House of Commons Hansard Debates for 19 Apr 1990

Mr. MacGregor : Throughout the passage of the Bill the Government have deliberately tried to be helpful to both Houses in responding to all queries. I hope that the hon. Gentleman will acknowledge that. We have been getting on with the detailed preparation of the Student Loans Company and at each stage we have reported to the House on the arrangements. We have therefore been clear with the House. The debates have been very thorough and have covered all points. The Bill has gone through reasonably quickly because it is a short Bill on a single scheme, but there has certainly not been any shortage of discusson in the process.

Mr. Richard Shepherd (Aldridge-Brownhills) : Will my right hon. Friend devote some time to the fact that this is only the fifth time in the history of our nation that a guillotine has been applied to Lords amendments? It is a very new process which only started in the parliamentary Session before last. Will my right hon. Friend justify how it is constitutionally right to predetermine how long we take to discuss amendments raised in the second Chamber of a bicameral system?

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Mr. MacGregor : I was trying to explain why I think that the motion is right in relation to the Bill before us, and I believe that I have support of the great majority of my hon. Friends.

There have been a number of changes to the Bill as it has progressed through both Houses. That bears witness to the value of parliamentary scrutiny. The changes fall into three categories. The first relates to technical amendments which were tabled in another place and, by and large have followed from further consideration of the details of the Bill in the light of debates in both Houses. The second category relates to changes of a detailed nature in response to points made by my hon. Friends and other hon. Members and includes all those relating to parliamentary procedure as well as to clarification of points such as the balance between grant and loan. The third category relates to a few points of substance. I cite, in particular, changes made--not always on the face of the Bill, because that was not necessary--in relation to increases in access funds and the disabled. Those amendments were in response to points made frequently in debate. Both issues have been thoroughly debated in both Houses and in Standing Committee. All the arguments have been held, all the issues have been debated, and we have accepted some additional points. That is all that has happened.

Mr. Harry Barnes (Derbyshire, North-East) : As the measure went through the House of Commons at a fairly leisurely pace, and there was ample opportunity to discuss it in Committee and on the Floor of the House, why were none of the amendments dealt with initially? Why have they all been made in another place, apart from a couple of technical amendments which were adopted in Committee?

Mr. MacGregor : It is because the Government were listening very carefully. In a number of debates in the House, we made it clear that we were listening and considering what to do. In the light of that consideration, some of the same points were made in another place and we decided to table certain amendments. I assure the House that the debates in this House as well as those in another place persuaded us of the value of those amendments.

Dame Elaine Kellett-Bowman (Lancaster) rose--

Mrs. Margaret Ewing (Moray) rose--

Mr. MacGregor : I am keen to get on so that we can get down to debating the amendments, but I will give way.

Dame Elaine Kellett-Bowman : Am I right in believing that my right hon. Friend accepted the amendments allowing access funds for the disabled?

Mr. MacGregor : We have increased the access funds by a further £10 million--I shall return to that later--and we have made some amendments to assist the disabled in repayment of loans. We have also made some proposals which do not have to be on the face of the Bill but to which I referred in answer to a parliamentary question.

Mrs. Margaret Ewing : Perhaps the Secretary of State has given way to me because of my natural Scottish reserve and reticence, but in the context of the balance between grant and loan, will he spell out in detail the implications

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of that balance for Scottish students who undertake the four-year honours course, which is the most common course in Scotland?

Mr. MacGregor : The hon. Lady knows that that matter has been debated in the House. She and I had exchanges on it during Question Time. We have made it clear that we intend to extend the time for repayment of loans of five years' duration or more, but not those of four years. I made that clear in answer to a parliamentary question in the House.

