Education: Contribution to Economic Growth

Baroness Cohen of Pimlico Excerpts

Thursday 5th December 2013 Lords Chamber

[Baroness Cohen of Pimlico (Lab)]

My Lords, many noble Lords have spoken about education in schools, which clearly, with a long tail of almost 1 million NEETs, is absolutely vital to our children and grandchildren. However, like my noble friend Lady Warwick of Undercliffe, I want to talk about the importance of education at university level, but from rather a different angle. I declare an interest as chancellor of BPP University. BPP are the initials of the founder of a fine training company, but now stand for the Business and Professional University. My noble friend Lady Morgan of Huyton emphasised in her speech the importance of technical education for economic growth. We at BPP, and I as the chairman of BPP Holdings Ltd long before we acquired degree-awarding powers—which we did in 2007, acquiring full university status this year—always thought that the end purpose of education must be to enable people to find a job and the life that will please them and give them a decent standard of living. Coming from a training background, as we do, we have always believed that. Yes, of course there are cultural purposes to university education, but for us the outstanding purpose has always been to enable our graduates to get into good, well paid jobs, because all else can stem from there.

I need to talk about the university a little in order to make my point. We have 9,000 students on seven campuses around the UK, with two in London and five in the regions. Some 3,000 of the students are undergraduates, which is a new departure for us. We teach very successfully the core business subjects, mostly accountancy and law. Some 65% of our students are female, and 96% have a job or are in further training within six months of leaving us. Our graduates make a major contribution to economic growth both directly and indirectly. They do so directly because we have a great many students at the graduate level from overseas, which helps to level up the balance of payments as well as spreading the reputation of the UK overseas. The indirect but vital contribution to growth is that the reputation of the UK as a good place to do business depends on having a corps of well trained, professional lawyers, accountants, actuaries and other business specialists. The City of London could not be the force that it is, contributing 20% of GDP, without its highly skilled lawyers and specialist accountants. Businesses all over the UK depend for their stability, and thus their ability to grow, on the efforts of their finance directors and the support of properly trained commercial lawyers.

At BPP I think that we can be rightly proud of our contribution not least because, as I should make clear, we are the only private, for-profit university in the country. But we are not the only people in the business. We believe that we are the most successful at placing our graduates in employment. A lot of universities teach law on a more theoretical basis, but we believe that students need to be taught by people who have worked in the profession. Some 80% of our tutors come from that background. The UK could do with more courses like this. I personally am particularly interested in the undergraduate-level courses that enable people of any age to move quickly into a position where they are useful and employable. There are definitely not enough of such courses, particularly for the capable young person who does not quite know what they want to do, but knows they want a decent job in a good business.

We have only 3,000 undergraduates so far but, private and profit-making business or not, we are able to charge fees of £5,500 a year for the three-year course, which is substantially less than for most law and business courses. The reason we can keep the fees down is that we do not have a conventional university structure. We sweat our assets and our buildings are hardly ever empty. Also, we have extremely flexible staff. We attract the services of excellent people by offering them what is essentially very well paid shift work on a part-time basis. That is a far cry from the leisurely programmes that I enjoyed as an undergraduate but it is very effective, and I believe that our universities could do much more to make their students more employable by teaching them for longer and better without risking the loss of the enjoyable university experience.

A new departure for us is that we believe that it is possible to deliver degrees that will get our students into good jobs on the basis of two years’ study. This is a work in progress but last week I was able to award degrees to some of the first graduates under the scheme. Those students are paying fees of £6,000 a year because the course is that bit more difficult to teach. On the other hand, however, they are getting a very economical degree because they pay only two years’ living fees, and it looks as though it will be very popular. Since most of our undergraduates are in their 20s, rather than 18 years old, this is of great importance, although it will also be an attractive offer to those aged 18. It will suit those people who did not quite work out what they wanted to do when they were 18, which must be a lot of them.

I believe that our model of using tutors who have worked in the relevant industry, determined and almost full-time university education, along with the very careful mentoring of students and a concentration on using assets so that higher education can be cheaper, could be spread more widely to other institutions. I regret very much something that has not yet been mentioned in the debate, which is the passing of the polytechnics, or rather their translation into universities. The polytechnics used to provide excellent technical training, which became diluted and a bit overly academic as they turned into universities. We are more on the model of a polytechnic than much of what is now being offered. I believe, I am afraid, that turning polytechnics into universities was a retrograde step for the country.

BPP University is a product of cross-party agreement. We were authorised under the Labour Government, who wanted to expand the provision of higher education and make it more varied and interesting, and we have been authenticated and given full degree-awarding powers following our review in 2013—so I am glad to record that this is not a controversial party political matter. We believe that it is a model for the future, and I would like to see more of it. I always say that I was badly taught at Cambridge, and that it was not until I met BPP and its training model that I realised what really good teaching looked like.