Lifelong Learning (Higher Education Fee Limits) Bill

Lord Watson of Invergowrie Excerpts

Monday 10th July 2023 Grand Committee

Moved by

[Lord Watson of Invergowrie]

3: Clause 1, page 2, line 34, at end insert—
“(3A) Regulations may not provide for credits to be differentiated according solely to whether the learning time is spent on in-person learning or on distance learning for the purposes of this Schedule.”

[Lord Watson of Invergowrie (Lab)]

My Lords, I shall speak briefly to Amendments 3 and 6 in my name and those of my noble friend Lady Twycross and the noble Lords, Lord Addington and Lord Storey, whom I thank for adding their names. I shall then speak a little more widely on a closely related matter, after I have given some attention to the per-credit limits issue in the amendments.

On the wording of these amendments, I do not doubt that either part-time or distance learners—in some cases they will be the same person—will be treated less favourably in terms of credits than those engaged in full-time face-to-face teaching. It would be helpful to have from the Minister confirmation that there will be a single per-credit fee limit that applies to the whole system and will not vary depending on the mode, subject or method of study.

The main reason for submitting these amendments, apart from that issue, was to facilitate a debate on maintenance support for distance learners. Given the narrow nature of the Bill, an amendment referring directly to maintenance support was ruled out of scope by the Public Bill Office; none the less, its staff then assisted me in putting this wording together. Currently, part-time students studying face to face are entitled to receive maintenance support. However, with the exception of those with a disability, the vast majority of part-time distance learning students are not entitled to maintenance support. The introduction of the lifelong learning entitlement offers an opportunity to make this important change—one that would facilitate greater access to and flexibility around lifelong learning, which is surely something that the Government want.

However, the Government’s response to the lifelong learning entitlement consultation made it clear that, while maintenance support will be extended to all designated courses and modules that are studied face to face, distance learning courses will continue to be denied maintenance support. There is no further detail to explain the reasoning for such a decision. I very much hope that the Minister will provide that information to noble Lords today. As I said at Second Reading, this decision flies in the face of the DfE’s own policy impact assessment for the Bill showing the extent to which financial concerns are a key reason for part-time learners—in particular mature learners, who are naturally more debt-averse—not accessing higher education study. When I asked the Minister at Second Reading why that assessment appears to have been ignored, she declined to provide an answer; I hope that she will do so today, because it is essential that the lifelong learning entitlement extends maintenance support to all learners.

Together with my noble friends Lady Thornton and Lady Wilcox, I raised this issue at Second Reading. Unfortunately, in her reply, the Minister danced around the question, linking it with the status of online learning, which is of course part of distance learning, and making sure that these courses work for those leaving school or those who are already in employment and have this flexibility. Yes, the fact that the maintenance offer will now be available for face-to-face part-time study below level 6 is a welcome step forward for many learners at levels 4 and 5 but it still stops short of including distance part-time learners. My question for the Minister is this: why should distance learners be discriminated against in this way?

The Tory Government have previously signified their support for the introduction of maintenance loans for part-time distance learners. That was in 2017, but, unfortunately, the measure has never been introduced. At that time, it was stated that, subject to satisfactory controls, part-time maintenance loans would be extended to distance learners with effect from the 2019-20 academic year. However, this commitment was abandoned in March 2019 on the basis that demand would not be high enough to make the distance learning loans viable. No evidence was offered to support that claim; again, I hope that the Minister will be able to fill that information void today.

The question needs to be asked: how could it have been known that there would be insufficient demand if that demand had never been tested? Ah, but it has been tested—just not in England. There is solid evidence that introducing maintenance support for part-time and distance learning students makes a difference; its introduction in Wales in 2018-19 illustrates the significant impact on demand for part-time learning. Surely the time has come to learn from Wales—not something that comes easily to DfE Ministers or officials, I suspect. At the very least, this Government owe it to distance learners in England to offer them the opportunity and then assess the results. Extending maintenance loans to distance learning students would help mitigate the current cost of living pressures facing distance learners, which, as I said, are beginning also to have an impact on mature students and discourage them from entering study.