I pay tribute to the sterling work done in Committee and in another place. Hon. Members on the Standing Committee devoted a lengthy period to the most careful analysis of the Bill. My hon. Friends played a particularly noteworthy part in achieving changes of substance. My hon. Friend the Member for Rugby and Kenilworth (Mr. Pawsey) was a persistent advocate of the need for an increase in the access funds. We listened carefully to his argument and others and I hope that he will be pleased with our response. I also pay tribute to the Government spokesmen in another place, the Earl of Caithness and Baroness Blatch--we have before us the fruits of their labours. Although we are approaching the final stages of the Bill, it is important that we do not engage in pointless repetition. The motion, if passed, will help to ensure that the scheme is ready for the beginning of the next academic year. We shall need to place regulations before Parliament soon, and additionsl preparatory work will be needed before the scheme is fully operational. Students will benefit considerably from the additional resources made available through top-up loans, and many students would not welcome being denied a loan as a result of filibustering. It is therefore right that we deal with the Lords amendments in a businesslike and proper fashion, without pointlessly spending much time throughout the night on technical details.

I have no doubt that the motion will give hon. Members the opportunity to raise wider issues, but I will briefly record one or two points about the Bill. The objectives of the Bill are to facilitate the expansion of higher education, in particular by providing more money to students while they are studying and, over time, to lighten the burdens of student support and maintenance support on taxpayers and parents.

The Anderson committee envisaged an eventual expansion of the higher education system to about 175,000 students, but in 1990-91 we expect that there will be more than 450,000 mandatory award holders and more than 1 million students in total. We are committed to continuing that expansion. The cost to the taxpayer of supporting students' living expenses has risen from £236 million in 1962 to £623 million this year at current prices, without taking account of inflation.

Loans will relieve the burden on parents and taxpayers and will give students access to more money. They will be able to use part of the high income that they can expect as graduates to borrow from the taxpayer and to repay the loan when their income rises. The loan will be at a zero real rate of interest, which is much more favourable than commercial borrowing terms or the loan schemes operating in most overseas countries.

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Mr. Robert Rhodes James (Cambridge) : On a point of order, Mr. Deputy Speaker. This is the guillotine motion, but the Secretary of State is making a Third Reading speech.

Mr. Deputy Speaker (Sir Paul Dean) : The motion lends itself to relatively wide debate.

Mr. MacGregor : I have already dealt with the guillotine. No doubt the speeches of other hon. Members will go rather wider than the motion. It is right briefly to place on record some of the key points.

The loan scheme will be more favourable than those in operation in most overseas countries. Moreover, graduates whose incomes, for any reason, are low, will be able to defer repayments. Deferments will be available to those on incomes below 85 per cent. of the national average. If the scheme were in operation, graduates could defer if they were earning less than £11,500. Deferment answers arguments that the scheme penalises those who choose a lower-paid occupation and women who choose to bring up a family. The deferment arrangements mean that they are not penalised. Top-up loans will more than compensate most students for any loss of benefit. We estimate that the benefits received by student claimants would have averaged £315 in 1990-91. That is more than outweighed by the loan.

We recognise that there will be circumstances in which further help is needed, and there will be three access funds, currently worth £25 million in total. To answer the question asked by my hon. Friend the Member for Lancaster (Dame E. Kellett-Bowman), we have added a further £10 million to provide discretionary support to students where it is needed to enable them to join or to remain on courses. The funds will be administered by the students' own educational institutions, which are best placed to assess their students' circumstances.

Differences in accommodation costs--this is an important point that I should like to make clear, not least to my hon. Friend the Member for Lancaster, who asked about it--were taken into account in the distribution of the access funds to the Universities Funding Council and to the Polytechnics and Colleges Funding Council. The Government wish the councils to have regard to the same factor in making allocations to their institutions. This autumn, students will have access to a 25 per cent. increase in resources compared with current grant if we pass the amendments and the Bill is given Royal Assent. The grant will be uprated in the autumn and loans will make available £178 million in addition to grant. We estimate that students in scope of loans would have been able to claim only £68 million in 1990-91. The net increase to students' budgets from the autumn should be £135 million. That is a mark of the scheme's generosity. Under the scheme, there will be progressive reduction in the real value of the parental contribution. When the scheme reaches maturity, parents in comparable circumstances will eventually pay little more than half the present contribution. The scheme offers parents a real benefit. That is why it is important to get on with the Lords amendments and to pass the Bill. The loan will not be means-tested. It will therefore be a valuable resource to the 40 per cent. of students whose parents do not make the full assessed parental contribution.

