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The Minister for Skills, Apprenticeships and Higher Education (Robert Halfon)
It is an honour to serve under your chairship, Dame Maria. I congratulate the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy) on securing this debate. It feels a bit like groundhog day, because we served together on the Education Committee. I have the highest regard for her work, not just on higher education but on special educational needs and disabilities, mental health and post-16 education. I am very happy to be debating the important matter of the OfS with her. I have had the privilege of visiting Ron Dearing University Technical College in her constituency, which is doing an incredible job in transforming the lives of thousands of students.
Before following through on the OfS issues, I want to begin by setting out how I see higher education, because it very much forms the architecture of what we are talking about today. Higher education of course plays many important roles in our society—developing people’s education and academic talents, academic knowledge, and world-class research and innovation, which are absolutely important—but for me the three key things are meeting the skills needs of the economy, providing high-quality qualifications leading to excellent, well-paid jobs, and advancing social justice. What I mean by that is ensuring that everyone, regardless of their background, can not only access high-quality education, but complete their studies and get good skills and knowledge, and jobs at the end. The OfS is essential to upholding the quality and ensuring the success of the higher education system and the aims that I have suggested.
Before I turn to the OfS specifically, it is important to briefly highlight the fact that we have an ambitious skills agenda, as the hon. Member for Kingston upon Hull West and Hessle pointed out, with £3.8 billion of extra investment over the Parliament. We are using that to expand and strengthen both higher education and further education. We are investing an extra £750 million in the HE sector up to 2025, to support high-quality teaching and facilities, particularly in science and engineering subjects, and to support NHS and degree apprenticeships. The hon. Member’s university, the University of Hull, is receiving more than £10 million in the strategic priorities grant, so I hope that she is pleased about that.
There is also, of course, the money that goes to UK Research and Innovation, which is £25 billion over the spending review. That is £6.2 billion for Research England, which funds our higher education institutions. The latest estimate shows that the income of English higher education providers in 2021 from tuition fees in education was £21.6 billion, which was 55% of the total income of £39.77 billion.
I was going to talk about the Lifelong Learning (Higher Education Fee Limits) Bill, as I thought it would come up, but we have plenty of time next week when we discuss the Bill on Report and Third Reading. The Bill will be very important, because the lifelong loan entitlement will provide everyone with a loan of up to £37,000 to do flexible and modular learning. There will be level 4, level 5 and level 6 provision, and it will start with level 4 and level 5. The OfS and the new register of FE colleges will provide the LLE, and those owners will have an important role.
Let me turn to the OfS and its vital work to support the Government’s priorities. I commend the activity of the OfS, for the most part, over the last five years to put in place the regulatory framework and to register providers. The hon. Member for Kingston upon Hull West and Hessle talked about the cost, which boils down to just under £13 per student. She also talked about regulation, and I completely get that. I am not a believer in small or big Government; I believe in good Government. I am not a believer in loads of regulation or low regulation, but in good regulation. To be fair to the shadow Minister, the hon. Member for Warwick and Leamington (Matt Western), he said that as well.
Of course, I recognise that regulation creates a burden for those being regulated, but it is important that the benefit of regulation outweighs the burden. Seeking to minimise the regulatory burden is a key focus. It is set out in the strategy to 2025. I wanted to go as far as possible in doing so. The OfS has already taken significant steps to reduce the data burden it places on providers. In 2022, it removed the need for all providers to send monitoring returns for access and participation plans. It significantly reduced its enhanced monitoring requirements, which are now less than a quarter of what they were in 2019. It has published its intention to become increasingly risk-based in the way it monitors compliance. It also plans to vary further the regulatory requirements placed on individual providers according to the risks they pose, which will affect the impact of its regulation on those that pose the highest risk.
In terms of the regulation of small providers, of course the OfS does apply the same requirements for all types of providers. Whatever provider they go to, students should expect the same quality of education outcomes, protection and support to complete their courses. I accept that the regulatory burden should be minimised, including for small providers, and the OfS has a plan to minimise it. When it does so, it must have regard to the regulation code principles on determining general policy. The regulation code is less relevant to the work of the OfS when carrying out individual investigations and taking enforcement action, but it does take compliance very seriously.
OfS fees are tiered by student numbers, so providers with fewer numbers, such as FE colleges, will pay less in fees. In response to the question from the shadow Minister, the hon. Member for Warwick and Leamington, we are reviewing the high cost per student for smaller providers when we consider the fees for 2024-25. We are considering those general fees at this time.
