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explanation is that, like the poll tax, its pursuit has been ordered from on high. Yet again it is a triumph of ego over reason. At last week's Conservative party conference the new deputy Prime Minister said that the Conservative party should become "the listening party". A week is a long time in politics. We do not expect the Government to listen to the country or to the Opposition. We do not even expect them to listen to their own Back Benchers--they have dismissed out of hand the criticism of the hon. Members for Chichester (Mr. Nelson), for Cambridge (Mr. Rhodes James) and for Brentwood and Ongar (Mr. McCrindle) and the criticism of Lord Rayner about the impact on medical schools.

I ask the Secretary of State--as a former Heathite and wet--why he and the Cabinet do not listen to themselves. Why do they not listen to the Secretary of State for Health, the Home Secretary and the Secretary of State for Wales, who are all signed-up members of the Tory Reform Group, which has said of loans :

"All the evidence suggests that the social cost of loans would be considerable. The results of having the system would be to reduce working class access to higher education, to lower standards and to produce a new class of poor graduates. The indirect damage to society may be even more serious".

The Tory Reform Group and their Cabinet colleagues and supporters are right. The Secretary of State is wrong. This scheme is rotten to the core. The Government should listen, recognise their error, and abandon the scheme before it is too late.

Several Hon. Members rose--

Mr. Deputy Speaker : A large number of right hon. and hon. Members wish to take part in the debate. The briefer the speeches, the fewer disappointments there will be.

10.58 am

Mr. Robert Rhodes James (Cambridge) : I have received a petition, signed by more than 5,000 constituents, which is on similar lines to those presented beforehand and which I agree.

I welcome my right hon. Friend the Secretary of State to his position. I wish to emphasise one point which has always dominated me--the words of Alfred North Whitehead :

"In the conditions of modern life, the rule is absolute. The race which does not value trained intelligence is doomed."

In England--although less in Scotland--we face the problem of an undereducated work force, even though it is a problem of long standing, and it is not the particular responsibility of this Government or, indeed, of any previous Government.

My first point is a point of principle. The hon. Member for Blackburn (Mr. Straw) referred to the pre-war arrangements. I was educated in the post-war system in the pre-grant era. To go to university--and there were not many universities anyway--one either had to have rich parents, which I did not, or one had to be fortunate enough to get a scholarship, and scholarships were few and far between. I was one of those fortunate enough to get a scholarship, but when the Conservative Government of the early 1960s introduced grants, I thought that that was one of the finest things that any post-war Government had done. That Government also initiated the expansion of higher education which was continued by the Labour

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Government. We all know that there were disappointments and that mistakes were made, but the principle that a university education should be available to anyone with sufficient ability, regardless of his or her means, was one of the finest principles ever established. I should have supported the proposal had we been talking about true top-up loans--loans to supplement the grant--but I am afraid that we are not. Instead, the scheme will reduce grants and make student finance dependent on loans. I listened carefully to my right hon. Friend the Secretary of State in the hope that perhaps there had been second thoughts. A substantial volume of opinion, both in the Conservative party and elsewhere, has concluded, having examined the scheme carefully, that it is wrong in principle and that the practicalities would pose immense difficulties.

Let us suppose that the Government go ahead with such a scheme, although I still hope that they will not. Why do they so casually reject the option of a graduate tax? I was not convinced by what my right hon. Friend the Secretary of State said about that. The Committee of Vice-Chancellors and Principals took the valid view that the option should be seriously considered.

If the scheme were the only development with which students were faced, it might not be the major disincentive that I believe it will be. But it is accompanied by the abolition of benefits, the introduction of the community charge--admittedly at a low level--and a number of matters which add up to a substantial disincentive to parents and people who wish to go into higher education.

I believe passionately that investment in education--not least in higher education--is the very best investment that we can make. Our higher education budget is not enormous compared with those of other countries, and I therefore ask my right hon. Friend seriously to reconsider the matter.

11.2 am

Mr. Martin Flannery (Sheffield, Hillsborough) : It is always a pleasure to speak after the hon. Member for Cambridge (Mr. Rhodes James), who has an enlightened approach to most subjects. The Minister's maiden speech in his new position sounded more like an uncorroborated confession : much of it was wrong, and he is not so innocent, either. Most of us have received a large number of briefs on this subject, and it is difficult to find among them one that agrees with the Government. Many people who vote Tory profoundly disagree with what is happening. We face a return to past attitudes which had a deadly effect and made it quite impossible to expand education.

