Higher Education (Fee Limits and Fee Limit Condition) (England) Regulations 2018

Lord Adonis Excerpts

Tuesday 24th July 2018 Lords Chamber

[Viscount Younger of Leckie (Con)]

My Lords, I thank the noble Lords on the Secondary Legislation Scrutiny Committee for their scrutiny of the fees regulations laid before this House in July and considered in the 36th report from the committee.

My purpose here today is to speak to the fees regulations that require approval. They support our aim that anyone with the talent and potential to benefit from higher education will be able to do so.

UCAS data show that we have made good progress on this. In 2017, 18 year-olds were more likely to enter full-time higher education than ever before, with disadvantaged 18 year-olds 50% more likely to enter full-time higher education than in 2009. The most recent UCAS data on application rates for English 18 year-olds show an increase by 0.2 percentage points on last year’s deadline to 38.1%. This is a record high.

However, as I have said before, we know that there is more to do. That is why the Government are currently undertaking a major review of post-18 education and funding to ensure we have a joined-up education system that is accessible to all and encourages the development of the skills that we need as a country. We expect to conclude the review in early 2019.

Turning to fees, the Government announced on 2 July in a Written Statement that maximum fees for students undertaking undergraduate courses in the 2019-20 academic year would remain at 2018-19 levels for the second year running, saving students up to £255.

This is not the only change we have made to help students. From the tax year 2018-19 starting in April 2018, we increased the repayments threshold above which graduates are required to make repayments on their loans from £21,000 to £25,000, rising by average earnings thereafter. We have also taken the opportunity to review policy for EU students. The Written Statement of 2 July I mentioned earlier also announced that existing eligibility rules for students from the European Union, and their family members, who start their courses in England in the 2019-20 academic year will remain unchanged. This means that EU nationals will remain eligible for home fee status, undergraduate, postgraduate and advanced learner financial support from Student Finance England for the duration of their course under the current eligibility rules.

Why are these regulations important? I turn now to the details of the fees regulations being considered today. They are made under Section 10 and Schedule 2 of the Higher Education and Research Act 2017. They will ensure that the Office for Students, the new regulator for higher education since 1 January 2018, has the powers to set maximum fee limits for home students studying at providers in England that are subject to a fee limit condition in 2019-20. These regulations will also ensure that the Government can implement the new regulatory framework under HERA in full; in particular, the requirement for providers to submit access and participation plans to the OfS in order to charge fees above £6,165 for a full-time course.

The existing fee caps, made under Section 24 of the Higher Education Act 2004 will be revoked automatically on 1 August 2019, as a result of Schedule 11(30)(2) of HERA. It is therefore essential that new regulations are made under HERA to ensure that fee caps continue and that students benefit from the freeze in maximum fees. Under HERA, providers can choose to register with the OfS in one of two categories: either the Approved (Fee Cap) or Approved categories. Providers registering in the Approved (Fee Cap) category will, for 2019-20, be eligible for OfS grant funding and will also be subject to maximum fees set through the regulations being discussed today: £9,250 for a full-time course offered by a provider with a teaching excellence and student outcomes award. Students attending Approved (Fee Cap) providers will be able to access loans to cover the full costs of their fees. Providers registering in the Approved category will not be eligible for OfS grant funding or subject to maximum fees. Students attending those providers will be able to access lower rates of loans towards the costs of their fees.

Under HERA, the OfS will be able to limit fees charged by Approved (Fee Cap) providers once these regulations come into force. So without these regulations, providers would be free legally to charge whatever fees they wished. In addition to setting maximum fees for the 2019-20 academic year, these regulations also amend another set of regulations that will allow the OfS to operate under HERA. The Fee Limit Condition Regulations, which came into force on 1 April 2018, deliver the framework for the capping of student fees for qualifying students and courses at providers registering in the Approved (Fee Cap) part of the OfS register. These regulations amend the Fee Limit Condition Regulations so that persons who have a current grant of stateless leave, and their family members, who are undertaking qualifying courses in the 2019-20 academic year are defined as qualifying persons. This means that they will benefit from the same maximum fees that currently apply to other qualifying persons, such as persons who are settled in the United Kingdom.