On the important point about the QAA, it chose to withdraw consent for designation. If the English system is not in line with the European standard, it is because we do not have cyclical reviews, which we consider disproportionate in terms of regulation. As the hon. Member for Kingston upon Hull West and Hessle highlighted, the OfS will take on the quality assessment role in the interim, while consideration is given to a permanent arrangement. I have met university stakeholders to discuss those issues.
Robert Halfon
I will in a minute. I have a fair bit to add and want to make the following point, because the hon. Member for Strangford (Jim Shannon) is so kind and comes to a lot of these debates on education and skills, as well as many other debates. I will have dialogue with the regulatory bodies. I was planning to visit them when visiting for the anniversary of the Northern Irish agreement, but unfortunately my slip was withdrawn because I had to vote in the House of Commons. Otherwise, I would have been there and visited universities and colleges in Northern Ireland. I very much hope that I will be able to make that visit. I note that at Queen’s University Belfast, 99% of the research environment is world leading and internationally excellent. I think it is No. 108 in the world, so congratulations to Queen’s University.
Robert Halfon
I have a lot more to day, but I will give way to the hon. Member for Sheffield Central now.
Paul Blomfield
I thank the Minister for giving way. I agree with the hon. Member for Strangford (Jim Shannon) that the Minister is widely respected for his work on education and his appointment to this job was welcomed. But I want to return to my earlier point about the OfS’s regulatory approach. When I debated the establishment of the OfS in Bill Committee with the Minister’s predecessor, I argued that we had a reasonable regulatory framework—the Higher Education Funding Council for England. The Minister at the time argued that it was important to put students at the heart of regulation. That is why it was called the Office for Students. Does the Minister agree that, if it is to live up to that name, it should do what it says and give a much stronger voice for students in the whole process of regulation? He does not agree with my concern that students have been marginalised, but will he set out how we could give students a stronger place in the OfS’s approach to regulating the sector?
Robert Halfon
That is an important question, and the hon. Gentleman is one of the key higher education spokesmen in the House of Commons. I am absolutely supportive of student representation. The student panel is incredibly important. I made a decision as a Minister to interview one of the members of the student panel. I did not have to do that—I could have just ticked the submission and said that Mr X or Ms X is fine—but I took proactive interest, because it is incredibly important to do so.
I met the student panel, and I want it to have a voice. I went to an OfS event in the House of Commons a couple of weeks ago. I spent time chatting to the student panel, which is essential in this. As long as it is used properly and listened to, it is the best conduit for ensuring that student voices are heard. The student panel has teeth. I will keep a watch over it, even though the OfS is independent and I do not have operational control. It is a bit like the police: the Mayor of London might have a say over the chief constable, but he does not necessarily tell them what to do day by day. Nevertheless, the student panel is incredibly important, so I accept what the hon. Member for Sheffield Central (Paul Blomfield) says.
The hon. Member for Stretford and Urmston asked me about the taskforce. It last met in full in June 2022, and there has been a subsequent meeting of arms-length bodies, separately, to discuss progress and to identify areas of work to take forward.
There is plenty of evidence to suggest that higher education is preparing students for high-quality employment: three quarters of graduates from full-time first degree courses progressed into high-skilled employment or further study 15 months after graduating in 2020. But more must be done to tackle the pockets of poor quality that persist, and the OfS is committed to doing that. The OfS has revised its registration conditions in relation to quality and standards to ensure that they are robust, and it is rightly now taking action to investigate and enforce those conditions.
We want to ensure that students see returns on their investment in higher education. The Institute for Fiscal Studies estimates that the net lifetime return from an undergraduate degree is £100,000 for women and £130,000 for men, but it should be noted that the IFS has also found that 25% of male graduates and 15% of female ones will take home less money over their careers than peers who do not get an undergraduate degree. I think that graduates should be achieving outcomes that are consistent with the qualifications that they have completed and paid for.
To give an opposing example, it is a testament to the genuinely excellent teaching and leadership at the University of Hull that nursing and midwifery students experience the highest progression rate—98%—compared to all other OfS-registered HE providers with available progression data, and that the university has performed above the OfS threshold for continuation, completion and progression. I say those things to highlight not just the brilliant work of the University of Hull but the important work that the OfS is doing. Without the work of the OfS, we would not have that kind of information.
