Higher Education and Research Bill

Debate between Viscount Younger of Leckie and Lord Mackay of Clashfern

3rd reading (Hansard): House of Lords
Tuesday 4th April 2017 Lords Chamber

[Viscount Younger of Leckie]

My Lords, with that introduction, how can one fail? I thank another noble and learned Lord—this time, my noble and learned friend Lord Mackay—for his helpful and astute contributions on this issue both in Committee and on Report. We are very grateful for the expertise that he brings to bear. As my noble and learned friend said, this amendment has had an interesting history and has done the rounds, but, on a serious note, let me offer my apologies if the department’s letters to him on this issue have misunderstood his area of concern.

I shall briefly reiterate why the powers to enter and inspect higher education providers, set out in Schedule 5, are needed. These powers will allow suspected breaches of registration and funding conditions which are considered by a magistrate to be, to quote directly from Schedule 5,

“sufficiently serious to justify entering premises”,

such as financial irregularity, to be tackled swiftly and effectively through the new power of entry. This will safeguard the interests of students and the taxpayer, and protect the reputation of the sector. As the NAO said in its 2014 report on alternative providers, at the moment the department has no rights of access to providers, and this affects the extent to which it can investigate.

We agree that it is vital, of course, that strong safeguards are in place to ensure that these powers are used appropriately. As set out in Schedule 5 as drafted, a magistrate would need to be satisfied that four tests were met before granting a warrant: first, that reasonable grounds existed for suspecting a breach of a condition of funding or registration; secondly, that the suspected breach was sufficiently serious to justify entering the premises; thirdly, that entry to the premises was necessary to determine whether the breach was taking place; and fourthly, that permission to enter would be refused, or else requesting entry would frustrate the purpose of entry. These criteria will ensure that the exercise of the power is appropriately limited. Further limitations are built into Schedule 5, including, first, that entry must be at a reasonable hour, and secondly, that the premises may be searched only to the extent that is reasonably required to determine whether there is or has been a breach.

I believe that the thinking of the Government and that of my noble and learned friend is very largely aligned in relation to these safeguards. I fully understand that this amendment does not seek in any way to alter the conditions which must be met for a warrant to be granted, or prevent warrants being granted where they otherwise would have been. Rather, as my noble and learned friend has set out, the amendment makes a small change to the powers so that the search warrant to enter a higher education provider must state that all the conditions for grant of the warrant specified in Schedule 5 have been met. I am grateful for my noble and learned friend’s valuable contribution and have discussed this with him outside the Chamber and reflected on this matter very carefully. As he said, he spoke with my honourable friend in the other place, Jo Johnson, on this matter today, and with officials from HM Courts and Tribunals Service. I hope that these conversations were helpful. However, the Government remain of the view that this schedule should stand as drafted, as we believe that a requirement to state that the conditions have been met would not provide an extra legal safeguard.

We agree that it is imperative that the conditions in the schedule are fully met before any warrant is granted. However, we believe that this is already the effect of the Bill as drafted, specifically paragraph 1 of Schedule 5. Furthermore, paragraph 3(1)(f) already provides that the warrant must, as far as possible, identify the funding or registration condition breach which is suspected. We understand that, in the past, magistrates may have taken an insufficiently robust approach towards scrutinising warrant applications but, as I have impressed upon my noble and learned friend, the position is markedly different now: the specifics of applications are carefully scrutinised and it is not uncommon for warrants to be refused. I should acknowledge to my noble and learned friend that there may have been a misunderstanding as to the requirement for a magistrate to certify that the statutory requirements for the issue of a search warrant have been met. I want to reassure him that a magistrate will be required to set out the reasons for their decisions in writing, and to add their signature to their reasons. I accept that this may be described as a certificate.

I want to go into a little more detail, bearing in mind the comments of my noble and learned friend. He asked whether an application under Schedule 5 is within the ambit of the criminal procedure rules. The criminal procedures apply to a magistrates’ court,

“when dealing with a criminal cause or matter”.

