Oral Answers to Questions

Lord Johnson of Marylebone Excerpts

Tuesday 13th September 2016 Commons Chamber

[Julian Sturdy (York Outer) (Con)]

7. What steps his Department is taking to promote innovation in all regions of the UK.

[The Minister for Universities, Science, Research and Innovation (Joseph Johnson)]

The Government support innovation through Innovate UK, soon to be part of UK Research and Innovation, and have invested more than £1.8 billion in innovation since 2007. Innovate UK is connecting businesses to local growth through its regional managers, and local enterprise partnerships are supporting innovation through £200 million of local growth funding.

[David Morris]

As chairman of the parliamentary space committee, may I point out that the space industry has outgrown the economy by 10% all through the austerity years? However, the industry is quite worried about the issues that could be caused by Brexit, even though the European Space Agency is outside the European Union. Can the Minister give us a categorical assurance that the space industry—and the aviation industry, which is annexed to it—will not be overlooked, especially in areas such as the north-west?

[Joseph Johnson]

We certainly recognise the value of space to our economy and we are working closely with industry to understand their concerns. We are also working closely with colleagues across the Government to ensure that we understand the impact of the referendum and all the opportunities associated with it, and we will continue to do that as we shape our future relationship with the European Union.

[Julian Sturdy]

The success of our agricultural industry is dependent on the latest innovations in agricultural science and technology, which are driven forward by world-leading research centres such as Fera on the outskirts of York. What assurances can the Minister give us that agri-food research will continue to play an important role in the Government’s overall strategy for supporting innovation and, ultimately, delivering food security?

[Joseph Johnson]

This Government are investing £160 million in agri-tech, including in centres for agricultural innovation, to ensure that our world-leading science is improving productivity on farms. In addition, a UK-wide food innovation network, which is to be launched shortly, will give businesses greater access to technology and science.

[Mr Gregory Campbell (East Londonderry) (DUP)]

Will the Minister ensure that the relevant Ministers in the devolved legislatures across the United Kingdom are brought together to ensure that best practice in innovation is not just replicated but brought forward in each of the relevant sections across the UK?

[Joseph Johnson]

We are working closely with the devolved Administrations as we put in place the creation of UK Research and Innovation. Excellent science and innovation will be supported through the new body, and we look forward to continuing to fund excellence in science and innovation, wherever it is found in the United Kingdom.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

Innovation is key to our regional economies, helping to create high-skilled, well-paid jobs. Innovation needs investment in research and development and in small businesses if we are to make a success of new ideas. European funding has helped to grow our regional innovation infrastructure. The north-east alone will receive £130 million in research funding between now and 2020, and 72% of EU funding to UK businesses goes to small and medium-sized businesses. Will the Minister commit to matching the funding for innovation that currently comes from the European Union?

[Joseph Johnson]

We have been monitoring the impact—any impact—on our research institutions and businesses since the referendum. The Treasury’s announcement on 13 August that it will underwrite for the life of the project all competitively bids for EU research funding that are applied for before our departure from the EU shows our determination to take action wherever necessary to maintain the global competitiveness of the UK’s research base and of the innovative businesses that win such bids.

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[Chloe Smith (Norwich North) (Con)]

T4. As we approach European negotiations, can the Secretary of State assure me that the Government will seek to enhance and promote British strengths in financial services, science and the digital, creative, cultural and tourism sectors, which are particularly important to my constituency?

[The Minister for Universities, Science, Research and Innovation (Joseph Johnson)]

Yes, I can certainly assure my hon. Friend that we plan to put science and innovation at the heart of our industrial strategy. Financial services, as part of the services sector, will also play an important part of our strategy as it is developed in the coming weeks.

[Patrick Grady (Glasgow North) (SNP)]

T5. Last week, the Government committed to ratifying the Paris climate agreement. Will they commit to doing so before the next United Nations framework convention on climate change conference of parties in Morocco, so that they can play a full and leading role at that summit?

[Maggie Throup (Erewash) (Con)]

T7. Britain is undoubtedly a world leader in scientific research. With that in mind, will my hon. Friend detail what role bioscience will play in the Government’s industrial strategy?

[Joseph Johnson]

The Government’s industrial strategy will position the UK as a global leader for the 21st century. The UK bio-economy is worth £220 billion in gross value added—13.6% of total GVA in 2014—with potential to grow by 13% by 2030. We shall continue to invest strongly in it.

[Paul Blomfield (Sheffield Central) (Lab)]

T6. The Secretary of State is a thoughtful man who I believe is serious about regional growth. Will he assure me that I am right in that understanding by cancelling his predecessor’s decision to centralise his Department’s policy functions in London? Among other things, that would maintain and build on its important presence in Sheffield.

Higher Education and Research Bill (Fourth sitting)

Lord Johnson of Marylebone Excerpts

Committee Debate: 4th sitting: House of Commons
Thursday 8th September 2016 Public Bill Committees

[Valerie Vaz]

Thank you, Mr Hanson. It is a pleasure to serve under your chairmanship. My amendment is intended to be helpful; obviously, if Members do not like what I say, they can just trash me in the press. “Office for Students” is a misnomer. First, this body is not about being an office for students; as various clauses make clear, the body is about registration and regulation—a registration procedure—and not about students. It is certainly not about having students as part of the office for students.

Secondly, from the written and oral evidence given to the Committee, the situation of postgraduate students has clearly not been acknowledged or mentioned in setting up this body, and, with the new changes in the Government, we now have two responsible Departments. Postgraduates do a fantastic job of not only research, but teaching, so they are split between the two. There is a gap there, which has been acknowledged. Postgraduate students have to be somewhere in the Bill.

Furthermore, there is nothing about subject-specific support—the strategic and vulnerable subjects, which require a higher level of funding. That is why I say that this body is not about students. There is nothing about skills, the skills deficit or protecting the STEM subjects of science, technology, engineering and maths. I liken the office for students to the Care Quality Commission. This is like calling the CQC the “office for patients” when its responsibility is not actually about that, but about regulating healthcare providers.

The office for students appears to set up regulation and registration processes. We can see in the Bill a power to impose monetary penalties and a power for the suspension of registration. Higher education providers will have to pay for the benefit of being part of the register. If we continue to look through the Bill, we see clauses titled “De-registration by the OfS” and “De-registration by the OfS: procedure”. Higher education providers are going to be spending all their time on bureaucracy, and all that money will be taken away from front-line services—away from the students themselves. That is why I say, again, that it is not about students.

According to clause 2(2), the Secretary of State has to give guidance. Again, there is no clarity. We need to change that, because we now have two Secretaries of State. If the OFS was for students it would be about fees protection, because students who were having to face bills of £27,000 are now being provided with invoices for £45,000. It would also be about students’ wellbeing, the skills shortage, retraining, returners, and all those people who do not classify themselves as students as we imagine them to be. Our time as a student is actually a very short part of our lives. There are people who do not fit the student mould, yet who will be students at some stage during their lifetime.

I want to pick up on the Minister’s remarks earlier about my being the only one who wants to pause the Bill. I do so because I am a lawyer, and was a Government lawyer. It is important to have clarity on the face of the Bill. Currently, that is not the case. The Minister helpfully told us that he has been living with the Bill for 14 months. I sympathise with him on that, but there have been a lot of changes, not least the new grammar school policy that might be coming through. What happens at the early stages of education filters up. The abolition of the Office for Fair Access and what happens to young people as they go through the education system will have a great impact. I know that it is not part of the programme motion, and I have been told that we cannot discuss this, but what happened on 23 June is vital. I say again that the machinery of Government changes.

There is no clarity on the face of the Bill. “Office for Students” is a misnomer. I would prefer to work with the Minister to find another way to describe the body, not least because it is not about students.

[The Minister for Universities, Science, Research and Innovation (Joseph Johnson)]

I echo the hon. Lady’s pleasure at serving under your chairmanship, Mr Hanson.

I shall move straight to the points raised by the amendment, with which I fundamentally disagree. I do, though, appreciate the hon. Lady’s efforts to be helpful and am pleased to have a chance to address the points she made. The Bill sets out a programme of reforms for higher education that will improve quality and choice for students. It will encourage competition and allow for consistent and fair oversight.

As I said when I gave evidence to the Committee this morning, there have been several significant changes to the higher education system since the last legislation was introduced to overhaul the regulation of the sector, all the way back in 1992. The majority of funding for the system used to come directly from the Government, in the form of grants. We have now moved to a system in which students themselves fund their studies.

The regulation of the sector clearly needs to keep pace with developments if confidence, as well as our international reputation and standing, are to be maintained, so we need an HE regulator that is focused on protecting students’ interests, promoting fair access and ensuring the value for money of their investment in higher education. That has been a central tenet of Government reforms since the publication of the 2011 White Paper, “Students at the Heart of the System”. Ensuring that the student interest is at the centre of the sector’s systems and structures is a cardinal principle of our approach.

[Paul Blomfield (Sheffield Central) (Lab)]

I thank the Minister for giving way; it is probably the first of many occasions. I wonder whether he could not give some reassurance to my hon. Friend the Member for Walsall South on the issues she is raising by indicating that he views our amendments sympathetically. They would give life to what he just talked about—putting students at the heart of the system—by providing for effective student representation both at the top on the OFS board and throughout the system.