I believe that it is vital to promote lifelong learning by providing greater access to financial support to meet existing financial commitments for distance learners, such as caring responsibilities. I know that the Minister genuinely wants to see the reach of the lifelong loan entitlement extend as far as possible and to secure the best learner outcomes. Extending maintenance loans to distance learners would enhance those aims. I look forward to hearing assurances from the Minister as regards the per-credit fee limit being applied equitably, irrespective of the mode of study. I beg to move.

[Lord Addington (LD)]

My Lords, I do not think I have to add much to what the noble Lord, Lord Watson, said as he is a man who never leaves you in any doubt that he has done his research. However, distance learning should be part of the network and structure of how you acquire qualifications and carry on doing so, updating them as you go through your working life. There cannot be much doubt that it is a good idea, so making sure that alternative forms of study, including distance learning, are covered in the Bill is—well, blindingly obvious comes to mind. We need to have this structure to make sure we are reaching the people we need to get at to improve their lives and, indeed, GDP—that wonderful thing—and productivity. You name it, training is a key component. Making sure it is more easily accessible in a way that is convenient to people, even if it messes up the paperwork a little, has got to be an advantage. I hope that the Minister will say “Yes, we are going to deal with this in another way”, but unless we have something that gives us some assurance here, the Government are missing an obvious trick. I hope that I and the noble Lord, Lord Watson, will go away suitably chastised that of course the Government are going to do this; they just have not told us how yet.

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[Baroness Barran (Con)]

I will speak to Amendments 3 and 6, tabled by the noble Lord, Lord Watson of Invergowrie, and also in the names of the noble Lords, Lord Addington and Lord Storey, and the noble Baroness, Lady Twycross. These amendments would require that per-credit limits and credit-differentiated activity may not be prescribed solely according to whether the learning is in person or distanced.

Fee limits are not different for distance learning currently, and there is nothing in this Bill that would change this. I hope that reassures the noble Lord, Lord Watson, on one of his questions. I can assure your Lordships that the Government have no intention of differentiating fee limits between distance and in-person learning under the LLE. The per-credit fee limits will be the same for full-time, part-time, face-to-face and distance learning.

Distance learning courses will remain in scope for tuition fee loan support under the LLE. As your Lordships have pointed out, these courses will also continue to be out of scope of maintenance support, which is in line with the current system. However, the Government are committed to encouraging flexibility, and I was grateful to the Committee for acknowledging the important expansion in the use of maintenance loans for living costs and targeted grants. This will make maintenance support available for all designated courses and modules under the LLE, including those currently funded by advanced learner loans and those studied part time. It will also include—a point raised by the noble Baroness, Lady Wilcox—targeted support grants such as the disabled students’ allowance and the childcare grant.

Your Lordships expressed real concern that the absence of maintenance loans might impact on demand for distance learning. The noble Lord, Lord Watson, referred to the impact assessment. I will need to check, but my understanding is that distance learning was not specifically covered in the Bill’s impact assessment. Rather, as the noble Lord knows, the impact assessment was very positive overall, particularly when referring to learners who might be debt averse.

The ratio of distance learners to campus learners has been constant, at around 10%, despite the rapid growth in campus learners over that period, so I do not think there is compelling evidence that the absence of maintenance loans is impacting on demand for distance learning, relative to campus learning.

The noble Baroness, Lady Wilcox, stressed that distance learning was the key to unlocking lifelong learning. I only partly agree with her: I think the key is choice. We need to offer learners choice, whether that be campus learning for those who would benefit from and prefer that approach, and distance learning for those for whom campus learning is not their ideal situation.

On the maintenance loan and distance learners, the Government will roll over the existing exemption that enables distance learners with a disability to qualify for maintenance loans and disabled students’ allowance. The disabled students’ allowance will be extended to all designated courses and modules. The Government intend to review attendance validation more widely, and we will consider any necessary policy changes following the outcome of that review. We believe this amendment to be unnecessary, and therefore the Government will not support it.

[Lord Watson of Invergowrie (Lab)]

My Lords, I thank the Minister for her response, and I also thank those who spoke on this group of amendments. I am happy to welcome what the Minister said about fee limits not being different and the Government having no intention to change that, and that per-credit fee limits will be the same for all modes of study. It is useful to have that on the record. I know that the Open University was concerned about the lack of specificity on that, and that has been laid to rest this afternoon.

