Brian Binley
Main Page: Brian Binley (Conservative - Northampton South)Department Debates - View all Brian Binley's debates with the Cabinet Office
(9 years, 11 months ago)
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Mr Binley
Many of us feel that the contributions being demanded are often too great, but I would not want to overstate that to the point at which we begin to believe that no student will ever be able to buy their own house. That is more than a slight exaggeration and it needs to be corrected.
Mr Bailey
I thank the hon. Gentleman for his observation. When I speak to sixth formers and potential undergraduates I always make the point that, compared with the cumulative spend in their lifetimes on cars that depreciate immediately, investing in their education is a very good investment. But it will have consequences for patterns of consumer expenditure, the full implications of which we do not yet know.
Mr Brian Binley (Northampton South) (Con)
I pay tribute to my colleague the Chairman of the Business, Innovation and Skills Committee, the hon. Member for West Bromwich West (Mr Bailey), not just for the report, but in recognition of all the years during which we have worked together on the Committee, with me as his would-be vice-Chairman. I believe that I speak as the longest-serving member of the Committee: I have been a member for nine years, and the grey hairs can attest to that record. I also thank all the other Committee members with whom I have worked during those nine years. It has been a fascinating experience.
I hope that I may wander off the main topic of the debate just a little—and it will only be a little. It is about time we saw Select Committee membership as an alternative career choice in the House of Commons. I hope that the importance of Select Committees will be enhanced, because, if that does nothing else, it may end what I consider to be the dangers of patriotism and patronage that apply in this place. I hope that that remark has been recorded, and will be picked up somewhere.
Greg Clark
I know that my hon. Friend—and he has been a friend for many years—is a considerable patriot. I cannot imagine that he was deprecating patriotism.
Mr Binley
No, not patriotism; I meant patronage, and I am glad that my right hon. Friend has pointed that out. I will now continue to speak according to the terms of the motion, Mr Deputy Speaker, which I am sure will delight you.
My colleague—indeed, I shall use the term “hon. Friend”—the Chairman of the Committee said that he would concentrate on wider issues than that of the money itself. I want to concentrate on the issue of the resource accounting and budgeting charge, the money and the black hole that the charge is producing for future generations.
Paul Farrelly
I realise that pinning down the RAB charge is rather like Phil Taylor—the legendary darts player who comes from my constituency of Newcastle-under-Lyme—throwing darts at a moving board, but does the hon. Gentleman agree that, with 45% of student debt expected to be written off in the future, the current system is really not working for students or for the taxpayer? Even in this age of austerity, lower fees would lead to the recovery of more debt, as well as wider potential economic benefits for students as they make their way in the world after university.
Mr Binley
I welcome the hon. Gentleman’s remarks. I shall say a little more about my views on the point he raises as my speech unfolds, but I will say now that every small business man in the land—I do not mean small in stature; I mean small in the sense of the size of the business—will know that if he lends money that he will not get back, he will have a cash flow problem that will create real trouble for him, if not now, then certainly in the future. I do not believe that Government money is any different in that respect.
The saga of higher education funding and support has rumbled on for a long time. Reforms in the 1990s created an expansion in higher education that widened participation, which, of course, is welcome. However, those reforms necessitated a change in the financial model for universities and those attending them. That is becoming increasingly unsustainable and could lead, as I have said, to a sizeable black hole in the Exchequer accounting, which the Government seem not to wish to recognise.
Many Government members are also my personal friends, and I am sure they are working on contingencies and do not have this in mind, because I would not ascribe to them the financial inadequacy that not recognising the problem would suggest. I hope my good friend the Minister will recognise that I do not think he is inadequate and I do think he will come up with the answers we require—that he will recognise the problems and consider very carefully the need for a proper review not only of the RAB charge itself and the loans surrounding it, but the way our universities work. I will talk about that as my speech unfolds.
Bob Stewart (Beckenham) (Con)
I thank my very hon. Friend for giving way. Is it correct that if my children go to a Scottish university, they will pay a lot of money, whereas those from Scotland, or from France or Poland, do not pay tuition fees? That is unfair and should be addressed, too.
