Higher Education: Funding and Student Finance

Baroness Wilcox Excerpts

Wednesday 3rd November 2010 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)]

My Lords, with permission, I will repeat a Statement made by my right honourable friend the Minister of State for Universities and Science.

“I would like to make a Statement on higher education funding and student finance. This follows the Statement made by my right honourable friend the Secretary of State on 12 October.

Our higher education system has many strengths, but also faces challenges—the need for more focus on the student experience, the need to widen access and the need for sustained funding. These challenges led the previous Government, on a cross-party basis, to set up the Browne review. We are grateful to Lord Browne for his excellent work. I think that he has made us all re-examine our positions.

On 12 October, my right honourable friend said that the coalition endorsed the thrust of Lord Browne’s report, but was open to suggestions before making specific recommendations, which would be radical and progressive. We have listened very carefully and with open minds. I can now give the details of our proposals.

First, we will introduce a progressive system of graduate contributions to the cost of their university education, with nobody having to pay up-front fees. Lord Browne suggested that there should be no cap on the graduate contribution. We believe that a limit is desirable and are therefore proposing a basic threshold of £6,000 per annum. In exceptional circumstances, there would be an absolute limit of £9,000. No publicly funded university will be able to charge more than this for its undergraduate courses. Since there will be a cap, we see no need for institutions to pay back a proportion of the graduate contribution as a levy to the Exchequer, as proposed by Browne.

We are also proposing a more progressive repayment structure. At present, graduates start repaying when their incomes reach £15,000. We will increase the repayment threshold to £21,000, and will thereafter increase it periodically to reflect earnings. The repayment will be 9 per cent of income above £21,000, and all outstanding repayments will be written off after 30 years. Raising the threshold reduces the monthly repayments for every graduate.

We will introduce a real interest rate on a progressive taper. For graduates earning below £21,000, the real rate of interest will remain at zero. For graduates earning between £21,000 and around £41,000, a real rate of interest will be tapered in to reach a maximum of inflation plus 3 per cent. When graduates are earning above £41,000, they will be making a full contribution to the costs of the system, but still incurring interest well below normal commercial rates. Under our proposals, a quarter of graduates—those on the lowest incomes—will pay less overall than they do at present.

The Government are committed to the progressive nature of the repayment system. It is therefore important that those on the highest incomes post-graduation are not able unfairly to buy themselves out of this progressive system by paying off their loans early. We will consult on early repayment mechanisms, similar to those paid by people who pre-pay their mortgages. These mechanisms would need to ensure that graduates on modest incomes who strive to pay off their loans early through regular payments are not penalised. For example, a 5 per cent levy might be charged on additional repayments each year over a specified amount such as £1,000 or £3,000. Alternatively, those on higher incomes—that is, over £60,000—who made an additional repayment could be required to pay a 5 per cent levy on this sum.

Whilst participation in higher education has improved in recent years, there has not been enough progress in securing fair access to some of our best known universities. We can make progress by improving the school attainment of pupils from disadvantaged backgrounds. That is why the Government are investing in a new premium for two year-olds and in the pupil premium. But we want that focus on improving the life chances of those from disadvantaged backgrounds to continue through to university. That is why, as previously announced by the Deputy Prime Minister, we will also establish a new £150 million national scholarships programme. This will be targeted on bright potential students from poor backgrounds to encourage them to apply to university and to meet their aspirations.

All universities that want to charge a higher graduate contribution than the £6,000 threshold will be obliged to participate in the national scholarships programme. We will consult students and university organisations on the details. We will look to increase the leverage of government funding by getting matched contributions from universities. Our current preference is for universities to offer scholarships to targeted students—including the principal beneficiaries of the pupil premium. That would mean that at least their first year is free. Other attractive ideas include expanding the model of a foundation year for young people with high potential but lower qualifications.

To ensure that the universities that charge tuition contributions above the £6,000 threshold take account of their particular responsibilities to widen participation and fair access, we will introduce a tougher regime of sanctions. Each institution will draw up a new access agreement with the Office for Fair Access. This would be expected to include activities such as outreach initiatives to attract more pupils to apply from disadvantaged backgrounds, and targeted scholarships and financial support for poorer students. OFFA will agree with universities a programme of defined progress each year towards their access benchmarks as calculated by the Higher Education Funding Council. If they are not making adequate progress towards these benchmarks, a mechanism will be established to allow OFFA to redirect a proportion of the income from contributions over £6,000 to specified access activities.

