Funding Higher Education

Roberta Blackman-Woods Excerpts

Wednesday 28th February 2018 Westminster Hall

[Mr Streeter]

If an individual sets up their own business and still owns it then it is up to them what they pay themselves, but other than that I tend to agree about large salaries at the top justified by being in a marketplace and having to compete with other organisations. The charitable sector is another one where we have seen massive chief executive officer salaries. I imagine that if many people knocking on doors raising money for charities really knew what was going on, they would not be so happy. There is a job to be done in all these sectors, perhaps sparked by the Government, to have more reasonable levels of pay at the very top. The gap to those at the top must be very dispiriting for those humbly working day in, day out for not very much money. I recognise that we need to do more about that. The Government have talked about it, and I support them.

I have three specific proposals before I sit down. There are two quick ones, and one where I will go into greater depth.

[Dr Roberta Blackman-Woods (City of Durham) (Lab)]

Does the hon. Gentleman agree that we need the Government to look at sustainability in the sector? The briefing for this debate said that the forecast surplus for the university sector is only 1.3% this year, so it is not a bloated sector. It does not mean there is a differential outcome for various institutions. In fact, university budgets are under threat from Brexit, from the cuts in research funding, from the fall in part-time students, and from a possible fall in international students, not to mention demographic trends in our country. We have to be careful to ensure a sustainable funding system.

[Mr Streeter]

I agree. When the panel reports its findings, I hope the Government take action to help us put in place a system that is both fair and sustainable. We have a world-class university system in this country that we must not in any way seek to undermine. It is hugely important that, as young people increasingly compete with people from other countries, we keep our highest university standards.

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[Paul Blomfield (Sheffield Central) (Lab)]

It is a pleasure to contribute with you in the Chair, Mr Hosie. I had not intended to speak today, but I was interested to hear what the hon. Member for South West Devon (Mr Streeter) had to say, and I have obviously been inspired by his contribution.

I want to make a few, probably disjointed points, the first of which is about the sustainability of the sector. As has been pointed out, we have one of the best higher education sectors in the world. At a time of uncertainty for the country, we ought to build on our strengths, and not do anything to undermine them. When the Minister winds up, I hope that he will assure us on how the review will maintain, or indeed strengthen, the sustainability of the sector.

There is a fear that, because of the way that the debate has opened up, the Government may intend simply to mitigate the costs by constraining fees without replacing them with teaching grants, rather than looking ambitiously at how the system works, as the hon. Gentleman suggested. Clearly, a move to reduce fees in certain subjects could have the perverse consequence of leading people in a contrary direction to the one suggested by the hon. Gentleman. Likewise, a fee cut that is not replaced by teaching grants across the board, or in any other way, could really bring into question the sustainability of the sector.

[Dr Blackman-Woods]

My hon. Friend is making a really important point, which I hope the Minister can address. There is real concern among universities that the review could result in a huge loss of income. As I said earlier, the whole of the sector is not making a huge surplus. We want our university sector to thrive, compete globally, and give our young people and others the skills that they need to compete in the workforce. My hon. Friend has raised an important point, and it is one that the Minister needs to address.

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[Paul Blomfield]

The hon. Gentleman is right. As I said, those of us on this side of the House who were on the Bill Committee, such as my hon. Friend the Member for City of Durham (Dr Blackman-Woods), argued that a focus on teaching quality was right, but we needed to get the way that we measured that experience right.

The other metric that is problematic is employment outcomes. The current Minister’s predecessor, the hon. Member for Orpington (Joseph Johnson), acknowledged that they were crude and, in a sense, unreliable metrics, but they were being used because they were the numbers that were available. I pointed out to the Minister at the time that there is not necessarily a relationship between teaching quality and employment outcomes. If a student had been to Eton and Oxford, like he had, and were from the right family and knew the right people, that person’s employment outcome was likely to be fairly good, irrespective of teaching quality. So when looking at the funding review, my warning is that we should make sure that we look at the educational experience of universities in the round. We argued that there should have been a statement in the Higher Education and Research Act 2017 about what universities were for.

