Tuition Fees

Robert Halfon Excerpts

Wednesday 19th July 2017 Commons Chamber

[Robert Halfon (Harlow) (Con)]

This is an important debate. I have huge respect for the Minister and all the work he has done to make our university sector better by ensuring that students from all backgrounds have the chance to climb the ladder of opportunity.

In considering student fees, we have a duty of fairness to both the taxpayer and the student, and it is right that taxpayers should not bear the burden alone. A number of principles need to be clear when it comes to tuition fees. The first is that we help students from disadvantaged backgrounds not just get on that ladder of opportunity, but get to the top. The second is that the interest rates charged should be fair for students. The third is value for money. When we talk about disadvantaged backgrounds, we need to be sure that we mean those at the very bottom struggling the most, as well as those who are just about managing.

Earlier this year, we heard that the numbers of working-class students entering the top universities had fallen over the last decade. Although more of our poorest young people are entering university, most are winning places at the lower and middle-ranked institutions rather than those offering the best opportunities for high-earning graduate careers. Disadvantaged graduates will suffer even more acutely than their more affluent peers on graduation, but they will also suffer a class pay gap that means that professional employees from poorer backgrounds are paid almost £7,000 a year less than their peers from more privileged families.

My hon. Friend the Minister spoke powerfully about what he wanted to do to improve the prospects of part-time students, and he recognised that the figures had declined. I welcome that and urge him to do everything possible to support part-time students, particularly single parents on low incomes who may fear going to university because of the size of the loan.

What does value for money mean when it comes to a university education? Why can universities charge the same high fees when there is such variation in the jobs that students find? The Minister has done a lot of work on that and on the new measurements he has introduced, but surely the time has come to look at the level of fees as compared with the destination data. People go to university to climb the ladder of prosperity, and to improve the skills and productivity of our nation. If they pay £9,000-plus and come out with a good job—job done. If they do not come out with a good job, we need to ask why.

[James Cartlidge]

My right hon. Friend is making an excellent argument, but does it not focus his attention on the repayment threshold? In a sense, a higher threshold enforces the very point he is making. If people get the higher salary, fair enough; they repay their loan. If not, they do not repay it anyway.

[Robert Halfon]

I have a lot of sympathy with my hon. Friend’s point.

We need to look carefully at the salaries of the senior management of universities. Something is going wrong if there are significant increases in the salaries of top management but poor destinations for graduates. To be honest, I do not mind what management figures earn if every single person who leaves that university gets a good job at the end. If they do not, I cannot understand why some vice-chancellors receive huge increases in their pay but fail to provide good outcomes. I am not going to name those universities today, but we need to take a hard look at this.

[Julian Knight]

My right hon. Friend is making a powerful and considered speech. Does he agree that we should also look at the length of university courses? Three years seems a little long for some courses, considering the smaller number of teaching hours.

[Robert Halfon]

Yes. My hon. Friend makes a point that I will come to, which relates to business rates. This is about not just the length of courses, but the way in which terms are structured. I said at the beginning of my remarks that the burden on the taxpayer needs to be fair, but we also need to ensure that the burden on the student is fair.

A constituent of mine entered university during the first year of £9,000 tuition fees, and her debt is now around £45,000 including the maintenance loan. I am not against student loans. It is not fair for working people in my constituency to bear the full burden of paying for all students to go to university. However, value for money also involves interest rates. Interest rate levels are much lower in the United States and, as I understand it, there are quite a few months in the year when students have more opportunities to work so they can pay back their loans. That relates to what my hon. Friend the Member for Solihull (Julian Knight) just said. The interest rate here, which the Minister knows is quite high, puts people off. I urge him to look into what can be done to have a system similar to that in the United States.

Of course, not all courses or institutions offer the same opportunities for employment after graduating. A history degree from a Russell Group university could, after five years, see someone earning double what they would have earned had they received the same degree from a less prestigious institution. University graduates have traditionally out-earned their non-graduate peers, but the gap appears to be narrowing. The value of a degree has begun to decline as the supply of graduates has outstripped demand. The Institute for Fiscal Studies recently warned that further increases in the number of graduates could lessen the financial gains of a degree.

The Minister knows that I am passionate about and strongly believe in apprenticeships, and he is a huge supporter of degree apprenticeships. It is important that all students know that there is a choice. There is a chance that we can offer every young person an apprenticeship, all the way from level 2 right up to degree level. We need as much investment as possible in degree apprenticeships, for which there is no loan. Apprentices earn while they learn, are virtually guaranteed to get a job afterwards, and get the skills and training they need. That would be a huge boon to people from disadvantaged to backgrounds. The levy must be used to fund degree apprenticeships as much as possible, as this will transform the nature of the debate, particularly for those from disadvantaged backgrounds.

[Several hon. Members rose—]