Our student support system is currently one of the most generous in the world. We will make it more progressive. Lower income students, while studying, will get improved help with their living costs. Students from families with incomes up to £25,000 are currently eligible for a maintenance grant, which is not repayable, of £2,900; we will increase this to £3,250. Those from families with incomes up to £42,000 will be entitled to a partial grant. There will also be increases in maintenance loans for students from families with incomes from £42,000 to £60,000. We will retain a higher maintenance loan for those studying in London.

All parties agree that the present system gives a raw deal to part-time students. They are particularly likely to be mature or disadvantaged students. Even the great higher education reports of the past, such as Dearing and Robbins, largely ignored them. Lord Browne has confronted the challenge head on. At last, under our proposals, part-time students will be entitled to a loan for tuition on the same basis as full-timers, and this support will be available to those studying for at least a third of their time, unlike the present grants for tuition which are available only to those studying for over half of their time.

Overall, this is a good deal for universities and for students. The bulk of universities’ money will not come through the block grant but instead will follow the choices of students. It will be up to each university or college to decide what it charges, including the amounts for different courses. All universities and colleges, whatever contribution they decide to charge, will be expected to publish a standard set of information about their performance on the indicators that students and their parents value: contact hours, teaching patterns and employment outcomes. We also propose to open up higher education provision to new providers, including further education colleges.

These proposals offer a thriving future for universities, with extra freedoms and less bureaucracy, and they ensure value for money and real choice for learners. We need to act quickly so that prospective students know where they stand. We intend to implement these changes for the 2012-13 academic year. We will therefore bring to the House our proposals on changes to graduate contributions before Christmas. Both Houses will have the chance to debate the proposals before a vote is taken. I am today placing in the Libraries of both Houses additional material that explains the modelling that we have done. We will also take powers next year to set a real interest rate for graduate contributions.

We will, as usual, publish the details of the university financial settlement for 2011-12 in our annual funding letter to HEFCE next month. We will therefore publish, later this winter, a higher education White Paper covering the wide range of long-term issues that arise from Lord Browne’s report. We hope to bring forward legislation in due course. Given the timescales, we would not expect to be implementing changes before the 2013-14 academic year.

Lord Browne’s report has rightly generated much debate. When the review was established exactly a year ago, it was on a cross-party basis. I hope that the Opposition will feel able to maintain that spirit. From our side, the two parties in the coalition have accepted the report’s broad thrust and are today putting forward a single, coherent and progressive policy. It will deliver a better deal for our students, for our graduates and for our universities”.

[Lord Triesman]

My Lords, I thank the noble Baroness, Lady Wilcox, for repeating the Statement and for providing another opportunity to look at this matter. I hope it is also an opportunity when some of the questions that have been pressing the whole way through might be addressed.

I probably ought to also say that, unlike normal circumstances where you see the Statement about half an hour or so before—it was in the other place earlier—we had what I ought to describe as the benefit of hearing it made by a Minister not responsible for this area at all, Michael Gove, on the radio this morning. I was surprised by that because I am an avid fan of the coalition document. I have read it many times and hope that I have become more illuminated as a result. I recall that on page 26 it talked about a very much more open and transparent parliamentary process in which it would not be the case that vital statements were made first for the benefit of the “Today” programme rather than in Parliament. I regret that this announcement was, because it diminishes the authority and the importance that we ought to place on this matter in Parliament.

We have had in effect four announcements on this subject in three weeks. The first, by the Secretary of State, welcomed the Browne report unreservedly—Browne was in. Then there was the formal Statement in which a number of the issues that the noble Lord, Lord Browne, had raised were thought not to be appropriate—he was out. Then we had the debate last week in which his status was restored once again—he was in. Now we have the whole of the mechanism in which there is going to be a cap, and a number of the other proposals that he made are out again. The process strikes me as more like the hokey-cokey than the making of serious policy. It also does not surprise me that we have arrived at this position despite the very clear view that had been expressed by at least one of the coalition parties. I wish briefly to quote its manifesto to its Members, because it must be important to stick to some kind of values in this. They said that they would:

“Scrap unfair university tuition fees for all students taking their first degree, including those studying part-time, saving them over £10,000 each”.