[Joseph Johnson]

Yes, I will certainly come on to that issue, which is the subject of a number of later amendments, but I will happily touch on it in answering the hon. Gentleman.

In its written evidence, University Alliance states that:

“As the organisation responsible for regulating the higher education sector, the OfS will need to ensure that institutions operate in the interests of students.”

That point was reiterated by Professor Quintin McKellar, vice-chancellor of the University of Hertfordshire in his evidence to this Committee, when he said that

“the Government’s idea to have an office for students that would primarily be interested in student wellbeing and the student experience is a good thing.”––[Official Report, Higher Education and Research Public Bill Committee, 6 September 2016; c. 22, Q31.]

We also heard from Alan Langlands, vice-chancellor of the University of Leeds, who concurred when he said:

“I think the Government have struck a reasonable balance, and putting students at the centre is sensible”.––[Official Report, Higher Education and Research Public Bill Committee, 6 September 2016; c. 27, Q41.]

The creation of the office for students is about putting students at the heart of the system. It has been a consistent theme of Conservative and, formerly, coalition policy for a considerable time. The OFS will, for the first time, have statutory duties focused on the interests of students and equality of opportunity when using the range of powers given by the Bill.

In addition, unlike appointments to the HEFCE board, the Secretary of State must “have regard” to the desirability of the OFS’s members having proven experience of representing the interests of students when appointing the OFS board. That goes straight to the point that the hon. Member for Sheffield Central raised. Schedule 1 of the Bill captures the intent of many of the amendments that have been tabled for later clauses. We feel that schedule 1 fully meets those intentions of ensuring that the OFS board has people with the experience of representing student interests.

[Mr Gordon Marsden (Blackpool South) (Lab)]

May I repeat my delight in serving under your chairmanship, Mr Hanson, and that of Sir Edward? On the very specific reference that the Minister has just made, some might say he is just trying to defend the indefensible. It is “Hamlet” without the prince, but we will come on to that in a moment.

Is it not the case that the specific phrase “have regard” offers the minimum in draftsmanship, not the maximum? We have to legislate not for the best universities—I am sure the Minister will in due course become part of them—but for the most unexcellent. Just saying “have regard” will not be sufficient to give the guarantees that students need.

[Joseph Johnson]

I completely agree that for the OFS to function effectively in students’ interest, they should be represented properly on it. We have had a crack at that in schedule 1. I am certainly receiving a lot of representations from Opposition Members and from student unions and so on saying that we have not gone as far as we might in entrenching that core principle with which we are in basic agreement: students need to be properly represented in the governance of the office for students.

I have understood the messages we are being sent, but I point out that at board level we will be recruiting those with experience of representing or championing the student interest. A critical feature of the OFS as it is organised is that overall it must have members with experience of representing the full diversity of the sector, including students. It is essential that the individual appointed can act on behalf of the wider student interest. That reflects common practice: board members are typically appointed for their breadth of experience and representation.

OFS members will have significant responsibilities in taking decisions, many of which will ultimately impact on all students, so it is essential that each member brings more than an individual perspective to the decision-making process to ensure that the diversity of stakeholders is fairly represented.

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[Mark Pawsey (Rugby) (Con)]

Does the Minister agree that the Opposition are focusing far too much on the institutions themselves? The whole point of the Bill is to focus on students. By calling for such a change, the hon. Member for Walsall South is missing the entire point of the Bill.

[Joseph Johnson]

I thank my hon. Friend for his point. That is right. HEFCE is a brilliant body. As we discussed this morning, it was set up in 1992 as the successor body to the Universities Funding Council. It is in the tradition of being a funding council at a time when the Government no longer principally funds the universities, so it is doing its job in a regulatory environment that reflects a bygone era. We need a regulatory structure that reflects the fact that students are now the primary funders of their education through the student loan system. This is a market, as recognised in law, so we need a market regulator. The office for students is the body that we believe is best placed to do that.

A change of name of the kind that the hon. Member for Walsall South suggests would go against the main principles that we are trying to achieve through these reforms. I note that none of the stakeholders who gave evidence to the Committee on Tuesday or today asked for a change of name.

As a regulator, the OFS will need to build relationships across the sector. Part of its duties will be thinking about the health and sustainability of the HE sector. However, that does not change the fact that the new market regulator should have students at its heart, and I believe that the name of the organisation needs to reflect that. For that reason, I ask that the hon. Lady withdraws her amendment.

[Valerie Vaz]

The stakeholders may not have asked for it, but that does not mean that people cannot have an idea of their own, take soundings or look at the face of the Bill and see what strikes them. I have not missed the point, as the Minister said, because clause 2(1)(b) says that the OFS is needed

“to encourage competition between English higher education providers in connection with the provision of higher education”.

Anything to do with students, universities or higher education is also about collaboration and public good. I wanted to flag up the fact that the name, as it currently stands, does not incorporate the idea of putting students at the heart of it, for reasons that I will not go through again. It is open to very clever civil servants to come up with something that reflects this debate. With that, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1 ordered to stand part of the Bill.

Schedule 1

The Office for Students

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[Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)]

It is a pleasure to serve under you again, Mr Hanson. I hope that this is not a private fight, and that the Committee does not mind a Scot intruding in this debate, which would seem rather strange to anyone who has been in receipt of university education in Scotland, because universities in Scotland have had students at their centre, in different ways, for centuries. Indeed, the amendments are extraordinarily modest in their intent.

Some may know that for centuries ancient universities in Scotland—the four ancients, as we call them—have had elected rectors. Only the students have been able to vote to elect rectors, who are chairs of the court. That has not led to an utter collapse in the system. Indeed, the other day we heard a professor saying how proud he was that his university was ranked 19th in the world. Over the years there have been some aberrations; in the early 1970s in Edinburgh, they elected a student as rector, who did go on to No. 10: a Mr Gordon Brown, I believe, who also used to be able to get elected as MP for Kirkcaldy and Cowdenbeath, but no more.

Having worked in the education sector at times, I know that students can show remarkably wise judgment: students elected me honorary president of Paisley University in the early 1970s for two years. More recently, when I was doing some work at Stirling University, I was invited to chair the students’ association as an external person. The engagement has been great, and there are many platforms for student engagement.

The serious point I would like to make about the nature of student engagement, however, is that we should look at some of the problems that we have on boards, not just in the education sector, but more generally in society. Look at what happened when the banks crashed. The Government regularly point out that part of the problem is group-think on boards—in other words, nobody on the board comes from a different perspective, able to challenge.

Although I respect many of the contributions we heard in evidence in the past two days, it strikes me that many of the people were talking with similar assumptions and in similar ways. We are just as likely to get group-think among well suited academics sitting together in a room as we are on the board of a bank. Student representation can provide a type of challenge, which is important. It is not even a problem if challenges are wrong, as long as there is challenge. To avoid group-think, there should always be someone willing to provide that challenge. That is where I think student representation has a particular role to play. If I correctly understood the hon. Member for Blackpool South to say that he intends to put his amendment to a vote, we will be happy to support it.

[Joseph Johnson]

I will respond to amendments 2, 122 and 3 together, as they all relate to student representation on the board. As I said earlier, students’ interests really are at the heart of the reforms. They are hard-baked into the Bill. They are clearly and explicitly, in black and white, in schedule 1, in which, as has already been made clear, the Secretary of State must have regard to the desirability of the OFS board containing people with experience of representing students’ interests.

We will continue to engage with our partners as the implementation plans are developed. That will include ensuring that the student perspective is represented on boards and decision-making bodies. That is why, for the first time, we are setting up an office for students, with the intention, set out in primary legislation, that its members will, between them, have experience of representing such interests. I think it is fair for the Committee to acknowledge that that is progress. The current legislative framework, which was set up in 1992, did not have any requirements for the board of HEFCE or its predecessors to have experience of representing the student interest. It is also fair to acknowledge that putting students at the heart of the governance of the main regulatory body that will oversee the sector is a significant step in the right direction, even if that is not quite as hard-baked as the hon. Member for Blackpool South would like, in terms of prescribing the specific number of people on boards who are capable of representing the student interest, or prescribing that those involved be current students.

[Mr Marsden]

I entirely acknowledge what the Minister says about the provision not existing in 1992 or subsequently, but that, while not exactly being a lawyer’s argument, is a slight straw person, if I could put it that way. We might as well say, “We have near-universal suffrage in the UK today; they didn’t have that 200 years ago.” It is not a very strong line of argument, I would suggest. The Minister talked about experience of representing the student interest; most of us here have that experience, so I wonder if either he or his officials could give us a definition of that, and say whether it includes or excludes existing students.

[Joseph Johnson]

It could easily include students who are presently at university, but we would not want to put that in the legislation, because that might exclude people who are quite capable of playing that role. Many NUS executives, for example, could occupy the position, but they are often not actually studying, as I understand the NUS’s arrangements. They take leave of absence or years out from their university. They sometimes perform these important functions shortly after they have stopped studying. Putting in legislation the kind of requirement that the hon. Gentleman wants would prevent many of those kinds of people from contributing their valuable experience. We would not want to exclude them by putting in a requirement that they be existing students. It would perhaps not be in the student interest to do so, because we want to make those skills available.