The Minister now proposes a plan that he says will double the number of entrants to higher education. When he elucidated the plan, however, we found that it was a plan for halving, rather than doubling, the number of those entering higher education. It would push into difficulties those young people who in the past have been able, because of the grant, to enter higher education. At a time when we urgently need to expand higher education, we should find ourselves curtailing it instead.

Earlier, in an intervention, I made a serious point that all Conservative Members should consider, and, to do the Select Committee justice, it is already doing so. The report on teacher shortages shows that one fundamental factor is that the fall in the numbers in the 16 to 19 age group is so

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serious that competition among the professions will make it increasingly difficult to persuade people to become teachers or lecturers and, therefore, to expand education. That is why the Committee of Vice-Chancellors and Principals, referred to by the hon. Member for Cambridge, profoundly disagrees with the plan. The committee asserts in its brief that the aims of any plan should be

"to ensure that students have enough to live on while they study" and

"to ensure that the scheme does not deter increasing numbers of people from applying for higher education."

I think that the whole House would agree with those aims, but we must judge them against certain criteria and against the Government's plan.

The committee says, first, that the plan should be simple--in addition to the principles that it should provide adequate means for the student while studying and that it should not deter people from becoming students, especially people from poorer families. The White Paper fails to satisfy any of the criteria laid down by the Committee of Vice-Chancellors and Principals--a very important committee which briefs us continually on education affairs.

The committee gave some of its reasons for rejecting the Government's scheme--for example, that the scheme takes no account of the loss of social security benefits, especially housing benefit. We must all consider that. It also takes no account of the poll tax or community charge, which will affect some students--especially poorer students--far more than others. The means-tested parental contribution may mean that some students do not receive the full amount. Many of them do not receive the full amount now. We should take into account the fact that, as a result of the Government's policies, many parents are already finding themselves in a dreadfully difficult position, with higher mortgage repayments and with the other startling effects of the Government's policies.

The scheme lacks simplicity. It is most complicated, and the Government are silent on the question of the administration of the loans. People are wondering exactly how the scheme will work. As my hon. Friend the Member for Blackburn (Mr. Straw) said, the banks do not want to be identified with it because it will earn them a bad reputation. That is an interesting position for them to be in. The banks are usually the ardent supporters of the Government, but even they are sounding a warning to them. Discussions with officials reveal that students may be involved with no fewer than four separate groups--their bank, the local authority, their institution and their parents. Yet the Government boast that this is a scheme whose simplicity should commend it to all of us.

The White Paper says that the scheme will mean a grant of 50 per cent. at the most. It is a strange top-up scheme that "tops up" the remaining 50 per cent.--as much again. The catch words "topping up" have no meaning in that context. The scheme will place a further tax on students, and a deterrent tax at that. It will mean that large numbers will not be able to attend higher education institutions. It commands so little support that it is almost an embarrassment to the Government to have to present it.

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Many students already borrow from their banks to try to top up their grants. I am perhaps the only hon. Member who has suffered this experience : I was a student from 1937 to 1939, when the teacher training course lasted only two years, and practically all my companions in college had no money to spend. They spent two years at college with nothing. Nearly all of them had to borrow the £40 per annum college fee from the local education authority which, in its turn, could lend that money only to a limited number of students. That lack of money stopped people entering higher education. As the hon. Member for Cambridge said, the grants were one of the greatest things to happen to the expansion of education in this country. This new scheme takes education back to the pre-war days.

After six and a half years of war I came home and still had to repay the £80 for my college fees. My wage as a teacher then was very small, indeed it was even worse than teachers' wages are today. It took me four years to repay that £80 from my pitiful wage. That kind of debt hangs over many students in other countries, particularly the United States.

This plan will most likely deter students from higher education. The doctors' representatives have briefed us that the new plan will stop students from becoming the doctors that we urgently need. Students on longer courses will be deterred. There will be a shortage of teachers if we do not reconsider the plan, and that is important because studies show that there is a shortage of teachers now. The Royal College of Nursing is opposed to the plan because it will lead to a shortage of nurses. At the moment there is keen competition among the professionals for qualified students. If the scheme goes ahead, they will be fighting for people from a much smaller group of qualified students. The Select Committee on Education, Science and Arts is well aware of the shortage of students in higher education. Conservative Members on that Select Committee will be aware that this is a cause of great concern for us all.