I will not carry on with the quote but there was also a “financially responsible plan” which dealt with the alternatives.

I once watched a very bold young man from this country go down the Cresta run as fast as he could on a bicycle. He did not get the whole way down. When I said it was an act of complete madness, I was told it was just an extreme sport. We have got into the period of extreme policy-making. It is not thought through. It has none of the fundamental elements in making vital policy for higher education. I appreciate that it has been welcomed by some institutions and I am hardly surprised. Anybody stripped of 75 to 80 per cent of their unit resource for teaching will welcome the lifeboat as their ship goes down.

I do welcome parts of the Statement. I welcome what is said about part-timers. The noble Baroness is right to say that that had the support of all parts of the House and it is true. I also welcome what has been said about foundation year development. That was always an area where a good deal more work would be useful. At the heart of this, however, it is so thoroughly piecemeal that it is about as sensible as going down the Cresta as fast as you can on a bicycle. There are no decisions on any of the mitigating factors which would produce the fairness that should go alongside—it is said—these highly inflated fee figures. The fee figures are there because they have to be—we know that prospectuses are about to be written—but none of the rest is there and there are no guarantees that any of the rest ever will be. Nothing is said about the way in which decisions among some universities to push toward fully privatised status will result from this, although it is quite clear from a number of vice-chancellors that they intend to do precisely that. In that sense, as we said last week, this is not about fees. It is about the ending of the concept of the public infrastructure role of universities. There is no serious debate on what that means or where it will lead. If we debated it, we might choose that road. What I know is that we have never once debated it.

I have looked through the Statement, as many noble Lords will have done. I can see now more clearly what a number of the figures are and, for those reasons, I shall make a couple of comments because I do not think that all the things said should pass unchallenged. I will turn then to the questions which, once again, I believe must be answered. I am astonished that the idea of treating the payment system like a mortgage system should have been raised at this stage without any firm information about whether it is going to be introduced and whether it would iron out unfairness. Saying that it is an attractive idea is quite different from introducing it. I am surprised by what is said about the “generous” increase in maintenance grants for lower-income students. The generous increase is £6.70 a week. I do not know what that buys nowadays—not a great deal, I suspect.

I turn to the questions which I believe must be answered today. I ask again about middle-income families and the longer time it will take for those in the second and third quartiles of income distribution to pay than those in the top quartile, because if the figures are as we believe it is not a progressive arrangement and could never be described as such. How much longer is it? I hope that the noble Baroness will not direct me to the BIS student loan repayment ready reckoner—the most obscurely written document that I have read in many a long year. Can she just tell us whether it is right, broadly speaking, that it would take someone from those two quartiles 14 years longer to make the repayment than somebody from the top quartile and whether it is the case that, unless you had some kind of mortgage penalty system to correct that, the outcome is as I have described?

I ask another question again. Are women, with the career patterns that they have—they are for reasons that we all know—being discriminated against and is that actionable discrimination? Is the assumption that higher fees will not adversely affect participation rates evidence-based or based on the anecdotes of some of those in the higher education system? I do not believe that there is good evidence, but I may well stand corrected. What is the Government’s impact study? What is the elasticity of demand? We should know that today.

What is going to be done about the arts, humanities and social sciences, which are the heart of our culture and, indeed, of world culture? The downgrading of these subjects to non-priority status is an astounding reversal of the very idea of a university. How will they be encouraged and protected as subjects? Will the Government fund the cash-flow and balance sheet deficits that will occur because there is a gap between the cuts that they are going to impose and the first receipt of these higher-level student fees, which are timed to come in in 2013? That is a penalty which no university could reasonably have anticipated. Will the Government pay it or will a still greater cut simply have to be absorbed? What do the Government recommend to make up the shortfall in the teaching unit of resource—approximately £1,500 per year—for those universities that face the cut and charge just £6,000? Is it okay, today, in our universities to slash the unit of resource in that way?

