Higher Education (Basic Amount) (England) Regulations 2010

Lord Krebs Excerpts

Tuesday 14th December 2010 Lords Chamber

I passionately believe that were the Government to do that, students, their families, graduates, universities and the taxpayer would, as a result, have a better outcome but the deficit would still be cut. In turn, the Government would be congratulated on listening, on thinking again and on putting forward proposals which sustain the long-term future of higher education in the UK as a public good, as it is perceived everywhere else in the world.

[Lord Krebs]

My Lords, I declare an interest as the principal of Jesus College, Oxford, and as somebody who has spent much of his career teaching undergraduates in this country and in north America. I have to say that I have changed my mind about the view I take on the Government’s proposals. The view you take, I think, depends on where you start from. The vice-chancellors, in their view, have their feet in the coals of the fire and are looking for a way to get them out, and the only way to do that is to support a whopping great hike in student fees. If, however, you stand back and ask some fundamental questions about the justification for the proposals, I believe that you come to quite a different view.

I asked myself three questions. Are the proposals justified and fair? Do they make the funding of universities more sustainable? Do we understand the consequences of this radical change? No doubt noble Lords are on the edge of their seat waiting to hear the answers to those questions. We have heard many of the things that I am going to say already, so I will take a short cut to save anxiety and stress and give the answers in summary form. No, the proposals are not justified and fair. No, they do not make the funding of universities more sustainable. No, we do not understand the consequences. Let me explain briefly why I have come to this view and why I therefore support the Labour amendment to the Motion.

We have already heard, and I do not need to dwell on this, that a university education is partly a public good and partly a private good. Individuals benefit but the nation needs doctors, lawyers, engineers, scientists—even civil servants and economists, it is sometimes said. The state should therefore pay part of a university education. I think it is reasonable that students should pay something themselves, so the debate is about how much it is fair to ask them to pay. These proposals represent, as we have already heard, a dramatic shift in responsibility for payment for an education from the public purse to the private purse.

We must not forget, as has been hinted at by other speakers, that the United Kingdom already invests a significantly lower proportion of its wealth in tertiary education than most other countries. The latest OECD figures, published this year, show us at 30 per cent below the OECD average in public investment in tertiary education and at nearly 40 per cent below the EU average. Will the Minister tell us how he can justify cutting public support for universities when we are already spending less as a proportion of our GDP than countries such as Hungary, Mexico, Poland or Brazil? Do not tell us that this is about reducing the budget deficit—it is actually about priorities.

The Minister tells us in his letter that no one should be put off from participating in higher education as a result of the changes. People have already asked where is the evidence to support that assertion. Certainly, the Institute for Fiscal Studies concludes in its report that students from the poorest 30 per cent of families will have more to pay back than they do at present. How do we know that this will not put them off? My conversations with the students I am responsible for suggests that it will.

We are also told—and this point has been raised already—that there are details of access arrangements, some of which are spelt out in the draft letter from the Minister for science and universities to Sir Martin Harris. But normally, when you want to understand the details, you turn to the fine print. I did so, and the print was so fine it was almost non-existent.

My second point was about the sustainability of universities. In his letter to noble Lords, the Minister states that the Government believe that this package offers a more sustainable future for our universities. I have always held the notion that belief should be reserved for matters of faith; no doubt the right reverend Prelates will comment on that. But when it comes to the sustainability of universities, I would prefer something more substantial than belief. We have already heard that in effect this proposal takes money with one hand and gives it back with the other, so the proposed fee increase—if we go to £9,000 a year—would barely exceed, and perhaps only just match, the amount of money that is removed in the cuts elsewhere. Therefore, universities such as my own, Oxford University, will be no better off, even if we charge £9,000 a year, and perhaps even worse off. How does this make the system more sustainable?

Thirdly, and finally, do we understand the consequences of this huge experiment? As we have heard, the proposal turns university education, to a large degree, from a public good into a private benefit. What do we know about the outcome? What do we know about its effect on the balance of students choosing to study different subjects? Do we know that it will encourage social mobility? Do we know what kind of restructuring it will result in in the university sector? I believe that the university sector could benefit from restructuring but I do not think that it is sufficient to leave that to the market. A university education is not like toothpaste or a fizzy drink; the market will not necessarily deliver what the nation needs. That can be delivered only after deliberation and consideration by Government and by Parliament.

As we have heard, universities in the UK are an outstanding success story; in fact, they are one of the very few areas in which we still have world pre-eminence. Let us not conduct a massive experiment and leap into the unknown with this success story without first understanding the outcomes and the possible consequences. For those reasons, I urge noble Lords to support the amendment and vote against this proposal.