Although an application for a warrant under Schedule 5 can be granted only where the breach under investigation is sufficiently serious, there is no requirement that the investigation must relate to possible breaches of the criminal law. However, in the absence of any specific guidance to the contrary, it is the practice of magistrates’ courts to deal with applications for a warrant to enter premises in accordance with the CPR and the criminal practice directions and using the prescribed form of application and warrant. Magistrates’ courts do not seek to make fine distinctions as to whether an application is civil or criminal. It is the nature of the application that is important.

As I said earlier, I can confirm that a magistrate will sign a separate form which certifies that the statutory criteria are met. In addition, of course, the magistrate will sign the warrant. With that reassurance, with the extra detail that I have set out and the reasons we believe this amendment is not necessary, I respectfully ask my noble and learned friend to withdraw his amendment.

[Lord Mackay of Clashfern]

My Lords, I am extremely happy because the purpose of my original intervention has been fully met by the description that my noble friend has given of the practice of the court. It is a little odd that the form is to be used only for criminal matters, but practice sometimes overcomes that. I am constrained to add a personal note. When I came to politics rather late in life, I had a very skilled, shrewd and experienced person to guide me. He was operating in a very hostile atmosphere and I gathered from him that if you could do anything to allay the concerns of those who were concerned about your activities, so long as it did not alter your own position it was wise to do so. I have used that criterion for most of my time in these offices. The person to whom I owe this tuition was the father of my noble and learned friend. I beg leave to withdraw the amendment.

Higher Education and Research Bill

Debate between Viscount Younger of Leckie and Lord Mackay of Clashfern

Report: 3rd sitting (Hansard): House of Lords
Monday 13th March 2017 Lords Chamber

[Lord Mackay of Clashfern (Con)]

My Lords, I wonder to what extent this amendment focuses on the general questions that have been raised. As I understand it, the amendment focuses on whether students at a particular institution should be eligible for loans. If an American university, or some other foreign university, set up a campus here, would the amendment provide that students at such a campus will not be eligible for student loans? I am not certain whether they would be.

[Viscount Younger of Leckie (Con)]

My Lords, the Government want to provide students with options and choice, and to enable them to pursue the path through higher education that is best for them. We want a globally competitive market that supports diversity, where providers that demonstrate that they have the potential to offer excellent teaching and can clear our high quality bar can compete on a level playing field. To deliver that competitive market, we are introducing through the Bill a single, simple regulatory system appropriate for all providers, with a single route to entry and, for the first time, a risk-based approach to regulation.

It is through imposing conditions of registration that are directly linked to risks that we are able to improve and strengthen regulation of the sector. The Bill will enable us to go further than ever before and protect against the very issues that I know noble Lords are concerned about, in that, for the first time, we can focus attention where it is needed, rather than having the current one-size-fits-all approach. This means we do not have to take such a blanket approach as proposed by the amendment, which would automatically exclude potentially excellent providers.

Let me be absolutely clear: we are talking about providers which are carrying out their activities principally in England, so inevitably there will be a presence of some kind in England. Although each case will depend on its own facts, in determining where a provider carries out its activities, questions such as where the provider’s management activities take place, where its courses are designed, where course material is prepared, and where supervision, marking or other evaluation takes place, will need to be considered. It is not simply a matter of where students are studying.

Clauses 4 and 79 are clear that only those providers which carry on, or intend to carry on, their activities wholly or principally in England can successfully apply for registration. Only registered higher education providers can benefit from their students having access to student support. While there is no requirement in the Bill that providers must be incorporated in the United Kingdom, this does not mean that the Bill has inadequate safeguards in respect of foreign-established registered providers. If, following its assessment of risk, the OfS considers that particular risks arising from the fact that a provider is incorporated outside the United Kingdom need to be addressed, these will be mitigated through the imposition of specific registration conditions.

I can commit today that the Government will give clear guidance to the OfS about carrying out its risk assessment in the case of providers that are not incorporated in the UK, and outlining factors for the OfS to consider and address when it decides what registration conditions to apply to these providers. As an example, the OfS will need a clear understanding of how it can effectively regulate this sort of provider, backed up through registration conditions where appropriate. This will include understanding how the necessary verifications on matters such as quality and financial sustainability can take place before a provider can be granted entry to the register, as well as how effective enforcement action can be brought by the OfS and how students’ complaints can be dealt with.

