University Tuition Fees

Jim Fitzpatrick Excerpts

Monday 27th November 2017 Westminster Hall

[Lee Rowley]

I completely accept that there is a societal good, and that is exactly why we should have debates such as this one. The reality is still that a proportion of the cost per student, on average, in our university sector is being paid for by society. An increasing portion is being paid for by the individual, but a portion is still being paid by society. The hon. Lady is absolutely right to make that statement. The system already makes provision for that, and the question is where we draw the line.

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

From the hon. Gentleman’s remarks and his answer to my hon. Friend the Member for Wirral West (Margaret Greenwood), does he accept that there needs to be a balance and that £9,000 tuition fees for the majority are wrong? That should be scaled depending on what institution someone goes to and what course they attend, for example, and there should be factors determining how much people pay in tuition fees or not.

[Lee Rowley]

I accept in principle that there should be a societal contribution and an individual contribution, which I think the hon. Member for Wirral West (Margaret Greenwood) was querying. My argument—the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) was absolutely correct about this—is that when an individual gains the most, they should be expected to contribute the most. We can have a party political debate about where to draw those lines, and I would probably take a different view from the Labour Members in the Chamber and from the Leader of the Opposition. In principle, somebody pays, and the question is whether that comes from general taxation or, at least, a contribution from the individual. My view is that it should be a contribution from the individual, and I understand, accept and support the direction of travel on tuition fees in recent years.

The motion that we are debating is about reducing fees to £3,000. In preparing for the debate, I looked at some economic bases on which the current system works. In my understanding, if we reduced fees to that amount, it would blow a significant multi-billion-pound hole in the national finances. I would not support that, but if it happened, the proponents of the measure would need to explain where the additional money would come from. It would be likely to reopen the debate about whether we should cap student numbers, which raises a question about supporting aspiration. It would probably also reopen the debate about the amount of money spent on supporting students through waivers, outreach programmes, measures to increase retention, combination discounts and hardship funds, with which nearly £0.4 billion is associated for the coming year. I would be interested to hear from those proponents where the alternatives would come from or what would be stopped if the proposed tuition fee reduction went through.

[Lee Rowley]

I thank the hon. Lady for that point, but I am not au fait with the specific subject and area that she outlined. However, if we accept the principle, which started in the late ’90s and was extended in subsequent periods, of trying to engender choice in this area and accept some element of market-based principles—I know that is controversial with some in the Chamber—then when there are demand, challenge or supply problems, the market mechanisms should have the opportunity to work.

I do not want to be totally critical of today’s debate, because I recognise that there is a genuine issue and that the petitioner began the petition because of genuine concern about where we had ended up as a country. I accept that the system as a whole has some issues, which is why I welcome the Government’s full review of tuition fees and the education system in general. I recognise that there has been inflation in the system in recent years and discussions about vice-chancellor pay in the past few months. I accept that initially, when the larger fee came in, not all institutions were expected to go to the top amount, so the review is timely and important. The argument is not about whether the system works perfectly now, because it does not—no system ever works perfectly, but this one obviously has challenges—and it is not about whether areas can be improved. Specific, obvious issues with the system have been highlighted in recent months, and I accept all that.

Ultimately, we come back to the principle that somebody pays: the taxpayer or the individual, or the individual makes a contribution. I think it is entirely legitimate that the individual makes a contribution. I support the system as it stands, pending the fuller review of the detail. For me, this is ultimately a question of a quasi-hypothecation or no hypothecation. Somehow the money will be spent and it will be paid back. The question is: who pays it back? Is the money associated with the people who get the greatest benefit? In my view, the people who benefit the greatest should contribute the most.

[Jim Fitzpatrick]

rose—

[Sir David Crausby (in the Chair)]

I remind hon. Members that the same rules apply in Westminster Hall as in the Chamber. If Back Benchers wish to speak, they will need to stand up to indicate that. As only Jim Fitzpatrick stood up, I will call him first.

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

It is a pleasure to see you in the Chair today, Sir David. Thank you for calling me earlier than I had anticipated. You have explained why and, fortunately, colleagues will not have to wait too long for their turn, as I will not detain them for long.