[Dr Blackman-Woods]

I am glad that my hon. Friend has raised the discussion we had in that Bill Committee about what universities contribute to our society in addition to teaching and education. They contribute to sports development, cultural development and social outcomes in our communities. They do a lot of voluntary work. Students from my own university, Durham, do a lot of voluntary work in the local community. If we are going to look at value for money, which I agree we should, we felt that the additional benefits that universities deliver to society should somehow be brought into the equation as well, and there was certainly a danger under that legislation of the wider benefits of universities being completely discarded in the Government’s TEF measures.

[Paul Blomfield]

I thank my hon. Friend for that intervention. Clearly, we are at one on that issue.

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[Carol Monaghan]

We also have to look at the retention rates for young people from disadvantaged backgrounds who do not have full support.

Ultimately, this debate should be about who benefits. We educate children in schools not simply for their own economic benefit, but for the benefit of society. We have got to ask whether the young people embarking on tertiary education courses will contribute economically and societally to our nations, or whether we are simply providing them with a service, for which they must pay. As legislators, we must be clear about that. Post-Brexit, the UK’s economic success will rely on a well-educated population. We have skills shortages in science, technology, engineering, healthcare, education and digital. Graduates are needed now to ensure that the UK remains competitive outside the EU.

The hon. Member for Sheffield Central (Paul Blomfield) mentioned the variance in fees. I have difficulties with that. If as has been rumoured we lower the fees for less expensive courses, how will we encourage our young people to study the more expensive science, technology, engineering and maths subjects, graduates of which are so desperately needed? EngineeringUK estimates that we have an annual shortfall of 20,000 engineering graduates alone. The hon. Member for South West Devon mentioned the impact of removing the nursing bursary. Again, who benefits? We should encourage young people to study those courses, not put additional barriers in their way.

Fees are not the only difficulty for English students. The interest on student loans has risen sharply—it is currently 6.1% for some students. Maintenance grants have been scrapped, and it is rumoured that student debt on completion has reached £50,000. Many young graduates will be left saddled with debt throughout most of their working lives.

The hon. Member for South West Devon mentioned students staying at home for their university experience, and was concerned about the impact on the whole package experienced by students at university. In Scotland and Ireland there is a cultural predisposition to stay at home. It is not necessarily financially driven—my son is staying at home during university—so there may be other factors at play. His education is not impacted. Students have opportunities for other life experiences, such as summer placements, industrial placements and travelling abroad. The hon. Member for Northampton South (Andrew Lewer) mentioned Erasmus, which is a rich experience for students even if they stay at home during university. I push the Minister to make a commitment on Erasmus, because university students and many people across the sector want that commitment as part of the Brexit process.

We are often told that our free tuition policy in Scotland prevents Scottish students from accessing available places, but since 2007, the number of Scottish-domiciled full-time degree entrants has risen by 12%. Since 2013, the total number of funded places available at Scottish universities, including additional places to widen access for students from Scotland’s most deprived communities, has also increased. The hon. Member for Sheffield Central mentioned the metrics used in the teaching excellence framework, and graduate success as an indication of our universities’ quality. Graduate salaries are a lot lower in many geographical areas in the UK, so students graduating in parts of England and Scotland will automatically have a lower salary than those in south-east England. That is a flaw in that metric.

We often talk about the number of young people going to higher education as a measure of economic success. I could not count the number of times I hear people talking about encouraging people to do high-quality apprenticeships, yet that seems to be forgotten when we talk about higher education. I would like there to be parity among apprenticeships, further education colleges and quality employment. In fact, we should look at positive destinations, not just the number of young people going to university. For many young people, a high-quality apprenticeship—degree level or otherwise—allows them to make excellent progress in the workplace without necessarily saddling themselves with debt.

