Draft Higher Education (Monetary Penalties and Refusal to Renew an Access and Participation Plan) (England) Regulations 2019

Debate between John Hayes and Chris Skidmore

Wednesday 8th May 2019 General Committees

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

I beg to move,

That the Committee has considered the draft Higher Education (Monetary Penalties and Refusal to Renew an Access and Participation Plan) (England) Regulations 2019.

It is a pleasure to serve under your chairmanship, Mr Hosie. I welcome the opportunity to debate the draft regulations. Last week, during our debate on the higher education registration fees regulations, I mentioned that we had come a long way since the passage of the Higher Education and Research Act 2017. It is good to see one of the architects of that Act, my predecessor as the Minister, my hon. Friend the Member for Orpington, as a member of the Committee. In the time since HERA gained Royal Assent, the Office for Students has taken shape as the new HE regulator.

Since the formation of the Office for Students, it has registered more than 350 education providers—352 at 26 April, to be precise—to exacting standards. It has also ensured that all registered providers with fee caps at the higher level have comprehensive access and participation plans to improve access and support for students from disadvantaged backgrounds and under-represented groups. All students should have equal opportunities to complete their courses, get a good degree grade and go on to a graduate-level job or postgraduate study. The OfS helps with that.

The OfS includes academic freedom as a core principle of governance for registered providers, and it works in partnership with the Department for Education on the best way to enhance and improve the information given to students about the quality and standard of teaching to justifiably expect. HERA gives the Office for Students the power to create a new single register of higher education providers to be maintained by the OfS. The register is the route for providers to charge fees that attract student loans, to become eligible for grant funding, to offer degrees or, indeed, to call themselves a university.

In return for those considerable benefits, providers must comply with registration conditions relating to, for example, their financial sustainability, quality of provision and student protection. Additional conditions—for example, on access and participation for students from disadvantaged backgrounds—also have to be met by providers on the OfS register.

HERA also gives the OfS the power to apply specific conditions to a particular provider if there is cause for regulatory concern. Those are not specified in the Act, but they can include such measures as imposing improvement plans on providers in certain circumstances, which might involve the imposition of student number controls on an institution or particular course to protect the interests of students.

In the event of any of those measures failing to stop a provider falling short of its registration conditions, to protect the interests of students and the taxpayer, HERA specifically gives the OfS power to suspend a provider and to restrict its activity, or to remove it from the register with a loss of access to any of the benefits of being in the regulated system, such as student support. Section 15 of HERA also gives the OfS the power to impose monetary penalties on providers that fail to comply with their ongoing conditions of registration. Regulations are required to make provision for the amount of the penalty that can be imposed, and may set out the matters to which the OfS must or must not have regard when exercising the power to impose a monetary penalty. These are the regulations that we are debating today.

During the passage of the Act, Members in all parts of the House debated long and hard about the future of higher education. Indeed, HERA was the most amended piece of legislation in this Parliament’s history. Irrespective of the different views of how we finance or regulate higher education, there will always be an imperative to ensure that students get a high-quality experience and positive outcomes from the time and effort that they put into their education.

Adherence to registration conditions is a vital component of our reforms to the regulatory landscape. It is critical to safeguard the interests of students and the quality and reputation of our higher education sector. The power of the OfS to impose this monetary penalty on providers is an important tool that it has at its disposal to enforce registration conditions and encourage compliance. Failure to put the draft regulations in place will mean that the OfS will not have that essential regulatory tool at its disposal at the very point at which it most needs it.

Monetary penalties provide an effective incentive to comply with regulation and act as an enforcement tool. However, they must also be proportionate and fair. There was no statutory obligation to consult on the draft regulations, but during the passage of HERA through Parliament, a commitment was made to consult on the matters that the OfS must have regard to when imposing a monetary penalty. The Department conducted its consultation between December 2017 and March 2018. To reassure the Committee, as these are new regulatory powers, we also took the opportunity to seek views on the maximum monetary penalty. Through that extensive consultation, we have established the fair and balanced approach set out in the regulations.

The consultation process identified some concerns that monetary penalties could take away provider income that might otherwise be used for the benefit of students. The majority of respondents did not support the Department’s initial proposal for the maximum penalty as it was initially set out, but respondents were broadly supportive of the proposed factors, especially the factor relating to impact on students. We have listened. In response, the Government adopted the lower of their options for a maximum penalty amount—2% of qualifying income rather than 5%.

We remain of the view that monetary penalties need to be set at a level that ensures visible and meaningful consequences for providers in breach of ongoing registration conditions without being unduly punitive. The legal restraints that the draft regulations place on the OfS, including the mandatory factors to which it must have regard when setting the penalty, are designed to ensure that it is required to—but can do no more than—take appropriate, reasonable and proportionate action. In doing that, the draft regulations ensure that the interests of students—both those at the provider in question and students more generally—are taken into account.