To provide some specifics, it will be open to the OfS to seek financial guarantees from parent or holding companies so that it may have sufficient confidence that the provider can deliver ongoing high-quality provision. As happens now, we would expect the designated quality body to have in place arrangements with overseas quality assurance bodies to share information about higher education providers operating in their respective jurisdictions. It is also open to the OfS, through Clause 15, to impose a public interest governance condition on registered higher education providers that requires the provider’s governing documents to be consistent with public interest principles listed by the OfS. The list must include, but is not limited to, the principle that all academic staff have the freedom within the law to question and test received wisdom, and put forward new ideas and controversial or unpopular opinions without placing themselves at risk of losing their jobs or privileges.

Furthermore, it is clear that in respect of a registered higher education provider’s activities in England and Wales, the applicable law will be that in the Higher Education and Research Bill, and other relevant English and Welsh law. For example, its activities in England will be subject to the relevant applicable law as it applies in England, such as tax and equalities legislation. It is not necessary for a provider to be incorporated under the law of the United Kingdom for English courts to have jurisdiction. It is worth noting that English higher education providers operating overseas are not subject to restrictions that relate to where they are incorporated. The noble Lord, Lord Stevenson, hinted at this in his speech. If we were to unilaterally impose such restrictions this could be seen as a barrier to free trade and consequently there is a real risk that other countries might retaliate. This risks damaging a valuable export industry for the UK.

We must also be mindful that until we exit the EU we should not legislate in a way that conflicts with EU law. A requirement that a provider is incorporated in the UK may breach EU law on freedom of establishment and freedom to provide services. As such, we do not believe that there is any benefit to be gained from insisting on a requirement that registered higher education providers are incorporated in England and Wales or another part of the United Kingdom.

I hope the House will bear with me while I speak briefly about a slightly different issue before I ask for the amendment to be withdrawn. We have been looking again at Clause 114, on the pre-commencement consultation. Noble Lords will recall that this enables the Office for Students to rely on consultations carried out by the Secretary of State, the Director of Fair Access or HEFCE before the OfS has the power or duty to do so. Where the power or duty would, once it exists, require the OfS to consult registered higher education providers, we want it to be as clear as possible that the Secretary of State, the Director of Fair Access or HEFCE may satisfy this requirement by consulting an appropriate range of English higher education providers before any such providers have been registered. To this end, the Government undertake to bring forward at Third Reading a minor and technical amendment to provide that clarity. I hope that Amendment 146 will therefore be withdrawn.

Higher Education and Research Bill

Debate between Viscount Younger of Leckie and Lord Mackay of Clashfern

Report: 2nd sitting (Hansard - continued): House of Lords
Wednesday 8th March 2017 Lords Chamber

[Lord Mackay of Clashfern (Con)]

The amendment arises out of an observation I made when this schedule was considered in Committee. I think it was the noble Baroness, Lady Brown, who said that this was quite a serious matter.

[Viscount Younger of Leckie (Con)]

I am sorry to interrupt my noble and learned friend but I believe that the amendment is within the group we have just concluded.

Higher Education and Research Bill

Debate between Viscount Younger of Leckie and Lord Mackay of Clashfern

Report: 1st sitting: House of Lords
Monday 6th March 2017 Lords Chamber

[Lord Mackay of Clashfern (Con)]

My Lords, I support Amendment 7 tabled in this group by the noble Lord, Lord Addington, and the noble Baroness, Lady O’Neill of Bengarve, and I want especially to mention Amendment 2. As I explained at Second Reading, my legal education, such as it was, was part-time, and I think that it is a very useful type of education with its mix of theory and practice in whatever it is you are aiming to do. I hope that this amendment will be considered seriously because it is important that the full range of students should be borne in mind by the authority looking after them, whatever its name happens to be.

As this is a new stage of the Bill I ought to declare my interests. I have been connected in one way or another with universities for a good part of my life, including two honorary fellowships at colleges in Cambridge, but I am not conscious that any of that has particularly affected my views on this Bill.

