Tuition Fees

Andrew Percy Excerpts

Wednesday 19th July 2017 Commons Chamber

[Angela Rayner]

The hon. Gentleman knows that we are talking about the tuition fee rise that his party said it would not impose on students and that it is trying to deny us a vote on. I hope he will push his Government to ensure that we do get a vote and that he will vote with us not to hike up tuition fees for young people.

Social mobility is stalling and drop-out rates are rising. Student debt in the UK is the highest in the world and more than 75% of students will never pay off their debts. The fact is that the Government’s policy on higher education simply is not working.

[Andrew Percy (Brigg and Goole) (Con)]

My position on tuition fees is perfectly clear, as my voting record in this Chamber will attest. The difference in what the hon. Lady has outlined today is that the normal run of things with Labour policy is to promise students something and backtrack when in government; this time, Labour has promised to write off students’ debts and then backtracked in opposition. Will she therefore apologise to the grandfather in my constituency who simply got his information from the news and wrote to me to tell me that he was going to vote Labour so that his children’s debts would be written off? If not, is she accusing him of being a bit stupid?

[Angela Rayner]

What I promise I will do for any of the hon. Members in this Chamber and any of their constituents who potentially were misguided is ask them to refer to our website, where they can get a copy of “For the many not the few”, which highlights our national education service. That is a huge number of pages longer than the policy in the Conservative manifesto, which was, quite frankly, to take the food from children’s mouths. That was rejected by the people of this country quite outstandingly.

There is an alternative—one that was outlined by the Labour party at the last general election. We pledged to end university tuition fees so that future generations will not be burdened with debt simply for seeking an education. We would fund that by taxing only the wealthiest individuals and the biggest businesses, rather than forcing only those graduates unfortunate enough to be £50,000 in debt to foot the bill. By contrast, the Government’s system will still cost the taxpayer nearly £6 billion a year in the long term. We would also bring back student maintenance grants to support students from low and middle-income backgrounds with their living costs, reversing one of the Government’s most regressive decisions.

There is someone in the Conservative party who for a long time agreed with that policy. There was a Tory shadow Education Secretary who said that the removal of the maintenance grant would

“far from widening access, narrow it.”

She told her party that it needed to

“show we care about the student who wants to go to university, but can’t afford tuition fees.”

She then helped to write, and stood on, a manifesto that would have scrapped tuition fees altogether. She is now the Prime Minister. But she is now the one narrowing access, not widening it. She is showing students that she does not care, and is hoping that her manifesto promises can be disposed of as quickly as Nick and Fiona were.

To think that on Monday the Secretary of State accused me of peddling “snake oil propaganda”. I guess that is her specialist subject. She promised to protect school budgets in her manifesto in 2015 before cutting them in real terms. She pledged to give 30 hours of free childcare to working parents only to tell tens of thousands of them that they do not earn enough to be eligible. Now she is breaking every single promise the Conservative party has made to students.

I have told the Secretary of State again and again what could be done to address the existing debt burden. I repeat that she could look again at the extortionate interest rates on students, due to rise to more than 6% at a time when the Bank of England base rate is 0.25%. She could keep the promise originally made to students to raise the repayment threshold on their debt in line with average earnings. She could look again at the unacceptable levels of disadvantaged students dropping out of university, and give them proper maintenance support.

All of those things would reduce the burden of debt on today’s graduates, and most of them would not cost the taxpayer an extra penny. The 2015 general election feels like a long time ago, but I remember a time when the Conservatives stood on a manifesto that said that

“we as a nation should not be piling up and passing on unaffordable levels of debt to the next generation.”

But that is exactly what the Government are doing. Increasing tuition fees again will simply leave more and more young people with debts they will never repay. Labour believes that is the wrong thing to do. Conservative Members may disagree, and that is their right, but what is not right is to deny this House the chance to decide.

Tuition fees are an important issue, but they are not the main issue before us today. The question before us today is much more fundamental. It is about trust in our Government and ultimately our democracy. Frankly, if Ministers cannot keep their promises to us, why should anyone else believe them?

--- Later in debate ---

[Joseph Johnson]

The hon. Gentleman makes an important point, and I acknowledge the fall, but he needs to understand that there are complex reasons for it, including the rapid increase in the proportion of people entering higher education at the young age of 18. This means that there is a smaller stock of students seeking to participate in part-time and mature study later in life. We also have one of the most buoyant labour markets of any economy anywhere in the world, which increases the opportunity cost of study for people later on in life, at a time when they would otherwise be earning significant sums of money. But we recognise that there is a fall, and we are taking significant steps to address some of the financial barriers that mature students face. That is why from the next academic year we are introducing a part-time maintenance grant on the same basis as the current full-time equivalent grant.

[Andrew Percy]

On the point about disadvantage, before young people get to university they have to go through the FE system. Will the Minister therefore congratulate North Lincolnshire’s Conservative council, which has confirmed this week that its post-16 student bus passes will again be set at £30 for the coming year, down from £200 a year under Labour? Does this not demonstrate once again that, when it comes to students, Labour says one thing when in opposition and does something very different when in power?

