Higher Education and Research Act 2017 (Further Implementation etc.) Regulations 2019

Baroness Wolf of Dulwich Excerpts

Wednesday 5th June 2019 Lords Chamber

[Baroness Garden of Frognal (LD)]

My Lords, this is a relatively uncontroversial SI that goes through the entire statute book, as the Minister set out, working out what consequential amendments need to be made as a result of the Higher Education Act 2017.

We have no issue with the changes that cross out references to HEFCE, individual research councils and definitions of a university in previous legislation, replacing them with references to the OfS, UKRI and the definitions set out in the 2017 Act, nor indeed with those that make the OfS an official government regulator, subject to the Regulators’ Code or those that allow a university’s charitable status to be regulated by the OfS rather than by the Charity Commission.

The Minister talked about data sharing and I have a question about that which has caused some concern. There has been confirmation from the HESA, that it distributes information on sexual orientation and religion, on a named basis, to the OfS and the Department for Education. This information has been provided by students as part of equality monitoring, but surely such a named database of religion or sexual orientation should not sit anywhere at state level. What plans are there to change this and for how many individuals does the department hold that information?

Parts on the pension scheme have also raised concerns. They ensure that university staff, mainly from post-1992 universities, remain eligible for the teachers’ pension scheme and the local government pension scheme. In September 2018, the Treasury recommended that employer contributions to the teachers’ pension scheme needed to increase from 16.48% to 23.6% of an individual’s salary to meet the expected future costs of paying pensions. The Government have recommended that the Treasury should pay an extra £830 million to schools to cover their additional pension contributions, and £80 million for colleges and other publicly funded training organisations.

Universities, however, will have to find the money themselves. That will affect universities created after 1992 that are not part of the main pension scheme for universities, which will have to find millions more from their squeezed budgets to pay staff. These are universities that rely more on tuition fees and have less of an ability to generate additional income.

The Liberal Democrat former Pensions Minister, Steve Webb, has said of this:

“For universities this is simply a spending cut, as the money for these contributions will have to be found from elsewhere. This does seem an arbitrary way of squeezing the independent schools sector and the university sector for what is essentially just an accounting change”.


Why are the Government footing the bill for schools and colleges, but not for universities? How will the Government ensure that these extra costs for universities will not have an adverse effect on students?

During the passage of the 2017 Act through Parliament, Peers across the House were united about the need for the Government better to recognise the importance of international students to our universities and wider economy, so do the Government acknowledge that anything that undermines the financial sustainability of our universities will inevitably lead to fewer overseas students coming to this country? Surely this pension decision will be a factor in challenging university finances.

The Augar review recommends that the Government adjust the teaching grant attached to each subject more accurately to reflect its perceived “value” to students and taxpayers. Given that a key aim of the Higher Education and Research Act is to improve student choice, do the Government consider that such a policy would undermine this principle? Following the Augar Statement yesterday, perhaps we may ask again: if fees are reduced to £7,500 how will this funding be replaced? How will the Government ensure that disadvantaged students at all universities can benefit from any replacement, instead of it being targeted at those in higher-tariff institutions?

I also want to ask the Minister about a couple of curiosities, which may prove that I have read these instruments. In Part 4, Regulation 43 amends paragraph 2 of Schedule 3 to the Charities Act 2011 to read:

“Any of the following if it is a relevant higher education provider”,


and names the universities of Oxford, Cambridge, London, Durham, Newcastle and Manchester. It then amends paragraph 3 and names King’s College, London and Queen Mary University of London. Is there any doubt that these are relevant higher education providers? What is the reason for separating King’s and Queen Mary? What about other universities? Are they not relevant higher education providers? This may be my ignorance about the way the legislation is written, but it seems curious.

Paragraph 11A of Schedule 3 to the Charities Act 2011 is amended to read:

“A relevant higher education provider … does not include (a) any college in the university of Oxford; (b) any college or hall in the university of Cambridge or Durham”.


Why is Oxford separated from Cambridge and Durham? There are, or used to be, halls in Oxford as well as at Cambridge and Durham. Will the Minister explain why Oxford has been separated in that paragraph? I look forward to the Minister’s reply.

[Baroness Wolf of Dulwich (CB)]

My Lords, many noble Lords will remember that, as the Minister reminded us, the Higher Education and Research Act 2017 established a regulator with unparalleled and unprecedented powers. One of those powers is effectively to set its own budget by deciding what to charge universities for its services and activities. During the debates in this House, noble Lords pressed very hard for the Government to ensure that the Office for Students was subject to the Regulators’ Code, so I am delighted to see that it is being placed on a statutory basis. How, though, is the Office for Students expected to demonstrate that it is behaving in accordance with the Regulators’ Code? What sort of information does it provide to the Government on that basis and what sort of information does it provide to the public on that basis?

[Lord Bassam of Brighton (Lab)]

My Lords, I guess the Minister is really asking the House to accept that these regulations are tidying-up amendments. I am grateful to him for his explanation of this statutory instrument, which, as he said, is a consequence of HERA 2017. The majority of the amendments are consequential and replace references to now-defunct bodies or repealed legislation. They include HEFCE and the Office for Fair Access, or OFFA.

Looking at registration under these regulations, under the Act a new regulator was created, the Office for Students, to oversee and monitor the activities, including in relation to fair access and participation, of English higher education providers that register with it. The OfS currently regulates registered HE providers under transitional arrangements which were due to end on 31 July. Will the Minister advise the House whether the new regulatory regime is on schedule to be to be fully operational by then? In addition to retaining existing HEFCE and OFFA functions for the transitional period, the OfS has gradually begun to exercise its functions under the Act, including the power to create a new single register of higher education providers. OfS registration affects the HE provision that institutions can provide, specifically access to public grant funding, the fee levels they can charge and the levels of support students can receive. Indeed, institutions that are not registered cannot access OfS or UK Research and Innovation public grant funding or charge above the basic fee amount.

I understand that since January 2018, the OfS has registered more than 300 higher education providers. However, last month, it was reported that 19 colleges offering higher education courses were still waiting to be registered with the OfS, only months from a new term when student recruitment should be well under way. Against this backdrop, Student Finance England was advising that to ensure funding is received in time for courses commencing in autumn 2019, new students should complete and submit their applications by 24 May. That seems a rather strange process and period of delay for making the system work. Does the Minister agree that the fact that it has taken almost a year to complete this process suggests that there might be room for some improvement?