Mr Binley
I will allude to that problem, which I hope will be corrected when this place discusses—if it has the courage to do so, and I pray it does—devolution and the Barnett formula, because there is no doubt that Scottish students who attend Scottish universities get a much more helpful and lucrative deal than Scottish citizens who attend English universities. This is a matter not of English or Scots, but of devolution, which in this instance works very much against students in English universities. They are ill done by, as are citizens more broadly, on whom less per head of population is spent than on our fellow Scottish citizens.
The much discussed 50% target for participation in universities, although arbitrary, was entrenched in the need for change in the 1990s and was one of the motivators of the current situation. I was a secondary modern schoolboy under the tripartite system, which could have been enhanced and could have flowered in the extent of choice it gave to parents. I regret that, at a stroke, it was done away with. I fear that was to our great cost and genuinely feel that the extension of offers in education that is beginning to flower now is an important development. Most importantly, we must place apprentices, technologists and all those who are so vital to the well-being of our economy on an exact par with university students, and in the past I fear they have not been given that recognition. I want to see a more equitable division between those who have gone on to higher education in technical fields and those who have chosen the academic areas for which the universities are famous. I think that that is part of the answer and I am sure that the Government will take it on board.
The 2011 White Paper promised that higher education would be put on a financially sustainable basis. The Browne review established the principle that the beneficiaries of higher education would need to make a greater contribution towards the costs, and I agree with that. It was also proposed that graduates should pay a proportion of their salary only when they were earning more than £21,000 a year, and that was widely welcomed. That provides a part-answer to a previous question.
The Select Committee inquiry in the first Session of this Parliament, to which I contributed, drew two conclusions about the affordability of the loan system. We agreed that there should be clarity for students about the relationship between the burden borne by them and that borne by the taxpayer, as a function of the performance of the economy. That seemed to me to be vital, because we have turned students into customers and consumers, and consumers have a right to know that they are getting a fair deal. That fair deal will also have an impact on their children and grandchildren, which is why this matter is so important.
I genuinely believe that we are leaving a massive black hole for future generations to deal with, and I say to my right hon. Friend the Minister that I find that immoral and totally unacceptable. I know that he thinks of politics in terms of an ethical and moral base, and I hope that he will hear my plea. We have no right to lay so much danger and concern on to those who follow us. We are already doing it with a deficit that was built up to far too high a level. That is causing us problems now and will continue to do so for at least the next five, six or seven years. I do not want that problem to be added to by a black hole because we did not take the trouble to consider this issue properly.
That is why I am appealing to my right hon. Friend in this regard, and I do so not for ourselves. Of course the Government can hide the problem away, but if they do so, they will not be acting in the ethical and moral way in which the Minister and I would want them to act. I therefore hope that he will recognise this element of the problem. This is not about the accounting that the Treasury seeks to project; it is about what most Members of the House of Commons want to see. I have served here for almost 10 years, and I believe that Members consider morality, ethics and good practice to be massively important factors in their deliberations, and I hope that we can apply those factors to this issue.
I shall be leaving this place in three months and I want to make a heartfelt appeal to the Minister on behalf of my two children and three grandchildren. The problem could easily be shoved aside, but it will come back to haunt us in a big way in 15 or 20 years if we are not careful.
The Select Committee inquiry drew two conclusions. I have just outlined the first, but the second has greater significance. We stated:
“The affordability of the new system is dependent on a wide range of variables which are outside of Government control.”
The truth is that we doubted that they had been fully taken into account when the system was set up. That gives the Minister the opportunity to say that there is a need to revisit this issue to consider what the other variables outside the Government’s control are. We are not the masters of every issue we face—we are rarely the masters of any issue we face, but that is especially true of this one, which will leave a deficit for our children and grandchildren if we are not careful. This issue is not totally, by any means, within the Government’s control and we need to consider that aspect. If we do not do so, we will be letting future generations down. Consequently, I wish to focus my remarks on the second conclusion.
Let me repeat for the record the doubts I had at the time the reforms were introduced. My right hon. Friend the Member for Havant (Mr Willetts) will know of them, because of some friendly, courteous but relatively robust cross-examinations when he was on the Front Bench. He knows that we were deeply concerned at that time, and nothing that has happened since has changed my mind. I do not believe that proper regard was given in the first place to long-term sustainability, and I want to concentrate on that nub of this matter.