What are the Government’s plans for the problem of Islamic finance approaches to usury, for which most of the things here suggested are abhorrent? Will the Government tell us how they will handle the growing pressure from universities, freed of any significant government expenditure on teaching, to become private—the issue which I think lies behind all these announcements? Finally, will the Government tell us their view of the rate of return on investment in university teaching with the fee at its current level, and whether the damage to investment is something that this country really ought to avoid?

[Baroness Wilcox]

This is a big subject, my Lords, and I want to answer as many of the questions of the noble Lord, Lord Triesman, as possible. I thank him for his comments and for his questions on what is a very important subject. I want to avoid turning this into a yah-boo-sucks time; I do not think that that sits well in this House. I could talk about the fact that the Leader of the Labour party and his supporters do not speak from the same hymn sheet, but I do not think it is the right moment to be doing things like that. Instead, I shall try to answer some of the questions the noble Lord has asked me.

We feel that the Government are placing universities on a more stable footing and allowing institutions to flourish. Our universities, as we know, are internationally renowned, but many of the strongest have told us that they need further investment in order to maintain their position, and so it is that we are taking this brave new stance, based, of course, upon a piece of work commissioned from the noble Lord, Lord Browne, by the noble Lord, Lord Mandelson, and the Labour party, and supported by us at the time. We are basing this upon six principles that he outlined.

The noble Lord talked about the arts, humanities and social sciences. Does ceasing their funding mean killing them and sabotaging some of the key sectors to drive us out of recession? We do not think that we are cutting the income of these departments. They are just going to have the money flow into them from a different route; it is going to be directed by the choices made by students. Those courses will still be there; they will be well promoted, and we hope that the young at school will better understand what choices are available to them, so that they bring the money with them. It will flow into those departments, as it always has; it will just be coming from a different direction.

I was asked why we are being less generous than the noble Lord, Lord Browne, for people earning over £35,000. Is this not another hit on the squeezed middle? We are committed to ensuring that higher education is affordable for everyone. This is a system that provides adequate support for students from low-income and middle-income families, but is also financially sustainable for the nation. We will give more maintenance grant to those with household incomes up to £37,000 and make available some non-repayable maintenance grants for those with household incomes between £25,000 and £42,000. This means that, compared with now, there will be more overall maintenance support to those with household incomes up to £45,000.

This is a generous package that benefits the vast majority. More than half a million students, as I have already said, will be eligible for non-repayable grants for living costs, as they are now, and almost a million students will be eligible for more overall maintenance support.

It was asked, given that over half of undergraduates are women, what the differential impact of today’s announcement would be on men and women. It is no pleasure to any of us to know that women still earn less than men do in the marketplace, and I hope that we will be able, in the time that we are the Government of this country, to help that to change. Because of that pay differential, women are less likely to be high earners. They will pay less and their repayments will be frozen when they are not earning—when they are having children and taking time off—and because of the long repayment time, the chances are that after 30 years they will not have finished paying and therefore it will just fade.

What about loans from Muslim students who believe that it is wrong to take out student loans because they attract an element of interest, and the payment of interest is against Islamic Sharia law? We want a single student loan system that can meet the needs of the majority of students, of course. The Government heavily subsidise the student support system and will continue to do so; we do not make a profit from student support. In circumstances where students feel that loans offered by the Government are against their law, students can take out a Sharia-compliant loan offered by one of the commercial banks at the moment, such as the Islamic Bank of England, Lloyds TSB and HSBC. I have spoken to my Muslim friends about this and they do not seem as exercised about this as maybe we think they are, because they do not see that there is a profit element in it to cause them great distress. I hope that I have been able to answer that question.

I shall see if we have any more answers; it is easier if we can get more answered now. I was asked if we will do what the noble Lord, Lord Browne, says and allow private providers to access public funding. We want to remove any undue barriers and make it easier for private providers to enter the market. We are committed to a level playing field for all providers. This will mean more and better choices for students and better value for money through new and potentially innovative and lower-cost approaches to teaching. We will consult further on this through a higher education White Paper this winter.

I doubt that I have answered all the noble Lord’s questions, but I will write to him with any answers that I have not been able to give now. No doubt other noble Lords in the Chamber are looking forward to asking questions that I hope I will be able to answer on my feet; if not, of course I will write.

