Oral Answers to Questions

Debate between Chris Skidmore and Angela Rayner

Monday 29th April 2019 Commons Chamber

[Angela Rayner (Ashton-under-Lyne) (Lab)]

Last week, we heard that 55 staff at the University of Winchester are facing redundancy as a result of the Treasury’s pensions bill, and the University of Cumbria is considering leaving the teachers’ pension scheme altogether. Will the Minister rethink before that trickle becomes a flood?

[The Minister for Universities, Science, Research and Innovation (Chris Skidmore)]

The Department had a consultation that also looked at the teachers’ pension scheme for further education, schools and independent schools. Obviously, there is only so much money to go around. We need to ensure that organisations such as further education colleges, which have no choice but to offer the teachers’ pension scheme, are protected.

I understand that this is unwelcome news for universities that are having to face increased bills, but in terms of ensuring that universities are financially sustainable, recent reports have shown that the universities sector is in good health. We need to ensure that universities work with the Office for Students, which is clear that when it comes to universities’ registration plans, financial sustainability is key and is marked down for five years. We want to work with universities to make sure they can offer the best experience to students.

[Angela Rayner]

I am sure those watching will say that the Minister’s response of “unwelcome news” is just not good enough.

One of the most important things in the education sector is the early years provision. Will the Education Secretary confirm that funding for Sure Start has fallen yet again? It is down by another 12% on his watch. Now that the Prime Minister has announced and promised an end to austerity, can the Education Secretary tell us when the cuts will stop for our tots?

[Chris Skidmore]

This Government are spending £3.5 billion on early years entitlement, and we are absolutely committed to ensuring that pupils get the best start in life as early as possible. The hon. Lady hits on the crux of the issue: to ensure that we have an education system that is sustainable and works for everyone, we need to make sure that all parts of the Department for Education are properly financed.

The hon. Lady’s commitment on the teachers’ pension scheme has to compete with other commitments within the education system. We will have an urgent question later about EU student finance, and I see in the papers that she has stated she would give free tuition fees to EU students. The point here is that money for EU students comes out of the pockets of Sure Start. The issue she has to address is where the money is coming from in the Department for Education for all her unfunded announcements. It is simply not acceptable for her to stand at the Dispatch Box and make commitments that will only disappoint people in the long term.

Tuition Fees: EU Students

Debate between Chris Skidmore and Angela Rayner

Monday 29th April 2019 Commons Chamber

[Angela Rayner (Ashton-under-Lyne) (Lab)]

(Urgent Question): To ask the Secretary of State for Education if he will make a statement on Government policy regarding tuition fees for EU students after the UK has left the European Union.

[The Minister for Universities, Science, Research and Innovation (Chris Skidmore)]

The Government have repeatedly made it clear that we absolutely value international exchange and collaboration in education and training as part of our vision for a global Britain. We believe that the UK and European countries should continue to give young people and students the chance to benefit from each other’s world-leading universities post exit.

Over the weekend, the media reported on a leaked Cabinet document discussing Government policy on EU student access to finance products for the 2020-21 academic year and beyond. At this time, I want to tell the House that no decision has yet been made on the continued access to student finance for EU students. Discussions at Cabinet level are ongoing and should remain confidential. I will make no comment on this apparent leak, which is deeply regrettable.

Students from the EU make a vital contribution to the university sector. It is testament to the quality and reputation of our higher education system that so many students from abroad choose to come and study here. As I stated earlier, since 2017 EU student numbers are up 3.8% and non-EU student numbers are up by 4.9%. In July 2018, we announced that students from the European Union starting courses in England in the 2019-20 academic year will continue to be eligible for home fees status, which means that they will be charged the same tuition fees as UK students and have access to tuition fee loans for the duration of their studies. Applications for students studying in academic year 2020-21 open in September 2019 and the Government will provide sufficient notice for prospective EU students and the wider higher education sector on fee arrangements ahead of the 2020-21 academic year and the subsequent years, which, as I have just stated, will obviously reflect our future relationship with European Union and the negotiations on that going forward.

[Angela Rayner]

Thank you, Mr Speaker, for granting this urgent question. We have all read in the leaked reports that the Secretary of State plans to withdraw the home fee status for EU nationals from 2020 onwards. The Minister cannot confirm the Government’s policy today, so when will universities get the certainty they need to plan for their future? Has his Department carried out any assessment of how many EU students would no longer study here as a result of this change?

At a time when the finances of universities are a matter of increasing concern, what impact will these changes have on the sustainability of our institutions? This issue should concern us all. International students make a net contribution to the public finances of tens of billions of pounds a year, so can the Minister tell us how much our public services will lose if fewer EU students come to study here, and how much education exports would fall by if EU students lost home fee status?