It is essential that the individuals who are eventually appointed be able to act on behalf of the wider student interest that I spoke about. Students are a highly diverse group, and we want representatives on the OFS board who can represent the rich diversity of the student population—mature, part-time, minority ethnic and distance learners, as well as many other forms of learners. We want the OFS board members to be able to represent more than one type of student. It is very possible that we can recruit members with several of the criteria that we are looking for.

[Dr Blackman-Woods]

May I help the Minister out by suggesting that he looks at having the president of the NUS, or an immediate past president of the NUS, as a member of the board—somebody with a very up-to-date knowledge of a wide range of issues relating to students and the higher education sector more widely?

[Joseph Johnson]

We have made it clear that we want the student voice prominently represented in the governance structures of the main regulatory body. We would not want to set out in legislation that the holders of particular positions in the NUS or other student unions had ex officio places on the board of the office for students. That would tie the hands of the board of the OFS in a way that would be entirely undesirable in primary legislation.

I want to pick up on one or two points that the hon. Member for City of Durham made. She said that the way in which the higher education market had evolved to cause students to be regarded as consumers was regrettable, and she also regretted the withdrawal of the state from the financing of higher education. I would like to point out that that is not true: the taxpayer still makes a considerable contribution to the funding of the system. Taxpayers fund it directly, and also often subsidise the loans that underwrite students’ studies. That is a critical feature of a progressive higher education system that has enabled many people from disadvantaged backgrounds to go to university and benefit from it.

As I was saying, schedule 1 is progress. It includes a requirement that is not found in current legislation. The student voice and the student interest will be represented in the main regulatory body; that has not previously been the case. The Committee should welcome that, even if some want the types and specific characteristics of the student representatives to be set down even more clearly.

[Paul Blomfield]

I thank the Minister for giving way again. He has explained his aspiration to engage students. The first OFS board will set the tone; it will set an operating framework that will be maintained over many years. Under the Bill, would the Minister expect that first board to include a current, or at least very recent, student, so that that particular experience could complement its work?

[Joseph Johnson]

I would not want that to be explicit in primary legislation. It will be for the Secretary of State to have regard to the duty to think about the desirability of student representation, but I do not want the Bill to be clear now as to whether it would be a current student or someone who had just finished studying. It could be either of those, or people with a number of other characteristics. The key thing is that there will be people on the OFS board who will be capable of representing the wider student interest.

[Mr Marsden]

Without trading lawyers’ words, the amendment says that at least one of the members should,

“at the time of their appointment, be currently engaged in the representation or promotion of the interests of individual students, or students generally”.

That is drafted quite widely, for the specific and practical reasons that the Minister outlined. It certainly does not say that a member has to be an NUS officer or official. There is a degree of latitude in the amendment.

Even at this stage, I shall make an offer to the Minister: if he is worried that the amendment is technically deficient—after all, he is Goliath and we are David in this matter; he has many officials to draft amendments, whereas ours may well be technically deficient—and he wants to suggest improvements to it, that would be a different matter, but he has not said that.

[Joseph Johnson]

I deal with the amendments that have been tabled. I do not choose which amendments Opposition Members table; I can deal only with those that are presented to me. The amendment as drafted would restrict student representation at board level to a current student. We think that is over-prescriptive. It is of course right that we engage directly students who are currently in higher education, but restricting the requirement in such a way would risk our not being able to appoint the right person to the role. It could, for example, prevent us from appointing a future full-time officer of a student representative body. For that reason, I urge the hon. Member for Ilford North to withdraw the amendment.

[Wes Streeting]

Having listened to the arguments, I am genuinely baffled by the Government’s reluctance to give way on the notion of student representation on the board of the office for students. I cannot understand how it could be reasonably argued that students’ interests lie at the heart of the office for students when there might be no voice around the table with current or recent experience of being a student.

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Those are the reasons why we are tabling these specific amendments. We do so to broaden and—if I can put it this way—make more catholic, with a small c, the criteria and the pool of talent from whom the Secretary of State will be able to draw the members of the first OFS board.

[Joseph Johnson]

Ensuring that the OFS board members reflect the diversity of the HE sector is of the utmost importance to this Government. It is also essential that the board has the range of skills, knowledge and experience that will be required for it to be the market regulator of a sector that is of such strategic importance to the UK.

The current legislative framework requires the Secretary of State solely to have regard to the desirability of appointing HEFCE board members with experience of the HE sector, business or the professions. Over the years, that has given successive Secretaries of State from different parts of the House the flexibility to ensure that the HEFCE board has the breadth and depth of experience and skills that it has needed to deal with the priorities of the day.

The provisions in this Bill relating to the OFS board appointments take the same approach as the current legislative framework. In line with the OFS’s broader remit, we have expanded the number and range of areas to which the Secretary of State must have regard when appointing OFS board members. For example, those areas now include developing and implementing a regulatory framework, and promoting student or consumer choice. However, the basic approach remains the same. The Secretary of State must have regard to the desirability of appointing, but is not bound to appoint, people with certain backgrounds. The aim of the Bill remains to preserve the crucial flexibility for Secretaries of State to constitute the OFS board in the most appropriate way to address the challenges and opportunities it faces at any given time.

On amendment 123, it is extremely important that the Secretary of State has the ability to determine the overall balance of the board, and to decide where the OFS board needs greater strength and depth. While I agree that a balanced approach will be important, the amendment would inhibit the Secretary of State’s ability to make appointments that reflect current priorities. It risks having a board lacking the depth and breadth of key experience it needs to tackle the issues of the day, which may vary over time. The amendment would mean that the Secretary of State needed to have equal regard to all the criteria. It therefore implies that it would be desirable to have equal representation from all the areas on the list all of the time.

The process we have adopted for making appointments to the OFS board is based on that which has been successful for the HEFCE board over the past quarter of a century. The current legislative framework requires the Secretary of State to have regard to the desirability of appointing HEFCE board members with expertise in higher education, business and the professions. In terms of OFS board recruitment, the legislation expands the skills it is desirable to have. In purely numerical terms, the Bill lists seven areas, whereas the previous legislation mentioned only three, which means there will likely have to be some trade-offs between different types of experience that the Secretary of State will need to consider when making appointments. Furthermore, it is highly probable that some people will satisfy more than one of the criteria, and it would therefore be odd to try to pigeonhole individuals into a category for the purposes of satisfying the amendment, rather than making a judgment on the best way for the OFS to deliver its duties.

On amendment 124, I am glad that the hon. Member for Blackpool South has raised the important role of FE colleges in HE. Some 159,000 students study HE in a college, which is why I would like to highlight the support given to the package of reforms contained in the White Paper and the Bill by the AOC. The AOC says:

“We welcome much of the Bill’s content, as it has been one of AoC’s key long-standing policy objectives to make it easier and quicker for high performing institutions, including colleges, to achieve their own degree awarding powers”,

as the hon. Gentleman’s college in Blackpool has successful done recently. I will read another quote from the AOC that shows the support from colleges for what we are trying to do through our reforms:

“Choice, access and quality are the welcome watchwords of the Government’s long-awaited plans to open up higher education and to allow more colleges to award HE qualifications. This step change away from the country’s traditional university system will empower more people than ever before to access HE in their local area through a college. It will also provide a wider choice of courses that are linked to employment.”

I agree that having board members who can represent a wide variety of students would serve to enhance the diversity of the board. However, a specific amendment to ensure that is not necessary, as the definition of higher education providers in clause 75(1) is broad enough to capture further education providers. The definition already includes any provider who is offering higher education courses, which reflects the definition used in the Education Reform Act 1988. That definition has been used deliberately so that it captures HE in FE as an important and valued part of the sector.

There is nothing to be gained by highlighting a distinction between higher education and further education providers as the amendment proposes. The Bill enables the necessary flexibility to select board membership that best represents a very broad range of student interests. The amendment would serve to restrict that flexibility. It is essential that the individuals appointed can represent all students, which reflects common practice, where board members are typically appointed for their breadth of experience and representation.

[Mr Marsden]

I have to say that the Minister’s response was an extraordinarily—this was possibly predictable—managerialist response written by his civil servants. It was a pretty poor response. On the specific point he made, I would have more sympathy with the technical position—I have no doubt that the civil servants have gone through the previous legislation—were it not for the fact that in the White Paper and the Bill that was presented, the role of further education colleges in delivering higher education was pretty non-existent. That is why it is important to include the phrase in the Bill at this point.

[Joseph Johnson]

I have made the point that including the phrase is simply unnecessary, because the definition of “higher education provider” that we are using, which is taken from the 1988 Act, captures the delivery of HE through FE colleges. It would be entirely redundant and confusing for people to see a new definition spring up at this point in the Bill.

Turning to amendment 125, widening access and promoting the success of disadvantaged students will be a key part of the office for students’ remit. We want to ensure that in bringing forward our reforms, higher education providers do not lose sight of their vital role in promoting social mobility and in helping some of the most disadvantaged young people in our society to benefit from our world-class HE system.

The integration of the remit of the director of fair access within the OFS signals our commitment to making fair access and participation a priority. The OFS will have a new duty that will require it to consider equality of opportunity in connection with access to and participation across its functions, so widening access and participation for students from disadvantaged backgrounds will be at its very core.

I understand the concerns expressed about the importance of considering experience of widening access and participation when appointing the chair and ordinary members, but just because it is not in the list in schedule 1 does not stop the Secretary of State from appointing ordinary members who have that experience. The OFS’s members will be drawn from a wide range of backgrounds to ensure that the body is supported by the knowledge and expertise critical to delivering its mission and informed by representation that reflects the diversity of the sector’s providers and students.