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Mr. Simon Hughes : On a point of order, Mr. Deputy Speaker. You must consider whether the Secretary of State is still in order--

Mr. Alan Amos (Hexham) : This has nothing to do with the hon. Member for Southwark and Bermondsey (Mr. Hughes).

Mr. Hughes : I am asking Mr. Deputy Speaker to consider this point. The motion is to guillotine or to timetable debate. It therefore precludes debates on a range of issues being taken separately. If they were taken separately, the points that the Secretary of State is now making could be made in those debates. This is a timetable motion. It surely cannot be right, instead of the House having the opportunity to debate the 17 Lords amendments, for the Government to use the guillotine and the limited time that they have made available to make their case, which they ought to make point by point in each of the debates. That is an abuse because it is substituting a timetable for proper ordered debate of different issues. It surely matters not whether it is the Secretary of State or the newest Bank Bencher who uses that procedure.

Mr. James Pawsey (Rugby and Kenilworth) : On a point of order, Mr. Deputy Speaker.

Mr. Deputy Speaker : Is it on the same point?

Mr. Pawsey : Yes. Do you agree, Mr. Deputy Speaker, that the interventions made in the speech of my right hon. Friend the Secretary of State underline the necessity for the motion?

Mr. Deputy Speaker : As I said earlier, the motion lends itself to relatively wide debate. I note that the Secretary of State is referring regularly to the Lords amendments with which the House will deal later. It seems to me that he is giving the background to the Lords amendments. How long the House takes on the motion is a matter not for the Chair but for the House.

Mr. MacGregor : I am anxious to get on, which is why I have not referred to matters such as housing benefit, as I suspect that other hon. Members will. I want as much time as possible to be given to the Lords amendments. The point that I am making, succinctly and briefly, is that it is important to deal with the Lords amendments as quickly as possible so that we can progress and so that the benefits of the scheme can be available to students.

It has frequently been argued that loans will inhibit entry into higher education. We have had long debates on that, but it is clear that, in general, countries with long-established loan schemes have a higher proportion of their young people in higher education than we do. Nor is there any sign that loans have deterred people from less prosperous backgrounds or from ethnic minorities from entering higher education.

We have carefully considered all the alternatives to the scheme presented to us, but I believe that they do not bear scrutiny. Providing additional resources as grant rather than a loan is simply not an option. Expenditure would continue to rise as the number of students increased, whereas the Government scheme reduces public expenditure in the medium term as repayments mount up.

Mr. Jack Straw (Blackburn) : On a point of order, Mr. Deputy Speaker. I have forborne rising previously but, with respect, this is an abuse of the procedures of the

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House. I once attempted to make a similar speech to the Secretary of State which had nothing whatever to do with a guillotine but everything to do with the substance of the Bill concerned and was rightly called to order. I suggest that the Secretary of State's speech is wholly out of order.

Mr. Deputy Speaker : I have already dealt with that point. I can add nothing further.

Mr. MacGregor : I shall make one last point, and I am entirely following your ruling, Mr. Deputy Speaker.

I have set out elsewhere the arguments against repaying loans through an additional national insurance contribution or through some form of graduate tax. I note how--including during debates in the other place--the advocacy of those options has faded away. We have given the scheme and the Bill thorough examination and the Government have accepted a considerable number of the Lords amendments. That is because, in the light of the discussions in this House and the other place, it has been right to do so. I have already explained that the amendments are either in response to points made by hon. Members on both sides of the House or technical amendments. Later, we shall debate two subjects on which I shall make it clear that we should not accept the Lords amendments. I emphasise that the majority are in response to points that have already been made.