There is evidence that the new scheme, which is supposed to benefit the taxpayer, will actually do the reverse. As my hon. Friend the Member for Blackburn explained, the new plan will cost a great deal more and will not do what it is intended to do. The Government had the benefit of nearly £100 billion of North sea oil money and the profits from North sea gas. They had a wonderful opportunity to do something for people, yet the streets are filthy and that money has not been handled properly. That money should have been a boon for all. The Government now propose to curtail education through this nonsensical scheme.

The low-income families will once again be hit hardest. The White Paper "Top-Up Loans for Students" is 11 months old. We have been asking for a debate on this subject since last November. At last we are debating it, but we are on a motion for the Adjournment, the proposal cannot be amended and we are debating it on a Friday morning. Instead of handling the real problem, the Government are trying to shield themselves and the country from the real problems by secreting the debate in an Adjournment motion on a Friday. The Government's scheme is like their handling of the economy--it is bad, useless and will come home to roost.

As my hon. Friend the Member for Blackburn said, the Government's aim is to save money. The Government are hopeless ; the scheme will cost more. They claim that it will improve education. That claim, and the claims about the so-called Education Reform Act 1988--it should be called

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the Education Deform Act--are linked. They will harm education. The scheme will not work. It will cause worry, misery and penury. It should be abandoned.

11.13 am

Sir Rhodes Boyson (Brent, North) : I am aware that many hon. Members want to speak and, as far as I can, I will speak in headlines. It was a pleasure to hear my right hon. Friend the Secretary of State for Education and Science this morning. I agreed with most of what he said, but not all. I have always admired him for being intelligent, full of integrity and of independent mind. I want to appeal to his independent mind. Hon. Members have said that they hope he will listen, and I have no doubt that my right hon. Friend's ears are some of the best in the House.

We all agree that more people should enter higher education. The percentage of people leaving school at the age of 16 is far too high. In Japan 92 per cent. of students stay on at school until they are 18. In Germany 64 per cent. stay on, while in this country only 32 per cent. stay on. The problem does not lie simply with higher education ; schools have a role to play. I am not convinced that a watered-down grammar school curriculum for all 14 to 16-year-olds under the national curriculum will solve this problem.

Many hon Members have referred to education in other countries. Unless we introduce some form of specialisation for 14-year-olds to make them interested in their future careers, people will not come through at the age of 16 and 18 to fill places in higher education. We already have a very high truancy rate. Three schools in one London borough have a truancy rate of 50 per cent. for 15 to 16-year-old boys. The curriculum that they follow has no meaning to them. They will not go on to higher education.

Under both Labour and Conservative Governments the value of the grant has declined under the present system. The situation is not ideal ; the grant has gone down while the average standard of living has risen. We have created a new poor. They are particularly the students at university who live on grants while their parents do not make up all the parental contribution. A study has shown that the value of the grant in purchasing power terms is 35 per cent. less than it was in 1962. It has dropped by 11 per cent. since 1979 while the average standard of living of people at work has risen by 27 per cent. The present system is far from ideal and is causing many families and students anguish.

People resent the parental contribution. It is particularly resented by the children of the one third of parents who do not make it up. That creates another new poor among students going off to university. Some parents make no contribution towards the grant. We will have to decide at what age people grow up. People can have sex legally and marry at 16. They can vote at 18. However, they are dependent on a parental contribution to their grant up to the age of 24. As Margaret Mead and other anthropologists have said, a good society has a time when a child becomes an adolescent and when an adolescent becomes an adult. One of our problems with young people is that they do not have a clear cut-off age when they become an adult. For people to be dependent on their parents up to the age of 24 or 25 is not helpful in the making of a good society.

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Other countries have a grant or loans system. The White Paper is not suggesting something that is unknown in other countries. So far as I know the Republic of Ireland is the only western country which does not have some form of loans system. We also hear much paternalistic talk about the percentage of the working or labouring classes going up to university--[ Interruption. ] The Labour party appeals to people in the north in an attempt to bolster their votes in election after election. I grew up in a two-up two-down house in a textile area in the 1930s not far from the area represented by the hon. Member for Blackburn. I know what I am talking about. I believe that if a university education is worthwhile, people from all groups will attend. People compete in every way in society and they are not dependent on being trained from above. The average loan in Germany is £2,000 per student and three times as many of the so-called labouring classes attend university in Germany than in this country.

