Higher Education (Industry and Regulators Committee Report)

Lord Storey Excerpts

Tuesday 21st May 2024 Grand Committee

[Lord Storey (LD)]

My Lords, it is a great privilege to follow so many colleagues who have, or had, positions in universities. I have enjoyed listening to their detailed knowledge. I thank the noble Baroness, Lady Taylor. In a sense, her opening remarks absolutely hit on my understanding of the situation. I was slightly concerned when she used a one-word judgment about the Office for Students—I have written it down somewhere and forgotten it. I thought we were against one-word judgments and that, like Ofsted, we did not want to go down that route. I am just teasing. All the issues were very carefully and considerately focused.

We have world-class universities and we ought to be proud of them. They have amazing leadership and staff, but that should not blind us to the fact that there are major problems in some of our universities. There is a great danger that we wallow in praise but do not tackle some of the issues happening around us. One has only to look at the private higher education sector to know that there are big problems, or to listen to students talk about their experiences of simple things such as chasing up and trying to get back a thesis or assignment, or their complaints of there being hundreds of other students in lectures. Those issues may be small and insignificant to noble Lords in this Committee, but to students themselves they are really important.

I have a background as an ordinary primary teacher and headteacher. I did a certificate of education and then went on to university because I realised that I needed a university degree if I were to get a promotion. Like probably everybody in this Room, I thoroughly enjoyed my time at university. University is not just about learning; it is about playing as well. How sad it is that, these days, many students cannot afford, for example, to go to university away from their home. Students increasingly stay in their own locality. I do not know the exact figures but at Liverpool University the students increasingly come from Liverpool, Merseyside or the north-west. When I went to teacher training college, my friends came from the north-east, Northern Ireland and all over the country. I gained so much from that experience of talking to people from different regions and cultures. We have lost that. Universities also provide the opportunity to learn different things and offer extracurricular activities. We talk about the importance of extracurricular activities in schools but they are equally important in universities.

I will come to the issue of funding in a moment. I want to single out a few comments that I feel must be addressed at some stage. The noble Lord, Lord Agnew, was either bonkers or brave—or both—to raise those hugely important issues. Somebody has to address them. We cannot just say, “He would say that, wouldn’t he?” I want to know the answers to his questions. Similarly, the noble Lord, Lord Lucas, went on and on, quite rightly, about linking higher education, schools and student satisfaction, but we never get any answers on that. At some stage, I would like to hear the answers. Finally in my general comments, I say to the noble Lord, Lord Johnson, that yes, I like the title, “office for lifelong learning”, so let us try to make that happen. It seems to be the right phrase.

When student loans were introduced—we remember all the furore about them; I had forgotten that they were introduced by a Labour Government, of course, although the coalition Government increased them enormously—my party leader and others signed pledges that they would abolish them. However, I thought to myself, “Do you know what? If students are getting a loan and paying for their university education, they will be in the driving seat. They will actually have a say in what is going to happen”. Similarly, when the Office for Students was established, I thought to myself, “Ooh, this is good: it has ‘students’ in its title. It will mean, again, that students are in the driving seat”.

The report is quite worrying but, actually, I can look at it in a positive way. You have to know where you are to find out where you are going. Remember, the Office for Students has as its mission

“to ensure that every student, whatever their background, has a fulfilling experience of higher education that enriches their lives and careers”.

I can tell noble Lords that, as a city councillor, I have referred three cases to the Office for Students. The first was that of a PhD student who was awarded only a master’s degree, not a PhD. She complained and said, “Hang on a second. I didn’t see my supervisor for three years. Covid came along and nobody from the university contacted me”. The university was not at all interested. I contacted the Office for Students and it was very proactive for that young woman. It ensured that she got a year’s extension and was paid some compensation. That would not have happened without the Office for Students, I guess.

The second case involved a mature student who had special educational needs and wanted another year. She had already delayed her degree by two years, and she wanted a third year. The university said no. The Office for Students sorted it out.

