Tuition Fees Debate
Full Debate: Read Full DebateDepartment: Department for Business, Energy and Industrial Strategy
Julian Knight
Main Page: Julian Knight (Independent - Solihull)Department Debates - View all Julian Knight's debates with the Department for Business, Energy and Industrial Strategy
(7 years, 5 months ago)
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Joseph Johnson
That goes to show the extent to which the Labour party misled the country in the run-up to the general election, and I think my hon. Friend’s constituents are owed an apology.
Let us not forget that it was a Labour Government under Prime Minister Tony Blair who sensibly put in place these legal powers, which we used some six months ago, to uprate fees in line with inflation through a negative procedure. However, under the regulations we are debating today, rather than increasing fees for everyone, we are only allowing providers to maintain their fees in line with inflation if they can demonstrate that they are using these resources well in terms of providing high-quality teaching and good outcomes for their students. Universities UK and GuildHE, the two main representative bodies that collectively represent over 170 higher education providers, have made it clear that allowing the value of fees to be maintained in real terms is essential if our providers are to continue to deliver high-quality teaching. Gordon McKenzie, the chief executive of GuildHE, made it clear that
“fees had to rise by inflation at some point and it was fairer for students if those rises were linked to an assessment of quality”,
as the Government are doing.
Julian Knight (Solihull) (Con)
University education is also a route to higher earnings, worth up to a quarter of a million pounds over a lifetime. If we go forward with Labour’s policy to abolish tuition fees, it would have a damaging effect on those from disadvantaged backgrounds, as we have seen in Scotland, where there is a fall in the number of people from disadvantaged communities applying to university.
Joseph Johnson
My hon. Friend is absolutely right. Labour’s policies would do the opposite of what it says they would do; they would represent a huge step backwards for social mobility in this country, they would be bad for taxpayers, who would be left shouldering the entire cost of the higher education system, and they would leave the finances of our university system in tatters.
As Professor Steve Smith, vice-chancellor of Exeter University, has said:
“The Teaching Excellence Framework presents us with an opportunity to invest in our students’ futures and the long-term economic success of our country, and to be recognised for outstanding teaching at the same time…The Government rightly wants ‘something for something’, for the economy and for students.”
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.
Julian Knight
My right hon. Friend is making a powerful and considered speech. Does he agree that we should also look at the length of university courses? Three years seems a little long for some courses, considering the smaller number of teaching hours.
Robert Halfon
Yes. My hon. Friend makes a point that I will come to, which relates to business rates. This is about not just the length of courses, but the way in which terms are structured. I said at the beginning of my remarks that the burden on the taxpayer needs to be fair, but we also need to ensure that the burden on the student is fair.
A constituent of mine entered university during the first year of £9,000 tuition fees, and her debt is now around £45,000 including the maintenance loan. I am not against student loans. It is not fair for working people in my constituency to bear the full burden of paying for all students to go to university. However, value for money also involves interest rates. Interest rate levels are much lower in the United States and, as I understand it, there are quite a few months in the year when students have more opportunities to work so they can pay back their loans. That relates to what my hon. Friend the Member for Solihull (Julian Knight) just said. The interest rate here, which the Minister knows is quite high, puts people off. I urge him to look into what can be done to have a system similar to that in the United States.
Of course, not all courses or institutions offer the same opportunities for employment after graduating. A history degree from a Russell Group university could, after five years, see someone earning double what they would have earned had they received the same degree from a less prestigious institution. University graduates have traditionally out-earned their non-graduate peers, but the gap appears to be narrowing. The value of a degree has begun to decline as the supply of graduates has outstripped demand. The Institute for Fiscal Studies recently warned that further increases in the number of graduates could lessen the financial gains of a degree.