We have already signalled the importance we attach to access and participation through the duties we are placing on the OFS and through the creation of the director for fair access and participation post. The DFAP will, like other members, be appointed directly by the Secretary of State. The DFAP must have the skills necessary to fulfil the duties placed on the OFS in widening access and participation. The necessary experience will therefore be there within the membership of the OFS. The OFS members will operate in effect as a board.

Amendment 126 relates to HE staff representation. The HE sector is diverse. It includes: large teaching intensive institutions that operate on an international level; highly specialist conservatoires of music, dance and the performing arts; and small, very locally based organisations focused on giving the most disadvantaged groups access to HE. In the Bill we have already included measures that mean the Secretary of State must have regard to the benefit of having represented on the board experience of providing higher education and experience of a broad range of providers. Such experience could come from higher education staff involved in teaching or research, or from leaders of higher education providers.

The most important thing will be that the individuals can bring a broad range of experience and represent interests that go beyond their personal position. In any case, it would be difficult to get a truly representative cross-section of HE staff, even if they filled all 15 available places on the HE Board. It would be impossible to ensure anything like fair representation from the other stakeholders in the HE sector alongside having anything approaching even reasonable representation of HE staff.

In practice, we see no reason why many members of the OFS board will not, at one time or another, have worked in HE and be able to use the experience they gained there to represent HE staff, regardless of whether they are actually employed in HE at the precise time they are serving on the OFS board. I therefore ask the hon. Gentleman to withdraw the amendment.

--- Later in debate ---

[Paul Blomfield]

I rise to speak to my amendments, which in an extraordinary example of excellent co-ordination say much the same thing but in a slightly different way. Amendment 156 tries to address what I see as a flaw in the schedule as drafted, which makes the director for fair access and participation responsible simply for reporting. The amendment seeks to clarify that he or she is not responsible simply for reporting but for that function and reporting on it. I think that is a helpful additional drafting point.

Amendment 157 clarifies the point about delegation and that the director should not be bypassed by his or her responsibilities being delegated to somebody else. The way that we deal with the matter could set the tone for discussions over the next few weeks. There is complete agreement on trying to achieve widening participation and enormous progress has been made. The Government have shown commendable ambition to make further progress. With these amendments we are considering ways to help that along.

I am sure my colleague the hon. Member for Cannock Chase will acknowledge that when we considered this issue in the Select Committee on Business, Innovation and Skills there were, despite the one area of disagreement, many areas of agreement. One was fair access. Changing the institutional architecture of the sector, which has merits, by bringing the Office for Fair Access into the OFS, also has risks unless we protect the autonomy and authority of that function within the office. That was a key recommendation of the Select Committee report, agreed by all Members. It also relates to the next group of amendments and I will say more about it then. We are simply seeking to ensure that that function has the authority to deal with universities, to get the sort of change of culture and practice that we are all trying to achieve.

I was a supporter of David Willetts’s appointment of the current director, which was not uncontroversial at the time. That was a signal from the previous Government that there was an intention to see change and Professor Ebdon has assisted that process enormously. He has been a very impressive director of fair access and we should listen closely to the evidence that he gave us on Tuesday. He is clear that this sort of definition is required to ensure that the director has the authority to help the Government achieve their objectives in negotiating the deals with the universities.

I hope the Minister will say he is happy to bring back some different form of wording, if not to accept the amendments, picking and choosing between mine and those tabled by my Front Benchers. I hope he will be able to make an amendment that reflects that suggestion, in which case I would be happy not to press mine to a vote.

[Joseph Johnson]

I thank hon. Members for their helpful and extremely interesting amendments. Although I was less able to be accommodating on previous amendments, I would like to signal that we are giving these amendments very careful thought. There is obviously agreement on both sides that social mobility is a huge priority, all the more so now for this Government. Widening access and participation in higher education is one of the key drivers of that.

I agree strongly with the hon. Member for Sheffield Central that the current director of fair access, whom I played a part in reappointing last year, has done a superb job and continues to be exemplary in the way he discharges his functions in that critical role.

Through our reforms, we are keen to ensure that promoting the success of disadvantaged students will be a central part of the OFS’s remit. Through the Bill, the OFS will bring together the responsibilities for widening participation currently undertaken by the director for fair access and HEFCE. Bringing those functions together in one body will ensure greater co-ordination of activities and funding at national level. That should allow greater strategic focus on those areas identified as a priority. In establishing the OFS, we have been clear that we are creating a single body, whose members will, in effect, operate as a board responsible for a range of functions, including access and participation. It will be the responsibility of the OFS to ensure that all its functions are being fulfilled.

Let me reassure Members the intention is that the OFS will give responsibility to the director for fair access and participation for activities in this area. The intention is that the OFS will give responsibility to him for these matters. We envisage that in practice that will mean that the other OFS members will agree a broad remit with the future director for fair access and participation and that the DFAP will report back to them on those activities. As such, the DFAP would have responsibility for those important access and participation activities, including—critically—agreeing the access and participation plan on a day-to-day basis with higher education institutions.

Amendment 134 would place in legislation details of how the OFS members will operate when considering delegation of functions. It would not, however, be appropriate to put that kind of detail into statute. Rather, we would expect the OFS, once established, to confirm how it will operate and exercise its delegation powers taking account of guidance from the Secretary of State. However, let me repeat and attempt to reassure hon. Members that the intention is for the OFS to give responsibility for access and participation to the director for fair access and participation.

The work of the DFAP does not need to be separated from the rest of the work of the OFS. The reforms mean that access and participation will be considered in the context of everything that the regulator does, with the Secretary of State’s directly appointed champion in the form of the director for fair access and participation. The Government are serious about social mobility and that is exactly what the measures will help to drive. I therefore ask the hon. Member for Blackpool South to withdraw his amendment.

[Mr Marsden]

I thank the Minister for laying out the outline and broader direction so strongly. I am glad that he reflected on my comments and those of my colleagues, and indeed the exchange I had with the hon. Member for Bury St Edmunds, because that was helpful in bringing out the tensions between day-to-day executive activity and broad strategy and policy. He referred to that in his comments.

We will take the Minister’s assurances at face value. We need to do that because what Ministers say in Committee influences the interpretation of the final legislation. We will wait to see how that issue is dealt with—in another form, if that is what he wishes. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

--- Later in debate ---

[Mr Marsden]

The generic points the Opposition Front Benchers would like to make in this area have been amply covered by my hon. Friends the Members for Sheffield Central and for Ilford North. I will briefly touch on amendment 128. I say again that we entirely endorse and think it is of huge importance that that report should come to Parliament on a regular basis. Although this is not part of any of the amendments, it is taken for granted that it should also go to the relevant Select Committees. It is in that context of closing the circle that we wanted to clarify with a probing amendment that the director would report to the board members of the OFS on his performance.

To go back to the point that the hon. Member for Bury St Edmunds made earlier, we do not want the director to sit in a bubble. I can imagine that the OFS board, once it gets going, will have myriad things to consider at its meetings and it is important therefore that we flag up that there is a regular slot for the board members to receive that report from the director for fair access and participation. That would be of benefit to the board as a whole and to the director in maintaining his strong relationship with it.

[Joseph Johnson]

Again, I thank hon. Members for their interesting amendments. Widening access and promoting the success of disadvantaged students will be a key part of the remit of the office for students. It will build on the important progress that has been made in widening participation in recent years. Hon. Members will have noted that the latest data for 2016 entry shows that the application rate for 18-year-olds from disadvantaged backgrounds is again at a record level.

We want to ensure in bringing forward our reforms that higher education providers do not lose sight of their vital role in promoting social mobility and in helping some of the most disadvantaged young people in our society to benefit from our world-class higher education system. The integration of the remit of the director of fair access into the OFS signals our commitment to making fair access and participation a priority. The OFS will have a new duty requiring it to consider equality of opportunity in connection with access and participation across all its functions, so widening access and participation for students from disadvantaged backgrounds truly will be at its very core.

There is a further protection in the arrangements because, as I have said, the DFAP will be directly appointed by the Secretary of State, but ultimate responsibility for access and participation sits with the OFS and it will be the responsibility of the OFS to ensure that all its functions are being fulfilled. As I said in my comments on the last group of amendments, the intention is that the OFS will give responsibility to the director for fair access and participation for activities in this area. We envisage that, in practice, that will mean that the other OFS members will agree a broad remit with the DFAP and that the DFAP will report back to them on those activities.

The OFS board will have responsibility for access and participation but, on a day-to-day basis, I envisage that that will be given to the DFAP. In particular, he or she will have the responsibility for agreeing access and participation plans, as is currently the case. I reiterate that because it is such an important point and I know hon. Members are focused on that issue.

The amendments would have the effect of requiring reports by the director for fair access and participation to be presented to the Secretary of State and to Parliament separately from other OFS reporting. As I said, that is an interesting idea, to which we will give some thought. We agree that it is important for the DFAP to report on their activities and areas of responsibility, so the Bill does require the DFAP to report to OFS members. As I have said previously, we are mainstreaming access and participation as a key duty for the regulator as a whole. As such, it will then be for the OFS members to report on that function.