[Dr Blackman-Woods]

The hon. Lady makes an important point. Does she agree that it is important not to talk in binary terms about university or technical education? Our universities deliver some of the best technical education in the country, and we should aim for a route to whatever form of education is best for the young person or older person retraining. We should not get stuck in the binary divide, but ensure that we make connections between them.

[Carol Monaghan]

We have a problem if we educate only graduates—we need a full range of different people with different skills. I usually speak about tertiary education because, in Scotland, the lines between further education and higher education are less defined than they are in other parts of the UK. In fact, a lot of our degree courses are delivered in further education colleges. The movement between FE and HE is a very important part of our educational landscape in Scotland.

Positive destinations should be a measure of success, and we should encourage young people of all backgrounds into whatever is appropriate for them. That includes those from the most advantaged backgrounds considering apprenticeships. We need to try to break down that barrier. I agree with the hon. Member for South West Devon that vice-chancellor pay has reached a ridiculous level for some. Lecturers were out on strike this week and last week because their pensions are under threat. I agree with him that perhaps the time has come to look at the pay package that we offer all staff.

Paying for education is a duty of Government, business and society, including the taxpayer. We need to ensure that we have a well-educated population that can provide economic growth in different businesses and sectors. Post-Brexit, there will be a struggle to create economic growth. We all have the duty to pay our taxes so that they fund the education of our young people, benefit society and fuel economic growth. The Scottish National party is fully committed to guaranteeing fair access to higher education, so that every young person, regardless of background, has an equal chance to go to university. My party will continue to work hard to ensure that.

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[Gordon Marsden]

No, I am not going to take another intervention. The Minister will have plenty of time to say what he wants to say.

My hon. Friend the Member for Sheffield Central (Paul Blomfield) rightly talked about the sustainability of the sector and some of the key issues in terms of Brexit. My hon. Friend the Member for Coventry South (Mr Cunningham), who is no longer in the Chamber, absolutely rightly drew us back to further education and nursing bursaries, and the hon. Member for Glasgow North West (Carol Monaghan) spoke about issues post-Brexit.

The point is very straightforward: since coming to office in 2010, Conservative-led Governments have repeatedly raised tuition fees. They trebled fees to £9,000 and subsequently increased them to £9,250. That agenda has hit students—particularly those from disadvantaged backgrounds—harder and harder since 2012. The cutting, one by one, of all the concessions that David Willetts introduced to temper the impact has been just as damaging. Those concessions were dismantled deliberately. The National Union of Students lists them in its briefing for the debate: the Government abolished maintenance grants, NHS bursaries, the disabled students allowance and the education maintenance allowance, and ended Aimhigher.

The Minister has inherited that. He is not responsible for it, but he would be wise to show due humility about its incremental impact on the people concerned. If he reads the “Fairer Fees” report published by the Sutton Trust late last year, he will see, as Members have already said, that the average debt for students in England is higher than the European average and twice the US average. As a result, the Government have racked up an unenviable record of nudging people away from, rather than towards, aspiration in higher education and chipping off many of the rungs of the ladder of social mobility that were designed to protect them.

The July report by London Economics for the University and College Union suggested that thousands of graduates would suffer a mid-life tax crisis, analysis undertaken last year by the Institute for Fiscal Studies shows the level of debt, and only this week the Sutton Trust gave us figures that show disadvantaged students across the UK are more than three times more likely to live at home while attending university. The hon. Member for Glasgow North West made that point, too.

The Prime Minister finally admitted last week, after months of us, the Sutton Trust and an impressive range of stakeholders all saying the same, that the current funding system leaves the most disadvantaged students with the highest debt, yet behind the warm words and soft soap that were ladled out by the Prime Minister in Derby and by her Education Secretary in the Commons, it seems that no new money is available and there is the potential for HE funding cuts. In her speech, the Prime Minister tried to talk the talk on social mobility and aspiration, but she did little to walk the walk and address either the FE sector, in which 10% of HE is delivered, or the problems with 16-to-18 provision that many colleges are suffering, including the one in which she chose to make her speech. It will take more than a brush-by in Derby one afternoon in February to remedy those issues.

