Higher Education and Research Bill

Debate between Lord Willetts and Baroness O'Neill of Bengarve

Committee: 6th sitting (Hansard): House of Lords
Wednesday 25th January 2017 Lords Chamber

[Lord Willetts]

My Lords, I support the amendment introduced by the noble Lord, Lord Hannay. As my noble friend Lord Patten displays such a close familiarity with Conservative slogans, let me add a second—one of the great Brexit slogans, “Take back control”. I do not see why our migration policy should be determined by the United Nations. No other country says its policy should be determined by how the United Nations has chosen to define immigration. If we want to take back control, I do not see why we should allow our policy to be determined by the United Nations. We should take back control of our migration policy and set it in accordance with our national requirements, rather than allowing this dangerous, global institution to decide who we should or should not count as migrants. As well as being about global Britain, the excellent proposition from the noble Lord, Lord Hannay, is about taking back control.

I have two brief questions for the Minister. We all appreciate the difficult position that he is in. One of the problems for universities has always been planning ahead and marketing themselves around the world when there is always a danger of further changes to the migration rules. If there is anything he could say that would indicate that the Government are not planning any changes in the regime for overseas students that would be a modest but helpful step.

Secondly, could the Minister indicate where he thinks education could sit within the industrial strategy? In the brief reading I have made of the documents so far, what has surprised me has been that I did not immediately see education in the list of key potential sectors. I hasten to add that education is not simply a business sector; it has a value in its own right. Nevertheless, it is a very successful British export. If, in response to the consultation on the industrial strategy, there were a message from the education sector that it would like to be backed by the Government in an exporting mission and be seen as an important part of GDP, I hope the Minister would be able to indicate that they would strongly support education as a key British export sector as part of their industrial strategy.

[Baroness O’Neill of Bengarve (CB)]

My Lords, I felt that this part of the debate would not be complete without the voice of the overseas student. I was an overseas student. I did my PhD at Harvard. The process for getting a visa was rather fierce. I remember going to the American embassy in London with a chest X-ray in a very large brown paper envelope, and there were other things that had to be produced. When the time came to leave, I had an American husband and a baby with an American passport. That made no difference. I was a foreign student who had come in under a particular programme, with a particular sort of visa, and I had to leave.

The point that is relevant now is that it is the accuracy and precision of the control process that prevents any drift from student status to economic migrant status. This is what matters and pretending that they are one and the same does not really address the problem. The problem is surely clarity about categories and controls.

Higher Education and Research Bill

Debate between Lord Willetts and Baroness O'Neill of Bengarve

Committee: 3rd sitting (Hansard): House of Lords
Monday 16th January 2017 Lords Chamber

[Baroness O'Neill of Bengarve (CB)]

I support the amendment. I think there are wider reasons for feeling that not everything can be well done by guidance. Among other things, guidance sits there in the cupboard, so to speak, and there is no reason for the Executive or Parliament to review it until somebody is tripped up in an unfortunate way.

Guidance seeks a sharper definition between what may and may not be done—between compliance and infraction—than is probably feasible. There is much to be said for a somewhat more formal procedure that will make it clear what has parliamentary backing, because it is a statutory instrument, and what does not. Excessive reliance on guidance would weaken the structure of the Bill and create a degree of persisting uncertainty. People are frequently being tripped up by guidance of which they have never heard which lives in an obscure place. That is unnecessary.

[Lord Willetts (Con)]

My Lords, perhaps I may briefly comment on these amendments by looking at them from the perspective of how the old system has functioned. We have been told about the powers of the OfS, and your Lordships are scrutinising those very carefully. I think that perhaps the powers of the old HEFCE have been understated. In reality, HEFCE was not only the funder but was using its funding power to be the regulator—a highly discretionary regulator that operated with very little transparency and few constraints.