The OFS members will operate in effect as a board, although they are not referred to by that term in the Bill. It will be required to produce an annual report covering its functions, and access and participation activities have been identified as a key function by virtue of their prominence in the Bill. That report will be sent to the Secretary of State and laid in Parliament. The work of the DFAP does not need to be separate from the rest of the OFS and its work should be reported to Parliament as part of the OFS’s overall accountability requirements. In addition, the Bill allows the Secretary of State to ask the OFS to provide additional reports on access and participation issues, either through its annual report or through a special report. Any such report will also be laid before Parliament and therefore made available in the Library. The OFS can produce separate independent reports on widening participation. It would not be consistent with integrating the role into the OFS to require separate external reporting from a single OFS member when the organisation will be governed collectively by all its members.

These arrangements ensure that effective reporting will be in place, so that the Secretary of State and Parliament can effectively monitor activity in this area. As I said, we are looking carefully at it, but in the meantime I ask the hon. Member for Ilford North to withdraw his amendment.

[Wes Streeting]

I listened carefully to the Minister, and I am grateful that he will go away and reflect. What he said about clarifying the reporting mechanisms reinforces my belief that the present arrangements do not go far enough. It is right and proper that the Secretary of State should be able to demand additional or more extensive reporting, either as part of the annual report or separately. That is to be welcomed, but it somewhat dilutes parliamentary accountability, which is separate from Government accountability. Many Members would welcome the opportunity to consider issues of access and participation through parliamentary scrutiny; it need not be burdensome, but it would be welcomed. I was particularly struck by the evidence given by my hon. Friend the Member for Sheffield Central.

--- Later in debate ---

[Mr Marsden]

The hon. Gentleman refers to another welcome precedent. Yes, Select Committees sometimes have this power but the devil is in the detail. I am reminded of what President Reagan said: in these matters one should “trust, but verify”. There have been discussions in the past about the powers of Select Committees. This is a new proposal, and it is a probing amendment, but it would do no harm if the Minister were prepared to say today that this is a part of the process that he would welcome.

[Joseph Johnson]

I think I can be of some help. There is no legal obligation for pre-appointment hearings to take place for OFS appointments, as currently none of them is on the Cabinet Office list of appointments subject to pre-appointment hearings—that is a technical point, and I do not want to be accused again of being overly managerial. Despite there being no direct legal obligation, I reassure the Committee that we fully intend to actively involve the Select Committee or Select Committees, as appropriate, in the appointment process, including the option of pre-appointment hearings for senior OFS appointments. I welcome the constructive role that Select Committees can play through pre-appointment hearings. I believe that that involvement will ensure sufficient parliamentary oversight.

For that reason, I firmly resist the suggestion in the amendment that a vote in both Houses should be needed to ratify the appointments. We need to ensure an appropriate level of ministerial involvement in the appointment to a key public role. Parliamentary ratification is not in line with normal practice and would be both burdensome and unnecessary. Furthermore, there is no precedent for parliamentary approval of such appointments. HEFCE appointments have never been subject to parliamentary approval, and the Cabinet Office general guidance on pre-appointment scrutiny states that it is for Ministers to decide whether to accept the Select Committee’s recommendation on an appointment. We are following the Office of the Commissioner for Public Appointments approved process and as such are working closely with an assigned public appointments assessor to ensure that all public appointments are fair and open. I therefore ask the hon. Member for Blackpool South to withdraw the amendment.

[Mr Marsden]

I have heard what the Minister has said. I am grateful for his endorsement of the overall principle. Heaven forfend that I should ruffle feathers in the Cabinet Office dovecote on this matter and provoke a constitutional crisis. On that basis, I am happy to take his assurance and to beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

--- Later in debate ---

[Mr Marsden]

I hear what the hon. Gentleman says, and of course we are all honourable Gentlemen and Ladies in this place and I hope we all act rationally, although there has been just a smidgen of examples in the past in which Ministers, on both sides of the House, appear not to have acted entirely so. [Hon. Members: “Surely not.”] Surely not. I take the point that the hon. Member for Cheltenham is making, but I feel that some movement—again, the Minister might not like the phrase “must specify”—away from a phrase that is redolent of Henry VIII powers would be helpful.

[Joseph Johnson]

I understand that the amendment is well intended, but I am afraid we are not going to be able to support it and certainly not as it is drafted. The amendment would require the Secretary of State to specify the reasons for removing a member of the OFS board from office and we strongly resist it. It would take us well away, quite clearly in the wrong direction, from the current legislative arrangements for HEFCE board membership. Such a requirement would be inconsistent with normal practice on public appointments, and as my hon. Friend the Member for Cheltenham hinted, it would be unnecessary, as general public law principles require that the Secretary of State must act reasonably and proportionately in taking an action such as removing a member from the board. The specific terms and conditions of appointments would also have effect in that way.

The Secretary of State might remove a board member for a number of reasons, and in many cases it would not be appropriate to disclose the grounds for dismissal. I am sure hon. Members can understand that the removal might, for example, be because of personal or health-related issues and making those public could be an inappropriate breach of a member’s privacy. Disclosure of reasons for dismissal may have an adverse effect on the reputation or future employment of the member.

Schedule 1 to the Further and Higher Education Act 1992 currently empowers the Secretary of State to appoint HEFCE board members on such terms and conditions as he deems appropriate. For the past 25 years, Secretaries of State from successive Administrations have routinely attached terms and conditions to the appointment of HEFCE board members relating to the circumstances in which they might be removed from office. These have, for example, included conditions relating to the individual’s fitness to hold public office and record of attendance at HEFCE board meetings.

[Mr Marsden]

On that point, I appreciate that the Minister is trying to be helpful and I also appreciate there is a balance to be struck between transparency and the sorts of personal issues he talks about. I do not think I am going to agree with him that the Bill has got the balance right; I personally believe that there needs to be greater transparency in it. To be helpful, given that he is praying in aid HEFCE as the precedent, if he is not prepared to accept the amendment, will he at some point disclose the generic list of principles that would be appropriate to remove a member of the OFS board?

[Joseph Johnson]

As I have said, over the past 25 years Secretaries of State have routinely attached terms and conditions to the appointments of HEFCE board members. I gave a couple of examples of the conditions that have been common practice, including that an individual must be fit to hold public office and that they must have a strong record of attendance at HEFCE board meetings. Those are the kinds of conditions that are typical, the breach of which might lead to a Secretary of State deciding that it was necessary to remove a member. I have to say that it has never proved necessary to remove a HEFCE board member over the past 25 years. If it had, the Secretary of State would have written to the board member in question to explain his or her decision. That letter would have had to be clear about the grounds on which the Secretary of State was removing the board member, and the individual in question would have had every right to make that letter public if they had wished to.

The Bill draws on that successful historical practice. Schedule 1 makes provisions identical to those in the Further and Higher Education Act as regards the Secretary of State’s discretion to set such terms and conditions for appointing OFS board members as he or she deems appropriate. As I have said, that replicates current arrangements and provides that crucial flexibility for the Secretary of State to set a clear expectation, appropriate to the circumstances of the time, on appointing OFS board members. In addition, the amendment would be inconsistent with the arrangements that apply more generally across the range of public appointments. I therefore ask the hon. Gentleman to withdraw his amendment.

[Mr Marsden]

We are not going to agree in principle on this issue, but I understand the Minister’s position. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Ordered, That further consideration be now adjourned. —(Mr. Evennett.)

Higher Education and Research Bill (Third sitting)

Lord Johnson of Marylebone Excerpts

Committee Debate: 3rd sitting: House of Commons
Thursday 8th September 2016 Public Bill Committees

[The Minister for Universities, Science, Research and Innovation (Joseph Johnson)]

I beg to move,

That, the Order of the Committee of 6 September be varied so that the following is added at the appropriate place in the table—

[Dr Roberta Blackman-Woods (City of Durham) (Lab)]

I thank the Minister for responding positively to our request.

--- Later in debate ---

[Carol Monaghan (Glasgow North West) (SNP)]

I echo the comments of the other Members and thank the Minister for making the time available.

[Joseph Johnson]

I have reduced the time that I had been allocated to give evidence to the Committee by 50%, going down to 15 minutes, and I feel it is important, before we get into the line-by-line, nitty gritty scrutiny of the Bill, that we have the opportunity as a Government to give an overview of what we are trying to do, the context for the Bill and the core measures that we propose to achieve those objectives. If we shorten the time much further, I am afraid we would lose the ability to give a coherent sense of what we are trying to do overall. I would prefer to be left with the 15 minutes to which I have already reduced my slot.

Question put and agreed to.

Examination of Witnesses

Dr Ruth McKernan, Professor Philip Nelson and Professor Ottoline Leyser gave evidence.

Higher Education and Research Bill (First sitting)

Lord Johnson of Marylebone Excerpts

Committee Debate: 1st sitting: House of Commons
Tuesday 6th September 2016 Public Bill Committees

[The Chair]

It is. I will not be difficult about that. Indeed, Mr Smith has already removed his, as has Mr Howlett, and that is fine. I am fairly relaxed about that, so please feel free, Mr Marsden.