The Minister knows that I am passionate about and strongly believe in apprenticeships, and he is a huge supporter of degree apprenticeships. It is important that all students know that there is a choice. There is a chance that we can offer every young person an apprenticeship, all the way from level 2 right up to degree level. We need as much investment as possible in degree apprenticeships, for which there is no loan. Apprentices earn while they learn, are virtually guaranteed to get a job afterwards, and get the skills and training they need. That would be a huge boon to people from disadvantaged to backgrounds. The levy must be used to fund degree apprenticeships as much as possible, as this will transform the nature of the debate, particularly for those from disadvantaged backgrounds.
Julian Knight (Solihull) (Con)
At the general election, the Labour party managed to rally an extraordinary number of young people to its cause—in one constituency, it even had young people standing on roundabouts with “Vote Labour” signs. I am sure many Labour Members will concede that they have those votes to thank for their place in this House today.
It is not difficult to see why students were tempted: not only did Labour promise to abolish tuition fees, but there was even talk of forgiving all student loan debt—an extraordinary, expensive undertaking. I wonder what those young voters must think now, barely a month on from the election, as they see Labour desperately trying to downgrade that promise to an aspiration, or as they see Wales—the only corner of the kingdom where the Labour party is in power—actually increasing fees, despite Labour’s having attacked them during the campaign.
What goes around comes around. I should inform the House that the film of the Labour party, effectively, backtracking on this promise has been shared 1.3 million times, so perhaps those roundabouts will not be quite so full of young students holding up signs for the Labour party at the next general election.
Perhaps the Labour party, including in Wales, now realises that there are very progressive elements to the tuition fee system.
Julian Knight
I am not going to give way at the moment.
Loans are available in this progressive system to everybody. They are paid back only when the student is earning enough to afford it, and the amount to be repaid scales up with income. Effectively, student loans are a type of graduate tax, rather than a tax on everyone, including everyone who does not go to university. No bailiffs are sent out to collect on student loans, and after 30 years any outstanding debt is forgiven by the Government. No other loan has so many protections built in for low earners.
However, to focus narrowly on the repayment structure is to ignore so much of what makes the current system a good deal for less-advantaged students. It secures more places and higher-quality teaching.
I know there is a lot of nostalgia in some circles for the days when university was free, but too often those people fail to acknowledge that this was only possible because the proportion of school leavers who went on to higher education was tiny. I was the first member of my family to go to university. I come from a council house background and a lone-parent family. It was a really unusual event at my school to go to university, to such an extent that when people found out that I had a place, I and a few others at my school were called on stage. When I went to university, only one in 10 were able to take up the advantages that I had, and I do not want us to go back there, under any circumstances.
When the previous Labour Government decided to massively expand higher education, the costs for universities ballooned, and it was rightly decided that those who stood to benefit should shoulder a share of the cost. The alternative was to fund the entire cost from general taxation—shifting the burden to millions of people who have never had higher education—or to leave it to universities to fill in the gaps in their budgets themselves. Scotland illustrates the dangers of that approach. Local students, especially those from disadvantaged backgrounds, have been consistently squeezed out of Scottish universities in favour of fee-paying international students.
Julian Knight
Scotland used to say to the rest of the United Kingdom, “We have a gold standard in education.” I think it is a matter of shame that the SNP has presided over the collapse of Scottish education in the way that it has.
Julian Knight
No—you had your chance.
As all studies show, the introduction of fees in England has seen an increase in the number of students from poorer backgrounds. Tuition fees have opened up the opportunity to study, and the repayment structure shelters them if they do not get the graduate dividend that they hoped for.
Of course, the current system is not perfect. There are legitimate questions over the interest levied on loans, and especially about the fact that nearly every university charges the maximum amount of fees. Price signals should be an important way for students to gauge the actual value of a degree course. I also think that some courses may be too long, and if they were to be time-limited, that would bring down the costs for all. But abolishing fees and forgiving debts that will only ever be repaid by high earners, and replacing the current system with one that taxes those who do not benefit or leaves universities fighting over high-income applicants, would be a huge transfer of wealth from the poor to the rich, and a ferocious attack on opportunity and social mobility.