Financial Support (Students)

Teresa Pearce Excerpts

Wednesday 15th December 2010 Westminster Hall

[Teresa Pearce (Erith and Thamesmead) (Lab)]

It is a privilege to have this debate under your chairmanship, Ms Clark. I am pleased to see so many hon. Members here to talk about an important issue. I will try to keep my speech brief, so that everybody can get in to make their points and, more importantly, to ask questions.

I asked for this debate for two reasons. First, we need to highlight the effect that the decision to scrap the education maintenance allowance will have on young people throughout the country. Secondly, we need answers about how the proposed financial support scheme, the enhanced discretionary learner support fund, will work.

Last week in the main Chamber, a vote was carried that will allow university tuition fees to rise up to £9,000 in a year to plug the gaping hole in the higher education budget left by the Government’s 80% cut. I voted against that rise with other Opposition Members. The Government fail to grasp that, by cutting EMA, many young people from poorer backgrounds, particularly in constituencies such as mine, will never reach the level at which they will be able even to consider attending university. Taken together, the tuition fee increase and the scrapping of EMA are a heavy blow to young people in constituencies such as mine.

The EMA keeps many young people in Erith and Thamesmead in college or sixth form—and in some cases, it has to be said, on the straight and narrow. Their families rely on payments to cover the costs of attending college, including transport and books, and they often help top up the family budget. One of my constituents, Trudy Mackie, wrote to me recently, saying:

“I am a single parent”,

living in Thamesmead,

“and have worked full time since leaving school myself. I have managed to purchase my own home and save a little money while supporting my daughter throughout her school life…She was identified as gifted and talented, as a school student likely to do well with support, and we have hoped and aimed for her to go to university for a long time on that basis. We are very concerned about the scrapping of the EMA and how this will affect our budgets. This…really does help my daughter to do extracurricular activities”

that enhance her education, such as

“theatre trips and additional lectures…Our household will struggle without this money.”

[Joan Ruddock (Lewisham, Deptford) (Lab)]

My constituent, Timar Misghina, a student, said precisely the sorts of things that my hon. Friend has just quoted. Tellingly, she said that EMA not only helps with books, transport and clothing, but helps to get her through her studies with fewer worries. It is important that, when people are trying to study, they and their families are not in a state of constant worry about money.

[Teresa Pearce]

I agree. It makes a difference if people know that they can concentrate on their education without worrying about the bus fare.

Some 43% of students at Bexley college and 38% of students at Greenwich college—the two largest colleges serving my constituency—receive EMA, the vast majority receiving the higher rate of £30 a week. Some argue that this money does not have an effect, but the principal of Bexley college, Danny Ridgeway, has confirmed that, in the past two academic years, students at his college in receipt of EMA have been more likely to pass their course than their colleagues who have not received EMA support. I believe that this positive outcome is linked to the attendance requirement attached to EMA payments.

[Bill Esterson (Sefton Central) (Lab)]

On that point, I received an e-mail from the principal of Hugh Baird college in Bootle, telling me that 84% of young people at the college currently receive EMA. She says that it is clear that the EMA has become a key part of family income and that its discontinuation is very likely to impact on the participation rate locally. In addition, a study in Merseyside colleges shows that the results of those on EMA are 7% higher than those of people who do not receive it.

[Teresa Pearce]

I agree. More importantly, Danny Ridgeway, the principal of Bexley college, agrees. He says:

“It is our view that the conditions that link payment to attendance and completion of work have been a motivator to help these students to success and progress”.

At this stage, we do not know whether the Government’s plans for enhanced discretionary learner support will have a similar attendance requirement. Will the Minister tell me whether it will?