The terms of reference published by the Department state that the review cannot make recommendations on tax policy and must make recommendations in keeping with the Government’s fiscal policies. Will the Minister confirm that that means there will be no new money for the policies in the review? Does it mean that savings will have to be found elsewhere in the FE budget if changes are to be made? My hon. Friend the Member for Sheffield Central challenged him and, to give him credit, he made a commitment that access and widening participation funding will not be diminished as a result of the review. I warn him that the Treasury has a long reach and he will need a stout shield to resist it in this area and others.

[Dr Blackman-Woods]

Does my hon. Friend agree that, unless the Government are at least prepared to put more money into the sector, it is difficult to understand how we will get a sustainable system for funding universities? The Minister needs to be clear about that.

[Gordon Marsden]

I absolutely agree. As the Minister is eager to explore our policies, I remind him that Labour’s policies and our message of progression were taken on board so strongly by would-be and existing students, their families and their parents during the recent election because we had a cohesive narrative. Whether we were talking about adult learning, college learning or traditional cohorts of young people going into higher education, we said that we wanted to lift barriers and financial burdens to make a step change in social mobility. The Conservatives did not put that message across, and suffered accordingly. Given the restrictions on the review, they will miss another opportunity.

The Conservatives continue to falter on the reintroduction of maintenance grants, to which we have been committed for nearly two years. The Prime Minister engaged with that tortuously last week. Our position is echoed by the education sector, Universities UK, MillionPlus, the Chair of the Education Committee, the Treasury Committee and even the vice-chancellor of the private University of Buckingham, Sir Anthony Seldon. UUK has said that there are ways in which the current system can be improved, such as by reintroducing maintenance grants, as has MillionPlus, but it is likely that colleges and universities will be expected to cover any extra costs. The Prime Minister implied that in her speech last week when she said the Government will have to look at how

“learners receive maintenance support, both from Government and universities and colleges.”

We have some idea of how that extra funding might be delivered under her policies: by robbing Peter to pay Paul. We saw the same sleight of hand from the Secretary of State in The Sunday Times, on the BBC and in his statement last week, when he talked about cutting the cost of tuition fees.

The bottom line is that those who already have a lot will be given more. Wealthy students and graduates will benefit the most, because they can pay off debt the earliest. Over the next 10 years, there will be 13 million vacancies but only 7 million school leavers to fill them, yet great swathes of our university extramural departments, institutions such as the Open University and Birkbeck, and new providers, have been swept away or at least crippled by the tripling of fees since 2012.

There is a social dimension. One in five undergraduate entrants in England from low-participation neighbourhoods chooses or has no option but to study part time. The Government need to address that. However, when the Prime Minister talked about lifelong learning last week, there were no words of contrition for what the Government have done: tripling fees, scrapping maintenance grants and introducing adult learning loans, half of which have been handed back unused to the Treasury.

What we need to know from the Minister—apart from why, curiously, there has been no reference to 16-to-18 education—is what he is going to do to reassure people. No direct grant has been available for university courses in the arts and humanities, social sciences, computer science, design, architecture or economics since 2014-15. Will there be anything in the review to support those? The Prime Minister and the Secretary of State have talked about two-year courses easing financial burdens on students, but where is the commitment to the continuous professional development that will be necessary in HE if those are to go forward correctly?

Finally, what are the principles behind the timing of the report? Of course, the report will not be independent but will have input—that is all it is—from the panel. However, that input may be quite weak. Why will there be no consideration of that? What will the Minister do to reassure us all that it is not just a PR exercise?

Henry Ford famously said that a customer can have any colour so long as it is black. If the Minister and his Government do not take proper regard of the various elements described in the debate, they will be just as guilty of that as Henry Ford.