[Viscount Younger of Leckie]

My Lords, this is a large group of important amendments—I think it is fair to say that it has grown in the past 24 hours—to which we have heard many valuable contributions, so I make no apologies for speaking at some length. Before I do, I wish to reiterate a point made by noble Lords on many occasions during the debate. One of the great strengths of our world-class higher education system is its diversity. That diversity, be it in the form of part-time study, providers of a denominational character or new innovative providers entering the market, is essential to promoting greater student choice. We want all students, whatever their background or circumstances, to get the most they possibly can from a higher education experience that can respond to their varied needs. A number of noble Lords have also made that point in this debate.

I turn first to government Amendment 8, on diversity of provision. The noble Baroness, Lady Bakewell, who is the president of Birkbeck, has long been a passionate supporter of part-time study and non-traditional students. Speaking in an interview in 2013 to Times Higher Education, the noble Baroness declared—perhaps I may quote her; I am sure that she will remember it:

“Part-time study and flexible learning are going to play a big part in the future of our society”.


The amendment I have tabled along with the noble Baroness, Lady Garden, explicitly recognises that. It makes it clear that choice among a diverse range of higher education provision is part of the OfS’s duty to promote greater student choice. That includes but is by no means limited to choice among a diverse range of provider types, course subjects and modes of study such as full-time, part-time, distance learning and accelerated courses. These are only examples rather than a comprehensive list because when looking to the future, the needs of students, employers and our economy will change and the sector will need to continue to innovate and diversify in response. That is why the Bill goes much further than the existing legislative framework in ensuring that the OfS board will include a diverse representation of interests, including individual student representation, and covering different types of institution.

At the same time, we need to avoid limiting the desirability of experience to a restrictive list of requirements that could prevent the Secretary of State appointing a board that is able to address the challenges and priorities of the day. Regarding Amendment 2, I would like to reassure noble Lords that the Bill as drafted enables the Secretary of State to choose, if he or she so wishes, board members with experience, knowledge and expertise in part-time study, adult and distance learning, and any manner of other diverse means of delivering higher education.

I turn now to Amendments 7, 48, 87 and 94 to 98, on equalities, access and participation. I understand and share the intent behind these proposals: where particular groups face additional barriers to accessing and participating in higher education, they should of course be supported appropriately and protected from discrimination. But I fear that the practical application of these amendments risks imposing additional burdens and constraints on the OfS that might not guarantee better outcomes for students. My noble friend Lord Lucas suggests specific ways of evaluating access and participation. I thank him for this and appreciate his engagement, but we do not see it as necessary. Providers already evaluate these activities and we expect this to continue.

We are proud that measures to increase access and participation and equality of opportunity are at the heart of the Bill. It already gives the OfS an explicit duty to have regard to the need to promote equality of opportunity in connection with access to and participation in higher education across all its functions. The OfS collectively, rather than a single member, will be responsible for demonstrating how that duty is being fulfilled.

Paragraph 13 of Schedule 1 confirms that the OfS must report annually on its functions—including access and participation functions—and that this report must be laid before Parliament. There is therefore no need for a separate report on access and participation. Taken together with the Equality Act, our reforms will help to create a framework within which all students should be protected—a framework that enables autonomous providers to respond to the needs of their particular student body by developing appropriate support services and procedures.

Throughout our consideration of the Bill the noble Lord, Lord Addington, has been tireless in his advocacy on behalf of disabled students. I can assure him that we will continue to work closely with the sector to promote best practice in making reasonable adjustments within the framework of the Equality Act. I have listened to the noble Lord’s concerns in Committee and today. I have met with him to discuss this important issue further. I am pleased to say that the Government have published a report by a senior sector-led group, setting out best practice principles for making reasonable adjustments. We will continue to work with that group to support higher education providers in identifying how those principles can be applied in practice. I will say more on this in a moment.

However, providers need the flexibility to determine precisely how best to meet their students’ needs, consistent with their Equality Act duties. Similarly, the OfS needs the flexibility to determine precisely how best to discharge its duties regarding equality of opportunity. I agree with the noble Lord that identifying barriers faced by particular groups of students and considering how they might be addressed is one way in which the OfS might take into account its duty regarding equality of opportunity. However, I believe that imposing this as a further duty on the OfS as set out in the amendment could be counterproductive, placing additional burdens on the OfS without a commensurate benefit for students.