Let me turn to the other element of the draft regulations, which permit the Office for Students to refuse to renew an access and participation plan. Ensuring that students from disadvantaged backgrounds and underrepresented groups can access and successfully participate in higher education is a priority for this Government. We have asked the OfS to secure greater and faster progress in this area. Access and participation plans are key to secure greater progress. The plans are not just about access to higher education but, importantly, are about support, so that students can successfully participate in their courses, helping to tackle drop-out rates, attain qualifications and progress from higher education.

[Sir John Hayes (South Holland and The Deepings) (Con)]

This instrument speaks of disadvantage and under-representation. Among the challenges faced are those confronted by disabled students and people with disabilities who are seeking to become students. On the Minister’s last point, on continuing support for those students, what results did the consultation provide? What further work might we do to ensure that people with disabilities can play their part and have their place in the sun?

[Chris Skidmore]

A total 54 organisations representing higher education organisations responded to the consultation. On the specifics relating to disabled students, I will be happy to write to my right hon. Friend with a range of views from those organisations during the consultation.

When it comes to support for disabled students, having been a secretary of the all-party parliamentary group for disability, I am keen to ensure that, as a Government and a higher education provider system, we do more to support disabled students. I have a roundtable organised for the Thomas Pocklington Trust on 17 May in Birmingham to talk to visually impaired students. I am keen to ensure that their needs are looked at. We are keen to ensure the disabled student allowance, which we raised for post-graduate study from £10,500 to £20,000 this year. A recent report demonstrated that just over 60% of disabled students found that the increase in support through DSA had allowed them to take up their course. Around 50% of those students felt that they may have dropped out if they had not had financial support.

It is not just about the money but about accommodation, and looking at what we can do—me as a Minister and the OfS—to reflect that in access and participation plans. If my right hon. Friend wishes, I can send him a copy of the Secretary of State’s guidance letter to the OfS, which was published in February or the beginning of March. As Universities Minister, I specifically ensured that the needs of disabled students were, for the first time, mentioned in the Secretary of State’s guidance letter. I will write to my right hon. Friend on the consultation and I am happy to send him that guidance letter, and I reassure him of my commitment to disabled students, to ensure that we do all we can so that more disabled students feel that they have the opportunity to succeed and have access to higher education.

[Sir John Hayes]

I have rarely received such a comprehensive and persuasive response to an intervention. I reassure the Committee that the Minister did not know I was going to make it, which makes it even more impressive.

[Chris Skidmore]

I am humbled by my right hon. Friend’s intervention. I am sorry to detain the Committee by giving a rather lengthy answer, but I thought it was important to do so. Ultimately, the draft regulations and the access and participation plans are about support, so that students can successfully participate in courses, and helping to tackle drop-out rates. Any provider that wants to charge up to the maximum permitted tuition fees to its students must be legally required by HERA to agree a plan with the OfS and then stick to it.

The OfS recently published guidance on the access and participation plans, which can be reviewed annually. There will therefore be an opportunity to update the plans with respect to new groups of students on which we may wish to focus in the future. I am fully aware that under-represented groups of students often present themselves, and we need to ensure that we have the flexibility in the system of access and participation plans to update them going forwards.

If we want to achieve real progress, it is vital that the OfS has strong powers where there are concerns that a provider has breached an access and participation plan—having failed, for example, to deliver on specific commitments laid out in it—or has exceeded the specified limits for course fees. In those circumstances, the OfS could, among other things, refuse to renew a provider’s next access and participation plan for a specified period.

Such refusals are a powerful tool. Without an agreed access and participation plan, a provider cannot charge higher-level fees. That would have a significant financial implication for many providers. More importantly, it would encourage them to stick to the letter of their plans, and ensure that they implement them effectively for the benefit of all students. Given the potential impact of refusing to renew a plan, the regulations ensure that providers can ask for any such decisions made by the OfS to be considered by an independent reviewer. That should give providers additional reassurance about the fairness and transparency of the process.

The regulations ensure that the OfS is consistent in the use of its powers. As such, it will have to take into account broadly the same factors before it decides to refuse to renew a plan as it would if it wanted to impose a monetary penalty—again, going back to the point about transparency in the process, and giving providers the opportunity to engage in dialogue with the OfS before we reach an end point at which action may need to be taken. Importantly, refusing to renew a plan is not the only tool available to the OfS if it is concerned about a provider’s performance on access and participation. Also available to the OfS are the sanctions and interventions that I have discussed, including monetary penalties, suspension of registration and deregistration, to address underperformance and encourage progress.

It is planned that the regulations, if passed today, will come into force on 1 August 2019, when the new Office for Students regulatory framework successfully becomes fully operational. That will permit the OfS from 1 August 2019 to start imposing penalties where it appears to the OfS that there has been a breach of a registration condition. The OfS will publish detailed guidance on its monetary penalties policy and processes before that date. The Government firmly believe that the higher education regulatory system must effectively protect the interests of students in the short, medium and long term—especially the most disadvantaged. The regulations support that.

