Higher Education (Fee Limits and Fee Limit Condition) (England) (Amendment) Regulations 2025
Lord Willetts Excerpts(1 month ago)
Grand CommitteeRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Willetts (Con)
My Lords, I very much welcome this measure. I should declare my interests as a visiting professor at King’s College London and a member of the University of Southampton’s council. I know from seeing universities close up that the situation is indeed serious, as the Minister rightly said. The freeze in the level of fees has meant a 28% cut in the real resource available for universities in the last seven years. This cannot carry on, so I support this measure.
Having heard the Minister’s arguments about the need to strengthen universities’ financial position, I would add that it is a pity that the entire extra revenues for universities from this measure go in meeting the national insurance costs that they face. I hope that the Minister will be able to tell us, in her winding-up speech, her estimate of the extra expenditure on national insurance for universities as compared to the extra receipts from these higher fees. What I conclude from this is that, if the Minister is to live up to the excellent rhetoric about putting universities on a sounder financial footing, she will need to go further in future. I hope that, in her response, she can give some indication of her plans for the future. I would encourage the Minister to carry on with indexation as an absolute minimum—after all, that is what the Blair Government did, automatically indexing fees year after year—because, otherwise, the problem that she described so eloquently will just continue to get worse.
A range of us have, in different ways, tried to find an alternative system for funding higher education. Employers will not put up any more, and the Treasury and the taxpayers are not going to put up any more either. So we all end up reluctantly concluding that this is the only game in town. All three political parties represented in the Committee today have concluded that you have to put up fees in order to sustain our higher education system—and that is the case.
We could all learn a lot from my noble friend Lord Johnson, who introduced the TEF. Clear pressure to raise the quality of teaching is an important part of any future increase. Personally, instead of the rather random process of an Augar review or a freeze, I always wanted to see a quinquennial review—a review every five years—modelled to some extent on the way in which the social security system operates, from which we can always learn. A quinquennial review would enable a judgment to be made about the right level of the repayment threshold and the right level of fees, in the light of what had happened to earnings and the cost of higher education, and it could set out a formula that lasted for the life of a Parliament.
I will not comment on foundation years. I recognise the political and popular anxieties about measures such as this. Such measures never poll well, but the reason for that is often a misunderstanding. A lot of people still think that students have to pay up front, and a lot of people, including parents, think that the debt is like a credit card debt or an overdraft, meaning that, if their child has a £50,000 debt, they can take out £50,000 less as a mortgage. Those are misconceptions. The fundamental case for these measures is that they are in the best interests of students. Students will have a well-financed and well-funded higher education and, as the Minister rightly explained, will pay back only on a repayment formula that is not changed by these measures.
Finally, I urge that, now that the Government are operating with a model that they themselves were crucial in designing, the Minister and the Government own it. All three parties have a shared interest in trying to communicate the reality of this system. If ever we lapse into saying that the fees should not go up because there is a cost of living crisis, that feeds misunderstanding and is extremely irresponsible.
I hope that the Minister will be able to spare the time for a meeting where we could go through the painful lessons I have learned about how one tries to communicate the reality of the system. I also hope that she might consider a more strategic approach, so that universities know that the real resource they have will at least be protected in the years to come.
Baroness Wolf of Dulwich (CB)
My Lords, I also must declare an interest, as a member of the academic staff of King’s College London. I would also like to note that I was a member of the Augar review. Apropos of the suggestion by the noble Lord, Lord Willetts, of a quinquennial review, I am rather pleased that it has taken only six years since the final report of the Augar review to get to some of the implementation of it.
Obviously, I welcome the Government’s decision finally to raise fees a little, but I would like to say something about foundation years. As the Government’s memorandum points out, this came out of the Augar review’s recommendation: basically, foundation years should go, except in a few specific high-skill and very important subjects, such as medicine. It is worth noting that, although the Government—indeed, their predecessor was in a similar position—decided not to go that far, as has been pointed out,
“there is little evidence that studying a foundation year is always necessary for students wishing to access an undergraduate course in these subjects, and potential foundation year students can choose functionally similar courses—such as Access to HE diplomas—that cost significantly less”—
or, as in the case of A-level resits, cost them nothing at all.