I say this to the noble Lord, Lord Addington, who, I know, is well exercised by this issue, as perhaps are a few other noble Lords. I can confirm that I and the Minister for Universities and Science, Jo Johnson, will write to the chair of the Disabled Students Sector Leadership Group to ask that it invite the noble Lord to meet it and work with him to develop the guidance further, based on his experience and expertise.

I listened carefully to the point made about dyslexia assessments. The noble Lord raised this issue with me in our recent meeting, and I understand his concerns. Students must provide evidence of their disability to prove eligibility for DSA, and they are liable to meet the costs of this. It is not the purpose of DSA to cover the costs of diagnosis of a condition or disability. Rather, it provides help with only the additional costs of study that a student incurs by virtue of having a diagnosed disability.

The question that could be asked is whether a provider could rely on previous diagnostic reports, or whether the disabled student may be able to bring these with him. This may have been the gist of the line the noble Lord was taking. However, all students are asked to provide evidence of their disability. This is fair, because every institution is different. It is important that the provider or institution can assess correctly students’ needs in relation to the particular course they are taking. That has to be based on up-to-date information. I hope that slightly more prolonged answer will help a little with the noble Lord’s issues.

--- Later in debate ---

[Viscount Younger of Leckie]

My Lords, the fundamental importance of joint working between the OfS and UKRI has been raised many times in this Chamber, in the other place and beyond. We listened carefully to the debates in Committee, including the powerful contributions from the noble Lords, Lord Triesman and Lord Smith, and many others, and with these two amendments we are responding.

The Bill requires both organisations to report annually to Parliament. This amendment will expand these reporting provisions to require that the annual reports of both organisations include a section detailing how they have co-operated over the period of the reporting cycle. This would include issues such as knowledge exchange and HEIF, or RDAPs, which we look forward to discussing later on.

With the amendments we are making it clear that the two organisations should co-operate. Clause 108 empowers them to do so. Now they must cover how they have done so in their annual reports, providing Parliament and commentators with the opportunity for scrutiny.

The amendments strike the right balance between empowering and facilitating joint working by requiring transparency around co-operation, without taking us into a prescriptive and potentially limiting list of activities which would be impossible for the organisations to expand or alter in response to changing circumstances. I beg to move Amendment 3.

[Lord Mackay of Clashfern]

My Lords, I strongly support the amendment. I just hope that in due course the Minister will be able to go a little further—but the amendment is very much in the right direction.

Higher Education and Research Bill

Debate between Viscount Younger of Leckie and Lord Mackay of Clashfern

Committee: 7th sitting (Hansard - continued): House of Lords
Monday 30th January 2017 Lords Chamber

[Lord Mackay of Clashfern]

I take this opportunity simply to congratulate the Minister on having taken over this intricate and important part of the Bill. He has discharged his responsibilities with great skill.

[Viscount Younger of Leckie (Con)]

My Lords, as this is the last group of amendments, most of which were not moved by the noble Lord, Lord Stevenson, I shall respond briefly and particularly take note of the general comments made by the noble Baroness, Lady Deech. I shall make a short concluding comment. If there are matters in this group of amendments that require some writing, I will write to all noble Lords and put a copy of such letters in the Library of the House.

I shall make some concluding comments about this quite long Committee stage. I record my appreciation of the whole Committee and of all noble Lords who have taken part in all the debates for the quality and constructive nature of the discussions we have been having in the past few weeks. I am very pleased that noble Lords recognise that Committee stage is about discussing the Bill, probing the detail and, importantly, giving all sides an opportunity to listen to other noble Lords’ points of view. As a result, noble Lords have not felt the need to divide the Committee beyond the first amendment on the first day. For that, I am grateful.

Now we have some time before the Bill enters its Report stage. The noble Lord, Lord Stevenson, has challenged me on the meaning of different verbs used on occasion by me on and around the word “reflect”. I hope I can leave a smile on his face—or perhaps not—by saying that I am actively working with my honourable friend in the other place, Jo Johnson, to reflect on these discussions and consider the best way forward. On a serious note, I hope the noble Lord and the noble Lords, Lord Watson and Lord Mendelsohn, realise that I have given much warmer words than that at certain points. In that spirit, I want to be sure that he understands that we are looking very carefully at Hansard and reflecting generally on all the debates. I am looking forward to Report. In the meantime, I would just say that I have very much appreciated the debates and look forward to future ones.