In October 2012, my right hon. Friend the Member for Havant, a wise and certainly highly intelligent Minister, was reported in The Independent—this was “reported”, so I cannot claim he actually said these things, as we all know the dangers that lie in that term—to have said that the RAB on students loans would not rise above 32%, with a 38% ceiling being the worst possible outcome for the taxpayer. In April last year, in response to a parliamentary question, he asserted that estimates at that time placed RAB at about 45%—in such a short time it had already risen way above what I believe were his genuine and heartfelt estimates. In my view, a level not far off 50% has been reached—perhaps it has already moved above that figure—and that simply highlights how important this matter is. To be totally fair, I should point out that he also stated that the Government had achieved significant savings for students, and increased income for universities. I believe he was right to say that, and I welcomed that view then and do so now. We pay tribute to the work he did in the Department, which will benefit my children and grandchildren. I hope I have given an even view of how I see the work of a right hon. Friend I am criticising just a little.
Looking at the reforms from a more detached perspective, it is far from clear that the Government can claim that these changes were a total success, not least on the RAB. A forecast drop in student loan repayments has raised existential questions about the true sustainability of the new system, and we could face a situation in which the effect of trebling tuition fees has resulted in a more expensive settlement for taxpayers, in the way that I have described. A report in March last year by London Economics found that if the charge increases beyond 48.6%, the cost of the reform
“will exceed the 2010-11 system that it replaced.”
That is a startling fact and it ought to add not only to our concern, but to the need for an immediate review in the way the Select Committee is requesting. As I have said, the RAB index is perhaps already above 50%. No business could sustain, and no Government should be prepared to sustain, such a situation, because it is the worst kind of accounting. It is the worst kind of financial thinking about the future, and I reject it, not only as a business man, but as a parent.
Mr David Lammy (Tottenham) (Lab)
I hesitate to interrupt the hon. Gentleman during what is emerging as an outstanding contribution on the Floor of the House. Does he agree that, given the Government’s continued repetition of the need to balance the country’s books, this is an extraordinary outlier in relation to that clear view that we have to have a sustainable economy? The fact the RAB is moving beyond 50%, as he is indicating, should cause real alarm.
Mr Binley
I am most grateful for the right hon. Gentleman’s remarks, and I add that this situation should cause real alarm to not only every Member of this House, irrespective of their position or party, but to every parent, business man and citizen in the land. At some stage their children and grandchildren will have to meet this charge if we do nothing about it now. I do not take the accounting answer given earlier by a man I respect, my right hon. Friend the Member for Havant, and I welcome the comments made by the right hon. Member for Southampton, Itchen (Mr Denham), a former Labour Minister, who, sadly, is leaving this place, too—that will be a great loss. He made the point that we cannot avoid debt of any kind and we cannot talk it off a balance sheet; it has to be dealt with at some stage. I would rather it be dealt with now than at some point in the future.
Any business would stem the flow of debt immediately, as it would be so damaging—it would threaten the very livelihood and stability of that business. Any business would be looking for ways of tightening up on credit control—it would probably have done that already, because it could never have afforded to have got into this situation. Any business would look for ways of increasing productivity within the system, and you will be pleased to know that I wish to say a few words about that relatively shortly, Mr Deputy Speaker, and then I will sit down. Does that reassure you?
Mr Deputy Speaker (Mr Lindsay Hoyle)
I am sure it reassures the rest of the Chamber.
Mr Binley
I fear that they are enjoying my contribution immensely, but your job is another matter.
Any business would be seeking to tighten credit controls and to find ways of increasing productivity in the areas of service provision, and would talk to its bank about contingency arrangements that might be in put in place and how that might be done. We are simply appealing about that aspect, because in this respect our bank is the taxpayer. I wonder what the taxpayer might feel about our not considering those contingencies. I have made that point in a number of ways during these remarks, but it is a vital part of what this place is about.
How must we seek to emulate that good, solid business man who would take those steps? I would seek from the Minister a wish and plans to improve loan contracts, with special emphasis on repayment procedures. We now have the information to prove that the procedures are simply not good enough to reclaim taxpayers’ money, especially from overseas students, and we have to look at that. Secondly, we have to improve collection procedures—again, particularly in respect of overseas students. It is not the job of this House to finance the education of those people, even though doing so creates a better world; I understand that aspect, but it is still not our job to finance their further education for the nations that they come from—I do not believe that our bank of the taxpayer would disagree with that view.
