Lifelong Learning (Higher Education Fee Limits) Bill (Third sitting)

Robert Halfon Excerpts

Committee stage
Thursday 23rd March 2023 Public Bill Committees

[Mr Perkins]

I do not intend to dwell on these two amendments; my hon. Friend the Member for Warwick and Leamington has forcefully set out their purpose. Regarding the consultation, given what we heard in the evidence session, it is important that the sector is engaged. There is a real concern that until there is clarity about a new method of funding further education and skills, which we know will be more expensive for providers to provide, although—quite rightly—it will not be any more expensive for learners to learn, there will be a gap there. So, unless someone steps forward, there is a real danger that an excellent opportunity will be created for learners that they will not actually be able to access in their local area.

On the subject of the definition of a credit, it is important to remind the Committee what we heard in the evidence session. My hon. Friend asked:

“Should the Bill have written into it some sort of definition of what a credit is?”

Ellen Thinnesen from Sunderland College responded:

“My personal and professional opinion is that it should. If we are defining fee limits attached to credits, it is really important to communicate to a student what a credit means. Essentially, a student wants to know a number of things. First, how much is this going to cost me? Secondly, what will I have to expend in effort and energy to complete this module? Thirdly, what will I get for that module and those credits from the institution that I am choosing to go to? So transparency about the relationship of credit to fees, and of credit to module content and what is expected within that, is very important.”––[Official Report, Lifelong Learning (Higher Education Fee Limits) Public Bill Committee, 21 March 2023; c. 12.]

It was crucial and right that she said that, with her understanding of what motivates learners. It is also important, of course, that future employers understand what those credits mean; other witnesses referred to receiving a handful of certificates, but said that there was no clarity about what those certificates meant.

Alun Francis from Oldham College responded to a question from the hon. Member for Bassetlaw by saying:

“The more important questions will be about the standardisation of the credits…so that learners know what they are getting and paying for. That needs to be absolutely transparent.

It is also important to say that in these technical areas there is a big difference between what learners pay for here and in a traditional degree, because some degrees are positional goods—they are paying for the credential as much as the content—but in these qualifications they are paying for the content. Learners therefore need to be clear that what they are getting is what it says on the tin. The other aspects, I think, we will just get used to.”––[Official Report, Lifelong Learning (Higher Education Fee Limits) Public Bill Committee, 21 March 2023; c. 13.]

Those are very powerful voices from the sector speaking in support of my hon. Friend’s amendment and if the Minister is not minded to support it, we will need real clarity for the sector as to how the definition of a credit will be assured if it is not in the Bill.

[The Minister for Skills, Apprenticeships and Higher Education (Robert Halfon)]

I thank the shadow spokesman, the hon. Member for Warwick and Leamington, for tabling his amendment and for his comments on it. He talked about the timing of the consultation and he said that it came out quite late. It came out quite late because we wanted to make sure that we got it right: we were having extensive consultation with the sector and with other stakeholders, as he rightly wants, and we wanted to make sure that we responded carefully. I do not know if he has seen the recent tweet by the vice-chancellor of the Open University, who said that he welcomed the engagement with the Government. There has been an LLE roundtable with previous Ministers and officials. I attended one such meeting only a few days ago on the LLE.

[Matt Western]

Will the Minister give way on that point?

[Robert Halfon]

Yes, of course. I will come on to deal with some of the hon. Member’s remarks.

[Matt Western]

It would have been really helpful if the Minister had been in post in March last year, because we might have got to this a lot sooner—that is the point I was making. I am sure that the intention was there in the Government, and of course the Augur report was published five years ago, but I have lost count of how many people I have stood opposite here in this past year. Had this Minister been in place, I am sure we would have had this Bill Committee in the autumn of last year.

[Robert Halfon]

The hon. Member is very kind, as always. I cannot speak for the past; I can just speak for the present and the future. My intention is to get this Bill right, which is why this Bill Committee is so important.

The hon. Member opened by saying that there was some confusion about the fixed-rate method and modules and credits. He mentioned Professor Malcolm Press. Universities UK has strongly welcomed the lifelong loan entitlement; I noted that point on Second Reading.

I will just clarify, for the benefit of the Committee, that the Government intend for all courses offered under the LLE to use the new credit-based system for calculating fee limits. That includes longer programmes, such as three-year degrees, as well as short courses or modules, regardless of whether they are studied on a full-time, part-time or accelerated basis.