Higher Education and Research Bill

Debate between Viscount Younger of Leckie and Lord Mackay of Clashfern

Committee: 6th sitting (Hansard): House of Lords
Wednesday 25th January 2017 Lords Chamber

[Lord Mackay of Clashfern (Con)]

My Lords, I wonder how this works in view of Clause 47(6):

“Regulations under subsection (1) may include power for the OfS to deprive a person of a taught award or foundation degree granted by or on behalf of the OfS under validation arrangements”.


What sort of validation of a degree is it when it can be taken from you—after you have got it, I assume?

[Viscount Younger of Leckie (Con)]

My Lords, I thank noble Lords for the opportunity to discuss validation arrangements. We believe that they are essential to a fully functioning higher education sector. We have listened to the concerns raised around the potential for Clause 47 to create a conflict of interest. However, I believe that a more substantial conflict of interest already exists within the sector.

At the moment, new providers usually have to find a willing incumbent provider to validate their provision. This gives those incumbent providers significant levers to control which new providers can enter the market, and what kind of provision they offer. Even if established providers are willing to help new providers get a foothold in the sector, there is an inherent conflict of interest if the proposed new provision would directly compete with one of their own courses. Of course, conflicts of interest are not the only problem validated providers can face. We know that some providers still find it difficult to find a partner that is willing to enter into validation arrangements with them, or have established arrangements unexpectedly withdrawn, and not because they are considered poor quality.

The noble Baroness, Lady Garden, stated that there was no evidence, but I have to put her right. We only need to look at events at Teesside University last year. Following a change of leadership, the university unexpectedly withdrew important validation services to 10 local colleges, based on a change of strategic direction and not as a reflection of the quality of the provision. Ensuring new and existing high-quality providers are not locked out of the market via their preferred entry route is essential to ensuring that students are able to access the right type of higher education for them.

The OfS cannot force providers to enter into validation arrangements. If insufficient providers are entering into validation agreements with each other or into commissioning arrangements with the OfS, or these fail to correct the problem, the OfS will need to find another way to promote competition and choice. Without further powers, the OfS could potentially be forced to stand by and watch while good-quality providers that do not want to seek their own degree-awarding powers remain locked out of degree-level provision indefinitely.

The OfS will, if it performs any validation function, have to have regard to the need to encourage competition among higher education providers in England. Its aim will not be to compete with the other higher education providers with a view to diminishing their attractiveness or their ability to offer validation services. It will only offer these services if there is demonstrable evidence that validation services are failing to support the sector. A regulator needing to take a role in the sector it regulates is not totally unprecedented. For example, the Bank of England regulates many aspects of the financial sector in order to maintain financial stability in the UK. In extremis, however, it will also act as the lender of last resort, or a market-maker of last resort, for example by buying and selling assets such as government bonds to provide liquidity at a time of financial stress.

Noble Lords might wish to read an interim report by the Open University and Independent Higher Education on a joint project piloting a streamlined approach to validation. The report highlights several perceived obstacles for providers in developing successful validation partnerships, including restrictive behaviour on the part of some validating universities and,

“insufficient support for alternative delivery models including accelerated and more work-based degrees”.

While the report accepts that this is not representative of all validation partnerships, it recognises the importance of validation as a route into the higher education sector and the need to fix problems which, if left unchecked, could have an adverse impact on student choice.

The report says:

“Validation stands as a critical part of the regulatory infrastructure, and its role as a gateway into the higher education sector means that any dysfunction will have a substantially negative impact on the diversity and quality of provision available to students”.


Relying on incumbents to shape the future of higher education can also curb innovation and result in the entrenchment of the same model of higher education, as providers may be hesitant to validate courses that do not conform to their usual modes of delivery. As the noble Lord, Lord Browne, said, validation can create a closed shop. As part of its work on improving validation services, we would expect the OfS to draw and build on this and other work already carried out.