Although I very much welcome the decision to reduce the level of fees on classroom-based foundation years, I recollect for the record that when we first looked at them on the Augar committee, nobody had really noticed, including us. It was pointed out to us by the FE principal member of our committee, Bev Robinson, who basically said, “Do you realise what’s happening?”. She also noted—I cannot tell how widespread this was—that she had come across some very aggressive recruiting by universities of young people who, in her view, would have been much better off either doing access to HE or retaking their A-levels.
I underline that the Government recognise this, and that the Secondary Legislation Scrutiny Committee also noted:
“While we welcome attempts to encourage under-represented groups into HE, we would be concerned if these came at the expense of poor value for money for those students and for taxpayers”.
The consultation process resulted in a small majority of people saying that they did not want the fees to go up. However, the majority of non-higher education provider respondents definitely wanted the fees to go down. That is where we are.
My view is that there is still a question mark over these years. I thank the Minister for cutting the fees for foundation years in classroom-based subjects, but can she assure us that the Government will continue to monitor enrolments to see whether that does in fact put an end to the enormous growth that there has been? Will she consider asking the department to study the impact of foundation-year study on young people who go by that route, and how successful they are? It is very easy to forget about it again, and it crept up on everybody unawares—and I think everyone is agreed that it is a good thing that we are taking some action.
Lord Storey (LD)
It always seemed to me that were almost gloating about this, but what a fine way to show that in the financing of our university sector, or in how we look after our students in many cases.
As I think has been said by the noble Lord, Lord Willetts, last year the Minister very bravely said the Government were going to increase tuition fees to get over that difficulty. Then, of course, along came national insurance and all that wonderful extra financial resource is completely lost.
My knowledge of the university sector has increased over the years with my children going to university and I also served on the governing council of Liverpool Hope University, so my interest has grown. I always think that we do not really grapple with some of the issues that face us; we try to push them away. I thought that when loans were introduced, it would put students in the driving seat of a university education. I do not think that has happened. In some universities, the way students are regarded is not as good as it should be.
I also wonder whether Tony Blair saying he wanted 50% of young people to go to university was the right way of deciding how we grow the university sector. I look now, and I see some universities really struggling, offering very low grades to get into university. I see universities almost competing with each other on courses when they are in the same city, for goodness’ sake—I just do not understand that. I look at private universities, which, obviously, get finances from the system. I was heavily involved in the Greenwich School of Management, where the Government were able to say, “We’re taking all these young people from deprived backgrounds and giving them a university education”—but, at the end of the first year, they took the money and ran. What went on in that particular private institution, along with others, was completely wrong. When it was highlighted on “Panorama”, the college was closed down, along with others. In one case, police took action. So we have to look carefully at how we use the money as well. Some of the practices that we currently carry out are, in my mind, just not acceptable.
I want to see students really value their university education. I will give an example of something that is a great pity. When I was at university, I stayed on Merseyside, but I loved the fact that I met people from all over the country, who are some of my best friends—from the north-east and elsewhere. Nowadays, students cannot afford that and, increasingly, they go to the university in their home area or even their home city. The figures for Liverpool John Moores or the University of Liverpool, for example, increasingly show that the students come from that city, that conurbation or that region. We have lost something in losing that opportunity.
I am delighted that the Minister talked to us about how we need to look at this properly and come forward with some proposals in the summer. I am delighted and excited by that, to be quite honest, but I hope those proposals will give us the opportunity to give our ideas and thoughts on what that might be. But, in terms of this SI, I very much support what the Government are doing.
Qualifications Reform Review
Lord Willetts Excerpts(3 months, 3 weeks ago)
Lords ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Baroness Smith of Malvern (Lab)
I thank my noble friend for those comments. I suspect that she—like me—has taught these qualifications. I introduced a general vocational qualification into a high school where I taught, so I very much take her point about the different teaching and learning styles from which students can benefit. I know she agrees that we must ensure that we do not lower the quality of qualifications for students who perhaps need different teaching and learning styles. We continue to review to ensure that qualifications are of a high standard.
From my experience of visiting colleges offering T-levels, I have to say that there are some very innovative approaches to the ways in which they are delivered. That is why there has been a steady growth in the number of young people undertaking T-levels. Of course, we have introduced three new areas this year, and there will be another new one next year.
I also take my noble friend’s point about extensive engagement. The process of the review involved consulting more than 250 individuals, including principals of FE and sixth form colleges, senior and curriculum leaders, teachers and subject specialists in FE, employer representative bodies, industry leaders, awarding organisations, mayoral combined authorities and other government departments. That is one reason why it has received broad support: it was, in essence, co-designed with those who will be responsible for delivering the qualifications process.