I am grateful to the Petitions Committee and my hon. Friend the Member for Hartlepool (Mike Hill) for the opportunity to participate briefly in the debate. I am pleased to follow the hon. Member for North East Derbyshire (Lee Rowley), who made a thoughtful contribution, outlining the pressures on the further and higher education system and the pros and cons of different elements. It was a fair presentation and I look forward to hearing the Minister respond to his comments, and to everybody else’s, including those of the Scottish National party spokesperson, the hon. Member for Glasgow North West (Carol Monaghan), and of my hon. Friend the Member for Blackpool South (Gordon Marsden). I suspect that my hon. Friend and I were the only two people in the Chamber today who were in the Commons when tuition fees were introduced in 1998, so I look forward to his wisdom prevailing in the debate from the Labour Front Bench.

I confess that I only realised the debate was taking place when the communications hub alerted me that my constituents had contributed the 10th-highest number of signatures to the petition—12,089. I tried to work out why that might be the case, but I have not arrived at a conclusion. I have not seen email traffic from my constituents to support the level of concern that the numbers suggest, but the petition has obviously attracted them and I am pleased to make a contribution.

I am grateful to the House of Commons Library for its background paper. Reading it brought back memories of our debates in 1998 on introducing tuition fees at £1,000 and then, in 2004, on raising them to £3,000. Our discussions were along the lines that the hon. Member for North East Derbyshire indicated—about the cap on student numbers and releasing it to allow more young people to go into further and higher education, which would require some assistance and contribution through tuition fees. That argument clearly won the day.

In 1998, I was ambivalent about the £1,000 level, mainly because the conditions attached meant that most young people and families in my constituency would not be expected to pay since the majority of my young constituents came from below the household income threshold at which it would be required. Tuition fees would not have added to the pressures that they experienced simply because of the size of household incomes in Poplar and Canning Town, as it was in those days. I assume that I supported the proposal—I have no recollection of not doing so.

However, the sister policy of abolishing maintenance grants, which the hon. Gentleman also mentioned and which the Library briefing paper focused on, concerned me. Whereas fees and their introduction would have had minimal effect, the proposed abolition of maintenance grants would have had—and did have—a profound impact. I voted against it, and that was my first—and probably only—vote against a three-line Whip in our 11 years in government. I knew that many families locally would not have been able to support their children into further or higher education without the grants. The briefing paper makes just that point by quoting the National Union of Students president, who said in her evidence to the House of Lords Economic Affairs Committee that simply abolishing fees would not help students, and that

“just scrapping tuition fees will not solve the problem. It is about maintenance support. Scotland is a prime example. It has no tuition fees, and students are still struggling. It is important to reinstate maintenance grants.”

Sir David, I am sorry I did not include you in our little gang of survivors from 1998, because you are non-political when in the Chair, but you were there, and you will remember, as will my hon. Friend the Member for Blackpool South, that, interestingly, the Labour Government restored maintenance grants four years later, recognising that they were an important policy. That was welcome.

[Dr Huq]

My hon. Friend is making an excellent speech on his rebel past and what fees were like before they turned into the monster that they have become. In those days, did he foresee cases like that of Siobhan Hallett of Acton? She makes £27,000 and her repayments are £58 a month, but if she works any overtime, her repayments rise to £115. She says:

“I feel like I am being robbed every time I try to better myself in society.”

She wants to get on the housing ladder, but she is being penalised by rising loan repayments. The Student Loans Company is taking what she earns.

[Jim Fitzpatrick]

My hon. Friend makes an important point about repayments—when they start, how much is repaid and at what interest rate. To be fair, the hon. Member for North East Derbyshire raised those points as well. I am sure that the Government are trying to weigh up all the different elements, because they all affect each other and the system is clearly unfair. I am sure that when my hon. Friend gets a chance to make her own contribution, she will focus on that; I might intervene to support her points, because they are emphatic and critical to young people’s quality of life during their time at university.

[Deidre Brock (Edinburgh North and Leith) (SNP)]

The hon. Gentleman referred to the situation in Scotland. Is he aware not only that students in Scotland are not saddled with £27,000 in debt in the way that students in other parts of the UK are, but that last year, additionally, almost 3,000 students qualified for a non-repayable bursary or had their funding increased? Will he comment on that particular situation?