The final case was a failure. It involved a student at a Russell Group university. On the day of her final exam, her father died. Imagine that. The university said, “Well, we’re very sorry about that”, but nobody contacted her; I mean, nobody actually said that. Her personal tutor did not contact her. What is that all about? That is another complaint from students when you talk to them. She was told that she could sit the exam in the summer. How crazy is that? She was not given a date; she just had to wait until summer came along. Then, sometime in August, she was allowed to re-sit the exam. That is not the way to treat a young woman whose father has just died. I contacted the Office for Students but, sadly, nothing happened on that occasion.

As we have heard from so many colleagues, the higher education sector faces a looming crisis. It is mainly to do with long-term financial sustainability, compounded by Covid; the freezing of student fees; inflation leading to higher costs for institutions, staff and students; a lack of EU research funding; and ongoing industrial action, as we have heard from a number of colleagues. The financial sustainability of the funding system for the higher education sector clearly needs to be sorted. Has the Office for Students paid sufficient attention to this challenge? It should be questioned on a number of issues. Has it lived up to its promise? Is it trusted by the providers it regulates? Has it acted in the real interests of students? On the last point, my experience is that it has. Have the Office for Students’ duties been applied consistently and equally? Should it focus more on communicating with institutions, rather than relying on data from those institutions?

The freezing of the cap on tuition fees for domestic students and the loss of EU research funding have led to higher education providers becoming reliant on cross-body subsidy from international and postgraduate students. This dependency comes with huge risks. It will be interesting to read Robin Walker MP’s inquiry into university funding’s reliance on international students. As Simon Marginson, a professor in higher education at Oxford University, says:

“If today’s decline in the real-terms value of fees continues … then within a decade even the UK’s most elite institutions will find themselves diminished. This could be further exacerbated as countries such as China … pour money into their own higher education systems”.


Vivienne Stern, the chief executive of Universities UK, says that there is a

“need to have a … conversation about how universities are funded”.

Over 100,000 more young people will be seeking university education by 2030, when there is little space or incentive to accommodate them. Let us get to the real issue. Political parties, particularly in an election year, are unwilling even to acknowledge or to face up to the problems in this field. At the moment, they would rather keep quiet. Can you blame them? “Well, Mr. Starmer, Mr. Sunak and Ed Davey, how are you going to deal with the matter? Are you going to put the funds or the loans up?” Of course they are not going to say anything now. Once the election is over, whoever is in Government, whether it is a coalition Government or whatever else, I hope that those political parties will have the honesty and the integrity to realise that the funding issue is crucial to the continued success of our universities. If they do not do something about it, we will see our world-class universities become second-class universities.

We can already see how this lack of action is affecting universities. Just one recent example, if your Lordships remember, was the University of Essex, which forecast a £13.8 million shortfall, blaming the 38% drop in applications from overseas students for its plans to freeze pay and promotions. In response, the plea for more government assistance puts universities at odds with government. It is argued that the sector has become bloated, providing too many courses that do not offer a return on student investment. But we cannot just leave silence to rule. Perhaps we need to find a new funding model. Is it increasing the level of fees or allowing universities to charge what they want, or do we just let the weak wither and close, and the strong and successful prosper? Do we look—dare I say it—at Vince Cable’s idea of a graduate tax? I do not know, but we have to do something about it. I hear only one or two voices, and they are not from political parties, saying, “Universities need more money”.

Returning to the Industry and Regulators Committee report, I hope the Minister in her reply will want to comment—I am sure she will—on some of the quite concerning conclusions of that report. The Office for Students

“does not engage with its stakeholders”,

whether students or providers; its approach to regulation seems

“arbitrary, overly controlling and unnecessarily combative”;

and,

“there have been too many examples of the OfS acting like an instrument of the Government’s policy agenda rather than an independent regulator”.