[Joseph Johnson]

My hon. Friend makes some superb points, and he is a tireless champion of his constituents.

On the repayment of loans, our repayment system offers a fair deal to students. The current student loan system is deliberately subsidised by the taxpayer and is universally accessible to all eligible students, regardless of their personal financial circumstances or credit history. Our repayment system is based on income, not on the amount borrowed. Graduates with post-2012 loans pay back only when they are earning more than £21,000, and then only 9% of earnings above that threshold. After 30 years, all outstanding debts will be written off altogether with no detriment to the borrower, and the Student Loans Company has no recourse to their other assets. The maximum fee cap is being maintained in line with inflation in 2017-18, so it will not be increasing in real terms for anyone going to university. We believe that it is right for those who benefit most from the higher education they receive to contribute to the cost of it. We should not forget that higher education leads to an average net lifetime earnings premium that is comfortably over £100,000.

Labour continues to scaremonger about the changes to higher education. The Conservative-led coalition and this Government have introduced important reforms. The Opposition have promised to write off student debts, to cut tuition fees and to restore maintenance grants. However, they have failed to set out a credible plan on how to fund their promises, and are now shamelessly abandoning them just weeks after the general election. That is hardly surprising, given that they had not even managed to persuade key figures in the Labour party who served in their previous Government. For example, Lord Mandelson described their policy offer as “not credible” and urged Labour to

“be honest about the cost of providing higher education”.

Of course, it is not just Lord Mandelson who has commented on this. The former shadow Chancellor, Ed Balls, said that his party’s failure to identify a sustainable funding mechanism was a “blot on Labour’s copybook”.

I therefore challenge the Opposition to explain how they would fund their alternative proposals on tuition fees, maintenance grants and the write-off of student debt. We estimate the annual cost of their policy on tuition fees to be £12 billion a year over the next five years of this Parliament. In addition, a one-off expenditure would be required to make good the promise of writing off historical student debt to the tune of £89.3 billion in cash costs. If Labour wanted to go the whole hog, a further £14 billion would be required to compensate graduates for historical borrowing that they had already repaid.

Make no mistake, Labour’s policy of abolishing fees would be a calamity. It would be ruinous for our world-class university sector, leading almost certainly to a fall in per-student funding of the same magnitude we saw in the decades before the introduction of top-up fees—a fall of around 40% in terms of the unit of resource. It would lead to the inevitable re-imposition of student number controls, which would cause the poorest and most disadvantaged to miss out on university, throwing social mobility into reverse. It would do all this at an eye-watering cost to the hard-working general taxpayer, whether he or she had been to university or not. Gone would be the concept of a fair sharing of the costs of university between graduates with higher-than-average lifetime earnings and society at large; taxpayers would foot the entire bill. That would be bad for universities, bad for students and bad for the taxpayer. It is no surprise that in the one place where Labour is in power, it has chosen a different approach. Last week, the Labour Government in Wales quietly increased their tuition fees for 2018-19 to £9,295 a year, making them marginally higher than the current rates in England. Labour in Wales at least knows that the party opposite’s plans are unfair to students and ruinous to universities. Perhaps it should tell the Labour party leader.

European Union (Approvals) Bill

Andrew Percy Excerpts

2nd reading: House of Commons
Tuesday 4th July 2017 Commons Chamber

[Margot James]

Any such comment from me would be speculation, which I intend to avoid, but I point out that Germany, like the United Kingdom, needs the consent of its national Parliament before its Ministers can vote on such draft decisions.

As I said, all member states apart from Germany and ourselves have agreed the Fundamental Rights Agency decisions, and we do not believe that any of the draft decisions are contentious. The Government are committed to being constructive in the UK’s ongoing engagement with the EU. Holding up progress on business that is simple and uncontroversial would undermine that approach and the principle of sincere co-operation that lies behind it. It is therefore clearly in the UK’s interests to approve these draft decisions. Delaying the decisions could have a negative impact on the UK’s exit negotiations with the EU, including discussion on any future framework. There will, of course, be further opportunities to examine more fundamental aspects of the work of the EU in other debates. However, I am sure hon. Members will recognise that, whatever their views on EU exit, it is in the UK’s interests to approve these draft decisions.

[Andrew Percy (Brigg and Goole) (Con)]

Will the Minister confirm that, as part of our ongoing relationship with the European Union until we achieve our freedom, the provisions of the trade agreement secured with Canada will be implemented fully in the United Kingdom, and that we will continue to play a proactive role within the EU and beyond in encouraging further free trade with Canada?

[Margot James]

I welcome my hon. Friend’s intervention. I remember his excellent work when he was a trade representative to Canada and I assure him that the Comprehensive Economic and Trade Agreement negotiations, completed between the EU and Canada, will cover the United Kingdom for as long as we are members of the EU. After that point, it will be up to us to decide the terms of any future trading relationship with Canada, bearing in mind the—I won’t go any further on that.

