Scotland Bill

Lord Foulkes of Cumnock Excerpts

Thursday 2nd February 2012 Lords Chamber

Moved by

[Lord Foulkes of Cumnock]

22: After Clause 14, insert the following new Clause—
“Variation of student fees according to origin of British students
In Part 2 of Schedule 5 to the 1998 Act, under Head L (miscellaneous) at the end insert—
“L8. Variation of student fees according to origin of British students
The setting of student fees for students from England, Northern Ireland or Wales studying at Scottish universities at rates different from those for students from Scotland studying at Scottish universities.Interpretation“Fees” has the meaning given by section 41 of the Higher Education Act 2004.””

[Lord Foulkes of Cumnock]

My Lords, it is my pleasure to move Amendment 22, which would prevent the Scottish Executive and the Scottish Parliament from imposing discriminatory fees on students at Scottish universities who are resident in England, Wales or Northern Ireland. The noble Lord, Lord Forsyth, has a similar amendment, Amendment 24. I must insist that he tabled it quite separately from my amendment and without any collusion whatever. I am saying this because his off-the-cuff comment earlier about the roadshow of the “toxic two” has been picked up north of the border and is already causing some interest. Both amendments were tabled with the same purpose.

[Lord Forsyth of Drumlean]

This is the first recorded occasion when the Scottish media have paid attention to anything that was going on in this House.

[Lord Foulkes of Cumnock]

I think that things are moving up the scale, although they are taking some time to do so. We are making a little bit of an impact there now.

I want to make it clear that in moving the amendment I am conscious of the sensitivities in relationships between Westminster and Holyrood, and between the UK Government and the Scottish Government. We have found in many of our discussions that this is a sensitive area in which we have to tread very warily, and I would hesitate to say anything that suggested that the UK Parliament was imposing its will upon the Scottish Parliament.

I say that having been a Member of the Scottish Parliament for four years. A number of noble Lords who have participated in these proceedings have also been MSPs—including the noble Lord, Lord Steel, who was Presiding Officer, the noble Lord, Lords, Lord Selkirk, Lord Watson and others who have participated, and, of course, the noble and learned Lord, Lord Wallace, the Minister who is to reply. Those of us who have been in Holyrood are aware of those sensitivities and we move with caution.

However, this Parliament has some responsibilities. The action of the United Kingdom Government in imposing very high fees precipitated this issue in the first place. I know that this is one area where the noble Lord, Lord Forsyth, and I might not totally see eye to eye. I am very pleased to see present the noble Lord, Lord Sutherland, who was a distinguished vice-chancellor of my old university, Edinburgh—not when I was a student, I hasten to add; he is not nearly that old, and neither am I. His experience and deep knowledge of the university sector will be very helpful, and that demonstrates some of the value of this Chamber.

We also have a wider responsibility for the European Convention on Human Rights and the equality legislation, as epitomised in the Equality Act. We therefore have to bear some responsibility for and take some interest in discrimination and equality. What has been not just proposed but agreed by the Scottish Executive and Scottish Government is tremendously unfair discrimination against students from England, Wales and Northern Ireland who go to Scottish universities. It really is quite disgraceful. It is astonishing, when you think of it, that students from Lisbon, Madrid or Berlin will all get in free to Scottish universities, but students from Belfast, London or Cardiff will have to pay fees.

[Lord Sewel]

Does the noble Lord recognise the supreme irony in the Scottish Government’s position? On the one hand, they are arguing for independence, but the policy they are pursuing can be carried out only while they remain members of the United Kingdom. If they achieved independence within the EU, they would not be able to have this pernicious policy.

[Lord Foulkes of Cumnock]

My noble friend, who was a distinguished administrator and academic at the University of Aberdeen—he was vice-principal—has put his finger on one very important matter. In fact, he has taken away a major part of my speech. Never mind about that. It is a massive irony, as my noble friend said, that the Scottish Government are able to impose these discriminatory fees only because Scotland is part of the United Kingdom. If Scotland was an independent country, as the SNP wants, that Government would be unable to impose those fees. Students from England, Wales and Northern Ireland would be in exactly the same position as students from Poland, Germany or wherever in the European Union.