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[Jim Fitzpatrick]

I am grateful to the hon. Lady for mentioning Scotland. I will come back to that. The position is also referred to on page 13 of the House of Commons Library briefing; I note that the Scottish Government are currently conducting a review of Scottish funding. That is welcome, because there are questions about how the policies on tuition fees, loans and repayments are applied in England, Scotland, Wales and Northern Ireland. I am pleased to hear that the Scottish Government are carrying out a review. I will return in a moment to what the Library briefing says about that.

As I was saying, I supported the introduction of tuition fees to help raise the cap on the numbers of young people going into further and higher education at college and university, because it was clearly recognised that the ceiling had been there for too long—30% was not right for our 21st-century country—and a change had to be made.

The Library briefing makes the point that each £1,000 cut in tuition fees would cause universities to lose £1 billion in income, or else the taxpayer would have to make up the difference, as the hon. Member for North East Derbyshire said. I do not support the abolition of tuition fees, but neither do I support £9,000 across the board. They should be variable, with the highest fees for the Russell group alone; £3,000 certainly seems too low for those universities. The petition, which is welcome, indicates that this debate is very much still alive.

[Bill Grant (Ayr, Carrick and Cumnock) (Con)]

There is general agreement that for good-quality university education to be sustainable, it must be paid for. There are many aspects to that, including the public purse and the individual. Does the hon. Gentleman agree that maybe we should consider looking to employers, who are also beneficiaries of graduates and postgraduates in their businesses? Could they be greater players in funding the education system that we need and desire?

[Jim Fitzpatrick]

The hon. Gentleman makes a good point. My hon. Friend the Member for Wirral West (Margaret Greenwood) said in her intervention that all of society benefits when a highly skilled cadre of young people come through the system. They make us more productive, more energetic and more able to compete in the world market. These are difficult questions for the Minister. I am sure that he has all the answers for us, and we look forward to hearing them in due course. Yes, a contribution across the board is entirely appropriate.

The Library briefing has some interesting paragraphs on fees, as I mentioned in response to the intervention by the hon. Member for Edinburgh North and Leith (Deidre Brock). Page 13 says:

“The free fees policy in Scotland has been discussed by many commentators, most noticeably by academic Lucy Blackman Hunter, who has suggested that free fees benefit middle-class students the most. It has also been suggested that the free fees policy is unsustainable and has led to the underfunding of Scottish universities and rising debt among poorer students.”

As I mentioned, the Scottish Government have indicated that they will be holding a review. I certainly wish them every success in that. My son went to Glasgow University, although as a London-born resident he paid full tuition fees.

[Deidre Brock]

I appreciate the point, but that does not address the fact that many students now in university in Scotland will leave with significantly smaller debt than students in England who are currently paying £27,000, as has been mentioned, and those paying slightly less elsewhere in the United Kingdom.

[Jim Fitzpatrick]

The hon. Lady makes a good point. The point has also been made that many students are leaving university with debts so high that they will never pay them back. The loss to the Exchequer is transparent. It suggests that the balance is wrong and needs adjusting. I do not detract from what she said, but the Library briefing says that the Scottish Government are reviewing the situation. Maybe they will make some adjustments to indicate how they would make the balance more equitable.

In conclusion, I am grateful to the petitioners for the opportunity to make these brief comments. Debts, interest rates, unpaid loans and fee levels have been key manifesto issues in every election at least since 2001. From this debate, it is clear that that will continue.

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[Carol Monaghan]

Perhaps the hon. Gentleman has read some figures but not fully understood them. We have college places aplenty in Scotland; we have college places that cannot be filled. There are now 116,000 full-time college places in Scotland, which is more than ever before.

In a Times Higher Education article last year, Professor Danny Dorling of Oxford University wrote:

“In contrast to England, Scotland shows what a real narrowing of inequalities would look like. There, the most dramatic change has been in the proportion of children from the most disadvantaged quintile of areas going to the highest tariff universities. Home student applications continue to rise in Scotland even as they begin to stall in England.”

To talk down the interactions between FE and HE in getting young people from disadvantaged backgrounds into tertiary education does a great disservice to the institutions and the young people served by them.

Our free tuition policy benefits 120,000 undergraduate students every year, saving them from the massive debt seen in other parts of the UK. The hon. Member for Poplar and Limehouse (Jim Fitzpatrick) stated that he was probably one of only two Members who were here when tuition fees were first introduced in 1998. In 1998, my son was born. He is now in his second year of university in Scotland and he has no tuition fees. At the moment, he is still debt-free, because like many students in Scotland, particularly in the west of Scotland, he lives at home and he has a job to supplement his life, especially his social life, if that is required. However, he is debt-free and hopefully will remain so.