[Lord Desai]

My Lords, I welcome this—

--- Later in debate ---

[Baroness Sharp of Guildford]

My Lords, there is a good deal to be welcomed in the package that has been presented today. It is indeed a more progressive package than the current loan repayments scheme with its current level of fees. The extension to part-timers and the way in which the interest is being tapered off mean that, again, the cost to those earning less is going to be less. It is a very clever system, and the Government should be congratulated on what has been achieved here.

As the Minister knows, though, I continue to have considerable worries about the degree to which some of those earning at middle-income level will never repay the loan completely and will therefore be confronted for 30 years by a marginal rate of tax of approximately 40 per cent, by the time that you add on the 9 per cent. Has any thought been given to the disincentive effect of this higher marginal rate of tax on young graduates, in relation to either their not wishing to go to university or to their going abroad instead? The logical thing would be to take your loan and then dash off abroad. Given that the loans are to be paid also to EU students, what is the record to date of EU students repaying their loans? Are we likely to see many of them also absconding and not repaying their loans?

[Baroness Wilcox]

I am very grateful for my noble friend’s warm words. She has asked questions that I hope I will be able to answer for her. Middle income is obviously a worry. Yes, she is right; it will not be paid off by the end of the 30-year period. It will lapse.

As for how these changes will affect international students, the Government have made it clear that they want to continue to attract the brightest and best international students to the UK. EU students have a right to be treated equally as regards tuition costs. UK students benefit from the tuition support available in other EU countries.

Support for tuition has been available for EU students since 2006-07. This support is paid directly to the higher education institution not to the student. The overwhelming majority of overseas borrowers are honest and want to repay the loans that they have received. Generally, European Union students are young and mobile and, when they graduate, will have a significantly higher earning potential because of their UK higher education. We are obviously concerned that, if any students are due to repay and are not doing so, the SLC will be robust in tracking down the borrowers to get back the money that they owe. We will make sure that that is done.

Effective collection across the EU is underpinned by EC regulations, which allow the SLC to obtain judgments in UK courts that can be enforced by courts in other EU countries. We will use this whenever necessary. It is heartening to know that, generally speaking, the European Union students pay their bills. As to the other question, I will come back to my noble friend.

[Lord Desai]

I welcome the fact that the Government have gone half way to accepting my suggestion that they should not have a fixed limit of £6,000. They have not gone to £10,000, however, as I suggested. Is it not better for the Government not to have an upper ceiling at all and to allow universities to charge differentially for different courses? This would make allocations for universities easier. It would also make the Government’s job easier because otherwise there will be far too much rationing and control of universities. That will lead to some terrible mistakes, especially in subjects such as the humanities, which could be taught for much less than the kind of fees that the Government want to charge.

[Baroness Wilcox]

I wondered whether the noble Lord, Lord Desai, would ask why we rejected uncapped tuition costs. I wondered if the noble Lord, Lord Desai, would ask this. The noble Lord, Lord Browne, made important recommendations about the structure and level of graduate contributions. We have considered them carefully. However, on balance, we have concerns that uncapped costs would put off some applicants, particularly those from lower-income families. For UK and EU undergraduates, we are proposing a threshold of £6,000 for graduate contributions, with an upper limit of £9,000. All universities and colleges will be expected to publish a standard set of information about all the courses that they provide. Universities may set whatever levels they consider best meet their individual circumstances, with £6,000 being the level above which additional requirements on access will be set. There will be an upper level of £9,000.

[Lord Quirk]

I imagine that most people will welcome the fact that the Government propose to follow the Browne recommendations as regards giving help to part-time and mature students. However, is the Minister aware that one of those recommendations—namely, to tie eligibility for financial help to the UCAS tariff points system—would be detrimental to part-time students who, after all, constitute something like 40 per cent of the student population, and a large number of whom fall well below the number of UCAS tariff points that would attract student support? This recommendation may be fine for traditional universities but it surely is not fine for part-time students. Do the Government have any view on that yet?

[Baroness Wilcox]

I think the answer is no; I do not think that we have. I am sorry but I do not think that I can answer that at the moment.