[Baroness Liddell of Coatdyke]

My noble friend is making a valid and important point, but there is another dimension to the issue. It is largely the Barnett formula, which taxpayers throughout the United Kingdom contribute to, that allows the Scottish Government to act in this way. We are discriminating against those taxpayers from England, Wales and Northern Ireland.

[Lord Foulkes of Cumnock]

My noble friend and former boss as Secretary of State for Scotland has just stolen the second plank of my argument, but she put it very well indeed. It is a serious matter, because the parents of potential students at Scottish universities from London, Belfast and Cardiff are paying money into the UK Exchequer and that money, through the Barnett formula, subsidises Scottish universities, whereas parents of students from Berlin, Lisbon or Madrid are paying nothing to the UK Exchequer. That is an astonishing position to take.

This has been recognised as an unfair anomaly and discrimination not only by Members of this House. Today's Glasgow Herald states that legal action is already being taken by Phil Shiner on behalf of Public Interest Lawyers. Let me quote directly:

“Lawyers will launch court action as early as next month to stop the SNP Government's controversial policy of enabling Scottish universities to charge English students up to £9000 a year in tuition fees while home students pay nothing, The Herald can reveal”.

That action is taking place, but how much better it would be if, instead of having to defend that action—in practice, defending the indefensible—the UK Government were to accept my amendment and the Scottish Government were to agree to stop that discrimination.

To quote from the Guardian—no, it was the New Statesman, which is even better than the Guardian—the point has been made that,

“The resentment felt by English students, who will soon pay the highest public university fees in the world, will further destabilise the Union”.

One wonders whether the First Minister of Scotland has an ulterior motive, because it is alienating people in England. Lots of people from south of the border, when they find out about that, say how disgraceful it is. I am glad to say that I have also been approached by lots of people north of the border who think it is disgraceful: students, parents and others who are really concerned.

The New Statesman continues:

“The growing disparity between the two countries is a reminder of the incomplete nature of Britain's constitutional settlement”.

That is absolutely right, and something that I propose to deal with in other amendments to the Bill and which I have raised elsewhere. It continues:

“The UK is now neither a unitary nor a federal state and its largest constituent group—the English—feels increasingly unrepresented. For too long, politicians have complacently ignored threats to the Union; they must now act to repair our disunited kingdom before it is too late”.

I say to that hear, hear. This may be being done for some positive reasons, but in my view, it is for ulterior motives as well.

I hope that we will consider passing the amendment. It is important that we send out a strong call from this Chamber, from Westminster, to the Scottish Parliament and the Scottish Executive that they should reconsider this. I must be honest: I know that one or two of my colleagues in the House of Commons, one or two here and one or two in the Scottish Parliament have had some reservations about me pushing ahead with the amendment. To them, I cite Claire Baker, who is the Labour spokesperson on education in the Scottish Parliament. When the order went through the Scottish Parliament, the Liberal Democrats and the Labour Members did not vote against it for interesting reasons. Claire Baker said:

“I remain to be convinced that the order provides the right answer”—

she did not believe that—

“but I accept that action must be taken. After this morning’s evidence I remain concerned about the introduction of a variable fee and the lack of regulation and access arrangements, and I have wider concerns about the £9,000 fee level that has been set. However, I will support the order, which I realise is important if we are to manage cross-border flow and protect student places. I will return to the fee level, the regulator and other issues of concern when primary legislation is being considered”.

So there is deep disquiet. People in the Opposition in the Scottish Parliament feel that they are being given Hobson's choice: they feel that they are being forced into this. Otherwise, universities, including my former university of Edinburgh, will be squeezed even further in their income and find it more difficult. The members of the Opposition in the Scottish Parliament have been placed in an impossible position by the sky-high fees imposed by the United Kingdom coalition Government and by the discrimination imposed by the Scottish Administration. That pincer movement is making it very difficult for people.