Only a month ago, the Secretary of State, along with the International Trade Secretary, launched an international education strategy. They said that education exports would reach £25 billion a year by 2030 and international student numbers would reach 600,000 by the same year. How can they publish this strategy one month, and then pursue a strategy that will undermine it the next? Does he still expect that 600,000 international students will come to the UK every year by 2030 if this rise in tuition fees is introduced?

Time and again, this Government have undermined our universities through their shambolic handling of Brexit. The future of Erasmus and Horizon 2020 are already in doubt, and now the very opportunities that we offer to young people from across the EU are being taken away. It is not in our interest to build walls between our world-class universities and our nearest neighbours, yet this Government are committed to doing exactly that.

[Chris Skidmore]

I thank the hon. Lady for raising this urgent question. It is important that we all recognise that EU students and staff make a vital contribution to our universities. It is also important that those people understand that the Government are determined to ensure that, even though we are leaving the European Union, we are not leaving our academic research partnerships behind. While I sit in the Department for Education as Minister for Universities, I also—[Interruption.] The hon. Member for Wythenshawe and Sale East (Mike Kane) is chuntering; either he wants to hear my answer or he does not. When it comes to setting out a position, it is important that this House does not go down a route of unnecessary negativity and does not somehow send out a message that the United Kingdom is an unwelcoming place.

We are determined when it comes to our universities and our EU student exchanges, and we have set out the international education strategy, which has the ambition of 600,000 extra international students by 2030, as well as setting an investment figure of £35 billion. [Interruption.] As the hon. Member for Ashton-under-Lyne (Angela Rayner) says—if she would not interrupt me—the economic importance of our higher education sector is reflected in the need to attract EU students and students from across the globe. That is the crux of the matter. We want to ensure that our nation is attractive internationally.

We have given commitments and guarantees regarding all successful Erasmus participations and regarding the Horizon 2020 science programmes, from which so many of our universities benefit. We made it a priority very early on after the referendum that we would set out the post-EU exit Government guarantee and the Government guarantee extension—that is, that we would fund the lifetime of these projects before Brexit if these applications were successful, and even post Brexit to December 2020.

We are drawing up our immigration system for January 2021 onwards. [Interruption.] The hon. Member for Wythenshawe and Sale East is again chuntering. Labour Members have called for an urgent question; either they want me to answer it or they do not. The point is that they are threatening a situation and claiming that we are somehow turning our backs to our European partners. That simply is not the case. With regard to our negotiations, I have spoken to about 15 European higher education Ministers. We need to make sure that we commit to them that Britain remains an attractive place for students from all nations across the world to come for work and to study. That is why we have established our international education strategy, why we have made the commitment on the guarantee, and why, rightly, we continue to work on our negotiations with the EU. If we had signed and passed a deal in this House, we would have had the certainty going forward to December 2020. Labour Members, with their Janus-faced—two-faced—approach, cast aspersions about the levels of uncertainty with regard to EU student funding when we would have guaranteed that funding for the next two years but they decided to vote against it. We need to work with universities globally to make sure that we raise our attainment. Our universities are world-class, with four in the world top 10 and 18 in the top 100. We want to support our universities. That is why we have published the international education strategy and why we want to work with them going forward.

Labour already offers students supposedly free tuition fees. Of course, there is no such thing as free tuition fees—they are paid for by the taxpayer, and this would cost the taxpayer an additional £12.5 billion. Labour’s additional policy, now, of saying that it would fund all EU students coming here to be able to study free of charge without having to pay back their tuition fees would cost at least £445 million a year. We have talked about magic money trees in the past—when it comes to Labour, it seems that we are talking about a magic money forest. We need to make sure that we have a fiscally responsible Government who look after our universities. That also means ensuring that we do not deceive our universities by claiming that we can spend money that we do not have.

It is not right that we should discriminate against our other international students. Does the hon. Member for Ashton-under-Lyne believe that we should offer a student finance package for European students once we have left the EU—a system that we have belonged to as members of the EU? Once we are no longer members of the EU, is it right that we then discriminate against Indian students or Chinese students? What does she say to them? How would she address the fact that her policy would discriminate against most of the students across the globe, at the same time as not having the money to be able to fund these student places?

Universities: Financial Sustainability

Debate between Chris Skidmore and Angela Rayner

Monday 11th February 2019 Commons Chamber

[Angela Rayner (Ashton-under-Lyne) (Lab) (Urgent Question)]

To ask the Secretary of State for Education if he will make a statement on the financial sustainability of universities in England.