[Lord Willis of Knaresborough]

Will my honourable friend the Minister answer a very simple question? I am sorry, I should have said, “my noble friend”. I apologise for that; I am very new to this place. The Government have confirmed today that new providers will come into the higher education market. She also confirmed that universities will be able to expand their student numbers according to demand. However, she said nothing about whether there will be an overall cap on the number of students. Unless there is a balance between the overall number of students going into the system and the resources which the Government are to make available in terms of loans and grants, the whole system is likely to collapse. Will the Minister say something about the total number of students that the Government will allow to enter higher education?

[Baroness Wilcox]

I am told that we are going to consult on this in the White Paper. Browne recommends allowing student numbers to grow. The current package should enable student numbers to be broadly maintained. However, we do not believe that we should set unsustainable targets for growing HE student numbers. This risks perpetuating the idea that the only positive option for an 18 year-old is a three-year academic course at university. We think that we should be concentrating more on breaking down barriers between academic and vocational education so that an apprenticeship and various other courses are considered as valid as a degree. As I say, we will consult on this in the White Paper.

[Lord Winston]

My Lords, I declare an interest as chancellor of Sheffield Hallam University. As I speak, thousands of students from both universities in Sheffield—Sheffield Hallam is Mr Nick Clegg’s constituency—are demonstrating against the Government’s plans. Will the noble Baroness be kind enough to tell us what plans she has as a Minister to engage students who would never have gone to university had they belonged to a previous generation as regards the fairness and acceptability of the Government’s plans for the funding of universities?

[Baroness Wilcox]

There is no doubt that there has been a big gap in recent times between universities and schools as regards careers advice and communication. We are committed to ensuring that students and their families know exactly what is available to them. As the noble Lord knows, I was for many years chairman of the National Consumer Council. Very often, the thing that constituted a barrier for people in this area was language. Often they did not understand exactly what was going on.

It is very important that we get universities to push back into schools—as they will—to ensure that schools well understand their requirements. We will get the business community to explain what qualifications it requires students to gain at university, or whatever other form of further education they are hoping to take part in. We are already starting to determine how we can best communicate what this change means and how empowering it will be for students. They will be able to ensure that they get the courses they want.

Universities will start to improve not just their academic performance but what they offer students to prepare them for life after higher education. After all, some students will be older, some will be younger and the way that all this is explained, and the way that we get it out there to the students, really requires a new look. We are excited about having the opportunity to do that.

[Lord Sutherland of Houndwood]

My Lords, the foundation years that were mentioned are one of the few ways that have been shown to work in dealing with the gaps in school education that sometimes afflict our young people. That being so, who will pay for these? Will there be a Government grant, or will there be an additional year’s burden on the student who has to contribute towards the costs?

[Baroness Wilcox]

I am sorry, but I may not have understood that carefully. If we are talking about fees, students will not pay any fees, of course, while they are students. Is that what the noble Lord is asking? They will not pay any fees at all until they are graduates.

[Lord Sutherland of Houndwood]

I ask permission of the House to restate the question. Courses that are foundation years often involve an extra year’s study. Who will pay for that? Will it be the state or the student who will incur an extra year’s debt?

[Baroness Wilcox]

I think that it may be as part of the national scholarship programme that we will engage with that.

[Lord Pearson of Rannoch]

My Lords, as we need to save money in our higher education system, may I suggest that the Government take a close look at the humanities departments of the former polytechnics? I ask the question against the background of my 10 years on the Council for National Academic Awards, which validated all the courses in the polytechnics until those were miraculously changed into universities in 1992. That experience led me to see that, although the former technical colleges continued to provide excellent quality after they were subsumed into the polytechnics, many of the new humanities departments—that is, the “poly” bit of the polytechnic experiment—did not. As far as I am aware, there is no quality control in this area. There is quality assurance, but that is a very different thing. I welcome the fact that the Statement says that all universities will be expected to publish standard information on employment outcomes. Will the Government ensure that this information reveals any weaknesses in the areas that I have mentioned, so that the huge sums of money that currently support such departments could be released for better departments and better institutions in the system?

[Baroness Wilcox]

I think that I agree with all of that. All universities and colleges, whatever contribution they decide to make, will be expected to publish a standard set of information about their performance against the indicators that students and their parents value. Listening to how the noble Lord described the matter from a polytechnics background—which is where I am from—I think that that will drive through very well, and I can only agree with him.