There may be some courses that are more suited to annual fee limits than credit-based fee limits, for example postgraduate certificates of education or first degrees in nursing. Where that is the case, the intention is that the Government will set fee limits using a consistent rate of 120 credits per year. That includes for Oxbridge, where there is no credit system for degrees; there will be a default credit system for those universities.

The Government intend to retain the ability to set fee limits using the current yearly fee system as well as the new credit-based system, but would use this ability only by exception. These exceptions will be set out via regulations, using the affirmative procedure.

Let me go through the amendments in a little more detail. They focus on the Government consulting with stakeholders regarding the fee limit method and credit-differentiated activities. We have engaged with a wide range of stakeholders to gather input to inform policy development and believe it is absolutely critical that we continue to engage with stakeholders all the way through. I mentioned the vice-chancellor of the Open University. He said:

“The Lifelong Loan Entitlement... has the potential to enable people at any stage of their working lives to improve their knowledge and skills and drive productivity and growth.”

The Government’s consultation on the lifelong loan entitlement included a question specifically on the issue suggested by amendment 5—whether any courses should be on the per academic year, or fixed, method of funding. We intend for all courses under the LLE to use the new credit-based method for calculating fee limits.

We understand, following the consultation and engagement with the sector, that there may be some courses that would be more suited to annual fee limits, such as nursing. In those cases, as I have said, the Government will set fee limits using a consistent rate of 120 credits per year for full-time courses. That will create parity with the current yearly fee system, but via a credit-based mechanism.

On amendment 3, I will provide some additional detail on credit-differentiated activities. A credit-differentiated activity is intended to be a period of study or other activity that has a different fee limit rate to another period of study within the same year—for example, a year containing substantial periods of taught study and time abroad. Credit-differentiated activities make it possible to set fee limits on sandwich placements and overseas study in a more flexible way.

Currently, placements and overseas study have a reduced fee limit rate, but that reduced rate can only be applied to a full year at a time. We are trying to make it possible to fee cap shorter periods of mobility in the year that they actually take place. Where I disagree with the hon. Member for Warwick and Leamington is that an explicit requirement to consult on the detail of credit-differentiated activities is not necessary and potentially burdensome.

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[Robert Halfon]

I thank the hon. Member for his question. As he knows, a credit is a unit of learning time. We are using the standardised system that exists already, but breaking it down into modules. As I said, the maximum will be 120 credits per year. In terms of the modules, there will be a minimum of 30 credits. If providers want to charge for more credits, that is up to them, but the student will not pay for those extra credits that they charge for. We are just breaking down the existing system to ensure that we can introduce modular and flexible learning.

[Matt Western]

I thank the Minister for his comments. However, we will press the amendment to a vote.

Question put, That the amendment be made.

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[Robert Halfon]

I thank the hon. Gentleman for his amendments. The standardised transcript, which is important, will be provided at the end of a module. It provides a clear record of the learner’s study in a recognisable format. It is something that courses already have in their existing certificates.

There are already qualifications for large courses, and employers know that. The standardised transcript will be given on the completion of the student’s module. It is intended to be a requirement of the regulations for loan funding purposes, but it does not necessarily need to be referred to in relation to fee limits.

Amendment 4 would require the definition of credit to align with sector-recognised standards. I emphasise that the Government fully understand the importance of that. We have introduced a definition of credit on the face of the Bill in proposed new paragraph 1A, which defines credits as units used to signify the total amount of learning time that a student would ordinarily be expected to spend in order to complete a course or part of a course. That relates to the hon. Gentleman’s question. As he said, it aligns with the definitions held by the Office for Students and Ofqual.

The Bill does not introduce a power further to define credits in regulations. However, regulations will set out that, for a course or module to be treated as credit-bearing, each credit must be equal to 10 learning hours. That mirrors existing sector practice. The Government do not intend to change regulations on the number of learning hours in a credit unless standards in the sector change. Learning hours are, and should continue to be, based on sector-led standards. I can give an assurance that regulations on learning hours will follow the affirmative resolution procedure so that Parliament will always get an opportunity to debate and formally approve any changes to regulations. As such, the amendment is not necessary.

Let me explain that a bit further. If learning hours are put into secondary legislation, rather than primary, providers that use a different number of learning hours per credit will simply have their courses treated as non-credit bearing, rather than being considered in breach of the fee limit rules as a whole. The Office for Students would have the ability to take action against the provider from a quality and standards standpoint if it deems that necessary, but the provider would not face additional consequences for breaching fee limits rules. As I say, regulations on learning hours will have to follow the affirmative resolution procedure, so Parliament will always get the chance to debate and formally approve any such number of hours before a law is made or changed.