I talked about social justice, which is very important to the hon. Member for Kingston upon Hull West and Hessle and to me. I want to ensure that no student is excluded from higher education because of their background. A wider point has been made about us putting extra burdens on the OfS, but it has recently launched the equality of opportunity risk register to highlight key risks that can impact negatively on disadvantaged and under-represented student groups across the whole of the student lifecycle. That is an extra thing for the OfS to do, but I want it to happen. I am delighted with that. I do not like the name “risk register”, but nevertheless the principle is really important. It will empower higher education providers to develop effective interventions and support at-risk students, helping them not only get in but get on. I have a lot more to day about Hull University. It really is doing some remarkable things, and I hope to be able to go there one day and see it.
The hon. Member for Kingston upon Hull West and Hessle cares deeply about mental health. We have allocated £15 million from the strategic priorities grant to the OfS for mental health support. That is another OfS duty and its purpose is to support students’ wellbeing when they transition to university, and to create opportunities for partnerships between providers and the national health service. The OfS has a role to play in funding Student Space, an online platform for mental health and wellbeing resources. The OfS also runs a mental health challenge competition with Northumbria University. It has supported projects to ensure that mental health needs are identified by providers. That is another important role for the OFS. Yes, the OfS has increased its role, but it is doing really important things that will make a difference to many students’ lives.
I knew that the hon. Member for Kingston upon Hull West and Hessle would bring up degree apprenticeships. I have some sympathy with what she says; there is too much regulation, and all I can say to her is to please watch this space. I am looking at it very carefully to see what can be done. Of course, we also have to maintain quality, because if we do not have quality, I will have the shadow spokesman, the hon. Member for Warwick and Leamington, get up in Education questions and ask why apprenticeship provision is so poor. The hon. Lady will be pleased that over the next two years we will increase from £8 million to £40 million—£16 million in the first year, and £24 million in the second—the funding to promote degree apprenticeships among providers. I know she will support that extra funding.
A House of Lords inquiry has criticised the OfS registration fees for being too high. As I have mentioned, however, in the light of the Government’s commitment to funding skills over the Parliament, the OfS registration fees offer value for money. It is currently around £26 million a year, which is less than £13 per student. I do not think that feels like a high price to pay to ensure that we have a high-quality system working in the interests of students.
In conclusion, the work of the Government, which I have outlined, and of the OfS regulator will continue to deliver on skills, jobs and social justice. I accept that there is over-regulation—the hon. Member for Kingston upon Hull West and Hessle highlighted some unnecessary regulation that I will look at with officials at the Department for Education. However, we have a world-class higher education sector. I am not complacent about it. I acknowledge that there is not enough in some areas, and that some graduates are not getting good, skilled jobs, but many—in fact, most—higher education providers deliver a top-class education and equip students with the skills they need to get excellent jobs. I am clear that a robust and fair regulator—a good regulator—is vital to ensuring that our higher education sector remains world leading and protects students and the taxpayer.
I think that the OfS has achieved a fair bit in the first five years of its existence. It has registered 400 providers. It has also registered the new Dyson Institute, which is—
Robert Halfon
Very good. I have been to that university. I met James Dyson some years ago when I was the Chair of the Education Committee. It was extraordinary. I hope that there will be many more examples of universities like that one. The Department will work closely with the OfS to ensure that we continue supporting a world-class higher education system. As I said, I remain committed to delivering on skills, jobs and social justice. The OfS will be an absolutely crucial part of that.
Matt Western
I was hoping that the Minister could cover the three questions I raised at the end.
Matt Western
There was one about political interference, which may be difficult for the Minister to answer. Could I go back to the second question? It was about whether he had any plans to raise registration fees. I also had a question about an assessment of the value for money that the OfS represents, particularly in the context of other regulators.
Robert Halfon
I am happy to answer. I think I said that we are considering OfS registration fees and that I will come back about that matter in due course. I do not recognise any political interference. Since becoming a Minister, I have had meetings with the OfS chief executive and chair, and we have literally just discussed what needs to be done to make sure that the organisation continues its work and that we continue to have a world-class university system.
I beg the hon. Gentleman’s pardon—what was the third point?
Robert Halfon
Ah, yes. I think the OfS is providing value for money. First, as I mentioned, the cost to students is just under £13, which represents value for money. More importantly, what are the outcomes? If we have great universities, as we do, and we are meeting the country’s skills needs, promoting degree apprenticeships and acting further on mental health and other areas, including social justice, to make sure that disadvantaged students have the right outcomes, as we are, then the OfS will absolutely be providing value for money.