[The Earl of Selborne]

The Statement refers to the present system giving a raw deal to part-time students, and I think there will be general agreement around the House that this is correct. Clearly, what is needed is not just better part-time provision but much greater flexibility and much better contacts with universities and with industry. To what extent will the proposals deliver that?

[Baroness Wilcox]

The proposals are a good deal for part-time students. Institutions with large numbers of part-time students, such as Birkbeck and the Open University, have been poorly treated in recent years because of, for example, the previous Government’s block on second-chance education. We share the conclusion of Lord Browne’s report that the exemption from up-front charges should be extended to part-time students, who have been unfairly discriminated against hitherto. We will therefore implement his recommendations.

This is very good news for part-time students. I was a part-time student once, and you had to pay everything up front. I was able to do that, but for several people with me it became too much. It was a shame because we lost such talented people at that time. We are looking forward to implementing the proposals.

[Lord Richard]

My Lords, I have a fairly simple question. How on earth do you empower a student by doubling his debt?

[Baroness Wilcox]

You empower a student by allowing him or her to go through the whole of their university time without fear or worry for money. Only after they have started to earn more than £21,000 a year will they even start to pay back anything.

In fairness, we are looking at a very different way of thinking. The money will be returned as the people earn a great deal more. As we all know, anybody who has been to university will earn a lot more during their working life than if they had not. Very often, the money that has enabled students to go to and enjoy university has come from people doing jobs that do not pay a great deal, but those people are paying tax that feeds through to students. I refer to people who work in any one of a million jobs but who have not benefited from a university education. The money comes back eventually—slowly—through the system, and the next set of students go to university. It is important to look at this in the round.

[Lord Elystan-Morgan]

In relation to the capping of tuition fees, have Her Majesty's Government conducted any study of the possible and likely deleterious and injurious effect that this would have on higher education in Wales? If so, what conclusions were arrived at and what discussions were conducted with the Welsh Assembly and the Higher Education Funding Council for Wales?

[Baroness Wilcox]

I am afraid that I do not know. The devolved assemblies will carry on doing things in the way that they wish, and we will consult them. However, today I am speaking for universities in England. Of course, as time goes on and we go forward, we will debate and consult with all the devolved assemblies in Wales, Scotland and Northern Ireland to see how we can best work together and learn from best practice.

[Baroness Symons of Vernham Dean]

My Lords, the noble Baroness has done her best to answer the questions, but it might be helpful if she gets a rather fuller briefing before dealing with a Statement of such enormous importance.

I return to the point raised by my noble friend Lord Triesman. I am sure that she heard her colleague, Michael Gove, on the radio this morning. He announced the main points in his interview on “Today”. The Front Bench opposite has said all sorts of things about election promises, but one thing that is certain is that Ministers must abide by the Ministerial Code. Has the noble Baroness read the code? If she has, she will remember that Section 9.1 states:

“When Parliament is in session, the most important announcements of Government policy should be made in the first instance, in Parliament”.

That is an unequivocal statement that all Ministers must abide by. Will she tell us what in that unequivocal statement the Government do not understand?

[Baroness Wilcox]

I do not know the circumstances of the interview and I do not know whether it was leaked. Michael Gove made a very good statement. It has been a very busy day, we have a lot to do and the noble Baroness has been, as she always is, very gracious. However, I have read the Ministerial Code, so I do not think that she can find me wanting on that point. She may feel that my knowledge of the breadth of the brief that I have is not as great as that of others. In this House—as the noble Baroness knows from the debate that we had last week—we have some wonderful minds and noble Lords who represent some of the finest universities not only in this country but in the world. I have tried my best today to do what I could—it is a very big brief—and, if I did not answer as well as the noble Baroness hoped, I am very sorry. However, if anyone wishes to write to me with other questions, I will happily answer them.

The Browne report, which was commissioned by the then Labour Government and which we have supported, is ground-breaking stuff. We are only too pleased that the previous Administration commissioned the noble Lord to do this work. We have taken on board the six principles that he outlines. This is a very exciting way to take our country forward. The report talks about building the greatness of our nation for tomorrow's world and I do not think that I could end on any better line than that. We as the Government of this country will do our best to achieve that.