I would also equalise the cost of university education through the nation. My hon. Friend the Member for Beckenham (Bob Stewart), who is no longer in his place, has already talked about the disparity in the fee situation between England and Scotland, which many people find unfair and unacceptable.
We need to increase university productivity. We should also consider compressing the time it takes for a student to complete a course. We could have courses of two years, or even 18 months if we are talking about golf course management. As a businessman, I despair at some of the degrees that come before me when people seek jobs, but that is another matter. We need to think about compressing courses and improving the productivity of a sector of our national life that has had it easy for too long. Members may think that there speaks a secondary modern schoolboy who did not have the opportunity to sit at the high table, but many people in this land believe that our university structure has been too aristocratic and too full of itself and that it needs to recognise that it is a contributor to our national wealth and well-being, and it is from that aspect that I come to this subject. We need to ensure that the Treasury finally improves contingency planning to reduce the impact of the deficit that we say will meet us in ever greater amounts as time goes by.
I have some questions for the Minister. I would welcome his confirmation on some of the details of our assumptions. In particular, what proportion is assumed to be used up by foreign nationals whose offspring would not have legal access to loans? What analysis has there been of the key variables affecting repayment rates, such as the future performance of the economy? A very long telescope is required for such a difficult job. None the less, we must have some contingency plans in place for worst-case scenarios, as they have not been built into the sector.
What work are the Government undertaking to understand more the nature of defaulters and, in the light of other options, the desirability of the continued expansion of higher education, particularly in the context of apprenticeships? We need to put even more effort—I do recognise how much the Government are doing in this regard—into technology apprenticeships and all those practical skills that the target of university entrance has demoted in the minds of many of our young people. I see too many people who think that the only objective in life is to go to uni. What a tragedy that is. We are increasing the number of people who see opportunities in engineering, technology and other such skills, but we are still not putting enough effort into that sector, and we are still not changing the view of young people that university really is the place to be.
Paul Farrelly
I take on board the hon. Gentleman’s points about engineering and vocational degrees. But does he also agree that at levels of £9,000 a year plus maintenance loans, many of those degrees at the likes of Imperial, which stretch over more than three years, make it less likely that people from more modest backgrounds will enter those professions, and therefore socially restrict the entry?
Mr Binley
That is absolutely correct, and it underlines the need for a proper review and perhaps the need to rebalance things. We should have not an across-the-piece £9,000 level of payment, but a rebalancing of the loans in association with what is required. This is a more complicated business than we first thought, and we need a review to take into account those factors to ensure that we have enough young people who can pay for my pension and the pensions of those who follow me and that this nation has the well-being to compete in an ever-more competitive world. That is what we are talking about. This arrogant view of universities as the place where we produce rounded men who talk with wonderful accents must end. These people who talk the Queen’s English sometimes do so to such an extent that they are not understood by those from a working-class background. I want all of our people to benefit. I want our nation to be serviced by people, from whatever background, with the skills and the ability to ensure that we maintain the well-being that I and other Members of this House have had the good fortune to enjoy.
Finally—you will be delighted to hear that, Mr Deputy Speaker—I want to mention the European dimension to this black hole. What prediction has the Minister made of changes and developments whereby equal access rights and obligations arise for EU nationals to borrow and study in the United Kingdom? If that is to be the case, will we find ourselves increasingly subsidising foreign nationals? I believe that charity and support must start at home.
I have every faith in my right hon. Friend the Minister. I know that he is an honest man and I look forward to his response with great interest, because I think that he might surprise us all and say that he agrees with many of our points.
Mr David Willetts (Havant) (Con)
This has been an illuminating debate, although my successor, the excellent Minister for Universities, Science and Cities, might think he is in danger of hearing from too many former Ministers going through our old arguments. We look forward to his fresh approach. I want to respond to the Business, Innovation and Skills Committee report. I always appreciated the courtesy of the Committee’s interrogations and the acuteness of its questioning.