[The Minister for Universities, Science, Research and Innovation (Joseph Johnson)]

I beg to move,

That—

(1) the Committee shall (in addition to its first meeting at 9.25 am on Tuesday 6 September) meet—

(a) at 2.00 pm on Tuesday 6 September;

(b) at 11.30 am and 2.00 pm on Thursday 8 September;

(c) at 9.25 am and 2.00 pm on Tuesday 13 September;

(d) at 11.30 am and 2.00 pm on Thursday 15 September;

(e) at 9.25 am and 2.00 pm on Tuesday 11 October;

(f) at 11.30 am and 2.00 pm on Thursday 13 October;

(g) at 9.25 am and 2.00 pm on Tuesday 18 October;

(2) the Committee shall hear oral evidence in accordance with the following Table:

[Dr Roberta Blackman-Woods (City of Durham) (Lab)]

made a declaration of interest. She said that, given that the Bill created a new office for students, witnesses from student organisations such as the National Union of Students should have been called to give oral evidence, as should representatives of the Quality Assurance Agency for Higher Education.

[Joseph Johnson]

said that it was open to all parties to propose witnesses, but that the Labour party had not proposed NUS representatives until so late in the process that they could not be accommodated within the programme motion. He commented that the Scottish National party had proposed witnesses representing Scottish higher education and that they would give evidence in the afternoon sitting.

[Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)]

made a declaration of interest in that he is an honorary professor at the University of Stirling.

[Paul Blomfield (Sheffield Central) (Lab)]

commented that it was odd not to have witnesses representing students, either from the NUS or those who had participated in QAA audits.

[Joseph Johnson]

thanked hon. Members for their comments and said that he did not want the Committee to think that the Government had not been engaging with students.

[The Chair]

reminded the Committee that further witnesses could be heard on Thursday if an amendment to the programme order were tabled and accepted at the start of the sitting on Thursday morning, although it would be a starred amendment and therefore subject to the Chair’s discretion.

[Valerie Vaz (Walsall South) (Lab)]

asked whether there had been any discussions about how the change in the machinery of government would affect the Bill, given that it would be split between two Departments.

[Joseph Johnson]

stated that the machinery of Government changes had gone through in July and that the lines of ownership were clear.

Higher Education Student Finance

Lord Johnson of Marylebone Excerpts

Thursday 21st July 2016 Written Statements

[The Minister for Universities and Science (Joseph Johnson)]

I am today announcing student finance arrangements for higher education students undertaking a course of study in the 2017-18 academic year beginning in August 2017.

Teaching excellence framework

As stated in the Government’s White Paper “Success as a Knowledge Economy: Teaching Excellence, Social Mobility and Student Choice”, published on 16 May 2016, from 2016-17 the Government are introducing a teaching excellence framework (TEF) to provide clear information to students about where the best provision can be found and to drive up the standard of teaching in all higher education providers.

In year one of TEF (2016-17), all higher education providers who have met the eligibility criteria set out in the Government’s White Paper will receive a rating of Meets Expectations. This TEF award will carry financial incentives, as detailed below, for 2017-18 which will last for one year only. A provisional list of providers achieving this rating in year one was published on 7 July 2016 on gov.uk¹

The following sections provide details on the maximum tuition fee and fee loan caps in 2017-18 for higher education courses at providers that have been awarded a rating of Meets Expectations in TEF year one (2016-17).

Tuition fees and fee loans for full-time higher education courses

For all new students and eligible continuing students who started their full-time courses on or after 1 September 2012 and are undertaking courses at publicly funded higher education providers that have achieved a TEF rating of Meets Expectations, maximum tuition fee caps will be increased by forecast inflation (2.8%) in 2017-18. For publicly funded providers that have achieved a TEF rating of Meets Expectations and have an access agreement with the Office for Fair Access (OFFA), the maximum tuition fee cap for full-time courses will be £9,250 in 2017-18. For publicly funded providers that have achieved a TEF rating of Meets Expectations but do not have an access agreement with OFFA, the maximum tuition fee cap for full-time courses will be £6,165 in 2017-18. For publicly funded providers that have not achieved a TEF rating of Meets Expectations, maximum tuition fee caps for full-time courses in 2017-18 will be £9,000 and £6,000, the same as in 2016-17.

Maximum fee loans for all new students and eligible continuing students who started their full- time courses at publicly funded providers on or after 1 September 2012 will be increased by forecast inflation (2.8%) to £9,250.

Maximum tuition fee and fee loan caps for students undertaking a work placement year of a sandwich course either in the UK or abroad will remain at 20% of the maximum applicable full-time fee and fee loan caps in 2017-18. Maximum tuition fee and fee loan caps for students undertaking an Erasmus study or work placement year or a period of study at an overseas provider that is not an Erasmus year will remain at 15% of the maximum applicable full-time fee and fee loans in 2017-18.

For continuing students who started their full-time courses before September 2012, maximum tuition fee and fee loan caps at publicly funded providers in 2017-18 will be £3,465, the same as in 2016-17.

Tuition fees and fee loans for part-time higher education courses

For all new students and eligible continuing students who started their part-time courses on or after 1 September 2012 and are undertaking courses at publicly funded higher education providers that have achieved a TEF rating of Meets Expectations, maximum tuition fee caps will be increased by forecast inflation (2.8%) in 2017-18. For publicly funded providers that have achieved a TEF rating of Meets Expectations and have an access agreement with OFFA, the maximum part-time tuition fee cap will be £6,935 in 2017-18. For publicly funded providers that have achieved a TEF rating of Meets Expectations, but do not have an access agreement with OFFA, the maximum part-time tuition fee cap will be £4,625 in 2017-18. For publicly funded providers that have not achieved a TEF rating of Meets Expectations, the maximum tuition fee caps for part-time courses in 2017-18 will be £6,750 and £4,500, the same as in 2016-17.

Maximum fee loans for all new students and eligible continuing students who started their part-time courses at publicly funded providers on or after 1 September 2012 will be increased by forecast inflation (2.8%) to £6,935.

Tuition fee loans for higher education courses at private providers

For all new students and eligible continuing students who started their full-time courses on or after 1 September 2012 and are undertaking courses at private higher education providers that have achieved a TEF rating of Meets Expectations, the maximum fee loan will be increased by forecast inflation (2.8%) to £6,165 in 2017-18. For private providers that have not achieved a TEF rating of Meets Expectations, the maximum fee loan for full-time courses will be £6,000, the same as in 2016-17.

For all new students and eligible continuing students who started their part-time courses on or after 1 September 2012 and are undertaking courses at private providers that have achieved a rating of Meets Expectations, the maximum fee loan will be increased by forecast inflation (2.8%) to £4,625 in 2017-18. For private providers that have not achieved a TEF rating of Meets Expectations, the maximum fee loan for part-time courses in 2017-18 will be £4,500, the same as in 2016-17.

Loans for living costs for new full-time students and continuing full-time students starting their courses on or after 1 August 2016

Maximum loans for living costs for new full-time students and eligible continuing full-time students starting their courses on or after 1 August 2016 will be increased by forecast inflation (2.8%) in 2017-18.

For students living away from home and studying outside London, the maximum loan for living costs for 2017-18 will be £8,430. I can confirm that the equivalent loan rates for students living away from home and studying in London will be £11,002; for those living in the parental home during their studies, £7,097; and for those studying overseas as part of their UK course, £9,654.

Loans for living costs for new full-time students and continuing full-time students starting their courses on or after 1 August 2016 who are entitled to certain benefits

Maximum loans for living costs for new full-time students and eligible continuing full-time students starting their courses on or after 1 August 2016 and who are entitled to benefits will be increased by forecast inflation (2.8%) in 2017-18.

For students who are entitled to benefits who are living away from home and studying outside London, the maximum loan for living costs for 2017-18 will be £9,609. I can confirm that the equivalent loan rates for students who qualify for benefits who are living away from home and studying in London will be £11,998; for those living in the parental home during their studies, £8,372; and for those studying overseas as part of their UK course, £10,746.

Loans for living costs for new full-time students and continuing full-time students starting their courses on or after 1 August 2016 who are age 60 or over at the start of their course

The maximum loan for living costs in 2017-18 for new full-time students and eligible continuing full-time students starting their courses on or after 1 August 2016 who are age 60 or over on the first day of the first academic year of their course, will be increased by forecast inflation (2.8%) to £3,566.

Maintenance grants and special support grants for full-time students who started their courses before 1 August 2016

The maximum maintenance grant and special support grant for eligible continuing full-time students who started their courses on or after 1 September 2012 but before 1 August 2016 will be increased by forecast inflation (2.8%) in 2017-18 to £3,482.

The maximum maintenance grant and special support grant for eligible continuing full-time students who started their courses before 1 September 2012, will be increased by forecast inflation (2.8%) in 2017-18 to £3,197.

Loans for living costs for full-time students who started their courses before 1 August 2016

Maximum loans for living costs for eligible students who started their courses on or after 1 September 2012 but before 1 August 2016, will be increased by forecast inflation (2.8%) in 2017-18.

For students who are living away from home and studying outside London, the maximum loan for living costs will be £6,043. I can confirm that the equivalent loan rates for students living away from home and studying in London will be £8,432; for those living in the parental home during their studies, £4,806; and for those studying overseas as part of their UK course, £7,180.

Maximum loans for living costs for eligible students who started their courses before 1 September 2012 will be increased by forecast inflation (2.8%) in 2017-18

For students who started their courses before 1 September 2012 and are living away from home while studying outside London, the maximum loan for living costs will be £5,440. I can confirm that the equivalent loan rates for students living away from home and studying in London will be £7,611; for those living in the parental home during their studies, £4,217; and for those studying overseas as part of their UK course, £6,475.

