Tuition Fees

James Cartlidge Excerpts

Wednesday 19th July 2017 Commons Chamber

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

I beg to move,

That this House has considered the Government’s decision to increase tuition fees implemented by the Higher Education (Basic Amount) (England) Regulations 2016 (S.I., 2016, No. 1205) and the Higher Education (Higher Amount) (England) Regulations 2016 (S.I., 2016, No. 1206).

Thank you, Mr Speaker, for granting this emergency debate. It is a shame that it has been necessary when we have a First Secretary of State who called for a national debate on tuition fees, a Brexit Secretary who says that this House always votes on statutory instruments and a Justice Secretary who, when Leader of the House, actually accepted the need for a debate and a vote. Of course, that was before the election; 100 days later, this weak and wobbly Government do not even trust their own Back Benchers with a vote on their own policies.

The Higher Education and Research Act 2017, which the Education Secretary and the Minister for Universities, Science, Research and Innovation took through this House, is very clear on the matter. Paragraph 5 of schedule 2 states that the upper limit of fees can rise only when

“each House of Parliament has passed a resolution that, with effect from a date specified in the resolution, the higher amount should be increased”.

Will the Minister guarantee that no students will have to pay the higher fees until both Houses have passed such a resolution allowing it, and will he tell us when the votes on these resolutions will take place?

The Minister seems to be one member of the Government who does not want this vote, judging from his Twitter feed last night. He said that plans to raise fees were first outlined in July 2016, and that we have since had extensive debate. Perhaps he forgot that the plans were announced on the last day before summer recess last year, and were snuck out as one of 30 written statements on that day. The statutory instrument was then put before the House just before Christmas last year. Not long after that, the Opposition prayed against the measures, yet despite repeatedly pushing for it we were not given a debate. As the Minister said, the regulations came into force on 6 January.

[James Cartlidge (South Suffolk) (Con)]

On the subject of being weak and wobbly, will the hon. Lady confirm whether it is still Labour policy to pay off all £100 billion of the outstanding student debt—yes or no?

[Angela Rayner]

I do not know how many times I have to explain this to Conservative Members before they finally understand. A cynic might say that they are wilfully misrepresenting my party’s policy. We have never said that we would simply write off all existing debt. Conservative Members refer to comments made by my right hon. Friend the Leader of the Opposition, and I remind them that he said we would look at steps to reduce or ameliorate the debt burden. Perhaps that confused Conservative Members, because their Front Benchers have not done that in seven years. For instance—

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[Angela Rayner]

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

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

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

“far from widening access, narrow it.”

She told her party that it needed to

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

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

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

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

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

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

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

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

[James Cartlidge]

On a point of order—

[Mr Speaker]

I hope that this is a point of order, rather than a point of frustration.

[James Cartlidge]

The point of order is that the Leader of the Opposition said to the NME—

[Mr Speaker]

Order. The hon. Gentleman must resume his seat. It was a nice try, and he is an industrious fellow, but that is a matter of debate. He cannot ask the Chair to adjudicate on who said what when, especially when it was outside the Chamber. I appreciate his assiduity, but he needs a rather better disguise than that.

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[Joseph Johnson]

I am puzzled by that intervention. Our per-university, per-student funding has risen by 25% as a result of our reforms. If the hon. Gentleman wishes to read the report published last week by the Institute for Fiscal Studies, he will see that, on a per-student basis, our universities, per degree, are better funded than they have been at any point during the past 30 years.

[James Cartlidge]

May I pursue the logic of that point? Is it not the case that if these fee increases do not take place, we will effectively be cutting spending on universities? Should we not be fighting cuts and opposing Labour’s plan to cut spending on higher education?

[Joseph Johnson]

Indeed. Our system of student finance is enabling our universities to be funded sustainably. As I have said, per-student, per-degree funding is up by 25%, but we will put all that at risk if we move anywhere near Labour’s policy platform.

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[James Cartlidge]

My right hon. Friend is making an excellent argument, but does it not focus his attention on the repayment threshold? In a sense, a higher threshold enforces the very point he is making. If people get the higher salary, fair enough; they repay their loan. If not, they do not repay it anyway.

[Robert Halfon]

I have a lot of sympathy with my hon. Friend’s point.

We need to look carefully at the salaries of the senior management of universities. Something is going wrong if there are significant increases in the salaries of top management but poor destinations for graduates. To be honest, I do not mind what management figures earn if every single person who leaves that university gets a good job at the end. If they do not, I cannot understand why some vice-chancellors receive huge increases in their pay but fail to provide good outcomes. I am not going to name those universities today, but we need to take a hard look at this.

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[James Cartlidge (South Suffolk) (Con)]

It is a pleasure to be called to speak in this debate and a great pleasure to follow the hon. Member for Blaydon (Liz Twist). I congratulate her on her maiden speech, which was very moving and powerful, particularly in relation to suicide. We all share her sentiment and hope to see greater progress on that. It is a terrible tragedy that so many still choose to take their own lives.

Having stood on many a football terrace, I am familiar with the Blaydon anthem, but I do not think that the edited lyrics to which I have been subjected are repeatable in this Chamber. I welcome the hon. Lady to the House.