These regulations also amend the Fee Limit Condition Regulations so that students already holding an equivalent or higher level qualification who are undertaking pre-registration, nursing, midwifery and other healthcare courses will be defined as qualifying persons and will benefit from maximum fee limits. With those explanations, I beg to move that these regulations be approved.

[Lord Adonis (Lab)]

My Lords, I am grateful to the Minister for introducing the regulations so lucidly. He referred to the review that is taking place on student finance, which is of huge importance, of course, to students and their families and to universities. He said that the report would come in early 2019 but he said nothing more about it. I have three specific questions about the review. First, will it be publishing either an interim report or any interim statements or summaries of evidence taken? I think that could be quite useful in stimulating the public debate that needs to take place around the future of the higher education funding system.

The second point is about consultation. Which groups of students and young people are the Government consulting, because a big and controversial issue has been the failure to include young people in the review team? The one group that is not a part of the review team directly is the group of very young people and students who are directly affected by this. That is a big mistake. The right thing to do, particularly if we are to win support from the generation that is paying these fees in a reformed system, is to have some buy-in from them at the beginning. The failure to put those arrangements in place will cost the Government dear. It would be good to know what consultation is taking place with young people.

Thirdly, what polling among the public and young people is the review doing to ascertain the attitudes of the public at large to the sharing of the burdens of paying for higher education and the attitudes among young people? My view all along, having played a part in the introduction of the original scheme in 2004 but having been opposed to the trebling of tuition fees in 2010, has been that students recognise that in order to be responsible and constructive members of society, particularly in the current climate, where they are very focused on getting jobs and making their way in the world, they need to make some contribution to the higher education system, but they resent the fact that all the costs of the higher education system have been moved to the students and the graduates. Polling might bring that out and might help to establish a basis of agreement on public attitudes, which might make a burden-sharing approach possible which, to be blunt, might mean cutting the level of fees from £9,500 but not eliminating them entirely.

My party’s official position is now to eliminate fees entirely. The noble Viscount’s position is to have them at £9,500. There is quite a big space between zero and £9,500. Being, as ever, moderate and constructive, I am quite keen that we come in somewhere in the middle of that space. That might be sustainable among the public, rather than doing what I fear may happen, which is lurching from a very high level of fees by international standards to no fees at all.

Finally, when I read the debate in the House of Commons Delegated Legislation Committee on these regulations, the Minister for Higher Education said that he was conducting a listening tour around the country. I am strongly in favour of listening tours; I wish the Government would conduct them on many other issues, too, including Brexit, but that is for a later debate. However, he gives an extraordinary figure for the number of students he has met, which I am hugely impressed by. He said that on his listening tour so far he has met more than 1,500 students. I am not sure whether those 1,500 have been in the hall with him as he has been going around or whether he has personally conducted conversations with them.

I would be very grateful if the noble Viscount could tell us whether he has any findings from the Minister’s listening tour or whether the Minister might publish findings from his tour when he has finished it, because knowing that he has conducted a listening tour but not knowing what he has heard is not of great use to Parliament when we come to consider these significant student finance and funding issues after the review reports in the early part of next year.

[Baroness Garden of Frognal (LD)]

My Lords, building on the reviews by the noble Lord, Lord Adonis, can the Minister say what progress the Government have made in appointing the independent reviewer of the teaching excellence framework? I can only apologise if I have missed the announcement somewhere along the line.

What assurances can the Government give that the independent reviewer of the teaching excellence framework will be a genuine exercise that influences the future design of the scheme? We would oppose any attempts to link tuition fee rises to the quality of teaching as determined by the TEF, which we maintain has flawed metrics, several of which have nothing to do with teaching.

Have the Government considered replacing fees with a graduate tax? This statutory instrument makes no attempt to find a solution to the position set out in the recent Economic Affairs Committee report, which estimates that in 30 years’ time the Government will have to find:

“an extra £8.4 billion to cover expected losses on the 2017/18 student loans”.

Does the Minister have any comment on the immense debt with which the current scheme is burdening future generations?

