Higher Education: Financial Pressures

Lord Parekh Excerpts

Thursday 30th March 2023 Lords Chamber

[Lord Parekh (Lab)]

My Lords, I congratulate the noble Lord, Lord Knight of Weymouth, on securing this debate and introducing it with considerable erudition and eloquence. This debate has become important in a post-Brexit age. It is because we have gone through the baptism of post-Brexit, and because of what is to follow, that we are concerned about the issues that it raises. I therefore want to ask myself what new issues it has raised, what the context is in which we are debating them and how old problems appear in new forms.

I shall concentrate on three issues that are important but, for obvious reasons, have not been discussed. The first has to do with the whole idea of student loans. Let us remember that a student comes out of university with a debt of, on average, £45,000. Even before he comes out with that debt and is still at university, he has to provide for his maintenance costs, which he does by relying on personal savings, with part-time work and in various other ways. There are many reports telling us how many students do not have food to eat, suffer hardships and undergo an enormous amount of pain in order to be able to graduate with some degree of decency.

Student loans do not serve the function of redistribution, which is what they are supposed to do. Levelling up must begin with, if anything, student loans, but that is not being done. Every penny that is given in loans has to be paid back, unless one is unable to do so after so many years and having earned below a certain amount of money. This does not happen in many of our competitive economies. For example, in France, tuition fees are pretty low; in Germany, they are non-existent in some Länder and very low in others. What is no less important is that the differential between the overseas student and the home student is much less than it is in our country. My feeling is that, rather than think of overseas students as a cow to milk and asking how they can help us bridge the gap in our own resources, we should be asking ourselves how the levelling-up scheme can be applied to them as well. In other words, the idea of the student loan needs to be rethought.

The second important subject I want to concentrate on is how the idea of the student loan has built in to it an element of structural bias in favour of overseas students having to pay more. If there is a teaching budget deficit, the expectation is that we will turn to overseas students, charge them £10,000 more than we charge domestic students and hope that they will bail us out. Our students cannot afford that kind of money, and they go to low-tariff universities. So there is a division between low-tariff universities, where our students go, and high-tariff universities, where overseas students go—a class division is almost built in to the student community. I do not think we fully appreciate how much resentment and hatred it causes among many of our students. I can say this with some confidence, having been a university professor for about 40 years.

The third element we need to think about is the Turing Scheme. There has been a lot of vacillation about Erasmus—should we join it or not? The Prime Minister said we should not and we finally decided—I think in December 2020—to go with the Turing Scheme. Why did we decide not to join Erasmus and to go for the Turing Scheme? We wanted to go global. What does that mean? It means that we should not be tied to any particular group. What does that mean? It means that we should be free to choose a country with which we associate. What does that mean? How are you going to take the mighty leap and launch out into the world at large, rather than connect with various groups with which you are already affiliated? I should have thought that, rather than take this mighty jump and pick and choose partners, we should be thinking about collaborating with those with whom we have already been connected and then gradually spread out into the rest of the world.

More importantly, there remain difficulties with the Turing Scheme. For example, the amount involved is much less than what we would have got if we had been part of Erasmus—I am told about £83 million. The scheme is subject to the spending review, and therefore there is no continuity, because the amount of money can change year to year. There is no funding for staff exchange or for pupils coming to the UK. We are not clear about language learning facilities. There is also unease about the time it could take to process visa applications for overseas students, and the question of not sharing best practices or learning resources.

I therefore want to end by putting three questions to the Minister. First, is there any attempt to look at the student loan in the context of an opportunity to level up? Has any thought been given to that? Secondly, should we not be thinking of overseas students just as much as we think of our own? Should we be thinking of all of them as Arabs and rich Nigerians and Indians, or should we not also think of those whom I encounter regularly—those who are poor and want to benefit from our education? Thirdly, is any attempt being made to reconsider the Turing scheme?