There is shared ground. Going to university brings substantial public and private benefits. There is little evidence that the benefits are decreasing even when the number of students and graduates is increasing. The private benefits come in the form of significant extra earnings. The public benefits come in many forms, including higher income tax receipts. The extra that a graduate is likely to earn during his or her working life, which on average is £200,000 or more, and the extra that the Exchequer is likely to collect from a graduate during his or her working life, which is possibly another £300,000 or more, are significantly larger than the amount of so-called debt that graduates have—it is a fixed monthly payment through PAYE, so the extent to which it should be regarded as normal debt is open to dispute.
Rightly, we contribute public resources to universities through the Higher Education Funding Council for England grant, which runs at almost £2 billion a year, and through support for students in maintenance grants and other specific payments. It is interesting that we are now hearing from the former Labour Secretary of State a proposal to abolish maintenance grants and replace them with further maintenance loans. Those costs that are paid through the Exchequer—the HEFCE grant to universities and the maintenance grant, disabled students allowance and so on to students—are undoubtedly actual public spending today and are accounted for as such.
There is a third cost—on which too much of the debate has already focused, but I will touch on it now—which is the extent to which these loans that are now being made for students will be collected back in the future, and the extent to which, at the end of the 30-year period, in 2046, people in this Chamber will discuss the public expenditure item that year of writing off the loans that have not been repaid. The former Secretary of State said that there are lots of different methods of treating this, and the Select Committee Chairman said that this was accounting. It is not a fiddly accounting point; it gets to the heart of the system. This is a forecast of what might happen in the future. That is why it is not public spending today. If it were treated as public spending today, we would get into the nonsensical position in which it would affect real things that BIS was doing. A BIS Minister would have to say, “I will cut back spending on catapult centres because I have to spend more money on the possible future write-off of loans in 2046.” That is no way in which Governments should operate and, thank heavens, they do not.
Mr Binley
Of course I understand both the experience and knowledge with which my right hon. Friend speaks, but at the end of the day we do have a duty—it is why children and grandchildren have been mentioned so much in this debate—to think about what they will inherit. Does he recognise that, and how does he see that duty being undertaken by this Parliament?
Mr Willetts
My hon. Friend makes an important point. This is not public spending, as is explained in the Office for Budget Responsibility “Fiscal Sustainability Report” at page 174, paragraph B.21, which states:
“given the way the National Accounts are measured this does not directly affect our fiscal forecast.”
But that does not mean that we should be cavalier or wilful and say, “It doesn’t matter what the write-offs are. That is a problem for 2046.” My hon. Friend is absolutely right, and that is what I want to touch on. Clearly, we have to do this prudently, which is why this appears as an item of spending in some BIS departmental budgets. Quite rightly, BIS Ministers and Treasury Ministers have to discuss what they think will happen on the write-offs. Incidentally, a very sensible reform a couple of years ago, when even the Treasury understood that having this in the annual budget bouncing around as forecasts was nonsense, was for the accounting charges to happen at a rate of one thirtieth a year. We want to recognise this issue, but it would be a mistake for it to be regarded as just like normal departmental expenditure.
Mr Willetts
On inaccuracies, the RAB charge is largely determined by external factors. The 2.2% cost of borrowing is determined by Treasury assumption. The repayment threshold in 2016 relative to earnings is entirely determined by OBR forecasts. We did not go round trying to reach an alternative wages forecast; we just took the OBR forecast, which was the only sensible way to proceed. Then the British jobs market performed differently from what everyone expected in 2010, with good news on employment and less good news on increases in the real value of wages.
There was an error. The error that was made, which emerges from increased research on what has happened to graduates, is that it looks as though graduate earnings do not bounce around as much as was expected. That is another factor, although not a significant one in how the RAB charge is forecast. The forecast is inevitably shaped by the kind of assumptions that I described earlier.
I have spoken for 20 minutes and I do not want to go on any longer. I have touched on my concern about the way this debate is going wrong. It is going wrong by treating the assumptions necessary to make any kind of RAB charge calculations as somehow fixing the design of the system for the next 30 years, when that is absolutely not the purpose of the specification of those assumptions to make the calculation.