On amendment 9, the Government fully intend to support transcripts for modules of courses. Although we encourage their use as good practice to support students for all level 4 to 6 study, we are not making transcripts mandatory for full courses. That is because modules are a novel concept in terms of designation for student finance, and do not have the fully established standards that exist for full courses. By providing transcripts for modules, the lifelong loan entitlement will enable credit transfer and boost labour market currency, allowing students to make full use of their academic achievements to progress.

Since transcripts are not mandatory for full courses, it would not be appropriate to reference them in primary legislation in the context of both courses and modules. I reiterate that employers know what courses are. Most courses come with a qualification of some kind. For those reasons, the Government will resist the amendments.

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In the spirit of collaboration, let me ask the Minister some questions. What is his justification for choosing 30 credits as the minimum number available to users of LLE? Does he intend to lower the minimum number of credits as the system develops? Would he consider reviewing that a year or two after start-up? Does he agree that setting the minimum at 30 credits might discourage people from pursuing modular lifelong study?

[Robert Halfon]

I thank the hon. Gentleman for moving the amendments. Let me respond first to how they are worded before I address the specific issue of the 30 credits. Amendments 2 and 6 have been worded to limit the default credit value to 10 and 20 credits respectively. I completely get that the intention is to probe the extent to which the Government are prepared to loan-fund modules of fewer than 30 credits under the LLE, but the amendments would not achieve that end because that is not what the default credit values in the Bill relate to.

It is worth clarifying the purpose of the default credit value: it is intended to allow fee limits to be set on full courses if they are not credit-bearing or the course is more suited to annual fee limits than credit-based fee limits. As mentioned, such courses may include some degree programmes at Oxford and Cambridge, and other courses such as nursing. For those types of courses, the fee limit will be calculated using a default number of credits instead of any provider-assigned credits. The default values will be set at 120 credits a year for full-time courses, which aligns with the sector-recognised standard number of credits in a full year.

The default credit values are there to provide a credit value for non-credit-bearing full courses only. They will not apply to modules. As all modules under the LLE will be credit bearing, modules will always have the fee limit calculated using the actual provider-assigned number of credits, not a default number of credits.

The Government have been clear that the modules must have a minimum size of 30 credits for funding purposes. We believe this is a suitable level to attract fees and maintenance loans as it represents a substantial-enough package of learning. It is based on significant consultation with stakeholders and is much smaller and more flexible for training, retraining and upskilling opportunities than the current one-academic-year minimum-size offer.

As mentioned, modules of a smaller size can also be funded—provided that they are bundled together in a single entry from a parent course to meet the 30 credits—to allow sufficient flexibility for retraining purposes. This will mean that funding will be available for a 20-credit module and a 10-credit module of the same course combined.

The hon. Gentleman cited the Augar report. Philip Augar is the key architect of this reform, alongside the former shadow spokesman for skills and universities, Gordon Marsden, who often spoke about lifelong learning. The Augar report is clear that a 30-hour credit represents a

“a significant amount of teaching and learning, and is an appropriate minimum for upskilling or reskilling.”

[Mr Perkins]

Will the Minister clarify for the Committee and for others listening to our proceedings how much loan a student who took on 30 credits would need?

[Robert Halfon]

Under the current loan system, the loan would be divided up in proportion to the 30 credits that the student was taking. It would depend on whether the credit is charged at £77 or £60, which would depend on whether the provider had a teaching excellence framework or an access and participation plan. If the credit was charged at £77, it would be £77 times the 30 credits. It would then be up to the student to decide whether they wanted to do the course.

To return to amendment 2, to cap all default values at 10 credits would make them unfit for purpose, as a full-time year is 120 credits. With that in mind, the Government cannot support the amendment.

[Matt Western]

I hear what the Minister says but am disappointed. I would have liked him to say that, within a year or two of the scheme being in operation, this idea might be up for review. We do buy into lifelong learning, and the Minister is right in what he says about Gordon Marsden, a former colleague, and the work done by the Augar review. However, although the intent is right, we need to consider the delivery and maximising the opportunity, which is why we think there is a real opportunity for the Government, at a certain point, to review the merit in lowering the default so that the minimum is not 30 bundled credits.

There is a huge need to address this country’s training and skills gap, and particularly to be more supportive of small businesses such as those represented by the Federation of Small Businesses, to help them with the training of their staff. We will not push the amendment to a vote, but I ask the Minister to reflect further. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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[Matt Western]

In all seriousness, the issue was discussed at the evidence sessions on Tuesday and there seems to be an anomaly. I am sure that the Minister will want to address that.