I also noted the suggestion in the previous debate to create an independent central validation body akin to the CNAA model. As a regulator of the higher education sector, the OfS is ultimately responsible for ensuring that the regulatory framework and its supporting processes are functioning effectively. As the noble Lord, Lord Browne, said, it therefore makes sense for the OfS to have a role in determining how validation problems that could prevent it from fulfilling its responsibilities, such as ensuring that market entry routes and related processes are functioning effectively, are actually fixed.

The OfS’s broader strategic role makes it best placed to identify emerging trends in validation services across the sector and to monitor the impact of whatever solution it puts in place to correct any problems. It will be able to draw on information and advice from all its designated bodies and stakeholders to develop a robust evidence-based approach to address any serious validation failings. I reassure noble Lords that this is not a power easily given or used. We envisage that the OfS would be authorised as a validator of last resort only if it was absolutely necessary or expedient after other measures had been tried and failed.

The noble Baroness, Lady Wolf, said that this would be based only on anecdotal evidence. The Secretary of State may exercise this power if she considers that it is necessary or expedient to do so, having taken OfS advice. That advice is most likely to come in the form of an evidence-based report.

The Secretary of State would need to lay secondary regulations in Parliament. As we all know, it is common practice for these regulations, which use the negative procedure, to be laid before Parliament 21 days before coming into force, giving Parliament the opportunity to see these conditions. As always, Parliament retains the power of veto.

The regulations, should they be deemed necessary, are expected to set out the terms and conditions of any OfS validation activity. I would expect the OfS, as the overall regulator of higher education quality and champion of students’ interests, to be best in class in terms of demonstrating that its validation services abided by best practice validation principles and delivered to the highest standards. I would also expect the OfS to put in place appropriate governance arrangements ensuring that an appropriate level of independent scrutiny was applied to the validating arm of the organisation and the safeguards to protect student interests.

The noble Baroness, Lady Wolf, asked how this would work, who within the OfS would do the validating and whether they would have the requisite skills and qualifications. The regulations by the Secretary of State could attach certain conditions to ensure that the service set up by the OfS was underpinned by the necessary expertise. As we expect members of the OfS board to have between them experience of providing higher education, the organisation will have the necessary expertise to recruit the staff needed to set up a validation function. For further detail on how the OfS validation arrangements would work, I again refer noble Lords to my letter of 19 January enclosing a factsheet published by the Department for Education on validation. With that, I move that this clause stand part of the Bill.

--- Later in debate ---

[Viscount Younger of Leckie]

The noble Lord makes a fair point, but I must go back to the overarching statement that I made at the beginning of the Bill: we have carefully crafted it to look ahead to the future. I have said specifically that we do not consider it right to be too exact in what we put in the Bill. I hope he will accept that.

On Amendment 371, spoken to by my noble friend Lord Lucas, the Government are committed to making data available publicly and in a format that can be easily used wherever possible. However, the data body will collect personal data and it may therefore not be appropriate or lawful to publish identifiers. In accordance with the code of practice for official statistics, the statistics published by the body should not reveal the identity of an individual.

On Amendments 413, 415, 415A and 415B, fees should be fair and proportionate, neither creating disproportionate barriers to entry nor disadvantaging any category of provider. I want to reassure noble Lords that there are several safeguards to prevent a burdensome charging regime. First, the Bill makes clear that the total fees charged by the body must not exceed the total costs incurred. However, I recognise that there must in addition to this be due oversight to ensure that these costs are kept to a minimum—so let me answer some points raised by the noble Baroness, Lady Wolf, the noble Lord, Lord Liddle, and my noble and learned friend Lord Mackay. The data body will be required to publish a statement showing the amount of the fees it charges and the basis on which they are calculated. Also, as part of the triennial reporting process, the OfS must report to the Secretary of State on the appropriateness of any fees charged by the designated body. We are confident that these safeguards are sufficient and that further specific requirements would be overly restrictive.

On Amendment 366, I must stress that we want to minimise the regulatory burden on providers by avoiding duplication. For this reason, it is best for the sector to have only one body designated to collect the information at any one time. However, I also recognise that there are already several sector organisations with an interest in gathering data, and I understand that noble Lords may have concerns about the availability of data and collaboration over their use. I assure Members that Clause 59(7) and (8) set out a clear expectation that the data body must co-operate with those other organisations and have regard to the desirability of reducing burdens on providers.

