigration.
I start with that strategy. The noble Baroness, Lady Warwick of Undercliffe, challenged me on the whole business of net migration. Reaching the tens of thousands remains the Government’s objective. We chose a net migration target because we want to control immigration due to its effects on social cohesion, infrastructure and public services. These arguments are frequently discussed in other areas, but they form the background to why this legislation has come forward. Jobs and wages are affected by migration but, when it comes to students, there is no cap on numbers—I repeat, no cap on numbers—of genuine students who want to come here. They are welcome. Those who have the right qualifications, sufficient funds to cover their fees and maintenance costs and a good level of English can study here, and there is no limit on numbers. Our reforms, to tackle the widespread abuse that was occurring in the system we inherited, have favoured our world-class universities.
Those reforms are working. The number of issued student visas has dropped by around 27% from the high in 2009, while visa applications from university students were up 7% in the year ending December 2013 and applications from students going to Russell group universities were up by 11%. Higher education statistics show that numbers of international students in our universities held steady in 2012-13, with a small decline of 1%—but numbers of UK and EU students have fallen by more than that. It is true that there has been a decline in the number of Indian students at our universities, but this followed a period of soaring numbers and, by contrast, there has been strong growth in numbers of students from China, Malaysia and Hong Kong in 2012-13.
Lord Hope of Craighead
Is the noble Lord suggesting that the unaccounted-for balance is made up of overstayers without leave to remain or people who, having studied here, are given permission to remain for longer than was originally envisaged?
Lord Taylor of Holbeach
I think that the noble and learned Lord will understand that I suggest both. The graduate course has been a success—we are increasing the numbers of students who are staying on for postgraduate work—and the business entrepreneur course is equally successful. There will be some, but there is unfortunately still some evidence that the tier 4 student migration group—it is a special route; it is not the same as everything else; students are treated as a special case—is being misused in some cases. That is why it is important that we have checks in place to make sure that that does not occur.
My noble friend Lady Williams suggested that the exceptional talent route has dismally failed. We do not accept that. We recognise that the number of visas that are taken up under that is low, but it was always thought that that would be the case. However, we are working with all the competent bodies—the Royal Society, the Royal Academy of Engineering, the British Academy and the Arts Council—to improve the process so that the visa process payment will not be paid until the competent body has endorsed the application. We are working with these bodies to ensure that the scheme is a success.
In answer to my noble friend Lady Benjamin, it is not the case that international students are unable to stay on and work. The post-study work route, which was much abused, which allowed all students to stay on and look for work, has been replaced by the graduate level job scheme, and we have made a success of that.
The noble Lord, Lord Stevenson, asked whether the cost of the surcharge in relation to the cost of studying was competitive with other countries. Yes, it was addressed in our published impact assessment, where the noble Lord will find the answers to a number of the questions he asked. However, I will make a point of writing to him with a full answer to all the various questions, some of which lie outside the Home Office’s own immediate area of engagement.
I understand that people want to make sure that the Government do not do anything that damages the reputation of this country as a centre of intellectual and academic excellence. I accept that. Speaking as a member of the Government, I remind noble Lords that we have a responsibility to seek to control immigration. All the measures in the Bill are about methods of making sure that people who are in this country are here legally.
There is no difference between us on the benefits that overseas students bring to this country. That is why there is no limit on numbers, and why I will continue to seek to reassure noble Lords on the Bill. I hope that we will have a chance to discuss it before we come back to this issue on Report. Meanwhile, I hope that the noble Lord, Lord Hannay, will withdraw his amendment.
Lord Hannay of Chiswick
My Lords, I thank all noble Lords who participated in a very impressive debate. I thank in particular my three co-sponsors of this amendment, the noble Baronesses, Lady Williams and Lady Warwick, and the noble Lord, Lord Tugendhat, who so eloquently set out the case which I tried to introduce. There were many other remarkable contributions to this debate, so I will not try to pick out any others.
In a previous debate on this subject—we are getting quite used to having debates on this particular subject—I likened the Minister to St Sebastian, filled with arrows but still smiling. The best pictures of St Sebastian always show him smiling despite the number of arrows that have gone through him. The Minister always handles this with great good temper. I was very pleased on this occasion that he had one supporter, as that removed the sense that we were indulging in an unfair debate.
I hope that we can stop having a war of statistics. The Minister came back again to the point about the UN figures. No one is contesting that the Government will continue to submit to the UN figures in the way that the UN has asked for—that is to say, all people who stay for a year or more. But there is not the slightest difficulty about disaggregating those figures and putting them together again before sending them into the UN. If the Government wanted to, they could leave students out of this Bill completely but, at the same time, continue to make the same returns. I hope that we do not have to come back to that. I think that the war on statistics has gone about as far as it can go. Frankly, citing several times the enormous enthusiasm for Indian students to come to this country sits a little oddly alongside a 49% drop in the past two years. If that is enthusiasm, I do not think we can afford many more victories like that.