On the point about work experience, my noble friend is of course right that while industry placements are a key element of T-levels, they also play an important role both post and pre-16. That is where we need to ensure that placements maintain rigour, are of quality and enable employers to step forward to do that. That is what we have sought to achieve with the flexibilities we have introduced into T-levels.
We need to continue working with employers by providing reassurance and the flexibility necessary to enable them to offer a range of placements. That is one of the things we do with our T-level and apprenticeship ambassadors, who work with employers to encourage them to offer the sorts of placements that will be beneficial for students in whatever course they are taking—whether it is one of those placements or work experience. We will continue to do that.
Lord Willetts (Con)
My Lords, I welcome this Statement. T-levels are a very useful part of the qualifications landscape, but it was never realistic to think that T-levels and A-levels between them could somehow dominate all the options available for 16 to 18 year-olds. Many former Ministers on both sides of this House took that view—I see my noble friend Lord Johnson sitting beside me. Although they are not present, I would like to say that it was good to work with the noble Lords, Lord Blunkett, Lord Baker and Lord Adonis, in arguing for a pause. It is welcome that we have now secured a rather better future, at least for some time, for BTECs.
I am sure the Minister will be aware of the recent report from the independent Education Policy Institute, which said that
“T levels are currently unsuitable for many Level 3 learners”.
That message from independent research is one that we all need to take to heart. I have two specific questions for the Minister. First, will she confirm that T-levels cannot do everything, alongside A-levels? They are a very useful qualification for a route to a post as a technician, but it is not clear that they can do everything, and so BTECs and NVQs have a lasting role in the vocational qualification landscape. On eliminating uncertainty, which my noble friend Lady Barran raised, a statement recognising that T-Levels cannot do it all would be very welcome.
My second question concerns the cost of T-levels. It has always been noticeable that in the DfE there is no money in some areas but in other areas money pours out to fund new initiatives. The Minister referred to the value of the 45-day placements. However, can she tell the House how much the funding of these 45-day placements is costing? Given that spreading access to work experience is so important, does she have any concerns that this very substantial funding for one specific way of accessing work experience is having the effect of diminishing opportunities for work experience for other students not on the T-level route?
Baroness Smith of Malvern (Lab)
The noble Lord is right that, when faced with a positive phalanx—I do not know what the collective noun is for former Education Ministers—it is probably wise to realise that there is some wisdom there. That has been demonstrated by the results of the review that we have undertaken.
I agree with the noble Lord that T-levels and A-levels would be an insufficient option on their own for all students. To reiterate, where T-levels exist in a route, they are the most appropriate large qualification. One of the other things that we have done is to remove the previously proposed rules of combination, which would have prevented colleges building appropriate courses for their students, in consultation with those students and others. That will provide more flexibility.
I will write to the noble Lord specifically about the cost of T-level placements, but it is right when introducing a new qualification that, as we have done, there is an uplift in revenue funding for T-level students, as well as some capital provision. Any new qualification will need a period of time to scale itself to a position where the normal level of revenue funding would be adequate to deliver it.
Universities
Lord Willetts Excerpts(4 months, 3 weeks ago)
Lords ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Lord Willetts (Con)
My Lords, I congratulate the noble Baroness, Lady Warwick, on bringing this debate to the House. I declare my interests as a visiting professor at King’s College London and a member of the council of the University of Southampton. I was also one of the commissioners who served on the UUK exercise. The chapter on which I was most heavily engaged concerned international students. It is excellent that the Government are now preparing, and have committed to produce, an international strategy for higher education—of course, my noble friend Lord Johnson was himself responsible for an excellent one in the past—and I hope that the Minister will be able to tell us what timescale that is on. I shall put two specific points to her about that strategy.
The first point concerns visas. The Minister is a former Home Secretary, and if I pressed her on the cost of visas, I know exactly what her answer would be, so I will not press her on the cost but on another problem with visas: the speed of getting them. There is an internationally competitive market whereby some overseas students apply for a range of different universities around the world, and for several visas, and they are waiting to see whether they get their US visa, their Canadian visa or their British visa. If the British visa process is the slowest, they have already committed to going to Canada before we have even had an opportunity of getting them here. I hope the Minister will undertake to pursue the speed of visa issuing with the Home Office.