Finally, I return to the main point. Whatever the detail of the argument, whatever the facts and figures—I know that the noble Lord, Lord Sutherland, and others will give more facts and figures about what is happening in the Scottish universities—it is deeply disturbing that such blatant discrimination should be taking place against students and potential students from England, Wales and Northern Ireland. I hope that the House will send that message very strongly to Edinburgh today.

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[Lord Foulkes of Cumnock]

I will deal with that very point. I started by saying very much what the Minister has said in his last few words. I am very aware of that sensitivity. I will come back to this in a few minutes, but I am really grateful to the Minister for agreeing to take this away and reflect on it. When he expresses the view to his colleagues, I hope he will make it clear that this is an all-party, cross-bench, overwhelming, united, passionate and powerful message from the House of Lords. We have had people from all the parties, with lots of graduates from Scottish universities and other universities, all powerfully talking in one direction. That is a message to get over: we may be non-elected, but some of us have been elected in other places for long periods and have a lot of experience. I hope that message will get through.

I will make two points before I come to my last general point. First, on unintended consequences that arise, the noble Lord, Lord Forsyth, said this was a question of domicile, not nationality, which is absolutely right. Let me tell the Committee of one of the unintended consequences. Early last year, a Tory Peer—I will not name him—told me that he already knows of relatively well-off people who are buying up flats in Edinburgh to establish domicile there, so that they will not have to pay fees. That is the kind of thing that happens—and no, it was not the noble Lord, Lord Forsyth, saying that. Just as others have said, those who are relatively well off might pay the fees while others can get what I might call a domicile of convenience, so as to not pay them. They will eventually sell the flat, or whatever, and manage to reap some profit on that.

My second point is on what the noble Lord, Lord MacGregor, and, again, the noble Lord, Lord Forsyth, said about the Barnett formula. There is an amendment tabled for later in this Committee from my noble friend Lord Barnett himself—I call him Lord Formula—to have this revised. He has wanted that done for some time. We know that, per capita, it is exceptionally generous to Scotland. That is why the Scottish Government and the Scottish Parliament have been able not just to keep free higher education but free prescriptions and free personal care as well, all of which is building up tremendous resentment south of the border. There is a feeling here that the taxpayers south of the border are paying for all those better services. We heard that expressed in a previous debate in this House by Members from England, and it is a very strongly held feeling.

I urge the Minister to think about the consequences. There is of course another way of dealing with this, which is how Mike Russell, the Education Minister in Scotland, wants to deal with it. He wants to end the anomaly by stopping allowing European students in for free. He wants to go to Commissioner Vassiliou and say, “Let's have this changed so that we don’t have this obligation”. I do not think he will succeed in that—I think it will be impossible for him to succeed in that—but let us think of what he is trying to do. He is trying to make it financially difficult not just for English, Welsh and Northern Irish students but for European students to come to Scottish universities. My noble friend Lord O'Neill spoke about the Caledonian closet. Can your Lordships imagine Scottish universities reverting to what they were centuries ago when Glasgow, for example, had just students from around the Glasgow area? They would become narrow, introverted and isolationist universities and not in the old tradition of Scottish universities. I hope that we will not move in that direction.

The Minister was genuinely helpful and I hope that he will take it away, as he said, and discuss it. I listened very carefully to my noble friend Lord Browne. I think that he supported me in principle and that he will take it away to look at in more detail. I will help him in that task. The noble Lord, Lord Forsyth, asked the Minister to talk to the Prime Minister about it. Can I add the Deputy Prime Minister, just to make sure that it is all squared with both parts of the coalition? Will the Minister also talk to the Scottish Government about it and say that there is a strength of feeling, there are anomalies and there may be other ways around it? Will he ask them to consider the options for ending an unfair and discriminatory arrangement? We have some time until Report stage to do that. We are not going to finish this Committee stage until late in March so we will probably not get to Report until April.