The noble Baroness, Lady Wolf, referred to unconnected fees. I hope I can give some reassurance that I understand the intention to ensure that fees are calculated fairly. However, I fear the effect would be to damage the interests of both the data body and providers. It would prevent legitimate overheads related to designated functions being incorporated in the annual fee and block the current practice, common to sector bodies, of charging fees varied by the number of students at a provider, which is essential to ensuring proportionate and affordable fees. With these explanations, I hope the Lord will withdraw Amendment 366.

[Lord Mackay of Clashfern]

On the Minister’s last point about connected and unconnected fees, I understand that the Secretary of State has to be satisfied that the fees charged are proportionate. On the other hand, the Secretary of State is not obliged to consider whether they are connected in any way whatever with the provider. That is the problem. The Secretary of State’s power to monitor the fees depends on what the authority is for the fees being charged. Most of the illustrations that the Minister has given are connected in some way with the provider. For example, if it is a question of assembling data, the data will include those provided by the provider who is charged—so that is connected to the provider all right. It is perfectly reasonable to charge for overheads in relation to a function connected with a provider, but charging for those unconnected with a provider seems to open up a large and rather unspecific area.

[Viscount Younger of Leckie]

I will attempt to answer the points made by my noble and learned friend. Surely this is encompassed by the safeguards that I outlined. There will be an opportunity on a regular basis, as I mentioned, to analyse and scrutinise the statement showing the amount of fees, including those that are unconnected, and how they were made up.

Higher Education and Research Bill

Debate between Viscount Younger of Leckie and Lord Mackay of Clashfern

Committee: 2nd sitting (Hansard - continued): House of Lords
Wednesday 11th January 2017 Lords Chamber

[Lord Mackay of Clashfern (Con)]

The question has been raised with me as to whether the provisions of Clause 2, in preventing an intervention by the Secretary of State, may have the effect of preventing the Secretary of State coming in to try to support vulnerable subjects. We know that some subjects are very important—for example, physics—yet they are quite expensive to teach. So in the interests of economy, institutions might be inclined to abandon courses in these subjects. The restrictions on the Secretary of State are not, I think, intended to exclude that kind of provision, but I should like confirmation of it.

The other thing that I want to mention relates to Amendment 56, tabled by the noble Baronesses, Lady Wolf and Lady Brown, about,

“the overall strength and quality of higher education provision”.

I am wondering what the “strength” aspect of higher education is. I would be glad of some clarification.

[Viscount Younger of Leckie (Con)]

My Lords, I thank noble Lords for a thoughtful and wide-ranging debate—a debate in two halves, or one-quarter and three-quarters. I must make sure that the House remembers the eloquent speech from the noble Lord, Lord Stevenson, before the dinner break. I hope to do justice in responding to all the important issues raised, and on this occasion I make no apologies for speaking for slightly longer on this group. For those areas where I do not have time to go into detail, I shall write a letter.

The Government are keen to ensure that the general duties afford the OfS the ability to make sound judgments and take action according to priorities. It is essential that this legislation sets out a high level of core priorities for the OfS but does not burden it with a long list of specific duties that it must attempt to balance without sufficient flexibility to be responsive as priorities change. The noble Lords, Lord Stevenson and Lord Liddle, raised the issue of ranking and the prioritisation of duties, which is a fair point, but I reassure them and other noble Lords that there is no implied ranking in the list of OfS duties in Clause 2. They are all important and must be considered in the balance. I agree with the noble Lord, Lord Liddle, that the competition duty must not override other duties. Clause 2 is deliberately drafted with that in mind. There is no hierarchy, and no obligation to prize one of the listed matters over any other. Ultimately, this approach is very much at the heart of optimising the effectiveness and breadth of the future OfS. A discretion is given to the OfS to decide how to weigh matters in the balance in individual cases. The OfS must be able to use its judgment on how best to balance regard for these duties. It must be able to take strategic action and be responsive to priorities, while still retaining accountability for ensuring that no duties are unduly neglected.