HEFCE was the extremely successful buffer body between government and universities, and the Government communicated with HEFCE notably through the grant letter—and the grant letter, I suspect, is the origins of the guidance provision in front of us today. The grant letter is the way in which the Government have historically set out their policy, week by week, year by year, for universities, and so, for example, it has been historically possible for the Minister for Universities to go to the Chancellor and say, “High-cost subjects are not being sufficiently funded. We do not think that the extra costs of doing them are properly reflected in the higher cost bands. Will it be possible to have extra funding attached to that?”—and then in the grant letter to suggest to HEFCE, “In the light of the funding we have available, it would be excellent if HEFCE were able to identify and set aside more funding for high-cost subjects”. Indeed, I used to write such grant letters with my excellent former colleague Sir Vince Cable.

What is happening—this goes back to discussions we had last week—is that as we are now moving from that old discretionary high-trust system to a new rule-bound system with a regulatory function, quite understandably your Lordships, at each stage of the process, are trying to pin down what kind of decisions will be taken and how they will be taken. I think that a power to give guidance distinct from a power to give instructions, and a reasonable amount of flexibility for Ministers to use it so that they can communicate the same kind of messages that they used to in the old HEFCE letter, is in the interests of the sector as a whole.

--- Later in debate ---

[Baroness O'Neill of Bengarve]

My Lords, we need to clarify a point that I have raised a couple of times already, which is whether English higher education providers are indeed public sector bodies and therefore fall under the 2010 Equality Act. I speak as a former chair of the Equality and Human Rights Commission. That legislation, which I think is better than it is usually given credit for, is very clear that it applies to public sector bodies. We do not yet know whether the definition of an English higher education provider in the Bill means a higher education provider that is a public sector body or even whether it has to be incorporated under the laws of England.

I suspect that there will be many overseas higher education providers which are extremely tempted by the high prestige, the system and the fact that students here are entitled to student loans, to seek to become higher education providers in England without being incorporated under English law and certainly without being public sector bodies, as the 2010 Act would require them to be to fall under this legislation.

Even were we talking only about a subset of English higher education providers that are incorporated under English law and that are going to fall under that Act, I am not sure that we would want all nine protected characteristics to carry the same weight. In particular, one has to think extremely carefully about age. It is not, of course, right to discriminate against people on the ground of their age, but to refer to disproportionality in the age distribution of a student body of an institution might seem ludicrous in view of the fact that, on the whole, people seek their higher education before they seek their careers.

There may be other difficulties here. I suspect that many people discussing equality fail to note that the 2010 Act sets out “due regard” duties. Those duties are met providing someone has due regard to the different characteristics at the point of making a decision. That seems to me to be correct, but it has no read-across to the question of proportionality and disproportionality, although that is a common misunderstanding. Perhaps we need not worry about the obvious implications of thinking that the proportionality would be an important consideration in these matters in that the fact—they are now facts—that more young women than young men go on to higher education in the UK and in England and that poor white boys and poor boys in particular, but not other ethnic minority students, are less likely to go on. It is quite surprising when one looks at the profile of different groups going on to higher education. I suspect that this is something that we need to untangle before we go any further.

[Lord Willetts]

My Lords, that fascinating intervention gets to the heart of the direction of travel that is being debated in many different amendments this afternoon.

My understanding—I am sure the Minister will correct me if I am wrong—is that universities and higher education institutions are not public sector bodies. Nevertheless, in a range of different contexts, Parliament has decided to impose on them the obligations they would have if they were. The public sector equality duty could be one example. Freedom of information is another example. My concern—here I am a bit of a purist—is that universities are not part of the public sector and it is quite important for universities that they are not. If I were running a university—which I am not—I would start feeling two kinds of pressures on me. On the one hand, a significant number of Members of this House and elsewhere want to treat universities as if they are public bodies, so that whenever there is a nice public sector duty around they say, “Let us add it to universities although they are not part of the public sector”. Both FoI and public sector equality are examples. On the other hand, at the same time the Government—and this process goes back before 2010—are saying, “There is a private contractual obligation to deliver a service to a student so really they have got to be subject to competition law and the CMA and so on”. They end up being subject to a pincer movement, where they have got all the private obligations as if they were a company that needs to be competing, plus we throw in all the public obligations as if they were in the public sector when they are not.