I hope that the Minister will go away and talk sincerely to them. I know that he is busy with other things, but I hope that he can take some time out to talk to people about this anomaly, which clearly upsets so many people, not just in this Chamber but, far more importantly, outside it, and try to find a fair and equitable solution. On that basis, I shall withdraw the amendment.

[Lord Forsyth of Drumlean]

My Lords, I thank the Minister for his response to the debate which was very generous, giving what a beating he was subject to during it. I always used to say of my late learned friend Nicky Fairbairn that if I were on a murder charge I would have him defend me. In the absence of Nicky, given that my noble and learned friend made a good job of a pretty limited set of arguments, that accolade may fall to him. We do not need to think about the future to see what is going to happen in the future. Only this week the UCAS figures were published. They show, surprise surprise, that more Scottish and European students, but fewer English students, are going to Scottish universities.

I feel a bit alarmed by the interests that were declared by my noble friends Lord MacGregor, a former Secretary of State for Education, and Lord Sanderson. I suppose I ought to declare a grandson, whom I am taking to the rugby on Saturday.; he will be supporting England and I will be supporting Scotland. He is only 13, but I would not like to think that his choice of university should be in any way limited by where he lives in the United Kingdom.

I do not normally disagree with my noble friend Lord Flight, but he has made some remarks about Irish universities. I ought to declare another interest: my youngest daughter went to Trinity College, Dublin. When she decided to go there, I thought that it would cost me an arm and a leg but it was free because there are no fees in Ireland. The consequence of that has been that a number of English students go to Trinity College, Dublin, but the university limits the number that it will accept and the result is that now you need to get four As, I think, in order to be able to go there. A distortion is being created not just in residency or wealth but also in the ability of the students. Only very able students from Europe are able to get into these universities.

I do not know whether or not it is legal to have a quota, but it is a remarkable argument. “Independence in Europe” was the slogan, and the whole idea of Europe—which, I confess, has been distorted—is that it is an open, single market where you have free movement of labour. That is the attractive part of the idea. It seems to be a complete distortion to argue that we are in favour of a single market throughout Europe but not within the United Kingdom. That argument will lead to fragmentation, which is precisely why Mr Salmond and his friends support it.

I will not detain the Committee; we will return to this. However, I want to pick up a couple of points that the Minister made. It is not right that an English student wanting to go to a Scottish university will to have to pay the same fees, because in Scotland we have four-year degrees. Personally, I would be very sad to see the end of the four-year degree system, but that may also be an unintended consequence of the distortion that has been created.

The Minister, speaking from the Dispatch Box, said something which absolutely horrified me, and which I hope will not be the general policy of the Government. He said that it would not be appropriate for him to comment from this Dispatch Box on the policies of the Scottish Government. Excuse me—this is part of the United Kingdom. The devolution Bill—the Scotland Bill—gave powers to the Scottish Parliament to exercise, but the powers to legislate on these matters remain with us. It is entirely appropriate for Ministers at the Dispatch Box to comment on the policies of the Scottish Executive—not Government, Scottish Executive—particularly if they affect the people of the rest of the United Kingdom. That is the kind of principle that I would expect to hear being enunciated by Mr Salmond and the separatists. It is the duty of this House to look at the consequences of the Scottish Executive’s policy and their impact not just on Scotland but on the rest of the United Kingdom. I hope that my noble friend will take this away and consider it very carefully indeed. There has not been a single speech in support of the current position. I believe that if we were to divide the Committee and people knew what they were voting for, there would be a jam in one of the Lobbies and the Minister would be searching for tellers. This matter needs to be looked at very carefully.