We are pleased to see in these regulations that the Erasmus year continues to be mentioned. Can the Minister give us any further assurance on government plans to ensure that we continue to be part of Erasmus, whether or not we leave the EU? It is a programme that brings great benefits to participants and to the economy, as students return with a more significant skill set to offer to employers. Does the Minister have any certainty to offer us on Erasmus?

We continue to be concerned about the changes to nursing funding, and would strongly support reinstating student bursaries. It is good to read here about the exemptions on equivalent and lower qualifications for health professionals. Might that lead to a wider exemption for ELQs in other areas? As we know, loss of ELQ funding is one of the key factors in the disastrous decline in adult education, and we would welcome some good news on that front.

Will the Government carefully monitor the effect on nurse recruitment and retention of the recent changes to funding? We note that the number of applicants to undergraduate nursing courses in the year after the abolition of bursaries was announced fell by 11,750—a reduction of 18%. This compounds the existing shortage of nurses in the UK. Almost every hospital is dangerously short of nurses, and the Royal College of Nursing estimates that there are 40,000 nursing vacancies across the health and social care sectors. That shortage will only worsen if nurses cannot be easily recruited from the EU. I hope the Minister can offer some reassurances on those various aspects.

--- Later in debate ---

[Viscount Younger of Leckie]

My understanding is that it covers England only. I understand that discussions are going on with the devolved Administrations, but the review focuses on England only.

[Lord Adonis]

I am sorry to interrupt the noble Viscount, but the situation of Northern Ireland is therefore very serious because there is no other means of conducting a review or introducing changes in the current climate. When the review was set up, it looked as if the Northern Ireland Executive might be re-established. That has not happened. Is he in a position to inform the House further about the Government’s attitude in respect of Northern Ireland?

[Viscount Younger of Leckie]

I think I will add that to the letter that I will write to the noble Lord specifically about Northern Ireland. I remember what he said in the previous debate.

The noble Baroness, Lady Garden, and the noble Lord, Lord Watson, asked about progress in appointing an independent reviewer of the TEF. The recruitment of the independent reviewer is under way and an announcement will be made in due course. I have taken note of the comments the noble Baroness made about the TEF and the feelings that were expressed in this House about it last year. If they have not gone away, it is an issue that will be addressed.

I reassure the House that this is a devolved matter—this is going back to the question raised by the noble Lord, Lord Adonis. The review covers England alone, but it comes back to the point that I was making that I will write to him about matters relating to Northern Ireland.

The noble Baroness, Lady Garden, asked whether we can continue to take part in Erasmus. An announcement on the Erasmus programme will be made in due course, particularly to take account of the planning needs of students and universities.

The noble Baroness, Lady Garden, also asked about ELQ exemptions and part-time study. The ELQ rules have been relaxed to support students who already hold an honours degree qualification and who wish to retrain on a part-time basis in a STEM subject. The review of post-18 education and funding will look at how we can encourage learning that is more flexible. This takes account of comments that I made in a recent debate on this important subject, particularly relating to the Open University.

The noble Lord, Lord Watson, and the noble Baroness, Lady Garden, asked about the decrease in part-time study, particularly in the 30 to 49 age group. In this academic year, part-time students will, for the first time ever, be able to access full-time equivalent maintenance loans, as I think the House will be aware.

The noble Lord, Lord Liddle, raised some interesting points about the perspective from universities, and I took note of what he said regarding Lancaster University. It is a fair point, because if fees are capped, less money goes to universities. We are obviously aware of that and will take account of it as part of the 18-plus review. It is part of the overall view of how the future of tuition fees will pan out. That includes the points he made about the means-tested maintenance grant.

My final point is aimed to address something said by the noble Lord, Lord Adonis. He was talking about a range of where tuition fees might be from £0 to £9,250. I took it that the £0 meant that it was still Labour Party policy that, if it were ever to come into government, it would offer free education to students.

[Lord Adonis]

I do not speak for the Labour Party—that is for my noble friend on the Front Bench—but that was the policy at the last election.

[Viscount Younger of Leckie]

My point in raising that was to say that this 18-plus review is also looking at these matters. Nothing is ruled in and nothing is ruled out and the independent panel will be looking at it. With that, I commend the regulations.