Higher Education and Research Bill

Lord Stevenson of Balmacara Excerpts

Committee: 2nd sitting (Hansard - continued): House of Lords
Wednesday 11th January 2017 Lords Chamber

[Lord Stevenson of Balmacara]

I thank all noble Lords for their contributions and I particularly thank the Minister for his very full response, which has gone some way down the path of trying to reassure us, although we will probably have to pick up one or two points that he made in the debate on the next group. I should like to end with my thoughts for him to take away and reflect on. I will not make the usual pun about whether they will be taken note of—although it seems that I just did.

The Minister’s argument for not putting more ambitious wording into Clause 2 seemed to be that there were already sanctions in place if, in the event, institutions did not do what was required. I find that a bit weak. I think that it would be more helpful if there were a bit more aspiration in Clause 2 and a bit less about the process, and I ask him to reflect on that.

The Minister also implied that many of the obvious day-to-day operations of the OfS and its ancillary work would clearly be in the public interest. However, you can never rely on that—a point made by the noble Lord, Lord Sutherland, before he left his place. The public interest is important, as has been said by a number of people around the Committee, including the noble Lord, Lord Lucas. I think there is a case for having the public interest mentioned in at least one of the provisions—perhaps in Clause 2(1)(b).

The whole discussion on the remit is not really about the financial health of the institutions concerned—again, there are processes in place for that—but about how to inculcate into the OfS, as it is set up, the sense of wanting to see academic vitality across the country and new institutions in the right places in the country, or a sense of innovation, which the noble Lord, Lord Willetts, talked about. Of course, he is right that the waves of change that came through were very impressive and produced a step change each time. However, in thinking about that he may want to bear in mind that we also lost a lot when some of the institutions—such as the polytechnics—set up in the shadow of the Robbins movement ceased to be polytechnics and lost some of the drive that was specific to that activity. In a sense, that is part of my worry about the clause—that it does not quite get us all the way to an all-inclusive and all-embracing style of higher education, including everything that is currently there and, without disrupting the existing arrangements, making plenty of space to bring in new people. However, the Minister has agreed that he will reflect on that and, on that basis, I beg leave to withdraw the amendment.

Amendment 29 withdrawn.

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Moved by

[Lord Stevenson of Balmacara]

33: Clause 2, page 1, line 12, at end insert—
“( ) the need to promote collaboration between English higher education providers where it is in the public interest and the best interest of students and employers,( ) the need to promote innovation in the provision of higher education by English higher education providers where it is in the public interest and the best interest of students and employers,”

[Lord Stevenson of Balmacara]

My Lords, we move to the other half of the discussion on Clause 2, which is primarily about competition and collaboration, as indicated in the Marshalled List and the groupings, although there are a number of sharper amendments around them. I shall not go through them in detail: they are basically about trying to prioritise collaboration and development and to reduce the reliance on competition.

We have already had a debate in which the Minister made it clear that the various points in Clause 2 are to be taken as a whole. Therefore, it could be argued that there is no need to worry about the problems created by competition or the fact that collaboration is not given a high enough position among the priorities. Nevertheless, if people read the clause from beginning to end, they will come across some words earlier than others that will be bound to set the tone. Therefore, these amendments—others will speak to the bits that they are most interested in—are interesting in that they try to give a sense that these measures must leave the sector with a predisposition to work together and the idea that, if it does work together, there will be benefits, and through that collaboration quality will be improved. For instance, Amendment 45 would explicitly encourage collaboration and innovation. You can say that that is not necessary but, if it were included in Clause 2, it would clearly make a difference. I beg to move.

[Baroness Brown of Cambridge]

My Lords, I will speak to Amendments 35 and 37 in my name and that of my noble friend Lady Wolf. In doing so, I want to support the intent of Amendment 33 in the name of the noble Lord, Lord Stevenson. As we have heard, universities are, by their nature, highly competitive; the noble Lord, Lord Bragg, commented on this on Monday and the noble Lord, Lord Liddle, reinforced the point today. They compete for the best students, the best academic staff and research funding, and they compete particularly fiercely for positions in the large range of existing ranking and league tables, and in particular for positions in the National Student Survey.

Much of this competition benefits students. For example, the importance of doing well in the areas of the National Student Survey that concern assessment and feedback has meant, in almost every university in the country, that students now have their work marked and returned much more quickly than they used to a couple of years ago. There is now a real focus on doing that in a timely manner so that students get good feedback on modules in which they are weak so that they can use it for revision and to ensure that they are well prepared for examinations. Clearly, competition in many forms strengthens the student experience.

Collaboration between institutions is also hugely important. Let me give noble Lords some examples. When I was director of engineering for the marine business at Rolls-Royce, we made use of a modular Masters in marine engineering and technology that was developed by a group of very distinguished universities, mainly in the north-east of England. Students could register at any one of the institutions for their degree and assemble a bespoke course, with specialist modules across the institutions. It was a collaboration that worked for industry and for students.

Collaboration and the sharing of best practice in the area of efficiency and effectiveness, as reported in Professor Sir Ian Diamond’s reviews, has enabled universities to reduce back-office costs, share access to expensive teaching facilities and invest in new infrastructure in recent years. Again, this is of direct benefit to students. Birmingham City University, Aston University and the University of Birmingham—all the universities in Birmingham—continue to collaborate on a joint outreach programme into schools across the city. It is a collaboration that supports widening participation and university access for some of Birmingham’s least advantaged children.