Long courses loans

The maximum long courses (living costs) loans for new and continuing students who are attending full-time courses that are longer than 30 weeks and three days during the academic year will be increased by forecast inflation (2.8%) in 2017-18.

Dependants’ grants

Maximum amounts for dependants’ grants (adult dependants’ grant, childcare grant and parents’ learning allowance) will be increased by forecast inflation (2.8%) in 2017-18 for all new and continuing full-time students.

The maximum adult dependants’ grant payable in 2017-18 will be increased to £2,834. The maximum childcare grant payable in 2017-18, which covers 85% of actual childcare costs up to a specified limit, will be increased to £159.59 per week for one child only and £273.60 per week for two or more children. The maximum parents’ learning allowance payable in 2017-18 will be increased to £1,617.

Part-time grants and loans

For those students who started part-time and full-time distance learning courses before 1 September 2012 and who are continuing their courses in 2017-18, maximum fee and course grants will be increased by forecast inflation (2.8%) in 2017-18. Maximum fee grants will be increased to £879, £1,054 or £1,321, depending on the intensity of study of the course. Maximum course grants will be increased to £288.

Disabled Students’ Allowance

Maximum grants for full-time and part-time undergraduate and postgraduate students with disabilities will be increased by forecast inflation (2.8%) in 2017-18.

Student support for part-time students starting a second degree course in STEM subjects

Most students who hold a higher education qualification are currently not entitled to apply for additional fee loan for a second course if that course leads to a qualification that is equivalent or lower in level (ELQ) than their previous higher education qualification.

The Government have previously relaxed ELQ rules in order to help people who already hold an honours degree qualification but who wish to retrain in some science, technology, engineering and maths (STEM) subjects. Students studying second degree courses on a part-time basis can already apply for fee loans for part-time second degree courses in engineering, technology or computer science.

I can confirm today that ELQ rules are being further relaxed to allow students wishing to start a second honours degree course on a part-time basis from 1 August 2017 onwards to apply for fee loans towards degree courses in the following additional STEM subjects: subjects allied to medicine; biological sciences; veterinary sciences, agriculture and related subjects; physical sciences and mathematical sciences.

Student support for new students starting courses in nursing, midwifery and the allied health professions on or after 1 August 2017.

I can confirm today that from 1 August 2017, all new undergraduate nursing, midwifery and allied health professional students on pre-registration courses will receive support for fee loans and living costs through the standard student support system, rather than through course fees and NHS bursaries for living costs paid by Health Education England (HEE). These students will therefore be subject to the same general student finance arrangements that apply to other undergraduate students in 2017-18.

I can also confirm today that students already holding an honours degree who want to start a second honours degree course in nursing, midwifery and the allied health professions from 1 August 2017 onwards will be able to apply for fee loans and living costs support for their course.

Further details on the undergraduate student package and support arrangements for postgraduate pre-registration nursing, midwifery and allied health professional students from 1 August 2017 onwards will be set out in the Government’s consultation response which is being published in due course.

These changes will enable universities to provide up to 10,000 additional nursing, midwifery and allied health training places by 2020, giving more applicants the opportunity to become a health professional.

Student support for armed forces personnel serving overseas and their families

Students who are undertaking a full-time or part-time distance learning course with a UK provider qualify for loans, and where applicable, disabled students’ allowance if they were undertaking their courses in England on the first day of the first academic year of their course and are living in the UK. Students do not qualify for support for a distance learning course if they are undertaking their course outside the UK. This rule currently places armed forces personnel serving overseas and their families who wish to undertake a higher education course by distance learning at a disadvantage as a result of their service.

I can confirm today that from 1 August 2017, UK armed forces personnel serving overseas, and family members living with them, will for the first time qualify for fee loans for full-time and part-time undergraduate distance learning courses with UK providers. They will also qualify for postgraduate masters loans for full-time and part-time masters degree distance learning courses with UK providers. Those students with disabilities will qualify for disabled students’ allowance. This change will apply to students starting or continuing distance learning courses in 2017-18.

I expect to lay regulations implementing changes to student finance for undergraduates and postgraduates for 2017-18 later this year which will be subject to parliamentary scrutiny. More details of the 2017-18 fees and student support package will be published by my Department in due course.

¹https://www.gov.uk/government/publications/teaching-excellence-framework-year-1-list-of-eligible-providers

[HCWS117]

Student Loans Agreement

Lord Johnson of Marylebone Excerpts

Monday 18th July 2016 Westminster Hall

[The Minister for Universities and Science (Joseph Johnson)]

Thank you for your excellent chairing of this debate, Mr Pritchard. It is a pleasure to serve under your leadership. I am glad to have been reappointed in time to take part in this important debate and discuss the matter with the shadow Secretary of State for Education, the hon. Member for Ashton-under-Lyne (Angela Rayner).

I recognise the sincerity and strength of feeling about this question among hon. Members and members of the taskforce that advised the previous Government, but I am sure they understand that my challenge as a Minister in the Department responsible for student and university finance is to ensure that our higher education system remains open to all and that our universities remain well funded. The hon. Member for Warrington North (Helen Jones), who made an excellent opening speech, and other hon. Members have asked several important questions, which I will attempt to answer. However, I will first provide some strategic context to the decisions that the Government took in 2015.

When we reformed student finance in 2011, we put in place a progressive student loans system. Higher education is therefore accessible to all who have the potential to benefit from it, irrespective of their ability to pay. The system is working well and this Government have done more than any other to put higher education financing on a secure and sustainable footing. England has some of the finest universities in the world, and it is vital for our future economic prospects that they remain well funded. Total funding for the sector increased from £22 billion in 2009-10 to £28 billion in 2014-15, and it is forecast to reach £31 billion by 2017-18. We must ensure that our universities have the resources they need and every student has a high-quality experience during their time in higher education.

As the hon. Member for Southport (John Pugh) acknowledged, the warnings in the last Parliament that there would be a deterrent effect on student applications proved wrong. Students from disadvantaged backgrounds are now going to university at a record rate—up from 13.6% in 2009 to around 18.5% in 2015. People from disadvantaged backgrounds are now 36% more likely to go to university than they were under the previous Labour Government.

[Helen Jones]

Can the Minister enlighten us about the position with the Russell Group universities?

[Joseph Johnson]

It is important that we make progress across our system. In the guidance that I sent to Les Ebdon, the director of fair access, in February this year—by the way, that was the first guidance that he had had in more than five years—I explicitly gave him strong political support to ensure that all institutions, including those that see themselves as the elite institutions in this country, do the heavy lifting on access and that people who have the capacity to benefit from education at Russell Group institutions get the chance to.

In Scotland, as the hon. Member for Glenrothes (Peter Grant) may be aware, controls on student numbers continue to stifle aspiration and opportunity in a way that is simply no longer the case in England because of the way that we have put our student finance system on a sustainable footing. He made several points in this respect. I steer him towards a recent statement by the Sutton Trust that

“Scottish 18 year olds from the most advantaged areas are still more than four times more likely to go straight to university than those from the least advantaged areas.”

By contrast, the figure in England is 2.4 times. I also point him to a statement by Audit Scotland, which says:

“It has become more difficult in recent years for Scottish students to gain a place at a Scottish university as applications have increased more than the number of offers made by universities.”

[Peter Grant]

I do not know whether the Minister is aware that the Scottish Government have committed themselves to ensuring that 20% of students in Scotland come from the 20% most deprived backgrounds by 2030. In other words, the Scottish Government have committed to doing away with that imbalance completely by 2030. May we be told what the UK Government’s equivalent commitment is?

[Joseph Johnson]

Certainly. We, too, are committed to increasing the proportion of students from disadvantaged backgrounds who go to university. As I said a moment or two ago, we in fact intend to double that proportion by the end of this Parliament compared with the level that we inherited from the previous Labour Government in 2009-10, taking the proportion from 13.6% to 27.2%. We also want the number of students from BME backgrounds who go to university to increase significantly, by 20%.

[Angela Rayner]

I stress the point made by my hon. Friend the Member for Warrington North (Helen Jones). The fact is that we still are not making progress with the Russell Group and ancient universities. Can the Minister be more specific about what the Government will do to try to make progress in those vital areas?

[Joseph Johnson]

Yes. As I said, we have written to Les Ebdon to give him guidance for his dealings with all universities. That guidance gives him strong political cover to ensure that all institutions do the heavy lifting that he requires of them as he negotiates access agreements. Through the Higher Education and Research Bill, which hon. Members have mentioned, we will strengthen his powers further, so he can start to look beyond the point of access to universities and at the whole student lifecycle. Widening participation is about much more than simply whether disadvantaged people get to university; it is also about how well they attain when they are there and how successfully they move on from higher education into employment or further study.

[Jonathan Lord (Woking) (Con)]

Will the Minister assure us that encouraging all places of further education to widen access will not undermine meritocracy? Will he also take to the newly expanded Department for Education the fact that education, from the early years up to university, is crucial in improving the life chances of those at the bottom of the scale?

[Joseph Johnson]

Yes, I assure my hon. Friend that universities are autonomous in setting their admissions policies. The access agreements—in future, those will be access and participation agreements—that they come to with Les Ebdon are not targets imposed by the Government but are voluntarily agreed by the universities with the director of fair access. That will remain the case. The autonomy of our great universities is key to underpinning their success and will remain a strong feature of our system.