Even taking into consideration my previous comments about UCAS statistics, the number of students from Scotland’s most deprived areas who are entering university has increased by 19% in just two years. We are clearly ahead of others in supporting such young people to ensure that they remain in education. Alastair Sim from Universities Scotland says that the entry rate for 18-year-olds from the most deprived areas of Scotland is 51% higher than 10 years ago.

Despite the attempts of this Tory Government to use statistics to spin the story, the facts in Scotland are different. In Scotland, we place a value on our young people; from baby boxes to free tuition, we tell them that they are important and we need them. We are told that our free tuition prevents Scottish students from accessing the available places. Again, that would help the Tory spin, but once again I have to disappoint. Since the SNP came to office in 2007, the number of Scottish-domiciled full-time degree entrants has risen by 12%, and since 2013 the total number of funded places available at Scottish universities, including additional places to widen access to students from Scotland’s most deprived areas, has also increased.

There is no doubt that the Scottish Government’s investment in additional places for access students and for those progressing from college has had a positive impact. We are investing £51 million a year to support 7,000 places, including those for access and articulation from FE to HE.

We are reaping the benefits. UCAS statistics for this academic year show that more than 34,500 applicants living in Scotland accepted a place at university this year, which is an increase of 2% and a record number at this stage in the cycle. Contrary to what the hon. Member for North East Derbyshire said, all other UK nations saw a fall in the number of people accepted to university compared with last year.

[Jim Fitzpatrick]

In my speech, and in response to the hon. Member for Edinburgh North and Leith (Deidre Brock), I referred to a comment in the House of Commons Library briefing paper that the Scottish Government are carrying out a review of this whole area of policy. Is that the case, or is it not? The hon. Member for Glasgow North West (Carol Monaghan) is painting a very positive picture, but if the picture is so positive why would the Scottish Government have to carry out a review?

[Carol Monaghan]

Of course the review is taking place. Despite the positive picture, and it is a positive picture, we do not stop there. We will keep going and keep going, until we can ensure that every young person, regardless of background, can go to university or can see university as something they would like to do.

The Scottish Government are doing other things, too. In Glasgow, they run a project called the advanced higher hub. I have mentioned it before in this place. In Scotland, advanced highers are the highest school qualification. The advanced higher hub is funded by the Scottish Government and supported by Glasgow City Council and Glasgow Caledonian University. It takes young people from disadvantaged schools all over Glasgow and brings them together to do their advanced highers. The idea was that if only one or two pupils were doing advanced highers in a particular school, it was not economically viable to run those courses, whereas bringing pupils from different schools together made it economically viable.

One of the side effects of the project arises from those students having their lessons on a university campus, as they start seeing university as something they can all do. University seems normal; the process is normalised. The number of young people who have attended the hub and who are now going to university is just overwhelming. It is a huge success story. We will continue to do all we can to widen access and ensure that our young people are given the best opportunity to succeed.

I want to say something about Labour’s position. I welcome Labour’s stance on tuition fees and I support any attempts to reduce or abolish those charges, but I struggle to understand Labour’s position. I want to have faith in it and I want to believe the Labour party, but we also see the Labour Government in Wales increasing tuition fees. I appeal to Labour colleagues in this place to follow the SNP, talk to their Labour colleagues in Wales and consider what can be done so that the public can be assured of their intent.

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[Gordon Marsden (Blackpool South) (Lab)]

It is a great pleasure to serve under your chairmanship, Sir David. I thank my hon. Friend the Member for Hartlepool (Mike Hill) for introducing the debate, with crispness but with insight. The truth of the matter is that a lot of water has run under the bridge since the e-petition was initiated. Members will have seen in the Library briefing that it was put together before the general election was called. Debate on it was therefore postponed. As I say, a lot of water has run under the bridge—under our bridge, and the Minister’s also perhaps—since then, but the reality that prompted 166,000 people to add their names to the petition remains the same. The current system of fees at record highs, and potentially rising in the years ahead, is unsustainable.