Secondly, I ask the Minister to raise the issue of international students with the Department for Business and Trade. There is enormous opportunity here for trade negotiations, whereby we make a commitment that we will extend access to our student loans for British students going to study abroad. The moment that the conversation with another country is about exchange and reciprocity, about saying, “We want more of your students to come here but it would be great if some British students could come to you, and we will provide them with a loan to do so”, we can make much more progress on growing international student numbers.
I very much agree with what my noble friend Lord Johnson said about fees; I strongly endorse his point. It was treated as though it were a heroically difficult decision. I asked the Library about the history. The Blair Government considered £5,000 fees; we ended up with £3,000 fees, but it was well known at the time that the Prime Minister himself and some of his advisers wanted £5,000 fees. They introduced £3,000 fees, which they indexed for several years with no fuss whatever—they just got on with indexing them. If they had done £5,000 fees and simply indexed them every year since then, fees would now be £9,545, almost identical to the level which the Government are now putting them at, but with some associated HEFCE grant; there were still teaching grants as well. The noble Baroness, Lady Blackstone, was right to say that we either need an injection of public money alongside, or fees will need to go even higher.
One of the most disappointing features of the argument about the recent indexation was the amount of confusion and misunderstanding about how the fees regime works. A lot of people linked it, somehow, to student hardship. The cash students need to live on at university is a completely different issue but does need to be tackled. Very few people realise that if the repayment formula is fixed, there is no increase in your monthly or annual repayments; it is just that you will repay for a bit longer.
One lesson from this, so that we do not slip backwards and see the type of anxieties to which the noble Baroness, Lady Blackstone, referred, is that it is really important that the Government keep on communicating the realities of how this system works, so that no disadvantaged student in a college or a sixth form thinks that he or she somehow cannot afford to go. I have to say that, in the last few weeks, Martin Lewis has once again been a voice of sanity, explaining the truth of the system, which is very different from some of the widespread misconceptions.
Unless we have a significant increase in fees, or further public expenditure support alongside, sadly, there will be universities that get into very serious difficulties. Will the Minister tell us when we are going to see a clear statement from the Government of what the process is for a university that runs out of cash? What happens? This could well be tested in the next year; we need authoritative guidance in the absence of a bolder proposal to increase fees.
Finally, I comment on one other issue. This is a Government who have an admirable commitment to raising the growth rate. Universities can really contribute to that. The industrial strategy had, I think, 11 references to FE colleges, which is admirable; it had two references to higher education, both in the context of research, and we have had eloquent statements about research. Universities are just useful for educating people in practical, vocational skills. There are 160 employer and other credentialising bodies that credentialise students who emerge from university. Will the Minister place in the Library the DfE estimates not of how many courses there are but of how many students are studying vocational courses that are in some way credentialised or vocational? Universities have an invaluable vocational role and I very much hope that, in the next stage of the industrial strategy, they are identified as a key sector, meriting particular support from the Government.
Higher Education Funding
Lord Willetts Excerpts(6 months, 4 weeks ago)
Lords ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Lord Willetts (Con)
My Lords, I congratulate the noble Lord, Lord Krebs, on calling this debate and thank him for his exciting vision for our universities as the care homes of the future. I declare my interest, especially if we are talking about care homes; I am a visiting professor at King’s College London. His speech correctly identified the pressures that universities face, on both their research funding and their teaching funding. They are linked in various ways, including because overseas student fees, which used to help subsidise the cost of research, are increasingly being used to subsidise the cost of teaching, which puts extra pressures on research funding. The DSIT capacity to do research is being cut because the DfE will not increase teaching fees for undergraduates.
I think it is important that we tackle the pressures on the cost of teaching students through an increase in the fees that they pay. This is important, above all, because of the interests of students themselves in a well-funded higher education. It is also in the interests of the wider economy to have well-funded, effective higher education, with good-quality teaching.
I particularly draw the Minister’s attention to an excellent piece of research showing the economic benefits of universities, and of creating more universities, by two academics at the London School of Economics, Professor John Van Reenen and Anna Valero, who now both happen to be in the Chancellor’s Economic Advisory Council—a very useful place for them to be located.
If we are to increase funding for teaching in universities, the Minister has a mechanism available to her—fees. There may be arguments for more selective funding of research. The UKRI budget is already allocated in a pretty selective way; a very high proportion of current research funding goes to the most prestigious, elite, research-intensive universities. More research funding could be allocated, if that is what the noble Lord, Lord Krebs, wants, but it would not tackle the underlying need to have better-funded teaching across the entire sector.