Listening to the witnesses the other day, I think there was some concession. If we have rising pension thresholds and we want to re-involve a sector of our population that has withdrawn from employment and the economy —we heard in the last few days about the Government’s intention regarding returnerships—people need to be able to access this provision; I am also thinking of the WASPI women. People suddenly find that they do not have the incomes they need to sustain themselves. The sorts of work they previously were involved in might no longer be open to them, and they might need to retrain. Age 60 is an arbitrary guillotine, and it is not necessarily appropriate. I very much hope that the Minister will clarify the issue for my hon. Friend the Member for Middlesbrough and the rest of us. Perhaps he might reflect on the economic needs, as well as the social needs, that such a change would meet.

It is important that Ministers should be confident that there will be no disproportionate effect on certain groups of students, some of whom we have mentioned, including those from disadvantaged backgrounds. I am thinking in particular of those mentioned in the evidence sessions—those with particular responsibilities, financial challenges, social and domestic challenges, caring responsibilities and so on. In the evidence sessions, I was pleased to hear from Professor Sue Rigby from Bath Spa University, who endorses the plan to ensure a risk analysis of the unintended consequences for students.

Finally, I believe there is a need to have regard for the impact on student numbers. I was intrigued to hear the suggestion from Sir Philip Augar, whom I respect greatly. He suggested that, with a declining population rate, “forward-thinking institutions” may see this route as a viable one to attract more students. A pessimist might say that, given a declining post-18 population rate post 2030, some institutions may see this route as a way to boost their declining student numbers. Although it might seem like a problem for the future, that future does not seem that far away—particularly in terms of electoral cycles. It might not be a problem that we envisage in the immediate short term, but modular study surely should not be seen simply as an avenue through which providers can boost student numbers, being purely driven by their own financial interests.

Sir David Bell of the University of Sunderland raised the prospect of the learner being overwhelmed by choice and he has a very real point. The choice on offer should always be a choice in the learner’s interest, and the Secretary of State would be wise to have due regard for how student numbers might be impacted in setting the maximum number of credits.

Amendment 11 seeks to avoid the unintended consequences of the 120 limit, which is a particular issue for accelerated learning courses, which give an offer to a particular population for whom getting through a qualification in a shorter period of time is really vital, or perhaps vital for the organisation that employs them. That is why we think amendment 11 should be accepted.

[Robert Halfon]

I thank the hon. Gentleman for his amendment. On his question about the maintenance loan, I confirm that the LLE tuition loans will be available up to the age of 60. We believe that is fair to students and fair to the taxpayer. Currently, just over 3,000 people—from memory, it might be 3,500 people—aged 60 take up student loans. However, learners near retirement or in retirement are likely to repay a very small proportion of their loan and their maintenance support will be subject to taper from the age of 60. I think that is what the statement refers to, but of course I am happy to write to the hon. Gentleman with clarification if he would like.

I can confirm that the setting of the maximum credits per course year will be based on robust analysis of any impact on learners and providers. More importantly, I can confirm that there is absolutely an opportunity for the sector to provide feedback on the proposed maximum values before regulations are laid. I can also give the assurance that regulations on maximum credits will have to follow the affirmative resolution procedure, so that Parliament will always get the chance to debate and approve formally any maximum credit values before the law is made or changed.

The regulations will cap the number of credits that providers can charge for within a given course year and for the course overall. That is to prevent providers from adding unnecessary credits to courses in order to raise tuition fees. The cap ensures value for money for the student and the taxpayer. The fee limits will remain aligned with the current rates, based on standard practice. A certificate of higher education will be capped at 120 credits; a diploma of higher education will be capped at 240 credits.

Regarding the hon. Gentleman’s point about the accelerated degrees, we intend all courses offered under LLE to be used under the credit-based method. That includes accelerated courses. The limit on credits will be set at 180 a year. Providers can offer more credits than the maximum, but cannot charge for them. That is in line with the current system, where providers offering the usual number of credits have the same annual fee limit as those offering more for the same type of qualification.

The Government are already factoring in the impact of these reforms on students and providers. That is why we resist the amendment.

[Matt Western]

I appreciate what the Minister says. It is encouraging to hear that those learners and the accelerated courses will be protected. However, we would like this amendment to be incorporated into the Bill, so we will put it to a vote.

Question put, That the amendment be made.