This has been a good-natured, thoughtful debate, with some excellent contributions from both sides of the House. This is the first time I have heard the hon. Member for North East Derbyshire (Lee Rowley), and I pay tribute to his speech. There are always different ways of looking at how things have gone. He cited the figures on participation in education that are handed out by Tory Whips at every Education questions, and they are true, in certain areas and in certain cohorts of young people. However, we have to think not simply about young people but about people of all ages, because that is a key issue we will face in the next 10 years. Indeed, among young people themselves, there are disturbing signs regarding completion, which I will mention later, making the picture perhaps not quite as rosy as the hon. Gentleman suggests.

We have had some excellent contributions from Labour Members. My hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) not only reminded himself and me of our mortality in this place, but also the Chair, which may or may not be a good thing to do. The truth of the matter is exactly as he said. People forget, of course, that the decisions taken in 1998 were the result of the Dearing report. The report had a consensus in this House, because of the issues it needed to address, but even then, there were many concerns about maintenance grants, as my hon. Friend rightly said.

Maynard Keynes famously said:

“When the facts change, I change my mind. What do you do, sir?”

That is one reason why the Labour party is now committed to what we said we would do in our manifesto. The loss to the Exchequer, in my view and, I think, that of many, of the funding processes is becoming unsustainable.

The huge amount of erudition and reference with which my hon. Friend the Member for Leeds North West (Alex Sobel) spoke did not affect the fact that he stressed, absolutely rightly, that the current Government in particular—the previous Government under David Cameron were also guilty of this—have an obsession with an ideological viewpoint which, as I have said before, could have come from the pages of Ayn Rand, in the sense that they regard higher education principally as a private consumable, although from time to time they throw bits of food off the table to the public good. That is one issue with which Opposition Members and progressive Government Members take strong issue. It must be remembered that Bahram Bekhradnia, whom my hon. Friend the Member for Leeds North West mentioned—the Chilean example he gave was a fascinating one—was not only a distinguished director of the Higher Education Policy Institute, which the Minister and I frequently use to bounce ideas off, but a director for 10 years, so he knew what he was talking about.

I was pleased with and interested in the contribution by my hon. Friend the Member for Reading East (Matt Rodda). He made points about the negative—if I can put it this way—nudge impact on groups of people, and he talked particularly about the south-east. From a northern perspective, one reason we were not happy with the freezing of the threshold was that it brought more and more graduates in the north and the midlands into the repayment trap too early. We should see in this whole process the problems of repayment.

The hon. Member for Glasgow North West (Carol Monaghan), whom I was pleased to work with on the Higher Education and Research Bill, made a number of interesting points, some of which I agreed with, some of which I did not. She talked about the impact of fees on English students, but the Government’s fee policies affect, and the tuition fees e-petition concerns, not just English students but tens of thousands of students enrolled in higher education in further education colleges, like mine in Blackpool. The issue also affects thousands of Scottish students in England and thousands of students from Northern Ireland. The Minister might want to pause for thought, because the Democratic Unionist party has been less than keen on tuition fees. That was why the DUP absented itself from our tuition fees debate in the main Chamber on 13 September and why the Government had to flee the field on that occasion and were forced to allow our Opposition motion to pass unopposed. The Minister should have a care not to rub his DUP colleagues up the wrong way, otherwise there might be an addition to that £1 billion down payment for their support.

The tuition fee changes that the Government put through before the general election saw the basic rate for tuition fees rise from £6,000 to £6,250 a year. The higher rate moved from £9,000 to £9,250. According to the Sutton Trust’s recent report, “Fairer Fees”, the average debt for students is £46,000. Student fees in the UK are 10 times higher than the European average and twice as high as in the US. In June this year, the Institute for Fiscal Studies sounded further alarms about the Government’s direction of travel. It said:

“Replacing maintenance grants with loans…results in students from low-income families graduating with the highest debt levels, in excess of £57,000.”

It also said that

“changes since 2012 have increased the repayments of almost all graduates, increasing the burden of student loans the most for low and middle earners”.

I have made reference to this elsewhere in the House, but the University and College Union commissioned a report from London Economics that was published on 20 July. It suggested that thousands of graduates will suffer a midlife tax crisis from the repayment of accrued interest on student loans. With a ninefold increase in inflation from 0.3% in April 2016—before the Brexit referendum—that will now get radically worse. None of these things exactly hangs out a welcome sign to young people who have got a place or hope to go to university, and that is significant.