[The Minister for Universities, Science, Research and Innovation (Chris Skidmore)]

I thank the hon. Lady for the opportunity to discuss the higher education sector today in what is my first urgent question.

This Government recognise the importance of the higher education sector and the massive contribution that it makes to this country. We recognise the multiple challenges that the sector is facing and that these will require institutions to adapt to a more competitive and uncertain environment. It is true that the current context presents significant challenges to institutional management, efficiency and financial planning in the HE sector, but it is wrong to characterise the HE provider sector as teetering on the brink of financial collapse. In its final annual report on the financial health of the sector published in March last year, the Higher Education Funding Council for England—the Office for Students’ predecessor—concluded that the HE sector continues to be in a sound position financially.

The new regulatory framework under the Office for Students brings a risk-based approach to monitoring financial viability and sustainability in order to protect students’ interests. Financial sustainability is a condition of registration. This means that the OfS, as regulator, will pay greater attention—and, importantly, require more specific action—where there is greater institutional vulnerability. Where the OfS identifies particular risks to a provider’s financial sustainability, it will indeed take action. This may include enhancing its monitoring or imposing a specific condition of registration on a provider to improve its financial performance. It may also require a provider to strengthen its student protection plan. This will enable action to be taken before a provider faces major financial difficulties.

The Department for Education is also working closely with the OfS to understand the sector’s wider financial risk in worst-case scenarios. We are working with the OfS, other Departments and other relevant national partners to develop full contingency plans to deal with unforeseen and/or major HE provider failure. This will set out roles, responsibilities, triggers and actions to be associated with instances where HE provider market exit falls outside the normal business-as-usual approach of the OfS in implementing its regulatory framework and requires Government action. But ultimately, as autonomous bodies, the financial viability of universities is a matter for the leadership of the HE providers themselves.

The terms of reference of the post-18 review that has been led by Sir Philip Augar include a focus on ensuring choice and competition across a joined-up post-18 education and training sector. The review will look at how it can support a more dynamic market in provision while maintaining the financial sustainability of a world-class higher education and research sector. We have been clear that the review recognises the need to preserve and protect the existing strengths in the system, and the stability of providers is key to a strong system.

The HE sector does face challenges, but we are confident that universities will rise to these challenges and continue to be providers of world-class higher education.

[Angela Rayner]

Thank you for granting this urgent question, Mr Speaker. I want to take this opportunity to wish my comrade, my hon. Friend the Member for Bolsover (Mr Skinner), a happy birthday.

Serious concerns were revealed this weekend about the financial situation of Reading University and there are reports of at least three more universities facing a significant risk of insolvency. I hope that the Minister will tell us in a little more detail what steps he is taking to address the situation at Reading, as well as across the sector, because the consequences of such a failure would be disastrous for students, staff and entire local communities and economies. Can the Minister reassure us that it is the Government’s policy to prevent such a disaster? I do not feel reassured from his response that he has a grip of this.

The Minister said that he is working with the Office for Students towards establishing student protection plans. Can he clarify how many universities do not have plans in place? When will he ensure that they all do? What will it mean in practice? Will students be left with a refund but no qualification after years of study? HEFCE had a list of universities of financial concern. Can the Minister tell us whether the new regulator has such a list and how many providers are currently of concern? Last year, it granted at least one £1 million emergency loan. Can he tell the House how many others have been issued? The new regulator has now said:

“The OfS will not bail out providers in financial difficulty.”

Is that Government policy and from when does it apply?

Can the Minister confirm that his Government have also handed universities a £200 million pensions bill but no new funding to meet those costs? Is he lobbying the Treasury to change that? The Office for National Statistics has demanded that the Government end the “fiscal illusion” of pretending that all loans for fees are repaid. When will the Government follow that ruling? Given the uncertainty that universities now face, can he tell the House whether the Augar review will be published this year? Will he guarantee that any proposals on tuition fees will not lead to cutting universities’ funding?

This crisis is a direct result of the Government’s failing free market experiment. Is it not time they faced the fundamental fact that education is best provided as a public service for the public good? If this Government will not change, it is time for a new Government.

[Chris Skidmore]

I will respond to several of those points, but I do not think it is appropriate for the Government or the OfS to comment on the position of individual providers.

In terms of the role of the Office for Students in HE financial sustainability, as I have stated, the new regulatory framework that has been created brings a risk-based approach to monitoring financial viability and sustainability, in order above all to protect student interests. The reforms have provided for that framework, and it means that the OfS, as regulator, can pay greater attention and require more specific action if there is institutional vulnerability.