The debates in this House, the other place and outside have shown that there is more widespread acceptance of the principle that "the beneficiaries of higher education should make a financial contribution towards it."

Those are the words of the Committee of Vice-Chancellors and Principals. We are simply putting in place a scheme of loans to supplement maintenance grants which most other similar countries already have. Both our levels of student maintenance support and the terms and conditions of the loans are more generous than theirs. The Bill will benefit from the changes that we are proposing to accept as a result of parliamentary debates. Now it is necessary to get on so that we can put the scheme in place in good time to enable students to get the 25 per cent. increase in resources that we are making available. That is why I commend the motion to the House.

5 pm

Mr. Jack Straw (Blackburn) : This guillotine motion is wholly without merit or justification. There has been no filibustering on the Bill. The motion is a simple abuse of power by an authoritarian and once all-powerful Government who are now in an advanced state of disorder and decay. I am not surprised that the Secretary of State spent 15 of the 20 minutes of his speech wholly outwith the terms of the motion, reading from a press notice about the alleged advantages of the loans scheme. He knows that the motion is unworthy of him and his office. Although the motion is an act of power, it conveys no strength, but rather the weakness of a Government who are afraid of argument and are trying to deny, even to themselves, the consequences of what they wish to force through.

The hon. Member for Aldridge-Brownhills (Mr. Shepherd) rightly and courageously said that, until two years ago, there had never been a precedent in the history of this House for any Government to seek to guillotine a Bill in the Commons during consideration of Lords amendments. The record of this Government, even with a majority of 100 over every party combined, is the record of

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a Government who are unwilling to listen and almost incapable of listening to arguments with which they do not agree.

The only other Government with a similar majority--the Labour Government of 1945-51--introduced only three guillotines. The Conservative Government of 1951-64 managed just 15 and the Labour Government of 1974-79, who had a majority of just one and at one stage had no majority, managed 11 guillotines. This Government in less than two years have managed to guillotine 12 Bills. There has been no necessity for almost any of those guillotines.

Mr. Pawsey : Will the hon. Gentleman give way?

Mr. Straw : No. I shall give way in a moment.

As is well known, last Wednesday the Opposition were told through the usual channels that the Bill would be guillotined. That announcement would have coincided with the last day of consideration of amendments and Third Reading in the other place, so in a cynical and squalid manoeuvre typical of the Government, that guillotine motion was withdrawn in order to lure their Lordships into the belief that the Government would at last play by the rules. As the Bill has now passed its stages in the Lords, the motion is being reintroduced in this House at the shortest possible notice to the Chamber. The motion gives us three hours to debate the guillotine and no more than two and three quarter hours to debate 15 of the 17 amendments passed by their Lordships. We have no time to debate the most critical amendments of all, those on housing benefit. I earnestly hope, as do all Opposition Members and, I dare say, many Tory Members, that, in the light of representations and as no privilege arises because the expenditure has already been authorised by the money resolution, Mr. Speaker will agree also to allow debate on those amendments. Even taking only the 15 amendments, the time allocated for debate amounts to no more than 10 minutes per amendment. The Secretary of State made the audacious claim that to allow this debate to continue unguillotined would lead to what he described as pointless repetition. Some of the serious and significant issues raised by their Lordships, some of which have never been debated in the House, deserve rather more than 10 minutes of discussion.

There is the issue of whether there should be consultation and who should be consulted on the new courses to be made the subject of the loans scheme. There is the major issue of parliamentary scrutiny of delegated legislation. There is the issue of the new powers taken for this authoritarian Government to force university and college administrations against their will to co-operate with the measure without adequate compensation. There are amendments on disabled students which may have all- party support, but which certainly deserve proper consideration.

There are amendments on the marketing and canvassing of loans to students or potential students under 18 and on the disclosure and sale of information belonging to the Student Loans Company. That raises the question of the circumstances in which the Student Loans Company could be privatised, as the Under-Secretary of State has

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promised will happen, and whether that privatisation could take place with the sale of the information that the Student Loan Company has.