This debate is on an important subject. Having intervened earlier on the shadow Secretary of State, the hon. Member for Ashton-under-Lyne (Angela Rayner), I have great sympathy for her. She has maintained her composure in the face of her party’s policy wobble over historical student debt, but, if we look at what the Leader of the Opposition said to the NME prior to the election, we cannot form any conclusion other than that he wished to wipe out historical student debt. He said that he would “deal with it.” Those were his words. What other conclusion could we form?

The politics of this are quite cynical. Talking about helping students means helping a large number of people, but it is a limited base. Spreading policies to all graduates with historical student debt, however, means appealing to a vast number of people, so to renege on that so clearly is disappointing and deceptive.

Equally, we all have to accept that people are worried about levels of student debt. I have four children and worry about them, should they ever get to university, racking up enormous debts. Who, as a parent and a human being, would not be concerned about that? However, we have to think rationally about the issue.

There are measures that can be used to ameliorate the situation. My right hon. Friend the Member for Harlow (Robert Halfon), the Chairman of the Education Committee, mentioned interest. Of course, student debts are packaged and bought on the basis of securitisation. I want to understand more about how that works, including the redemption penalties and whether it is possible to change those contracts without huge cost to the taxpayer. We would all benefit from knowing more about that. Perhaps my right hon. Friend’s Committee could take evidence on it.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

My hon. Friend makes a strong point about the level of interest on debt and securitisation. He will accept that, because of the high proportion of that debt that is written off, it is in effect a grant, so the interest rate will need to be higher to make it attractive to people who want to take on that security.

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[James Cartlidge]

I am afraid and suspect that that is true. I think that it is also the case that the higher interest rate enabled the Government to increase the low threshold under Labour to the higher threshold of £21,000 under us.

On the subject of the cap—this goes back to my intervention on my right hon. Friend the Member for Harlow—if we are able to raise the threshold at which people pay, that is a fairer deal for the student because it ensures greater quality. They repay when their earnings reach a point where we think it is fair for them to start doing so. I think we should look at that, but it is not cheap. My understanding is that if we raise the threshold to £25,000, it will cost almost £2 billion a year in lost income to the Revenue. That is not a minor detail.

We really have to make a decision, as a country and a Parliament, about our priority. What is the most important thing that we want from higher education? Why do people go to university? In my view the most important thing is to have the highest-quality education possible—the best quality degrees. That is what matters. We need to think about the upside, which is that someone who goes to university could earn £250,000 more in their lifetime—the figure is often far more than that—than someone who does not. In fact, to access highly paid professional jobs people need a degree.

[Michael Tomlinson (Mid Dorset and North Poole) (Con)]

Was my hon. Friend as interested as I was to discover that the uplift is £250,000 for females and only £170,000 for males? Both are significant figures, but is it not interesting that the larger figure is the uplift for females who go to university?

[James Cartlidge]

I am always interested in female uplift. The striking thing is that, regardless of whether they are a man or a woman, university is an incredible opportunity for individuals to improve their standing and their circumstances and to get a career, so that they can afford a home and to raise a family. That is the upside.

To me, the most important thing is the quality of the degrees. I worry that if we go back to a free system, the quality of degrees will not improve but fall, partly because the funding will fall. We will go back to rationing the funding and the places. If we are honest, will the students who go to university when it is “free” take their education as seriously as those who go when it is not? Of course, it is not free. That is the great delusion. As my hon. Friend the Member for Solihull (Julian Knight) said, it is not free; it is just that somebody else pays, rather than the beneficiary. The whole of society pays.

The money has to come from somewhere. The Labour party will supposedly pay for it by raising corporation tax. Never mind the fact that all the evidence shows that by cutting corporation tax, we are raising the revenue to the Exchequer. This will not happen without a cost. [Interruption.] The hon. Member for Wythenshawe and Sale East (Mike Kane) chunters about the Laffer curve—he’s having a laugh about the Laffer curve! If Labour Members studied this, they would realise the reality. The OECD figures show that the predicted tax take from corporation tax when it goes to 17% will be the same percentage of GDP as in 2010 when it was at 26%.

The point is that there is a downside of going back to free education. We have to pay for it in some way. What we need is the upside, and the upside is having a competitive graduate system so that our graduates have the best quality qualifications.

I want to conclude with the big picture. The big picture is that people who go to university now are heading into a much more competitive labour market—a globalised, international labour market. Whatever the effects of Brexit are, that will not change. When our children go to university, they will be up against it. They will be up against graduates from India and all over the world. We need to give them the best weapons in their hands—the best tools with which to navigate their way through the challenges of life—and that means getting the best possible qualifications. I therefore urge my hon. Friends to consider the importance of quality.

Finally, I will remark on a very welcome measure that my hon. Friend the Minister for Universities, Science, Research and Innovation has brought in. As I understand it, universities will be able to raise fees to the maximum level only if they can demonstrate that their teaching is of the highest quality. We are moving towards a quality-based scheme. I very much welcome that and we should all support it.