The noble Lord and I did not confer on this issue at all. We both tabled amendments because we are both aware of the feeling on this matter. I put down my amendment as an amendment of principle because it seems to me that the principle of devolution should be that policies which affect Scotland are made in Scotland and that the Scottish Parliament should be responsible for them, but that in so doing—this is an important principle—people in the rest of the United Kingdom should not be disadvantaged vis-à-vis other European Union citizens. If I had put down an amendment that said the Scottish Parliament should have the power to legislate in a way which discriminates against people in England, Northern Ireland and Wales but not other EU citizens, it would have been laughed out of court. That appears to be the position of the Government—that they are prepared to have a status quo of that kind.

I do not see this as being something that might have unintended consequences; it seems to me to be central to the whole philosophy of devolution. I find myself in a very surprising position in having to explain the philosophy of devolution as I have not been a strong supporter of it because I thought that it would lead to exactly the difficulties which we are now encountering. However, that is water under the bridge. If we are to maintain the United Kingdom, we have to make it work. Setting boundaries and a framework seems to me a more appropriate way of going forward than limiting the scope in particular areas of policy. But in whichever direction we go, we need to resolve this problem one way or the other. One way of dealing with it would be to say that the fees of those students who go from England to Scottish universities are picked up by the Department for Education and that the money is taken off the block grant to the Scottish Parliament. There is a whole range of ways of doing it. I think that would probably be the most provocative way of doing it. There are other ways of doing it but I urge my noble and learned friend and his colleagues to think carefully about the best way of doing it, perhaps as my noble friend Lord Maclennan said, in consultation with the Scottish Government. We cannot go on like this.

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Moved by

[Lord Foulkes of Cumnock]

26A: After Clause 14, insert the following new Clause—
“Rail passenger services
(1) In Part 2 of Schedule 5 to the 1998 Act, section E2 (rail transport) is amended as follows.
(2) In the exceptions insert—
“Services for the carriage of passengers by railway which start and finish in Scotland, including the power to decide who will run such services, the provisions of the Railways Act 1993 notwithstanding.”
(3) In the interpretation insert—
““Services for the carriage of passengers by railway” has the meaning given by section 82 of the Railways Act 1993.””

[Lord Foulkes of Cumnock]

My Lords, I shall be very brief on this because I know that we have some of the most distinguished lawyers from Scotland waiting in the wings to talk about the Supreme Court. I am looking forward to hearing them do so.

This amendment was moved by my colleague Thomas Docherty in the Commons and has the support of the trade unions. It comprises a simple, technical new clause. Most people think that the Scottish Parliament already has the power to decide on the model for the ScotRail franchise, or for the franchise in Scotland. After all, it has to fund that franchise through its Ministers and it is responsible for the letting of the franchise. It is also responsible for funding the building of new railways in Scotland. We have successfully given greater powers to Scottish Ministers to do everything except determine the model of that franchise. I will not argue that a switch to a not-for-dividend model would necessarily be the best. The issue is that Scottish Ministers must let the franchise according to a privatised model. I am not saying that that is wrong; I am just saying that they should have freedom to decide what the model should be. I hope that noble Lords, particularly the Minister, will note that I am suggesting additional powers for Scottish Ministers and the Scottish Parliament, which would be welcome.

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[Lord Wallace of Tankerness]

The noble Lord, Lord Foulkes, gave a fair analysis or description of what his amendment is intended to do. The noble and learned Lord, Lord Boyd, said that this might just be an oversight in the original arrangements. The noble Lord, Lord Foulkes, said that it was too small a matter for the Calman commission. I think that quite a significant change is proposed; it is not a small matter at all. The fact that I do not recall any representation on or consideration of it as part of the Calman commission may say something about whether there is widespread support for it.

The noble and learned Lord, Lord Boyd, asked why legislative competence has not gone hand-in-hand with executive competence. I think I am right to say that executive devolution was not present in the 1998 Act, but was subsequently negotiated between the then Scottish Executive—I think that Mr Henry McLeish took a role in that—and the Labour Government. The agreement reached was one of executive devolution. The Labour Government did not think it right at that stage to extend legislative devolution, and that continues to be the position of this Government. The Government are committed to maintaining a GB-wide national rail network which is publicly specified and funded in the public interest but which is provided by the private sector.