Mr Binley
I deliberately mentioned black holes because they have an event horizon. Once an object crosses that event horizon, it is stretched out of existence. Part of the reason why I want us to have a review is to know where that event horizon is. That would be one of its important purposes. Is my right hon. Friend eschewing the other aspects that we talked about—better debt collection, better loan agreements and better productivity from our universities—which would be useful now?
Mr Willetts
That is very fair, and it is the point on which I want to end. I think debt collection is not a particular weakness of the scheme. Again, some of the Select Committee reports and even the NAO stuff is unfair in regarding debt collection as an area where we could do massively better. Essentially, we are forecasting income tax receipts up to 2045—calculating 9% of earnings above a threshold out to 30 years and discounting its value back. This preoccupation with the RAB charge is relatively new. When Labour’s RAB charge was 42%, we did not have agonised debates about it. It has suddenly become the hot topic of the day, as though it somehow proves that the system is unsustainable.
The real issue, as has been correctly identified by my hon. Friend the Member for Northampton South (Mr Binley) and the right hon. Member for Southampton, Itchen (Mr Denham), is what is happening to the student’s academic experience. When I talk with student unions, I find them relatively relaxed and accepting that 9% of earnings above £21,000 is affordable, but what they say is, “We are entitled to £9,000-worth of higher education today for the fees we pay.” There is a lot of dissatisfaction with the quality of the academic experience—for example, the amount of contact time they have with academics and the quality of the teaching—and that is the real-world challenge for our universities. I am one of the culprits in this regard, but I hope that in future our debates on higher education—I look forward to reading the Hansard reports—will focus a little more on that question and a little less on esoteric calculations of what might or might not be written off in 2046.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
What a privilege it is to take part in this debate. The quality of the contributions has been excellent. The House will recall that I have been involved in higher education for a very long time. Over the 10 years that I was the Chair of the Education Committee it partly covered higher education, so I was very absorbed in the subject. I was also a university teacher for 12 years, back when I used to work for a living, as I sometimes say—like the hon. Member for Northampton South (Mr Binley), I am one of the few Members who had a career before entering this place. The fact of the matter is that this has been a very high-quality debate.
I care deeply about higher education and love what it has done for my generation. I am the youngest of five children and the only one to go to university. I got into the local grammar school and was saved by going to Kingston technical college and then getting a scholarship to the London School of Economics, where I am now a governor. Higher education made my life. It gave me opportunities that my brothers and sister never had. I think that we underestimate just how powerful it can be and just what it has done in a short number of years for the people of this country.
I was at the LSE when the Robbins report was being written. Indeed, we had to walk quietly past the great man’s study in case he was behind the door, working on the royal commission. What he came up with still guides us, and I still think that it is right. He said that higher education should be paid for through a fair balance between the individual who benefits, the employer that benefits and society. That thread has run through all the contributions we have heard today. We are still concerned about how to deliver that fairness and that balance.
I do not want to repeat the excellent contributions we have heard on funding or to get into the black hole, so I will instead focus my remarks on delivery. However, I will say that the reason I gave, as co-chair of the Higher Education Commission, for doing a report on the long-term sustainability of higher education in our country was that everyone is talking about it. As my old friend the right hon. Member for Havant (Mr Willetts) knows, the higher education sector is very gossipy, and people in every corner—including vice-chancellors and business people—have been asking whether this is a long-term, viable model. They are asking that because higher education is so vital to our future. To get it wrong would be disastrous for our country’s future.
Fifty years ago Harold Wilson, who was born in my constituency, delivered a speech to the Labour party conference in Scarborough. It is now known as the “white heat of technology” speech. He said that for years this country had been ruled by a few people who went to posh schools and then to Oxford or Cambridge and who were essentially amateurs, but that the new world had no future for people without skills, or even for semi-skilled people. He saw that the future was in high skills, quality management and high science. He told us to look at what was happening in Russia: they had put a man into space before the Americans. He had been to the United States and seen production lines in the automobile industry where nothing was touched by a human hand. He could see that as a country we had to become highly skilled.
