Higher Education and Research Act 2017 (Consequential, Transitional, Transitory and Saving Provisions) Regulations 2018

Viscount Younger of Leckie Excerpts

Wednesday 9th May 2018 Lords Chamber

[Viscount Younger of Leckie (Con)]

My Lords, I thank the noble Lord, Lord Hunt, for tabling this Motion. It is clear from it that the regulations are not in themselves at the heart of what troubles noble Lords and that, as the noble Lord said, this debate is intended instead to go somewhat broader on a number of issues, many of which have been raised previously in this House, not least during the passage of the Higher Education and Research Act, or HERA as it is known. Indeed, we spent about 110 hours debating the Act in both Houses, had more than 1,300 amendments and made at least 31 major concessions. Nevertheless, I welcome the opportunity again to touch on the issues raised in the Motion.

I want to put on record as a reminder what the regulations will enable. In particular, they enable the Office for Students and UK Research and Innovation to exercise the statutory functions previously exercised by the Higher Education Funding Council for England, which we know as HEFCE, and the Director of Fair Access to Higher Education. This will be for a transitional period between 1 April 2018, when HEFCE and DFA ceased to exist, and 31 July 2019, after which the new regulatory system under HERA will be fully functioning and the old system will in essence fall away for good. The transitional period allows for a smooth progression to the new system of regulation introduced by HERA, so minimising any disruption in the sector. The consultation on the OfS regulatory framework explained how this transition would work and the proposals were met with general approval by those responding.

Let me now address the four key issues that the noble Lord, Lord Hunt has raised. I want to spend some time on them, despite the Benches opposite being not exactly full for this debate as the noble Lord, Lord Storey, pointed out. On the first issue, the independence of the Office for Students from Ministers, I remind your Lordships that the House voted for the OfS to be an operationally independent statutory body, responsible and accountable for a much broader suite of functions than was its predecessor, HEFCE. Let me be quite clear: in regulating all registered higher education providers, it is the OfS, and not the Secretary of State, that determines and publishes the registration conditions applicable to providers, the registration categories and its own regulatory framework. The Secretary of State’s powers to attach terms and conditions to OfS grant funding and to give directions to the OfS are limited. The OfS is required only to have regard to guidance from the Secretary of State and not to follow it. However, I think that noble Lords will agree that it is important that the OfS has obligations to report to the Secretary of State, and these are set out in HERA. I reassure the noble Lord, Lord Judd, that the OfS also has obligations to produce annual reports and accounts, and these are publicly available.

A recent example will help me illustrate the reality of the OfS’s independence. While the department started off the consultation exercise on the conditions and regulatory framework, working with the then future OfS chair, CEO and Director for Fair Access and Participation, once the OfS was established in January 2018, it did not simply adopt the proposals outlined in the consultation document produced by the department. The published framework differed from the consultation draft in some significant respects. For example, taking into account responses to the consultation, the OfS decided to drop the registered basic category of the register which the department had proposed. I hope that this small example helps to reassure noble Lords that the OfS acts, and will continue to act, independently from Ministers.

On the second issue raised by the Motion, I might begin by laying out exactly how the OfS engages with students. The Office for Students’ approach to regulation and its statutory duties, as set out in the regulatory framework it published in February, is bold, student-focused and risk-based. It is consistent with its statutory duties, which, again, this House voted for.

We expect all members of the OfS board to engage with students to ensure they really understand the issues that they face and have these as considerations when making decisions and exercising their functions. HERA ensures that there is to be at least one OfS member with experience of representing or promoting higher education students’ interests, either individually or generally. However, I am pleased to say that the OfS went one step further: it should be a further reassurance to the noble Lord, Lord Judd, that it has set up a student panel where all 13 members are either students, prospective students or recent graduates. This membership includes current undergraduate and postgraduate students, part-time and international students, prospective students at GCSE and sixth-form ages, and a representative from the NUS. This provides a direct channel into the OfS itself, bringing a diverse range of views and perspectives. It is also worth noting that the current student representative on the board is also a full member of the student panel.

It bears repeating that HERA sets out the requirements to be met in appointing OfS members, and the desirable criteria for the make-up of that membership that the Secretary of State must consider. These statutory requirements were all subject to a rigorous parliamentary debate in this House about whether particular representation was necessary to enable the board of OfS members to operate effectively. Parliament concluded that there should not be a requirement for specific representation from every single part of the sector. Instead, the criteria to which the Secretary of State must have regard include experience of providing higher education, and from a broad range of different types of English higher education providers. We consider that the current OfS membership meets these criteria.

I recognise that the appointments process for OfS members has not necessarily been as smooth as one would have hoped, a matter raised by the noble Lord, Lord Hunt, and the noble Baroness, Lady Garden, with some further criticisms. I reassure your Lordships that the department has looked carefully and seriously at all the recommendations of the Commissioner for Public Appointments, and we have already made improvements to the DfE diligence processes in line with the Commissioner’s advice. To further ensure the robustness of these processes, we have established a DfE nominations committee, to ensure adherence to the Government’s code on all future public appointments. I will also update noble Lords on the couple of appointments still to be made. The competition for the OfS member with student experience is to be launched shortly, as the current appointment is on a short-term basis only. We will run a separate competition for the vacancy left by the resignation of Toby Young later in the year.