Mr. Andrew F. Bennett : Will the right hon. Gentleman give way?

Sir Rhodes Boyson : Yes, by all means I will give way to another paternalist.

Mr. Andrew F. Bennett : Is the right hon. Gentleman aware of a German survey which shows that fewer poor people are attending higher education because of the introduction of the loans system? Over the past 10 years the loans system in Germany has had the effect that we now fear here.

Sir Rhodes Boyson : I shall have to debate that with the hon. Gentleman outside the Chamber. The figures that I have are different. The Minister also has figures for Germany. The subject will make a splendid debate in Oxford or Cambridge or somewhere in the north where the allegedly deprived live, to whose conscience the Labour party will continue to appeal at election time.

The present system does not help part-timers or those coming back to education later in life. One aspect that I like about the proposed new scheme is that it will cover students up to the age of 50. Part-time education and the Open university are the cheapest ways for people to go through higher education, yet we have underfunded them from the beginning.

I shall support the Government's new scheme, but I wish to make some mild suggestions which may influence Government policy now that Ministers are listening. I was privileged to be a Minister at the Department of Education and Science before loans were as fashionable as they are now. I produced a loans scheme, but it was dismissed in seven and three quarter minutes by a Cabinet sub-committee. I spent three months travelling around the world to see different schemes in operation. I concluded that debt redemption was most difficult. Much of the money is never recovered. The only system that worked was the Swedish system where the loan was plugged into income tax. I understand why Labour Members are silent : Sweden is a Socialist country, but I will take the truth from anywhere. That system seemed to work. The loans were paid directly by the Government and there was a graduate tax until the loan was paid off. Nothing was paid if the person did not earn the average income. It seems strange to take 85 per cent. of the average income as the limit here. I would suggest that a simpler method would be to take an

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average income rather than employing statisticians to work out what is 85 per cent. of it. I also suggest that a wife should not be responsible for her husband's loan or vice versa. That is my preferred scheme. I know that the banks will provide the money, which will save the Government money but the Government always find money when they want to for denationalisation of water and electricity and other matters.

Mr. Straw : And the poll tax.

Sir Rhodes Boyson : I must not be drawn by the hon. Member for Blackburn (Mr. Straw) on the community charge on which my ideas have been completely uninfluential.

The simplest method would be to plug loans into taxation. At some stage we shall link national insurance and taxation so that people either gain or lose from the state. That will be when we get a proper system going.

Do we believe in the incredible Labour policy under which the numbers going on to higher education will be doubled, the Government will give students a better grant and money will be saved? I do not believe it. As always, I am trying to help the Labour party. Labour policy is improving on nuclear defence. Bit by bit, the Labour party is approaching the truth and I welcome that. I am sorry that the hon. Member for Sheffield, Hillsborough (Mr. Flannery) has left the Chamber. I always enjoy his interventions in my speeches and I tried to intervene in his speech. Apparently, Labour does not intend to unscramble the privatised industries and bring them back under national control. The Labour party's policy of wiping out parental contributions and doubling the numbers in higher education is not credible. I shall not hazard a guess about what the centre parties think. They can think what they want because nobody notices anyway. I would prefer a system where we pay for the very able to go to university. Wherever such people come from we must get them through higher education and not discourage them from taking it up. First, I would give a third or half of pupils who got the highest results at A-level, in whatever subjects, free tuition and a more generous grant than at present. In that way, we could keep "high culture" alive, as the German universities put it. Secondly, I would test the other half to two thirds on their motivation and give them a loan linked to income tax.

Hon. Members on both sides have said this morning that students increase their earning potential by 30 per cent. by going to university. Higher education is a personal investment. Students should assess what they should do in order to repay these loans. My criteria are high culture first and motivation second. When the Government plan the numbers for the professions they never get them right. Either we have too many doctors and lawyers or too few. It is better to leave it to the students to say, "If I train for this profession, I shall be able to repay my loan." I would prefer that to the present system. I shall support the suggested system on Second Reading. I do not agree with the intentions of my Government on every matter, but generosity on my part is helpful.