The Sutton Trust has issued Members with a factsheet on student debt, but it has also done research that shows that in 2017, financial worries about HE were particularly pronounced, and they increased in families with low levels of affluence. Some 66% of those families were worried, as compared with 46% in high-affluence households. It is no wonder that the results of the survey of student experience by the Higher Education Policy Institute and the Higher Education Academy show that just 35% believe that their higher education experience represented good or very good value for money.

I have talked about the issues around the drop-out rate. Two recent reports from the Office for Fair Access and the Social Market Foundation point to growing drop-out rates, particularly among students from disadvantaged backgrounds. I have already referred to the Sutton Trust survey. It showed the poorest statistics in eight years for school students wanting to plan for higher education.

I will raise a point that the Government seem to neglect. I have talked before about the fact that we can nudge people away from things as well as towards them. The issue is not just a question of the increasing pressure on those who have taken out loans and how that affects their social mobility; it is also a question of how that puts off people who might want to go to higher education in the first place. By its very nature, that is much less quantifiable, but it is a real factor that needs to be discussed.

What is clearly part of the equation is the impact on part-time and mature students. The main casualties of the increases in tuition fees since 2012 from £3,000 to £9,000 have been mature students and part-time learners. In England, there has been a 60% drop in the number of part-time students since 2010-11. The Minister has said on several occasions that he thinks the argument is far more complex than that, but many people, including me, think that the statistics tell their own story. We simply cannot afford to have that haemorrhaging in the involvement of those groups.

The skills figures are stark: only 13% of the 9.5 million people in the UK who are considering higher education in the next five years are school leavers. The majority are working adults. There is a social dimension to the issue. That is underlined by the fact that one in five undergraduate entrants in England from low-participation neighbourhoods choose—or for financial reasons perhaps have no other option—to study part time. Those are the sorts of people being affected. Even the Minister’s distinguished predecessor Lord Willetts has now admitted that the decisions the Government made in 2012 to treble tuition fees—at that time, the fees were buttressed by various safety mechanisms for social mobility, but those were then stripped away by subsequent Governments—weaken that argument about social mobility still further.

Those are not good bases on which this or any Government should defend the current system. Indeed, there is a palpable and growing realisation that the Government’s settlement for higher education is divisive and financially unstable, especially in regard to tuition fees. Keith Burnett, the vice-chancellor of Sheffield University, put it sharply in a Times Higher Education article in June:

“With total debt forecast to hit £200 billion in six years and to pass £1 trillion by 2045, it will dwarf credit card debt”.

On the basis of the Government’s disappointing general election results—it is important we recognise that it was not just students who turned against them in a big way; it was young people in general, because the student issue and how the Government were dealing with it was seen as emblematic of their attitude towards young people in general—it is not surprising that there has been lively discussion in government about what should be done. The First Secretary of State acknowledged that student debt was a huge issue. The Leader of the House spoke about it, although she did not come forward to discuss matters properly. One of the leading members of the Government—if one is to believe what one hears, he is very much a darling of Tory activists—the Secretary of State for Exiting the European Union, the right hon. Member for Haltemprice and Howden (Mr Davis), is on record as saying in 2010 that he opposed the plans to increase fees to as much as £9,000 a year. He said

“that is something I don’t believe we can allow to continue. I have always been against tuition fees. In 2005 our policy was abolition and I was one of the drivers behind that.”

That is the reality of where we stand today. The Government have conceded that the situation with fees is unsatisfactory. If they thought the current system was working well and would be sustainable in the long term, they would not have tinkered with it at the Conservative conference, where they capped the fee rise to £9,250 and increased the repayment threshold of student loans. As one of the central announcements in her conference speech, the Prime Minister committed to a review of HE funding and student finance, but the Minister has yet to reveal the details of that review. At the conference and subsequently, he seemed singularly unhappy about associating himself with the review. The Chancellor failed to mention it in the Budget, so will the Minister let us know the terms of reference for the review? Will it be a full consultation? When will it be brought back?

[Jim Fitzpatrick]

I know that the further education sector is very close to my hon. Friend’s heart. I just left the reception of the London region of the Association of Colleges where there was great dismay that the Government have been almost silent on the future arrangements for the further education sector. That is similar to the absence of any clarity on where the Government are generally going in this whole area that my hon. Friend is outlining.