The dynamic of these debates begins by saying we must do more to preserve the autonomy of universities and then spend the rest of the time adding extra obligations we would like them to comply with. If at the end of the legal process of preparing what will become an Act of Parliament we have ended up with more obligations on the universities, making them subject to the CMA, and more public sector duties despite them not being in the public sector, we will leave universities even more burdened than they are at the moment. We require some self-denying ordinance so that we do not keep piling more obligations on them. We have already imposed on them a range of obligations that go way beyond what any other private body is susceptible to. At some point there is a danger that universities will end up in the public sector. There is a danger that we all talk about them as if they are part of the public sector and treat them as if they are hospitals, schools and so on. They are not. They are independent bodies outside the public sector and we should be wary of imposing obligations on them as if they are inside, especially when we are in parallel and subject to greater market competition as well.

Higher Education and Research Bill

Debate between Lord Willetts and Baroness O'Neill of Bengarve

Monday 9th January 2017 Lords Chamber

[Baroness O'Neill of Bengarve (CB)]

My Lords, I should like to ask the noble Lord, Lord Stevenson, what meaning is intended by,

“primarily located in the United Kingdom”.

There is a large number of examples across the globe of franchised campuses, sometimes franchised by extremely reputable universities in this country and in the United States but operating in other countries. Is it a matter of where the majority of their students are in the world, where the governing body is or where the financial control is? I feel that some clarification may be needed.

[Lord Willetts (Con)]

My Lords, perhaps I may put three questions to the noble Lord, Lord Stevenson, about this proposed new clause. First, there is a classic model of a university—a kind of trusteeship model—in which the university has no interest in profit, it is located in a particular place, and its academic staff and the people running it at any one time wish to enhance it and pass it on to the next generation in roughly the same form. That is a completely noble and understandable model of a university and it is what most British universities are like. However, it is not the only form of universities. There are enterprise universities, global chains of universities and for-profit chains of universities.

Personally, I rather regret the fact that there is not a single British-based global chain of universities, as that is probably the only way in which we will meet the surge in demand for higher education around the world. Organisations such as Amity and Laureate meet this demand but no British organisation does so. Pearson College perhaps comes closest to the model but it is not the same. The amendment seems to propose a kind of anti-globalisation measure. If MIT or an American chain wanted to set up a university in Britain, we would not allow that. If an organisation is not located primarily in the United Kingdom, it does not count.

My second point concerns the not-for-profit stipulation in the proposed new clause. It is very important that a higher education institution and a university have very high academic principles. Personally, I do not think that we should require that they should not be for-profit organisations, given that we know that if you really want to provide higher education on a large scale and grow rapidly, some combination of commercial management and access to commercial capital markets is probably the way to do it. Again, the amendment takes a view about what a university is and eliminates a model. It is a model that barely exists in the UK, although we now have some examples of it, and it is a pity that the amendment tries to stop the process of creating enterprising universities alongside trusteeship universities.

My third point concerns the assertion:

“UK universities are public bodies”.

There is a very attractive rhetoric about the public value of universities, and they do indeed contribute to society in the way that is described here. If, through legislation, we define them as public bodies, we are no longer simply making an attractive rhetorical point about their public purpose; I presume that we are saying something real about their status. We went through this very issue only in the past few years with FE colleges, which were defined as part of the public sector. When people realised what that meant—the colleges being subject to public expenditure controls and borrowing counting as part of the PSBR—even some of the people who rather liked the idea that these were public bodies ran away from the implications. Are we really saying that we think that universities are part of the public sector and subject to the rules and constraints of being in the public sector? You could argue that one reason why our universities have done rather well is that they are not part of the public sector. If this is to be anything other than rhetoric, I assume it means that we think that in future universities should be part of the public sector. Therefore, we are invited to consider a future where universities are not part of global chains and not allowed to make a profit, and, instead, we are going to define them as part of the public sector. Sadly, I do not think that that is the future of higher education in this country.