I argue that students, employers and our economy will benefit directly from this type of collaboration—and we want to see more of it, not less. To focus on competition in the absence of collaboration could slow the rate of improvement and innovation in our higher education system. I urge the Minister to ensure that the Office for Students has regard to the need to encourage both competition and collaboration between HE providers. This will be in the interests of students, employers and our economy.

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[Viscount Younger of Leckie]

My Lords, I assure the noble Baronesses, Lady Wolf and Lady Brown, and the noble Lord, Lord Stevenson, that I fully understand the principles they seek to address here. To reassure the noble Baroness, Lady Brown, on the new duties for collaboration and innovation, we are wholly supportive of collaboration and innovation where it is in the interests of students. I hope I can go some way to answer the question raised by my noble friend Lord Willetts on how collaboration and competition will work. I will say a little more about that later. For example, providers could share services to generate efficiencies that allow more resources to be focused on teaching, offer courses in partnership, or design new styles of degree programmes to meet differing students’ needs. These are essentially non-competitive ways to enhance the offering from both or more institutions should they decide to collaborate.

I will start by saying a little more about collaboration. The general duties of the Office for Students are absolutely consistent with the idea that providers should continue to collaborate and innovate in the new regulatory system. There should be no conflict with the OfS’s duty to have regard to encouraging competition between higher education providers where it is in the interest of students. My noble friend Lord Jopling is right in his assessment that the OfS is already required under Clause 2 to have regard to,

“the need to promote quality, and greater choice and opportunities for students”.

Such collaboration and innovation is implicitly and undoubtedly in the student interest. To pick up on the question asked by my noble friend Lord Willetts, there is nothing inherent in that “have regard to” duty that would prevent the OfS also supporting collaboration between higher education providers if it considers it is also in the interests of students, employers or the wider public—for example, by supporting the merger of two providers.

The noble Lord, Lord Winston, asked in his thoughtful, brief intervention how the OfS would enforce collaboration. We do not wish to create an expectation that the OfS should be formally or actively regulating this type of activity. That would be unnecessary.

On innovation, we concur with the noble Lord, Lord Stevenson, about a lack of innovation in the higher education sector. It is important for the OfS to have a focus on supporting a competitive market. That means it must regulate fairly and allow all providers to operate under the same set of rules. This will make it simpler for new high-quality providers to enter and expand, help to drive up teaching standards overall, enhance the life chances of students, drive economic growth and be a catalyst for social mobility.

Competition will incentivise providers to raise their game, fostering innovation. New providers can respond innovatively to what the economy demands and equip students with the skills needed for jobs of the future. So promoting innovation, like collaboration, does not require a separate duty. When it is in the student interest, the OfS will be fully able to support it because the student interest is at the very heart of the OfS. Requiring the OfS to have regard to encouraging competition only where it is shown to be in the interest of students, employers and the wider public would be unnecessary, burdensome and inflexible to implement. The current wording already limits the promotion of competition to where it is in the interests of students and employers. The amendment would mean that the OfS would have to demonstrate that in some way that these various interests were met, placing an unnecessary evidential burden on the regulator and, in turn, on higher education providers.

I now turn to whether the OfS should have regard to encouraging competition where this is in the interest of the public or of wider society. The Bill makes explicit the general duty to encourage competition,

“where that competition is in the interests of students and employers”.

In doing so, it emphasises that the student interest is at the heart of the OfS and recognises the wider public benefits associated with maximising choice and competition in the higher education sector.

As I set out in the previous debate, operating in the public interest or that of wider society is implicit in the role of the OfS as a public body that is accountable to the Secretary of State and to Parliament. The noble Baroness, Lady Wolf, spoke of the conflict between the roles of the CMA and the OfS and asked me to provide further detail. As I said on Monday, I look forward to discussing this matter later in Committee, when we will consider the noble Baroness’s proposed new clause. I hope that she will have a little patience and that we can discuss that at more length later on in the Bill. In the meantime, I hope that I have been able to reassure the noble Baroness, Lady Wolf, and the noble Baroness, Lady Brown, who spoke at the beginning of this debate, that we have struck the right balance—and it is a balance. I hope that she will not press her amendment.

[Lord Stevenson of Balmacara]

I think that it was my amendment, but the noble Baroness may choose not to move her amendment at the appropriate time. I am grateful to everyone who has contributed to this debate. It has been a good mini-debate on the other half of the question about what Clause 2 sets out to do.

I am left with one question. I realise that it cannot be answered at this stage, but I wonder whether the Minister could write to me about it. We bandy around the word “regulator” a lot and I think that we all have slightly different versions of what it means. It would be helpful before we go to the later stages of discussing what the OfS is to have a clear definition. I am thinking in particular about the generic rules that apply to regulators; for instance, the amendment to the ERR Bill to require all regulators to have regard to growth—there were others of a similar class. As I understand it, the implication is that whatever the statute contains when this Bill becomes an Act will have to be read as if it also included an exhortation to ensure that all work was done to provide growth. There is nothing wrong with growth—we supported that—but it was aimed mainly at economic and not social regulators. There have been difficulties with applying it in the social work area, for instance, and other areas, so it would be useful and comforting if the Minister could write to us explaining exactly what the term regulator implies. That would give reassurance to some of us who have been worrying about this issue. The suggestion that we should have as the main functions of the Office for Students a set of pretty high-level statements and not a detailed list is fine, but I would like to see that list in relation to whatever else comes with the responsibility of being a regulator. I beg leave to withdraw the amendment.

Amendment 33 withdrawn.