The noble Baroness, Lady Garden, has raised on a few occasions, including today, her wish for a representative from the further education sector to be on the board: I know that the noble Lord, Lord Hunt, raised this as well. We encourage such representatives to apply when the competition is launched. We also, of course, continue to communicate with the Commissioner for Public Appointments on these appointments.

I move on to that old chestnut of institutional autonomy: the noble Baroness, Lady Garden, should be reassured that I remember it. It was debated at length during the progress of HERA through both Houses of Parliament, but it bears repeating: after amendments by your Lordships, HERA brought in the most robust statutory protection for institutional autonomy that has ever existed in our modern higher education system. It placed new and explicit protections for the freedom of English higher education providers. I do not think anyone disagrees about the importance we place on institutional autonomy and academic freedom, and this is reflected in the duty of the Office for Students, in carrying out all its functions, to have regard to the need to protect the institutional autonomy of English higher education providers. That duty also applies to the Secretary of State when issuing guidance, giving directions by regulations and determining terms and conditions of grants to the OfS. This means that the Secretary of State must have regard to the need to protect the institutional autonomy of English higher education providers when exercising any of these functions.

The final issue within the Motion refers to the overemphasis on making the higher education sector more of a market. I would like to put this in a slightly different way. Students are surely better protected when we make them aware of their rights in relation to their education, including their rights as consumers. I use this word with some caution because I know from previous debates that this is a term that does not best please a number of noble Lords, including the noble Lord, Lord Judd, but I use it nevertheless. I make no apology for what the noble Lord refers to as “marketisation”. Surely the House will agree that students should rightly expect the best quality and robust standards in their higher education study and experience, and equally be protected from concerns about governance and financial stability. The OfS sets clear expectations about how providers should go about this, through conditions of registration. For example, the OfS has now introduced a registration condition for student protection plans, to set out what students can expect to happen should a course, campus or institution close, to ensure that students can complete their courses or be compensated if this is not possible.

I turn to questions raised during this short debate, particularly from the noble Lord, Lord Hunt, and the noble Baroness, Lady Garden, who spoke about the word “provider”. Let me say that not all higher education providers are universities. “Provider” includes universities, but the terms are not interchangeable. There are special protections attached to the use of university title and providers have to meet tests in order to call themselves a university. The noble Baroness, Lady Garden, asked whether the OfS has the expertise necessary to undertake the vast number of tasks that it has been set or that we gave it. The OfS combines the expertise of its diverse board, its student panel and its staff with the experienced leadership of its chair, Sir Michael Barber, and its CEO, Nicola Dandridge. It is well placed to perform its functions, we believe, during the transition period and beyond.

The noble Baroness, Lady Garden, spoke about the TEF external review and the subject TEF. I reassure the House that the TEF review is going to take place and, of course, I have said from this Dispatch Box that we need to move to a subject-level TEF. By extending the test to the subject level, the Government aim to help prospective students compare the different courses on offer across institutions. This will shine a light on course quality, revealing which universities are providing excellent teaching and which are perhaps coasting or relying more on their research reputation.

I would also like to raise myself the issue of essay mills, raised by the noble Lord, Lord Storey. I know he has raised it on other occasions in this Chamber. I start by saying, and I am sure the whole House will agree with me, that cheating of any kind at any level is completely unacceptable, particularly to the department and to the country. We have given the new regulator, the OfS, the power to take appropriate action where this is happening, including fines, suspension from the OfS register or, ultimately, deregistration of the provider—the highest possible punishment. We have given the OfS the power to impose fines when it is fully operational. The Government have already taken action to ensure that universities know their responsibilities and have instructed leaders across the sector, including the NUS, the QAA and UUK, to create new guidance, which was published last year, as the noble Lord may know, setting out their roles when it comes to cheating. However, we are reviewing its effectiveness, particularly because of the seriousness of this issue. The Department for Education has ensured that the parliamentary passage of the Bill did not rule out legislating in the future: that is a measure of the seriousness with which we take it.

I listened carefully to the speech of the noble Viscount, Lord Hanworth, who spoke about what he called an amenities arms race. We believe that investing in the student experience via new facilities and by other means is a good thing, but rest assured that the TEF and the regulation provided by the OfS still puts the greatest stock on teaching quality and provision.

Finally, I think it is worth reflecting on what has happened since the Higher Education and Research Act received Royal Assent. As planned, the OfS was up and running from 1 January 2018 and officially launched on 1 April 2018. In the meantime, the designated quality body and designated data body were announced after recommendations by the OfS. The OfS published its regulatory framework and registration conditions on 28 February and the Secretary of State’s guidance was issued shortly before that date. The OfS has established and convened the aforementioned student panel to advise on strategy and activity. The OfS is now registering providers with early student recruitment cycles, and on Monday 30 April published its strategy and business plan for 2018-19.

To conclude, clearly there are strong views still on all sides of the House. I am thinking particularly of the noble Lord, Lord Hunt. I will review Hansard to be sure that I have covered many of the points he made. Understandably perhaps, he used a broad brush to cover a range of issues, including tuition fees. He will know that the post-18 review is looking at the funding of tuition fees. I will look carefully at what noble Lords have said, and indeed what I have said, and if a letter is merited, I will certainly write to noble Lords and leave a copy in the Library. I hope that I have reassured noble Lords about the reasons for this order and on the questions they have raised. I hope that the noble Lord, Lord Hunt, will withdraw his Motion, but of course that is entirely his decision.