Higher Education

Baroness Sharp of Guildford Excerpts

Wednesday 9th April 2014 Lords Chamber

[Baroness Sharp of Guildford (LD)]

My Lords, it is a pleasure to follow the noble Baroness, Lady Donaghy. To my mind, she has raised an extremely important issue, because the quality of teaching in our schools and universities is fundamental to the success of our education system.

I have been in this House for almost 16 years and have spoken on higher education from these Benches on numerous occasions. It is unusual that we have not had a major debate on higher education for some time and I am very grateful to the Minister for raising this important issue. My own background is that of a university teacher and a researcher. I spent the last 20 years of my academic life at the University of Sussex in the Science Policy Research Unit. During my career in this House, I have concentrated quite a lot on the role of the science and technology subjects and the importance of, in particular, the teaching of mathematics, and I continue to take an interest in these subjects.

I have also played an active part in developing Liberal Democrat policy. During the early part of this century, when my noble friend Lord Willis was the spokesman on education for my party in the other place, he asked me whether I would work with him on developing a rationale for our policy of zero fees. I have had little difficulty in justifying that policy. Having been the product of a regime in which I paid no fees whatever and received very generous maintenance grants which enabled me to go to Cambridge—I share the admiration for that university expressed by the noble Lord, Lord Holmes—I nevertheless felt that in terms of intergenerational equity it was not difficult to justify a regime in which, because it was becoming increasingly important that we should do so, we extended tuition through to the age of 21 for the current generation of young people and they would pay for it later.

I suppose that, for that reason, I also became at that time a convert to the concept of a graduate tax. Given the not wholly progressive income tax system in this country, it seemed to me somewhat unfair that those who were on relatively low pay and had not benefited from a university education should have to pay through their income tax for those who benefited and gained considerably from such an education. Today, I continue to feel that some form of graduate tax is the best way of coping with the situation.

However, my remit was also to look at an integrated system—one that incorporated the further education sector as well as the higher education sector. We should not forget that the further education sector provides higher education for some 200,000 of our 1.3 million students. Therefore, it is a considerable player within the higher education sector. The scheme that we came up with was one that, in effect, looked to some form of voucher system for young people and provided a degree of flexibility between the sectors and between different elements in the sector. I shall come back to that later.

As the noble Lord, Lord Bilimoria, who is not in his place at the moment, the noble Lord, Lord Holmes, and the Minister himself have indicated, we have much to praise our higher education system for in this country. In terms of international ratings—I was looking at the Times Higher Education reputation rankings—we have 10 universities in the top 100 and are second only to the United States. In terms of publications, with 1% of the world’s population we produce 6.4% of the world’s scientific publications and 14% of the most highly cited publications. The quality of our research attracts many international R&D laboratories, especially in the life sciences, where we have forged a position as an international leader.

The universities themselves are great generators of wealth. It is estimated that their contribution to the UK’s economy is more than £70 billion—2.8% of GDP —creating 750,000 jobs. We attract large numbers of international students, in spite of the efforts of the Home Office. I entirely endorse what the noble Lord, Lord Bilimoria, said about the sheer ludicrousness of the current policy in relation to international students. It is rather absurd that the Department for Business, Innovation and Skills is doing its best to encourage international students to come here while, at the same time, the Home Office does its best to discourage them. That is quite stupid. As the right reverend Prelate the Bishop of Winchester indicated, these students give considerably to their local communities.

However, we need to beware of complacency. The farewell lecture that Bahram Bekhradnia gave when he departed as director of the Higher Education Policy Institute warned that we cannot assume that our relative success will continue indefinitely. Many other countries are investing very heavily in their higher education sectors. South Korea, Singapore and Hong Kong have been rising up the league tables very rapidly, as indeed has China. If we look at spending on tertiary education, we are spending rather below the OECD average of 1.5%—we spend about 1.4%—compared to the USA which spends 2.8% of GDP, Canada 2.5% and South Korea 2.5%. We spend relatively lowly on tertiary education in terms of our proportion of GDP. China is investing in and expanding the sector in spectacular fashion. We may currently be taking large numbers of postgraduate students from China but they are returning to become the key academics in their universities in that country. There will come a day, as we have seen in Hong Kong and Singapore, when students will stay at home because their universities are ranked as highly as our universities over here.