The Government’s current line is that many students would have stayed in education anyway and that EMA is therefore a dead-weight. When the Minister makes this point—I am sure that he will—I would be grateful if he commented on the following points. First, research underpinning the dead-weight assertion was flawed, because it was undertaken only among schools, when 69% of the recipients of EMA attend colleges not schools. Furthermore, a significant number of EMA recipients are black and ethnic minority, yet those surveyed were 91% white. If a survey is undertaken with an unrepresentative sample, I believe that the results are irrelevant to the debate.

Secondly, research from the Institute of Fiscal Studies showed that where EMA is available, participation in education and attainment levels increased. Does the Minister not think that those are worthwhile objectives?

Thirdly, many public policies involve a high amount of dead-weight—for example, the initiative announced in the June Budget about temporary relief from national insurance contributions for new businesses. The Treasury’s costing shows that 96% of that tax cut will go to employers who would have set up anyway and that 4% will go to employers who have set up in response to the incentives. If the sole aim of this policy is to stimulate new business, it would be regarded as 96% dead-weight. Why are employers worthy of support, while young people, who are the future of this country, are not?

Before I turn to the details of the enhanced discretionary learner support fund, I wish to discuss what will happen to those students who currently receive EMA and are mid-way through their courses.

--- Later in debate ---

[Katy Clark (in the Chair)]

Order. Can I remind hon. Members that interventions should be short?

[Teresa Pearce]

My right hon. Friend raises an interesting point.

Students who receive EMA and are mid-way through their courses began those courses in good faith and could not have foreseen that the funding that they were promised would be withdrawn later. On 25 November, my hon. Friend the Member for Wigan (Lisa Nandy) and I wrote to the Secretary of State for Education, urging him to ensure that students would continue to receive EMA for the duration of their courses. We have not yet had a clear response from him, so I would be grateful if the Minister clarified what is to happen to those students, particularly given the recent confusion between written answers and information appearing on Government websites.

In answer to my hon. Friend the Member for Warrington North (Helen Jones) on 15 November, the Minister said that £174 million would be set aside for EMA in 2011-12, the next school year. Yet the Directgov website states:

“If you currently get EMA you will continue to receive it for the rest of this academic year, but you will not receive it next academic year”.

I would be grateful if the Minister clarified which is the correct answer.

EMA keeps young people focused on their studies, as other hon. Members have mentioned, meaning that they do not have to take on part-time jobs to see them through their education. Long gone are the days when students could get Saturday jobs to do that, because those jobs are often taken by middle-aged women. The jobs just are not there.

In a letter that I received yesterday, the Minister says that

“the expectation that young people will remain in education or training post-16 is much stronger…than…when EMA was introduced. Already, 96 per cent of 16 year olds and 94 per cent of 17 year olds participate in education, employment or training. Attitudes to staying on in education post-16 have changed.”

I totally agree with the Minister, but that change is precisely because of EMA.

The Government have indicated that future decisions on who will receive payments will be made at individual institutions. The coalition Government say that that is because the school or college is closer to students and can make better judgments, but those very institutions are opposing the withdrawal of EMA. If the Minister trusts their judgment about the administration of the enhanced discretionary learners support fund, perhaps he will tell us why he does not trust their judgment on the value of EMA as a whole.

I would like answers to the following questions. Will the new scheme take account of travel costs? A written answer to my hon. Friend the Member for Wigan shows that the last time the Government assessed the average travel costs per student was in 2003. How will we know what the costs are now if the figures are eight years old?

Will the enhanced discretionary learners support fund even include travel costs? At the moment, it does not. What safety net will be in place if too many students need funding, but not enough money is available locally to fund them? Will that mean less funding per student, will allocation be on a first come, first served basis, will students have to parade their poverty to see who is at the front of the queue, or will more funding be made available? If a college does not use all its grant, what will happen to the surplus? My constituency could be considered to be an area with a high level of student need, and those questions are important to me and the people who sent me here.

[Katy Clark (in the Chair)]

Order. I have received written indications from 12 Back-Bench Members who wish to speak, and I ask hon. Members to bear that in mind when making their contributions.