Harold Wilson also said some ridiculous things in that speech. He said, “Why do only 5% of people go to university? It should be 10%.” What a silly statement—I say that in jest. Why should we not have a university in every former industrial town? When Labour won the election a few months later, the polytechnics were introduced. There is a lovely story that Harold, when given the list of colleges of technology that were to be brought up to polytechnics, said, “Eee, where’s Huddersfield?”, before writing it in. I mention that because it is an amusing story, but there is a serious point: any town or city in this country that does not have a university cannot get into the super league. Up and down the country, large towns and cities that do not have a university—Huddersfield is lucky to have one—are in a lower league. I do not mean to decry those places, but universities are so important to the life of our communities, to their wealth and success. If we took them out of our towns and cities, we would be left with very little.
Mr Binley
I made a point earlier about being a secondary modern schoolboy at a time when only 2% of the population went to university, and I desperately regret not being able to take advantage of further education. I am really glad that so many of our young people can now do so. I was one of those boys that Harold Wilson was perhaps talking about—I was not a great fan of his, but that is another matter. Thank God we have a university that is doing its job so well in Northampton. I agree with the hon. Gentleman in that respect.
Mr Sheerman
I have a close relationship with Northampton university and its excellent vice-chancellor and know of its commitment to social enterprise. I am astonished by how few Members are in the Chamber for this debate. Huddersfield university is the biggest employer in my constituency, the biggest bringer of wealth, and it is what makes my town so vibrant. It has 25,000 students, and growing, and a massive number of staff. Think what that means for local businesses and supply chains. It pays very fair wages and sticks to all the principles. Indeed, not only was it last year’s university of the year, but it has just been given an award for the best level of employability of graduates. I will say more about that in a moment.
What Harold Wilson said 50 years ago is even more true today. If we do not produce the high skills we need in this country to compete and earn our living, we will be in dreadful trouble. Out in India, Brazil and China there are masses of people getting high-level and very practical qualifications. In every area where we have expertise we will find more and more competition as time goes on. We have to become brighter and smarter all the time. There is no place in our society for people without skills. That is a tragic aspect, but it is also a hopeful one. We have built up a fantastic university structure.
When I got the “Too Good To Fail” report going, what I wanted to say was that we do not want to throw everything up in the air. I do not want another Browne report, and I do not want to have to go back to the LSE and have another Robbins report. It is time that sensible men and women get together, as we have today, and say, “The system is working fairly well, but there are some real problems—can we fix them intelligently by co-operating?” The interesting and remarkable thing about the way in which higher education policy was produced, as Members might remember, is that it came out of an all-party agreement not to discuss the subject during a general election. We said that we would set up an inquiry agreed by both sides—Opposition and Government—and let it get on with its job.
Greg Clark
Those funds are available through the access regulator to be invested in the best way. Social progress has been made and people from my background now have the chance to go to university in increasing numbers. To rob universities and our young people of that help and assistance is an extraordinary suggestion from the Labour party.
For what purpose? It would reduce the payments not for poorer graduates but for the very richest. Those who pay off the £9,000 loans in full would be the only beneficiaries. I am talking about the richest 20% of earners, who would pay off their loans on average 28 years after graduation, when they are in middle age, and when they are earning on average £78,000, according to a think-tank. Ironically, this debate has been largely focused on the concerns that too high a proportion of loans is notionally projected to be written off, yet the Opposition want to write off 100% of loans over £6,000 for all graduates, even the ones who can comfortably pay.
I am not instinctively a partisan politician, and I believe it is strongly in our interest that policy questions about our universities should be, wherever possible, rooted in consensus and stability. That was the intention behind the Browne review, which the hon. Member for Huddersfield (Mr Sheerman) referred to, and which the previous Government set up. My right hon. Friend the Member for Havant implemented that dispassionate and thorough report. I hope that the right hon. Member for Birmingham, Hodge Hill will reflect on the ever more obvious success of the system, get behind it and drop his temptation to engage in a stunt that would plunge the financing of higher education into chaos.
Greg Clark
I am just about to conclude.
If the right hon. Member for Birmingham, Hodge Hill does get behind the system, in the same spirit, he will attract praise, not opprobrium, from those on the Government Benches—I am sure that my right hon. Friend would be generous in acknowledging that—and he will earn the respect of the sector, which values the stability and the sustainability that we now have in the financing of higher education in this country.
Madam Deputy Speaker (Dame Dawn Primarolo)
Order. I am sure it will be in the record, Mr Binley, as you said it very loudly. Even I heard it. It was just a shame that your right hon. Friend did not.