The UK is not investing enough in R&D, as the noble Lord, Lord Bilimoria, said. It is not just our universities; the private sector is not investing enough in research and development. Our total spend at 1.7% of GDP is well below most of our competitors who are now spending roughly 3% of GDP and rising. Ours has been falling. In the late 1980s we were spending 2% of GDP on R&D and even that was low at the time, but it has now fallen to 1.7%.

We should not be complacent about teaching. The research assessment exercise, as it was then called, was introduced in 1989. It is now the research excellence framework. This has given a considerable bias within universities for people to concentrate on research rather than on teaching. One of the reasons why we have been rising up the research rankings is that all the incentives are there within universities to concentrate on research. However, has that been at the cost of teaching? Far too many classes in universities are taken by postgraduate students who have no training whatever in teaching. We hear too many stories of work not being marked promptly and of little feedback being given to students. I went to university in the late 1950s when only 7% of the age cohort went. We are now looking at 45%. The pedagogy has to be very different. We can no longer assume that students are self-motivated and can be sent off to the library with a list and told to work by themselves. The internet has done an enormous amount to make material available but students still need teaching. As I say, the pedagogy in our universities has not had the attention that it deserves.

Above all—this point was raised by the noble Baroness, Lady Morris—we have not been looking enough at the dynamism and the diversity of this sector. We need a sector that shows greater flexibility in meeting the challenges from such things as the new online facilities. There is a need to mix and match courses and provide for young people who perhaps move from one institution to another. There is a need for us to consider where our skills gap lies and whether the universities are meeting it. The OECD, in its report Skills beyond School, highlighted the issue. It stated:

“While many young people in England pursue vocational qualifications at universities at bachelor level, very few undertake the kind of shorter vocational programmes that would represent a more cost-efficient response to the need for certain mid-level skills”.

In 2008, the Leitch report on skills made the point that 70% of those in the workforce in 2020 would have already completed their education. We need to think much more about education for mid-career which is not there at the moment. We need to have a stable financial framework if we are to develop new frameworks for higher education. The Dearing report in the 1990s suggested that funding should come from society and industry as well as from individuals. Industry funds remarkably little in the way of higher education. It contributes a certain amount to R&D but it does very little for teaching in higher education. Although students pay fees of £9,000 a year, the switch has been from the state paying the money to the state lending the money, so the money is still coming from the state. As so few of the loans will be repaid at the end of the day, the subsidy continues to be extremely high. I was among those who had some scepticism about the student loan system. It was described by Nick Barr on one occasion as a very dodgy form of PFI. To my mind it is both unduly expensive and ineffective. It transfers the cost of loans from the present to the future generation while taxing disproportionately those young people whose families are not sufficiently well heeled to pay off their debts. My own party has made a great deal of the IFS endorsement of the present system as more progressive than its predecessor as the threshold is £21,000 rather than £15,000 so that those on low incomes pay back less. But it ignores totally the fact that the distribution of wealth in this country enables those at the top end to pay off their student debts so that their children do not have the 9% surcharge on income tax that others have. In 2010, I was among those who predicted that the system would not prove sustainable. Its potential collapse came rather sooner than I expected. I thought that it would probably go through to about 2020 when the debt burden would become apparent.

I have gone on much too long already but I want to go back to the point about diversity. I feel that it is extremely important to develop a system where there is a greater mix of short and longer courses and where universities play a part alongside the further education colleges and other specialist colleges. To oil such a system we need to have a proper form of credit accumulation so that people can transfer from one form of the system to another. I feel this particularly with the development of online facilities and the mix and match of campus-based learning and distance learning. I urge the Government to try to develop a system that is much more diverse and flexible than the current one and to consider a student loan system such as that proposed by Million+ which looks to paying back over a longer term loans directly funded by the Government.