There is no brilliant alternative. Of course, if fees go up, it is right to expect clear evidence that this will mean better quality teaching. My noble friend Lord Johnson of Marylebone, who increased fees from £9,000 to £9,250, did so in association with that much more rigorous assessment of teaching quality in universities.
Most depressing is the belief that this mechanism is somehow no longer available for us, despite the fact that almost every party represented in this House now has in the past used precisely such a mechanism to fund higher education. It has been the cross-party agreed basis for funding higher education over the past 20 years. I have heard people say that students cannot afford it because of the cost of living crisis, but we know that students do not pay upfront. We also know that it does not affect the amount that graduates repay; there is a repayment formula for that, which is highly progressive. Rightly or wrongly, there are no longer interest rates on graduate debt. It is reasonable to expect a prosperous middle-aged person to pay back for a couple of extra years if it means that the university education of the younger generation is properly funded. I very much hope that the Minister will accept that this is one mechanism at her disposal to tackle this financial crisis.
King’s Speech
Lord Willetts Excerpts(8 months, 3 weeks ago)
Lords ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Lord Willetts (Con)
My Lords, I begin by drawing the House’s attention to my interests, particularly a professorship at King’s College London and a role at the University of Southampton. I also welcome both our new Ministers to their roles. We very much look forward to engaging with them in the months and years ahead.
I congratulate my noble friend Lady Monckton on her excellent maiden speech. In her reference to her grandfather, she might have put the muzzling of cats on the political agenda. It sounds like a cause that this House might embrace.
I would also like to say how much my noble friend Lady Barran contributed to our debates on education with her extraordinary courtesy. Her speeches were always so well informed and long may she continue in a Front-Bench role.
I would like to focus on higher education, because it is crucial to the priorities the Government have set out in the King’s Speech and it is very important for opportunity. Higher education is the one stage of education where kids from disadvantaged backgrounds outperform. It is also key for growth. A lot of vocational and technical training happens in higher education. We should not have an old-fashioned picture of our education whereby that is not part of the role of universities, when it is.
Of course, higher education institutions can transform places. The journey from starting off as a mechanics institute or a teacher training college, becoming a big, ambitious FE college and then a university is often associated with the transformation and growth of a city. Worcester, if I may say so, is a vivid example of that process. Universities are one of the most powerful mechanisms we have, therefore, for spreading opportunity to some of the cold spots in the UK.
Higher education cannot do this, however, if its resources are as constrained as they are at the moment. Universities are under serious financial pressure. We all lose out but, above all, students lose out if the real resource behind their education and their university experience is being cut. I therefore very much hope that we will now see action to tackle this crisis before a university goes bust. Many are under financial pressure; some are in real danger of going bust.
We do not need another big review of our entire higher education system. All three of the main parties represented here in this Chamber, when faced with the responsibilities of office, have essentially operated the same system: a graduate repayment system. There is no fantasy alternative model that gets rid of all the imperfections of the current model. We therefore do not need to waste time on some massive review; we need instead simply to focus on improving the current system, getting across the crucial message, of course, that students do not pay up front. For students, the main issue is the cash they have to live on while they are at university. That is the pressure point threatening access, not misconceptions about the cost of fees.
There is—if I may use a rather crude term in this elevated debate—a deal to be done. Of course, Ministers and the Government will have pressures that they want to meet, so the deal must involve some increase in fees, so that universities are better funded. It should also involve more initiatives on access. BTECs are a very important part of access to university. The new Minister will notice that there is a dangerous cabal of ex-Ministers around. When I see the noble Baroness, Lady Morris, and my noble friend Lord Baker debating, it is a bit like veterans Wimbledon: you can come here and see the education debates of 20 years ago going on. However, when they make common cause on BTECs—others here also associate ourselves with that—I hope that Ministers will listen. As part of the deal, there also needs to be pressure to ensure that education standards are rising in universities and that students get a fair deal.
All that can be done and should be done as a matter of urgency. The demographic backdrop is very important as well. Because of the surge in the birth rate, reaching a peak in 2012-13, we now face a decline in the number of young people in nurseries and primary schools. The number of young people in secondary education has peaked; the next five years will see a surge in the number of people over 18. They should benefit from a reformed apprenticeship levy, high-quality further education and a properly resourced and effective higher education system.