It is important to recognise the substantial executive devolved powers which Scottish Ministers have in relation to railways. They include giving general guidance to the Office of Rail Regulation, giving notice of their requirements for the outputs of the rail network in Scotland and the level of public funding available to the Office of Rail Regulation and publishing a Scottish railway strategy. They also have power to designate, let, fund, manage and enforce Scottish franchises and publish a statement of policy on franchising; to set fares; to publish a code of practice protecting the interests of disabled passengers; to appoint a member of the Passengers’ Council; to give financial assistance to any person for the purpose of developing Scottish railways; and to publish freight grants schemes for Scotland. Indeed, they have considerably more powers than that. Of course, the Scottish Executive have also taken considerable initiatives in building and constructing new railways—my noble friend Lord Mar and Kellie is probably a personal beneficiary of the railway from Stirling to Alloa—so substantial powers are already available.

However, as I said, we believe that devolved powers are best exercised within a coherent GB structure, as provided for under the Railways Acts 1993 and 2005. It is essential that the overall regime for the provision of rail passenger services and their regulation remains a reserved matter. It would not be sensible to run the railway in such a way that the Scottish Parliament through legislative devolution could overturn the framework that governs the operation of passenger services in Great Britain as a whole.

The noble and learned Lord raised the question of Wales. I will certainly confirm the position, but the fact that we wish to keep a GB structure means that there is no legislative devolution to the Welsh Assembly.

[Lord Foulkes of Cumnock]

What I am proposing would not overturn the structure of the railways in Great Britain as a whole, as the Minister just said, but is merely filling a little gap in the model, the kind of franchise that can be agreed by the Scottish Executive and the Scottish Parliament. It is a small but important addition and it would not disturb the rest of the railways in the United Kingdom. I hope that he will give it some serious consideration.

[Lord Wallace of Tankerness]

I think it would, if we take it that GB includes Scotland. If Scotland could have a different model from that operating in the rest of Great Britain, that would amount to a material change. We believe that the right balance is in place. It was a balance struck not by this Administration but by the previous one, and not just as part of the original legislation but as one for which specific consideration was given for a Section 30 order. The arrangement struck the right balance and I urge the noble Lord to withdraw his amendment.

[Lord Foulkes of Cumnock]

On every previous occasion, I have said that I am really grateful to the Minister for listening carefully to the arguments and being sympathetic, accepting some of the arguments and going away and looking at the amendment. In this case, I am disappointed. I could have gone on at much greater length arguing the case, but I have some concern for my noble friends the eminent lawyers from Scotland and we need to get on to the issue of the Supreme Court. However, this is an important issue. The trade unions feel strongly about it. I know that the Scottish Government would welcome this change. It seemed to have some support in the House of Commons, and would be a coherent arrangement.

The noble Earl, Lord Mar and Kellie, is a very quietly spoken Member of this House and always speaks exceptionally briefly, but in this case his point was really quite a remarkable Exocet. In his brilliant intervention, he said that whereas there could be no public ownership so far as Britain was concerned, in relation to United Kingdom interests, French, German or Dutch railways—all three are publicly owned—would have no problem at all in buying into and taking over this franchise. That is a serious anomaly. It might be best to have some kind of United Kingdom or Scottish structure different from the current ScotRail structure to deal with it. I hope that the Minister will give further consideration to this between now and Report so that we can avoid a rather longer debate then. Nevertheless, I beg leave to withdraw the amendment.

Amendment 26A withdrawn.

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[The Lord Speaker]

In Clause 18, Amendments 42 and 43 not moved?

[Lord Foulkes of Cumnock]

Not moved.

[The Lord Speaker]

The Question is that Clause 18 stand part of the Bill. As many as are of that opinion will say Content.