--- Later in debate ---

[Andrew Percy (Brigg and Goole) (Con)]

It is a pleasure to speak from the Back Benches once again, Mr Deputy Speaker—I had almost forgotten about the whole standing-up-and-sitting-down thing.

I welcome the Bill and offer it my full support, but in so doing I want to speak specifically about the provisions relating to Canada and broaden things out—remaining within the realms of the debate—to cover our future relationship with Canada more generally. I do so as our former trade envoy to Canada, a role that I very much enjoyed until I was made a Minister, and which we probably need to fill again in the near future. I can think of one or two possible candidates—tall, dark, handsome former Ministers from the north of England, perhaps—[Interruption.] Where are they, indeed?

It is very nice to have a Bill before the House today that mentions Canada, as it is 150 years since the British North America Act, which established the Confederation of Canada, was enacted. Just this past weekend, celebrations took place throughout Canada. It is nice, 150 years later, to recognise Canada’s birthday and, thinking about competition and business, to recognise the 200-year anniversary of the Bank of Montreal—the bank with the longest presence in the United Kingdom—which also falls this year.

The competition provisions in the Bill are sensible and operate, like the EU-Canada Comprehensive Economic and Trade Agreement, as a basis for a future relationship with Canada once we have left the European Union. I want to use this debate to explain why I feel this relationship is so important and is worthy of more attention from Her Majesty’s Government over the coming years.

Of course, we have an important shared heritage with Canada which has been strengthened through conflict and war. A reminder came recently when the Bletchley Park commemorative badge was presented by our representative in Ottawa to 96-year-old Sonja Morawetz Sinclair, who escaped the approaching Nazi armies in Czechoslovakia and worked in the examination unit, supporting the important signals intelligence work that was done there. It is nice that our Government have recognised that contribution.

Of course, we have a shared legal system, a shared language, shared business practices, a shared Head of State and, indeed, a shared system of government. This is a relationship that, post-Brexit, can flourish on the basis of those commonalities. It also makes economic sense for us to develop this relationship much more closely. UK exports to Canada in 2015 were £7.3 billion, whereas imports from Canada were £7.4 billion. We have a relatively well-balanced trading relationship as a consequence of our important commonalities and agreements, not only as regards competition, as in this Bill, but as regards the recently agreed EU-Canada trade treaty. It is a good basis for a treaty between this country and Canada once we leave, but because of the nature of European decision making, I think we can do better following our exit from the EU.

We are well placed to succeed and do well from that relationship post-Brexit, not least because of the friendly business environment that I have mentioned and our shared heritage, but also because of our strong presence in the market, particularly as a result of investment from the Government through UK Trade & Investment, the Foreign and Commonwealth Office, and now the Department for International Trade. I saw that for myself, and saw how valued it was in my time as a trade envoy. We had an excellent team, led by High Commissioner Howard Drake, who was well regarded, and by the consul general and director-general for UK trade and investment, Kevin McGurgan, who was based in Toronto. I saw how well regarded he was and how well connected, both at a political and business level, Her Majesty’s Government were as a result of those relationships. Only two weeks ago, I was in discussions with our consul general in Vancouver, Nicole Davison, who leads a team in the west doing a great job.

I want to put a bit of meat on the bones and outline what more we need to do to get the maximum advantage from that relationship post-Brexit. I have discussed the need to recognise first—I believe the Government have done so—the importance of that relationship. We have friends at court in the Brexit process. The newly elected Leader of the Opposition in Canada, Andrew Scheer, wrote a comment piece in favour of Brexit in the run-up to the election. The Canadian Government have said that they want to be as helpful as possible to us in this process, and indeed the probable next premier of Alberta, Jason Kenney, a former federal Cabinet Minister, was an advocate for Brexit before the referendum.

That relationship is important to us, not least because Canada is campaigning for a place on the UN Security Council. I call on the Government not just to recognise the importance of the relationship at a federal level but to recognise that Canada is a country of several different economies, and that that provincial relationship with those Governments, three of whom are represented in the United Kingdom—British Columbia, Ontario and Quebec—is vital.

Broadly, my pitch on the Bill is to recognise that what we have achieved through the EU and bilateral arrangements with Canada is a close relationship. However, we need to do more to put more meat on the bones and strengthen that relationship. The Government recognise that, and there is work under way. I call on Ministers to ensure that they are fully cognisant of this important relationship, and put the required effort and attention into supporting that through visits and, as I have said, making sure that our network in the market is as strong as possible so that we get a good deal to replace CETA in the future. As I say, that requires recognition of the specifics of the provincial position in Canada, both politically and economically. I have nothing else to say, other than to end where I began and wish Canada happy birthday on its 150 years, which I am sure that the House will agree with.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I call Vicky Ford.