Higher Education

Lord Watson of Invergowrie Excerpts

Thursday 7th March 2024 Lords Chamber

[Lord Watson of Invergowrie (Lab)]

My Lords, my noble friend Lord Blunkett has done your Lordships’ House a service by introducing this important debate. I thank him for that.

Levelling up is a term that is almost incapable of meaningful definition. However, it was a key pledge made by the Government at the last general election to reduce regional inequality in England and it is fair to ask what has happened since then. The £3.6 billion towns fund was the main initiative, yet the Government have had to admit that less than a fifth of the projects approved to improve towns across England have been completed. Last year we learned that councils were having to scale back or freeze levelling-up projects because of soaring costs and that the Department for Levelling Up, Housing and Communities was returning almost £2 billion of housing money to the Treasury, unable to find projects to spend it on.

Of course, inflation and interest rates have made it difficult for some projects to make progress, but the Government have failed to respond, instead asking local authorities to reduce their ambition. Surely, the very last thing required in the pursuit of increased growth, productivity and levelling up is less ambition. However, yesterday’s Budget provided evidence that the Government have redefined levelling up to their own advantage. The Chancellor highlighted future investments in Buckinghamshire, Cambridge and Surrey—all of which happen to include battleground seats for the upcoming election. Even that well-known deprived area of Canary Wharf is to be the recipient of government support.

The economic impact of higher education institutions was graphically illustrated by my noble friend Lord Blunkett in his powerful opening speech. Research by London Economics found that the estimated total benefit to the UK economy from 2021-22 first-year international students over the duration of their studies was more than £40 billion, while the estimated total costs were around £4 billion, meaning a benefit-to-cost ratio of 10:1. You would think that an economic impact of that level would be hard to ignore, yet the Government are making a determined attempt to do just that: as my noble friend Lord Howarth said, visa rules were changed at the start of the year so that international students could no longer bring dependants to the UK unless they were studying a postgraduate research course or a course with a government-funded scholarship.

This will hit many universities hard, given their reliance on international student fees to offset the fact that domestic student fees have not risen for a decade. Ironically, in their levelling-up strategy of 2022, the Government highlighted the importance of higher education institutions and their role in boosting local economies, but it seems that this crucial role has been trumped by the need to appease the right wing of the Conservative Party.

I want to highlight a part of the higher education sector which has a unique, vital and too-often undervalued role in levelling up—the Open University, to which the noble Lord, Lord Storey, referred. Flexible lifelong learning through part-time higher education is crucial to improving the UK’s economic growth rate. Supporting and encouraging adults who are already in work to reskill and upskill will be critical to increasing productivity and filling skills shortages in growth areas of the economy. Flexibility is essential in allowing people to access higher-level skills in the area where they live by enabling them to fit their studies around the demands of work and family. The sharp decline in part-time higher education over the last 15 years has led to a big decrease in the number of adults aged 21 and over accessing higher education and therefore caused regional disparities in higher education participation to widen.

The higher education participation rate of working-age adults aged 21 and over in England is now 30% lower than it is in the rest of the UK, largely due to the ending of the maintenance allowance and other support that is available to full-time students. Part-time distance learning is critical to widening access, supporting social justice and levelling up by allowing disadvantaged adults and those from higher education cold spots to access higher-level qualifications in their local area. That is evidenced by the Open University. More than half of its students begin their studies without the traditional entry qualifications demanded by other universities and more than a quarter come from the most disadvantaged areas in the UK.

The lifelong learning entitlement will offer a real opportunity to tackle many of the barriers to people studying flexibly in England. It will not be introduced until next year, but the removal of some of the restrictions on how additional funding entitlements for reskilling later in life are used will significantly improve flexibility. The positive impact of the lifelong learning entitlement could be enhanced by extending maintenance support to all part-time students, including distance learners, either through an extension of maintenance loans or the introduction of targeted maintenance bursaries. This has had a transformative impact in supporting flexible learning in Wales and those lessons need to be learned in England, if not by this Government then certainly by the one that will follow them.