No one has mentioned the problem of our last closed shop, the student unions. I look forward to a debate on

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that before the new Session begins. I trust that the Queen's Speech will include a Bill to deal with the problem of our last closed shop ; may it end.

11.26 am

Mr. Simon Hughes (Southwark and Bermondsey) : This is the first opportunity that we have had to discuss this proposal. I hoped that it would be an opportunity for the Government to reflect on the opinions expressed about it. Of the speeches made so far, only half of that of the hon. Member for Brent, North (Sir R. Boyson), could count as support. Otherwise, the Secretary of State stands on his own. That may say something about the general view of the proposals conceived by his predecessor. I hope that at the end of the debate the Secretary of State, his Ministers and officials will retire gracefully, consider carefully, and rethink properly these proposals.

In the 11 months since the White Paper was published there has been widespread opposition to it, and not only from the Opposition parties. My party passed a clear, overwhelming and unequivocal motion against student loans in March. One might expect Opposition politicians to do that, but it is noticeable that academics, vice-chancellors, principals, commentators and financiers have also expressed their opposition to all three of the objectives set out by the Secretary of State at the beginning of today's debate. The first was to spread the cost of higher education more widely. It would be tragic if the Department of Education and Science were run on the principle that higher education should not in the future have a higher share of public expenditure.

In an editorial on 3 October, the Financial Times said : "In the US, public expenditure on higher education absorbs 2.5 per cent. of gross domestic product ; the figure for Britain is around 1 per cent. Such a policy"--

that of keeping down expenditure while increasing the numbers-- "will either fail or result in a big reduction in the quality of university education."

We need more expenditure on higher education, not the same or less.

The second objective enunciated by the Secretary of State was that there should be more money for more students. What the Secretary of State did not say was that this objective would be achieved only by students incurring more debts. The Secretary of State and the Prime Minister seem to favour a more indebted society ; the Chancellor of the Exchequer certainly does. To encourage debt, particularly in the youngest members of society, is not a moral principle that Governments have previously supported. I hope that even this Government will see the immorality of pushing people into debt as opposed to helping them to avoid debt as they become adults and take on full working and family responsibilities.

The third objective set out by the Secretary of State was that, by this means, we should produce changes in student attitudes. Mr. Wilby said in The Independent of 29 September :

"Ministers argue that proper loans, borrowed from banks, are somehow good for students rather as schoolmasters used to argue that cold showers were good for pubescent boys. This is ideological twaddle."

The most worrying thing of all that the Secretary of State said and that betrayed the fundamental flaw in the Government's policy was, "We believe that students must invest in themselves, for themselves." The difference

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between the Government, my party and my colleagues and, I guess, all Opposition Members is that Opposition Members and some Conservative Members such as the hon. Members for Cambridge, for Leeds, North-West (Dr. Hampson) and others believe that it is for the nation--for the people--to invest in education so that the nation and the people can benefit. We do not share the selfish attitude that the only proper investment is investment in oneself for oneself. We believe that investment in others so that the common wealth might benefit would be a far more appropriate policy.

Mr. Burt : I understand what the hon. Gentleman is saying, but does he accept that there is a sense of balance and proportion? There is no doubt that the Government already contribute a huge amount to higher education. The argument is not that the individual student will take on the full burden but that he or she will accept part of the burden for his or her own living arrangements--nothing else. Surely that is a fair spread of the burden.

Mr. Hughes : I am sure that the hon. Gentleman realises that many students already have a very impecunious existence. They decide to opt out of earning money at a young age, at substantial disadvantage compared with some of their peers, and often with no realistic chance of recovering their position. Just because they are graduates, it does not mean that they necessarily end up doing higher-paid jobs. Many non-graduates earn considerably more than graduates. One cannot rely on the benefit being much greater as a result of the sacrifice that one makes at the beginning.

It was noticeable that the Secretary of State paid no attention to the arguments put forward in 1986 by the Select Committee on Education, with a Tory majority, and already cited by the hon. Members for Blackburn (Mr. Straw) and for Sheffield, Hillsborough (Mr. Flannery). The Select Committee made it clear how vital grants were. It is disingenuous for the Secretary of State to ignore the one specific piece of recent advice by the Select Committee on this subject.