[Jonathan Lord]

To return to a point that was raised a moment ago, does the Minister agree that it is somewhat rich for our colleague the Scottish National party spokesman, the hon. Member for Glenrothes, (Peter Grant), to talk about the Scottish system when English taxpayers are subsidising education in Scotland under the Barnett formula? As the Minister and his Department perhaps know, we also could have no tuition fees in this country if we had the same generous per-head allocation from central Government as Scotland does.

[Joseph Johnson]

Higher education has been a devolved issue since 1999, and it is up to the devolved Administrations to determine how they spend their resources. In England, we have chosen to put our higher education on a sustainable footing, which has meant that proportionately more people can go to universities in this country than ever before. We want that to continue.

[Sir David Amess in the Chair]

Many hon. Members raised the threshold freeze and retrospection. The e-petition that we are discussing was started by Mr Alex True, who is a recent graduate, because he was concerned by the Government’s decision, which we announced in November 2015, to freeze the repayment threshold at £21,000 until April 2021. This is an important matter and a proper subject for debate, and I welcome the opportunity to explain why the Government took that decision and its impact.

We considered freezing the threshold because we needed to ensure that higher education funding remained sustainable. The choice was either to ask graduates who benefit from university to meet more of the costs of their studies or to ask taxpayers to contribute more. We undertook a full consultation on the change, as Members have mentioned. The consultation was open for 12 weeks, until 14 October 2015, and we then undertook a full assessment of the equalities impact, in line with our obligations. The responses to the consultation, which I accept were often against the proposal, were analysed exceptionally carefully. On balance, the Government decided that it was fairer to ask graduates for a greater contribution to the costs of their study rather than to ask taxpayers to do so. The reasons for that are clear. Graduates benefit hugely from higher education. On average, graduate earnings are much higher than those of non-graduates. In 2015, graduates’ salaries averaged £31,500, compared with £22,000 for non-graduates. The threshold is still higher in real terms than the one we inherited from the Labour Government.

[Paul Blomfield]

A good attempt from the Minister, but does he not accept that he is missing the point? It is not a question of comparing the threshold he inherited; it is about the commitment made to students when they entered into their university degrees. Does he not accept the argument that it is a fraudulent practice to enter into an agreement on one set of terms, only for the Government then to change those terms completely? Would he accept that in relation to the purchase of a product he was making?

[Joseph Johnson]

Hon. Members made much the same point on many occasions throughout the debate, and I will come on to those arguments shortly.

[Jonathan Lord]

May I sympathise with the points made by the hon. Member for Sheffield Central (Paul Blomfield)? It is not just those on the Opposition Benches; those students affected have a lot of sympathy, certainly from me and, I hope, many of my colleagues, on the Government Benches, when it comes to the retrospective nature of these changes. As the Minister knows, I have had a heavy postbag from students for whom the goalposts have been changed and who are effectively due to pay a much higher interest rate than they could realistically have anticipated. I do not think that is right. We have heard eloquent speeches about the other challenges facing the younger members of society today. This is one area where we could help them out.

[Joseph Johnson]

I look forward to explaining shortly to my hon. Friend exactly why we took the decision and the reasons why we believe it was the right way forward to put our system on a sustainable footing and ensure more opportunities for young people to gain from all the advantages that higher education can bring them.

For loans taken out before 2012, graduates started repaying when their income reached £15,000. That threshold has now risen to £17,495. The Government set the repayment threshold at £21,000 for post-2012 borrowers, proposing that that would be uprated annually in line with earnings from 2016, when the first graduates under the new system would start repayments. When the policy was introduced, the threshold of £21,000 was about 75% of expected average earnings in 2016. Updated calculations, based on earnings figures from the Office for National Statistics, show that figure is now 83%, reflecting weaker than expected earnings growth over the intervening period. The proportion of borrowers liable to repay when the £21,000 threshold took effect in April is therefore significantly lower than could have been envisaged when the policy was originally introduced. The threshold would now be set at around £19,000 if it were to reflect the same ratio of average earnings.

I also wish to stress that the impact of the freeze is relatively modest—albeit, I accept, still unwelcome for graduates. Borrowers earning over £21,000 will repay about £6 a week more than if we had increased the threshold in line with average earnings. Of course, those graduates earning less than £21,000 will not be affected at all.

[Paul Blomfield]

Is the Minister not confirming what I said earlier? I hope he will address that specifically, but the problem is that when the Government introduced the new system, they got the resource accounting and budgeting charge wrong. The consequence is an additional cost on the Exchequer, and instead of taking responsibility for that, the Government have transferred that responsibility on to students.

[Joseph Johnson]

Modelling the RAB charge is not an easy process, but the figures that the hon. Gentleman referred to earlier were simply not correct. We never modelled the RAB charge at over 50%. We expect about 20% to 25% of the loan book not to be repaid, and that is a deliberate, conscious investment by the Government in the skills base of the country. It is a progressive policy that enables people to go into careers that may not necessarily allow them to repay the full amount, and the Government do that knowingly and willingly.

[Angela Rayner]

Will the Minister not acknowledge some responsibility of the Government for the lower than expected average earnings projection he has just outlined, in terms of decent jobs and high wages?

[Joseph Johnson]

I reject the characterisation of our labour market as a failure. Clearly, when we look at the unemployment figures today, we cannot but be struck by the extent to which we have succeeded in getting many thousands more young people into work. The latest unemployment data from the ONS show 23.1 million people working full time, which is 300,000 more than even a year ago, let alone than in 2010. The percentage of young people out of work is now at a record low altogether.

[Liz McInnes]

While the Minister is quoting employment figures, will he tell us how many of those jobs are high-paid graduate jobs?

[Joseph Johnson]

Graduates from our universities do spectacularly well on the whole in moving into graduate employment. Obviously, we want variability across the system to even out and we want to ensure less patchiness in the system, but graduates do go into graduate employment on the whole.

The funding system put into place is also progressive. Interest rates after graduation increase with income, so that high earners repay more. For those earning £21,000 or less, the interest rate is set at RPI flat: the loan balance does not increase in real terms. For borrowers who earn more than that, the interest rate increases to a maximum of RPI plus 3%. It is only fair that borrowers who have benefited most from their education should repay the most back into the system.

Student loans are very different from a mortgage or credit card debt. Repayments are determined by income, not the amount borrowed. Borrowers are protected. If at any point their income drops, so do their repayments. Borrowers will repay only if they earn above the threshold and the loans are cancelled after 30 years, so many borrowers, as I said, will not repay the full amount. That is part of the taxpayers’ investment in our country’s skills base.

I recognise hon. Members’ concerns that students may not be fully aware of the terms and conditions of their loans at the time of application. The Student Loans Company does, however, provide students with a clear statement of the terms before the student completes their application for a loan. On page 3 of “Student loans—a guide to terms and conditions”, it states clearly—this is not hidden in some small footprint—that

“The regulations may change from time to time and this means the terms of your loan may also change. This guide will be updated to reflect any changes and it’s your responsibility to ensure you have the most up-to-date version.”

Furthermore, it is worth noting that the threshold freeze did not actually change the terms and conditions; it merely left them unchanged.

That information includes the way that interest will be applied and the repayment terms that will apply. Students are asked explicitly to confirm that they understand the information before they are granted the loan. All the information that the SLC provides to students is reviewed regularly to ensure that it is both accurate and accessible.

[Wes Streeting]

I have lost count of the number of times that iTunes has changed its terms and conditions, and I check the box and agree every time—more fool me, some might say. However, when the substance of the repayment conditions is written up in large print to entice students in but is open to change through the small print, surely that is not right. Even if the Government and the Student Loans Company took even greater steps to tell potential students that the terms and conditions could change, that is hardly a reassuring message to send to them, is it?

[Joseph Johnson]

There are always ways in which the Government can try to make things more explicit, but we cannot deny that on page 3 of the guide to terms and conditions students were clearly informed of the possibility that terms might change. In the event, they did not change—they were left unchanged, as I said.

Let me turn to the benefits of the freeze to the system and all the other reasons we felt it important to do what we did. A sustainable student finance system enabled us to abolish student number controls, lifting the cap on aspiration and enabling more people to receive the benefits of a university education. That is essential if we are to maintain our place as a country with a modern, highly skilled economy. Freezing the threshold means that we expect to recover £3.2 billion more of the loan outlay from existing borrowers. From future borrowers, we expect an additional £1 billion of repayments per £15 billion of loan outlay.

We send proportionately fewer people to university to study at undergraduate level than our main competitors. Between now and 2022, more than half of job vacancies will be in occupations most likely to employ graduates. If we are to continue to grow our economy, we must equip our young people with the skills and qualifications they need to fill those roles. England is not unique in grappling with those problems, but we are one of the few countries to have found a sustainable solution. That has been recognised internationally; the OECD has praised the student loan system in England as that of

“one of the few countries to have figured out a sustainable approach to higher education finance”.

I recognise the strength of feeling there is on the issue, but the Government must balance the interests of students, who benefit from higher education, with those of general taxpayers. We have taken difficult decisions, but in the process we have underpinned the financial sustainability of our student funding system in a manner that means we can lift student number controls and enable proportionately more young people than ever before to benefit from university.