Ultimately, these are autonomous bodies and leaders of HE providers are responsible for ensuring their institutions’ financial viability. They are not part of the public sector; they are autonomous institutions. During the passage of the Higher Education and Research Act 2017, a key point voted on by Labour Members was that universities would remain independent and autonomous. The OfS will therefore work closely with providers in financial difficulty, but neither the OfS nor the Department for Education will prop up failing providers. The OfS may enhance its monitoring or impose a specific condition of registration, requiring a provider to improve its financial performance, but we need providers at risk of any financial difficulties to come forward, so that we and the OfS can work with them on improving those registration conditions, which may require a provider to strengthen its student protection plan.

I turn to the issue of HE provider failure. The aim of the new HE regulatory approach is that the Office for Students will be able to act in anticipation of developments such as course closure or market exit, rather than in reaction to them. As I have said, under the new regulatory framework, providers must meet a set of registration conditions aimed at ensuring that they are financially viable, sustainable and well-managed organisations. The new HE regulatory framework has been designed to promote diversity, innovation and choice in HE, in the interests of students, and achieving that does not equate to propping up any particular failing HE provider.

In a competitive market, providers that fail to meet quality standards for students’ expectations may see their financial position come under even greater pressure. There is an expectation that providers may, in a small number of cases, exit the market altogether as a result of strong competition. However, the OfS’s primary interest is ensuring that any such closures do not adversely affect students and their ability to conclude their studies and obtain a degree. Students are making a considerable investment when they commit to a programme of study—investing their time, energy and money—and it is important that they should be able to complete those studies.

On protecting students and student protection plans, the OfS has the powers to ensure that all registered HE providers have these plans in place to safeguard students’ interests against the risk of financial failure. It is a registration condition that they have such a student protection plan in place. Student protection plans will set out what students can expect to happen in the event of a course, campus or department closure or if an institution exits the market. The plans must address the specific risks faced by the provider, and may include measures such as the transfer of students to another provider or financial compensation. In addition, the new regulatory framework sets out that all providers must have a refund policy.

On the pensions issue that the hon. Lady mentioned, the Government’s consultation on the teachers’ pension scheme changes closes this Wednesday—13 February. I encourage all providers to participate in that consultation, which is an important one. It is right that this live consultation should seek views on the impact of the proposal on higher education institutions, and we will finalise funding decisions once the consultation has concluded.

The hon. Lady mentioned the post-18 review being led by Philip Augar, which is still ongoing. More information on the review will be available in due course, and it will be published in due course. I will not speculate on what recommendations the independent panel will make on HE tuition fees, or on what the final conclusions will be. However, the post-18 review terms of reference include a focus on ensuring choice and competition across the joined-up post-18 education and training sector. The review will look at how to support a more dynamic market in provision while maintaining the financial sustainability of a world-class higher education and research sector. I look forward to the review being published in due course.

When it comes to the hon. Lady’s own position on the financial sustainability of the HE sector, I have to say that of all the universities I have visited and all the vice-chancellors I have spoken to, not one supports Labour’s position of removing tuition fees and completely crippling the HE sector’s financial position. The removal of fees completely would ensure that instability returned and student number caps returned. When it comes to access and participation plans, the money spent on them has risen from £430 million to £860 million in recent years, and that money would end up being capped. Labour does not have any answer on what it would do to ensure that the finance of our universities is protected for the longer term.

Oral Answers to Questions

Debate between Chris Skidmore and Angela Rayner

Monday 4th February 2019 Commons Chamber

[Chris Skidmore]

I work closely with Universities UK and with Universities UK International and its director, Vivienne Stern, to allay their concerns. When it comes to the Government’s guarantee, all successful bids that have been approved by the European Commission will be guaranteed funding.

When the House comes to vote again on a deal that will protect Erasmus students not only under the withdrawal agreement but under the political declaration, perhaps the hon. Lady could say to Universities UK that she will now vote for a deal that will protect all Erasmus students.

[Angela Rayner (Ashton-under-Lyne) (Lab)]

I, too, welcome the fact that half the questions and half the time today have been spent on further education, and I also welcome the new higher education Minister to his place. I believe he is a scholar of Tudor England, which I suspect will serve him well considering how long higher education Ministers last in this Government—it is about the same as Henry VIII’s wives.

Will the Minister confirm that figures show there are 36,000 academics from other EU countries working in UK higher education, nearly one in five of the total academic workforce? Given the damage that a disastrous no-deal Brexit would clearly do to the sector, will he promise the House today that he will never be part of a Government who allow that to happen?