Why should the scheme be opposed? First, it will extend hardship for students. It is an extraordinary feature of the scheme that the welfare state is suddenly to be denied a particular range of people. Since 1944 the principle has been that social support would be given to people below a certain income level. These proposals mean that income support, housing benefit and unemployment pay is suddently unavailable to students, whatever their income. That is entirely unacceptable as a matter of principle.

The Government have not said what a minimum student income should be. They have not admitted that students on full maintenance grants could lose up to, or even more than, £1,000 a year as a result of the removal of housing benefit. There has been no assurance that students will not be poorer as a result of the scheme. The removal of the right to claim unemployment benefit or income support could affect 100,000 to 200,000 students. Is that insignificant? Should that be ignored? The Government have not answered questions about why unemployment benefit, for example, should be removed from this category in our society. They have not dealt with the fact that many students will be in a particularly disadvantageous position. If a student is doing a four-year course in Scotland, his debt is likely to be substantially greater. A medical student doing a five or six- year course at Guy's hospital in my

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constituency, as the hon. Member for Lancaster (Dame E. Kellett-Bowman) is aware, will probably be substantially in deficit. We are talking about thousands of pounds, and, in some cases, about tens of thousands of pounds. Postgraduate students who will lose housing benefit are not eligible to take advantage of the top-up loans scheme. All these are real people in real education, making real choices about how to organise their lives. The inadequate access funds--the Government are to put in a small amount of money but have given no detailed explanation--are no substitute.

Secondly, the scheme will clearly deter many students from applying for further and higher education. All surveys suggest that loans, as opposed to grants, are a deterrent, particularly for those who find higher education most difficult to obtain. A recent survey at Cambridge university suggested that nearly 50 per cent. of women would have been deterred had they had loans and not grants. I appreciate that one could say, "Yes, that is a survey. They would say that, wouldn't they?" However, if we are trying to encourage women and those for whom higher education is most difficult to choose, we must be conscious of the risks. Small proportions of our ethnic minority communities and black people are at university. What are we to do? Are we to say they will be all right because they are likely to be earning the highest incomes? That is twaddle. The figures show that these groups are the most economically disadvantaged. As a proportion of people in higher education, their numbers will decrease.

As an example of the risks to disabled students, the Royal National Institute for the Deaf estimates that the cost of support for a full-time student is in the region of £8,500. Will there be funds to cover the cost of an interpreter to enable someone to follow a postgraduate certificate of education? They are exactly the people for whom it is vital to encourage access, but they are exactly the people whom this scheme will discourage from the beginning. Mature students who make a decision in mid- life to go back to college normally risk incurring a substantial loss of income. If they are told that they cannot have housing benefit or unemployment pay, will their numbers increase? Logic says otherwise.

Perhaps most important of all, whereas we know that we still have significantly small numbers of people from working backgrounds--social classes 4 and 5--in our higher education system, there is not a jot of evidence that this scheme will encourage there to be more. Rather, to the contrary, it will discourage those young people from going into higher education. If one comes from a background in which it is difficult to break from peer group and family pressure to make certain choices for higher education, one will be even more deterred if the risk is also a financial one. It is completely inconsistent for the Government to argue that they believe in an increase in numbers and yet make it clear that that increase will be obtained only if students must pay.

Currently available choices will be put at risk. The strong likelihood is that students will be obliged to follow more practical and vocational courses. The idea of a liberal, balanced, general education will be something which people will not have the "luxury" of being able to afford. Just as research has moved from pure to applied research, colleges will move from courses in general education to courses that are funded specifically with a view to helping people into jobs. That is not the way to produce an educated society.

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I repeat the point that I made to the Secretary of State. Trends in Europe are the other way from these proposals because of evidence in countries such as Denmark, Sweden, the Netherlands and West Germany. They discovered that they were unable to recruit from as wide a range of backgrounds as they would have wished, that their loan schemes were complicated and clumsy to administer, and that there was a high level of default. What evidence is there that we will not have the same problems? It is fallacious to argue that, because there has been an increase in participation in other countries where there has always been a loans scheme in part, the change from a grant system to a loans scheme will not act as a deterrent in this country. It is an absolutely illogical fallacy. There is no evidence. That is why I hoped that, as a man of intelligence and integrity, the Secretary of State would have said, "We are taking a huge risk, but we believe that it is the only way out." If the Government had admitted that it was a big risk and that they might not achieve any increase in numbers, they would at least have been honest.