Some issues remain on the question of distance learners’ maintenance. If I understood the Minister correctly, she said that distance learners account for about 10% of all learners taking undergraduate courses and that that figure has remained stable while the overall number has increased. I am not sure that suggests that there is not an issue. How many more would have come forward and participated had they had the support needed—the sort of support to which the noble Lord, Lord Addington, and my noble friend Lady Wilcox referred? These needs will still be there.

It is slightly disingenuous to suggest that the disabled students’ allowance is available. That is basically saying that, if you want to study and are disabled, you can do so from home, but if you choose not to study, you need to make bit more of an effort and could get to classes if you really wanted to. As we have said, this impacts often older learners—those with family or caring responsibilities or a full-time job that stops them doing that. It is in no way a defence of the current situation.

I do not have the figures to cite to the Minister on the impact assessment, but, as I said earlier, when the plan to provide this support to distance learners was abandoned four years ago, it was on the basis that the demand would not be high enough to make it viable. I do not quite know what “viable” is—has it got something to do with repayments? I do not know. We need some more information on this, and it may be possible to get it at Report.

The Government cannot use this Bill to change that because it is so narrow, but this issue will not go away and it will impact on the Bill’s effect, which we very much support, of getting more people to make use of lifelong learning. With those remarks, I again thank everyone who has contributed on this group of amendments and I beg leave to withdraw the amendment.

Amendment 3 withdrawn.

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[Lord Storey (LD)]

I rise to support my noble friend Lord Addington’s amendment. I want to tease out of the Minister some answers on sharia law and its effect on accessing education opportunities for all. I was with a group of about a dozen Somali women on Sunday. They have that conflict between faith and education. The Minister will remember that in 2014—nine years ago—the Government published a report on Islamic finance in the UK that acknowledged the lack of an alternative financial product to conventional student loans. It was a matter of concern. The report also identified a solution: a frequently used non-interest-bearing Muslim financial product. The Government explicitly supported the introduction of such a product. However, since then no sharia law-compliant student finance scheme has been made available. Why not, Minister, and what we are going to do about it?

[Lord Watson of Invergowrie (Lab)]

My Lords, I will speak to Amendment 11. Before doing so, however, I want to touch on a point that the noble Lords, Lord Addington and Lord Storey, made about sharia-compliant loans. I can remember a time so far back it was before the Minister was even in your Lordships’ House, during the debate on the Higher Education and Research Act. The noble Lord, Lord Willetts, will remember, because he was very active in that. At that time, the issue of sharia loans came up. That finished immediately prior to the 2017 general election, six years ago. Why on earth has it taken so long? I suspect the Minister will not have the answers now, but someone in the Department for Education—or maybe the Treasury—should have. The answers must be found, it cannot be that difficult. Basically, I echo what other noble Lords have said: get a move on because it is a problem that surely cannot be insuperable.

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[Baroness Barran (Con)]

My Lords, Amendment 7, tabled by the noble Baroness, Lady Twycross, and in the names of the noble Lord, Lord Addington, and the noble Baronesses, Lady Wilcox of Newport and Lady Thornton, Amendment 8, tabled by the noble Lord, Lord Addington, and Amendment 11, tabled by the noble Lord, Lord Watson of Invergowrie, would place requirements on the Government to review the impact of the Act. I take this opportunity to confirm that the Government agree with the sentiment behind these amendments and are fully committed to monitoring the impacts of this transformation of student finance.

As your Lordships will be aware, the Government have published an impact assessment for the Bill which includes a consideration of impacts on learners, providers and employers. A full impact assessment and an equality assessment were also published alongside the Government’s response to the LLE consultation. In addition, parliamentary accountability mechanisms are already in place to review Acts of Parliament, including post-legislative scrutiny reviews, and I take this opportunity to acknowledge the Education Select Committee in scrutinising the work of the department.