[Gordon Marsden]

I thank my hon. Friend for raising the situation in further education colleges, because a number of FE colleges, including in my constituency, took the leap of faith in the late 2000s—very much encouraged by the then Labour Government—and set up higher education departments. Those higher education departments must be allowed to flourish, but it seems they are bearing not only the burdens that I am talking about generally, but particular burdens because of the nature of the young people they take in. It is a double whammy, because they take in young people from poorer backgrounds, who are precisely the sort of people most likely to be put off by rising fees. They also take in older people who wish to reskill and retrain, and they too are precisely the sort of people likely to be put off. We know that because we see what is happening with the advanced learning loans that the Government introduced progressively, largely but not entirely for further education, where 60% of the money put out in those advanced learning loans—the figure has barely changed—year by year has remained the same. That is a crisis for FE colleges, but it is also a particular crisis for HE in FE colleges.

Our plans would uprate the funding to universities in line with inflation, whereas the Government’s plans basically impose a real-terms cut in funding. Of course, rising fees might have been easier to swallow if they had been put back into the system, but, again, as MillionPlus has said, and as has been referred to today, there has been no increase in direct grant available from Government for university courses in the arts, humanities, social sciences, architecture and economics to name a few of the subjects affected since 2014-15. That means universities are now required to fund programmes that previously were supported by Government, and there has been a decline in capital investment and an 80% cut in the teaching grant. Will the Minister confirm how much funding in real terms universities will lose in each of the next five years as a result of their current position and their decision to freeze fees?

Now that the Government have increased the student loan repayment threshold, whatever else it might mean for the benefit or otherwise of the students concerned, it means that they are going to miss their own RAB target by around 15%, so will the Minister confirm whether they will revise the target?

The University and College Union got it right when it responded to the Chancellor’s Budget statement. It said:

“The glaring omission from today’s speech was any support for current higher education students, or further detail on the Prime Minister’s promised review of university funding in England.”

That is why we have persistently, in both the HE and FE Bills that came through before the general election, argued the case for much greater focus on some of the groups who will be affected by that. That should go to the heart of the way in which student loans are handed out at the moment. The Minister knows that the Student Loans Company has recently been the subject of controversy, but the issue, which I will not dwell on today, of overpayments and how that has affected many students brings us back to the point that the Government and the Student Loans Company are operating a system that is beginning quite significantly to fail. If the nature of the Student Loans Company board or the Office for Students board were perhaps slightly broader than they are at the moment, more light might be shed on this area.

We appreciate the fact that the Chancellor has listened to our call for proper information sharing between HMRC and the Student Loans Company. Even though it has been postponed until 2019, I hope that that will have a major impact on the current situation. A great deal of thought needs to be given to any major changes in student finance, but the direction of travel matters. We are clear about our direction of travel. We would build bridges for people and not put barriers in their way via a series of measures that stress private good as opposed to public good and which keep people in silos.

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[Joseph Johnson]

Indeed they would, but it is also important that they make a direct contribution that relates to the benefit they have received, which has been provided for them by a public funding contribution.

[Jim Fitzpatrick]

I echo the point made by the hon. Member for Glasgow North West (Carol Monaghan). In response to the Minister’s challenge to me, he is right: I do not support full abolition, but neither do I support the £9,000 level. I think there is a balance to be struck. On his comment that the Treasury presses hard, I know it does. I have been in government; the Treasury always presses hard. The political choice that one makes, and that the Treasury and the Cabinet make, is how far it is allowed to press, and where the trade-offs are. The hon. Lady says that there should be contributions from elsewhere. The health service has suggested that we have golden handcuffs for those who want to qualify as doctors, and free them from their tuition fees to get them into the NHS and keep them there for the rest of their professional lives. Those choices and judgments have to be made.

[Joseph Johnson]

I would just note that higher education is a devolved policy responsibility in the United Kingdom. Those parts of the United Kingdom that have the present level of fees that we have in England have been able to lift student number controls. Other Administrations, which have made their own policy choices, have not been able to lift student number controls. As a result, under those Administrations we have seen far lower levels of widening participation than we currently see in England. We genuinely think that returning to a cap on student numbers would be absolutely disastrous for young people from lower income backgrounds.