Mr. Harry Greenway (Ealing, North) : Will the hon. Gentleman give way?

Mr. Hughes : I will not give way, as other hon. Members wish to speak.

The Secretary of State should notice that, even among Tory supporters as well as supporters of my party and the Labour party, support for grants has increased as opposed to decreased in recent years.

The argument that has been advanced about the short-term costs is clear. On the Government's own figures, at the best this scheme will actually cost more--extraordinary when the Government are asking for Tory support--at least for the next 13 years, possibly for the next 23 years, and, without any stretching of the imagination, potentially for many years beyond that. It is an extraordinary proposal. The Government have put forward a scheme which, in the short and medium term--in the political lifetimes of every hon. Member--will cost the Exchequer more. I had thought that the Chancellor of the Exchequer was against the public purse spending more. It is all very well saying that eventually, on the best projections, the figures will balance some time early in the next century, when the reality is that the best projections 10 years ago of how the economy would work did not foresee us in the dire straits that we are in now. Even on the Government's figures we cannot assume that the scheme is a justifiable use of public expenditure when it will cost the country so much more and risk so much more as well--

Mr. Harry Greenway rose--

Mr. Jackson rose--

Mr. Hughes : I shall give way to the Minister.

Mr. Jackson : In such debates, it helps if hon. Members listen to each other's speeches. The hon. Gentleman should have listened to my exchange with the hon. Member for Blackburn. The fact is that there will be savings under this scheme at the turn of the century.

Mr. Hughes : The fact is that, on the figures given by the Under- Secretary and the Government, the first date by

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which it is conceivable that the scheme will have broken even is 2002, which is 13 years away. The Government concede-- all the experts who have commented on the scheme apparently believe--that the break-even point could well be well into the following decade, if not well after that. The Minister knows that.

Mr. Harry Greenway rose --

Mr. Hughes : No, I shall not give way.

The Government argue that it is important to make young people less dependent, but they will be more dependent when paying back loans over years if not decades. Many may, paradoxically, become more dependent on their parents than they are now.

The Secretary of State has come to the House to defend an ill-conceived and ill-thought out White Paper. Sadly, he has argued unconvincingly when he should have been able to find arguments--if they existed--to win the discussion today. The Secretary of State has tried to defend, but has not defended the indefensible. There has been enormous opposition to this scheme, including from Conservative Members.

The costs to the country outweigh the benefits, and the costs to the Exchequer will outweigh the benefits for decades. Students and their livelihoods and incomes and their families' incomes are at risk. There is nothing to suggest that access to higher and further education will be improved.

In the weeks that remain before the Queen's Speech--I am sure that there will be other competitors for legislation--I ask the Secretary of State to drop the baton that was passed to him by his predecessor ; to realise, as a former Treasury Minister, that he is now the custodian of a proposal that will be unworkable and that will do himself and his Government no favours, not least with their own supporters, and to rethink so that we can have a scheme with which we can expand education and do what we need to do to survive and prosper in the future as a nation. It is no good having a scheme that currently does not work too badly replaced by education on the never-never because then we may never never see the expansion of our higher education that this country so badly needs.

11.43 am

Dr. Keith Hampson (Leeds, North-West) : In 1976 I first wrote an article in favour of loans. Before that I had been against them. Indeed, in the 1960s I helped to draft a ringing denial that loans were good for British higher education for the then leader of the Conservative party when he was the first party leader to address the National Union of Students' annual conference, which that year was held in Leicester. However, I changed by view and I shall later give the House some of the reasons why I came out in favour of the loans scheme.

Four years ago my hon. Friend the Member for Buckingham (Mr. Walden) and I persuaded the then Secretary of State for Education and Science, now Lord Joseph, to withdraw some proposals affecting parental contributions and urged him to review all student support, including consideration of loans. Frankly, like most of my colleagues, I find it disappointing that after four years the net result of the Department's efforts is an excellently researched comparative document about what has happened elsewhere in the world, with a good statistical base, but which is short of effective details on what the

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proposals that it is recommending will mean. It is especially disappointing that after all this time the details have still not been finalised with the banks.

However, I must advise the hon. Member for Blackburn (Mr. Straw) that this debate goes back much further than that. Indeed, it goes back to the 13 points of Mrs. Shirley Williams in the 1960s when the Labour Government first raised student loans--

Mr. Straw indicated dissent.

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