Lifelong Learning (Higher Education Fee Limits) Bill

Lord Johnson of Marylebone Excerpts

2nd reading
Monday 19th June 2023 Lords Chamber

[Lord Johnson of Marylebone (Con)]

My Lords, I echo others in saying what a pleasure it is to follow those two excellent maiden speeches this afternoon. I draw attention to my interests in the register, particularly as visiting professor at King’s College London and as chairman of FutureLearn.

I sincerely welcome this Bill as it addresses a very important problem with our current funding system for higher education. Our system, modified by my noble friend Lord Willetts, is one of an income-contingent, time-limited graduate contribution towards the repayment of heavily subsidised loans for tuition and maintenance. In my mind it is the least bad of all available systems, but it does have three flaws.

The Bill is important in that it address one major flaw: the impact that our current system has had—as we have heard from many Members this afternoon—on lifelong and adult learning, which has been in crisis in this country for a decade. On its own, however, it is not enough, because it does not address two prior problems with our student funding system: the fact that our system has not allowed for tuition fees to rise with inflation, which has led to the progressive defunding of our universities, and the increasingly precarious dependence of our universities on international student tuition income, cross-subsidising domestic tuition and the important research that goes on in our system.

Sadly, this Bill does not address that problem. Nor does it address a related issue: we have a system that has no link at all between the quality of provision and the fees that institutions can charge for that provision. It is very important to have alignment between quality and funding; it seems to me essential that we put such a system in place. The coalition Government did attempt that under David Cameron’s Administration when they instituted a link via the teaching excellence framework, which resulted in the only year of inflationary uplift to tuition funding over the last decade. Institutions that participated in the teaching excellence framework were allowed to raise their fees from £9,000 to £9,250. Sadly, however, that sensible innovation lasted only one year, because a snap election resulted in the Government losing the majority on which the policy depended.

Since that time we have seen, effectively, a crisis whereby our institutions, so important to our future as a knowledge economy, are becoming increasingly financially vulnerable. Had we stuck with the mechanism that the Cameron Government instituted, we would not have a situation where, for example, UEA had a £40 million deficit this financial year; tuition fees would have been allowed to rise to around £11,700 for those institutions that acquitted themselves well in the teaching excellence framework; and we would have a link between teaching quality and funding, which any sensible system should have.

So, all that aside, it would be better if this Bill reinstated a link between quality and funding and made automatic an inflationary uplift in the upper limit of our tuition fee system, to put our universities on a stable footing. But that is by the by. The important thing is what this Bill does try to do; that is what is important today. The Bill creates a framework for us to move to a much more flexible system whereby we fund credits rather than years of study and enable people to dip in and out of learning throughout their lives. That is really welcome. I thoroughly support the objectives of the Bill and the framework that it creates for a much more detailed policy that is, hopefully, to come.

My concern, though, is about a policy that is in development at the moment in the department. There are lessons that we need to learn from the short-courses trial, which a number of Members have already referred to today. The trial is clearly struggling, with only 37 participants to date. That really is a paltry number, and I do not think it is sensible for us just to plough on and not try to learn some lessons from what is going on right now with the pilot and from the rather lacklustre response from providers—universities—in coming forward with suitable content for LLE funding.

There are potentially three lessons that we might preliminarily try to draw from what is going on with this pilot, and they are as follows. First, it is a mistake for us to focus so narrowly on level 4 to 5 courses at the expense of level 6 and level 7—that is, master’s—courses. Obviously, levels 4 and 5 are important, and I am not trying to say we should not have people doing level 4 and 5 study, but it is disappointing that modular degrees are not going to be available until the academic year 2027-28, almost a decade after the Augar report was commissioned and eight years or so after it landed. That is an inordinately long time for us to be getting off the policy drawing board into delivery mode for modular degrees, and I think the department could actively look at ways of accelerating that.

In respect of level 7, as the noble Lord. Lord Rees, said, it is important that we make modular funding available for level 7. Of course, master’s loans are available in non-modular form outside the LLE, but many people in work who already have level 6 qualifications will want to continue to progress to higher levels of educational attainment and will want to access level 7 courses. So I strongly urge the Government to remove their mental block on making LLE funding available for levels of study above level 7.

The second lesson that I suggest can be drawn from the pilot is about the minimum size of funding for which LLE funding will be made available. As the noble Lord, Lord Stevens, said in his excellent speech, 30 credits is too large a block of funding both in terms of learning commitment and time and with regard to the amount of loan funding—probably over £2,000—that the learner will have to commit to taking out. Other countries’ experience is that blocks of study of 10 or 15 credits are a much more flexible way of getting this thing off the ground, and I urge the Government to be a bit more flexible regarding the minimum size of funding that LLE will make available.

My third lesson, and this is probably the most important one, is about the kind of provision that will be eligible for LLE funding. At the moment the Government are determined, as far as I understand, to replicate provision that already exists; it has to derive from an existing HE qualification. In effect, we are saying that we want more of the same but in smaller pieces. This is a big missed opportunity. We want to enable learners to access different kinds of provision from different kinds of providers in different shapes and forms. We do not want to create a policy framework that completely chokes off innovation at this stage. Learners, as Andreas Schleicher from the OECD put it in his recent HEPI lecture, will want to access many different types of provision from many different types of provider in lots of different ways, so I urge the Government to be a bit more flexible in the range of providers and the types of courses that they allow into the LLE funding regime.

Those are three early lessons that I would draw from the pilot. I do not think it is irremediable at this point. We are not going to launch the LLE until 2025-26, so there is plenty of time to get the policy right, but we need to crack on with it. In the meantime, I strongly support the Bill for providing the legislative framework for what I hope will be the skills revolution that Ministers want.