Amendments 7 and 8 would require the Government to review the impact of the Act in relation to multiple different areas. However, vehicles through which these areas can be monitored already exist. For example, I take this opportunity to refer your Lordships to the publications produced by the Higher Education Statistics Agency, which will continue to publish data on learner uptake, personal characteristics of learners, including disabilities, and student course enrolments. Similarly, data on the take-up of level 3 courses, as referenced in Amendment 11, is available on the government web pages. I also refer your Lordships to publications from the Office for Students, including its annual report and accounts, as well as publications on the financial sustainability of the sector. Furthermore, information on student loan borrowers is publicly available from the Student Loans Company.

The Government are working jointly with the Student Loans Company and the Office for Students throughout the development and implementation of the LLE. I refer your Lordships to the framework document between the DfE and the OfS, which was updated in January 2023. It sets out the governance framework within which the OfS and the DfE operate, including in relation to financial matters. The department and the OfS will continue to work together to monitor expenses, funding, resources and efficiency via business planning.

I note that Amendment 8 references the impact of the credit-based method on students with disabilities and those with a need for a sharia-compliant loan system, among other criteria. I clarify that the fee limits are set on courses, not students. Therefore, the credit-based method, like the current fee-limit system, will not depend on any characteristics of individual students. All students on a course will have their fees determined in line with the same fee-limit rules, regardless of whether they have a disability, self-fund or use alternative loan arrangements.

I take this opportunity to assure your Lordships that the Government remain committed to delivering an alternative student finance product compatible with Islamic finance principles alongside the LLE. We were grateful for the support and contributions of noble Lords on this issue during the passage of the Financial Services and Markets Act. I can confirm that, in April, I met the noble Lord, Lord Sharkey, and representatives from the Islamic community, including the Islamic Finance Council UK, to discuss the steps the Government are taking to deliver alternative student finance as swiftly as possible. I look forward to meeting them again—later this week, I believe.

[Lord Watson of Invergowrie (Lab)]

They may have been confidential discussions, but is the Minister able to tell the Committee what the stumbling block is to introducing suitable loans?

[Baroness Barran (Con)]

I am familiar with what the current issue is and, if I express myself in any way inaccurately, I know that my colleagues will help me to write to the noble Lord and all your Lordships. The issue is that there are obviously very significant changes to the Student Loans Company systems with the establishment of the LLE, and sharia compliance should not be an add-on on the end. It needs to be woven through every single one of them and we are committed to doing that really important job. It is very significant in its complexity, but I am happy to set out more detail in a letter to the noble Lord, if that is helpful. I can stress, knowing what I think is behind his question, that there is no lack of motivation and commitment to doing this. It is a practical barrier rather than any other.

Returning to my recent meeting with representatives on this issue, we will continue to engage with your Lordships, Members of the other place and representatives from the Islamic community. I will be able to provide a further update on alternative student finance later this year.

Delivering the Government’s vision for the LLE will require, as I just said in response to the noble Lord’s question, extensive changes to the student finance system and the types of course available. Introducing ongoing reviews into primary legislation before policies have been fully implemented or had sufficient time to bed in would, we believe, be of limited value, if any, particularly when the Government want to focus on working with the sector and learners—and indeed with employers, as your Lordships raised—during implementation.

As your Lordships know, we often see initiatives in post-16 education needing time to scale up to reach their full potential. The noble Lord, Lord Watson, referred to the development of T-levels, which have been deliberately phased to ensure high-quality provision. There are now 16 T-levels available, with 164 providers. Over 10,000 new students were recruited to T-levels in 2022; that is more than double the 2021 figure, but there is obviously also tremendous growth potential there.

I turn to some of the specific questions which your Lordships raised. The noble Lord, Lord Aberdare, hoped that there would be a straightforward registration process for independent training providers. Of course we need to make it as straightforward as humanly possible; equally, it needs to be appropriately rigorous so that we uphold quality because, as the noble Lord understands extremely well, there have been issues with the quality of provision and we really do not want to go there again with these reforms. We are very committed and keen to ensure that we uphold quality at all times, so simplicity of process should not trump the quality of delivery.

In relation to VAT, the noble Lord answered his own question; it is considerably above my pay grade. On creative subjects, I had breakfast last week with a group of tech companies to talk about STEM careers. A number of them really wanted to talk about only the importance of creative subjects within a STEM career, so I agree with much of the sentiment that the noble Lord expressed on that.