HERA established the Office for Students, and it is already operational. The regulations enable the use of an important tool that will give the OfS the opportunity to carry out its core task of the effective stewardship of the higher education landscape, so that all providers deliver positive outcomes in the students’ interests. I therefore hope that the Committee agrees that the regulations are ultimately of benefit to students and the sector alike.

Draft Designs and International Trade Marks (Amendment etc.) (EU Exit) Regulations 2019

Debate between John Hayes and Chris Skidmore

Tuesday 5th March 2019 General Committees

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

I beg to move,

That the Committee has considered the draft Designs and International Trade Marks (Amendment etc.) (EU Exit) Regulations 2019.

It is a pleasure to serve under your chairmanship, Mr Hanson.

The framework for protecting intellectual property is a vital part of our industrial strategy. The UK’s strong IP system drives creativity and showcases UK innovation. Leaving the European Union will not change that. We will continue to deliver quality rights-granting services, lead the world in IP enforcement and engage in international IP discussions.

This draft statutory instrument uses powers provided by the European Union (Withdrawal) Act 2018 to ensure that protection continues in the UK for registered and unregistered Community designs, and international trademarks and designs in the event of no deal. It also addresses other deficiencies in UK law that would arise on exit.

Under the EU designs regulation, the shape and appearance of a product can be protected under a registered Community design granted by the EU Intellectual Property Office. That system runs in parallel to our domestic system, so protection in the UK can currently be obtained by registration under either or both of the EU and UK systems.

Shape and appearance can also be protected under the unregistered Community design. That right is established automatically when a design is first shown to the public, and it is particularly valued by design-intensive sectors such as the fashion industry. As with registered design, the UK provides a parallel domestic system. However, the scope of UK unregistered design is different from that of the EU equivalent because protection is afforded only to three-dimensional designs.

In addition to the rights granted by the EU Intellectual Property Office, businesses can obtain EU-wide registered design and trademark protection through an international system administered by the World Intellectual Property Organisation. That system enables business to protect designs and trademarks in multiple territories via a single application, filed in one language. Both the EU and the UK are contracting parties to that system. As with registered EU trademarks and designs, international EU rights are protected through EU regulations, meaning that a failure to act will result in the protections afforded to those rights being lost.

The draft regulations in Committee provide replacement rights for those who own registered EU designs on exit day in the form of a “re-registered” UK design. For those holding unregistered Community design, we will preserve UK protection through the “continuing unregistered” design. The new UK rights will be fully independent of the corresponding EU right. However, they will retain the effective date of the EU design and, in the case of a re-registered design, any other relevant dates filed as part of the original EU application.

The scope of protection for EU unregistered designs is broader than that provided by existing UK unregistered design, so we are introducing a new type of UK right called supplementary unregistered design. By doing so, we will ensure that the full range of design protection provided in the UK before exit day will remain available after we leave the EU. That new right will function alongside existing UK unregistered design.

To ensure continued protection in the UK for international designs that are protected through EU designations under the Hague agreement, we will create comparable re-registered UK designs just as we are doing with registered Community designs. For international trademarks designating the EU, we will create a comparable UK trademark, using an approach similar to that set out in the EU trademarks exit SI, recently approved by both Houses; the Committee in this place was attended by several members of this Committee today.

As with re-registered designs and comparable trademarks created from registered EU rights, the new UK designs and trademarks will be fully independent of the corresponding international rights, but they will inherit their effective dates and be treated as if applied for and registered under UK law.

For those with registered Community design and international EU design and trademark applications that are pending on exit day, we will allow corresponding UK applications filed after exit day to claim the EU right’s earlier filing and priority date. To do so, an application must be submitted to the UK Intellectual Property Office within nine months of exit day.

The draft regulations also set out provisions to accommodate other particulars of EU and international design and trademark protection, including deferment of design publication and the use of subsequent designations to create multiple EU protections under a single international registration. The new UK rights can be challenged, assigned, licensed and renewed, so the instrument also sets out how such procedures will be accommodated. The IPO provided an outline of the changes through technical notices published last year, and it will provide full business guidance once the instrument has been made.

[Sir John Hayes (South Holland and The Deepings) (Con)]

On pending applications, people have proceeded using the existing system and will reapply to the new system. Can the Minister assure us that there will be no delay there? If people have had an application in for some time, that could affect their business. Can the Minister send out a clear signal from the Government that those people will not be adversely affected?

[Chris Skidmore]

I can absolutely give that assurance. I have full confidence in the IPO, in both London and Newport. I have visited the office to see its ongoing work in ensuring that the registration process is clear and consistent. When it comes to registered Community designs, it is important that the information is there—with many other issues, there is a lack of data—and that there is a simple transfer across. I am confident that that will minimise the impact on businesses; in fact, it will give them greater flexibility by providing that nine-month window for registration in the new UK-wide system.