The House has never discussed two key issues : the new controls over the institutions and loans to under-18s. Yet the Secretary of State treats the House with such contempt that he is willing to allow us only 10 minutes' discussion per amendment.

On 20 October 1989, The Times Educational Supplement reported a vision of the hon. Member for Leeds, North-West (Dr. Hampson) about the Bill. Incidentally, he is the campaign organiser of the right hon. Member for Henley (Mr. Heseltine). He said :

"We are potentially into another poll tax scenario in which our MPs welcome the principle of loans without waking up until it is too late to the practical repercussions".

Most Conservative Members are not so much asleep as in a trance. They are transfixed and rendered incapable by the desperate prospect of defeat that inexorably comes closer every day. One word should awaken them from their trance, although whether it will I do not know. One word should make every Conservative Member with an ounce of self-interest and survival refuse to back this guillotine motion. One word should be sufficient warning to send them running, and that word is Baker. [ Hon. Members :-- "Straw."] It is Baker. This Bill has the curse of Baker upon it. [Laughter.] I am glad to see that Conservative Members laugh before the gallows.

The man who created teacher shortages on a scale never before seen, the man who collapsed teacher morale on a scale never before seen, the man who rendered Conservative education policies less popular than ever before and the man who invented the poll tax and then cut and ran is the same man who invented the loans scheme and then cut and ran. The mess that he leaves on this is no less than the mess that he left on the poll tax.

Mr. Pawsey : On a point of order, Mr. Deputy Speaker. The hon. Gentleman criticised my right hon. Friend the Secretary of State for straying from the point and getting involved in a wide-ranging debate. What is he doing now, if it is not that? It is extraordinary.

Mr. Deputy Speaker : I am applying the same rules to both Front Benches.

Mr. Straw : With respect, Mr. Deputy Speaker--

Dame Elaine Kellett-Bowman : Further to that point of order, Mr. Deputy Speaker. With the greatest possible respect, I say that that is not the case, because my right hon. Friend the Secretary of State for Education and Science was discussing education and the hon. Member for Blackburn (Mr. Straw) is discussing everything under the sun.

Mr. Deputy Speaker : It would be better for the House if hon. Members left those points to me and if we got on with the debate.

Mr. Straw : The hon. Member for Lancaster (Dame Elaine Kellett- Bowman) should listen for once and take my advice. I am seeking to explain why it is in the interest of Conservative Members as well as of the Opposition to vote against the motion.

In this week's Sunday Times , there was a lengthy and well-informed article about how the Conservative party managed to sink ever deeper into the mire on the issue of the poll tax. It spoke about the authors of the loans

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scheme, the guillotine motion and the poll tax. A ministerial colleague of the Chancellor of the Duchy of Lancaster, the right hon. Member for Mole Valley (Mr. Baker), was quoted as saying : "Baker was clever enough to see the problems but ambitious enough to overlook them."

Mr. Patrick Thompson (Norwich, North) : On a point of order, Mr. Deputy Speaker. You are rightly allowing a wide-ranging debate on this matter, but when an hon. Member starts to debate the community charge he is well out of order.

Mr. Deputy Speaker : The hon. Member for Blackburn (Mr. Straw) is regularly mentioning the motion and is in order.

Mr. Straw : Not only was the right hon. Member for Mole Valley clever enough to see the problems of the poll tax but he was clever enough to see the problems of the student loans scheme. In both cases he was ambitious enough to overlook those problems, knowing that he would not be around when they came home to roost. They have been left to the hapless and luckless present Secretary of State for Education and Science. More fool him for picking up the challenge.

Let us look at what the Secretary of State claimed in his speech for the loans scheme. He said that it was designed to "relieve the burden" on taxpayers. It will cost the Exchequer £750 million in the first three years and £2,000 million over the next 20 years. Because the money will disappear into a black hole of administration, default and deferral, the scheme will cost most students dear. Far from helping poorer people to gain access to higher education, the scheme will be an indiscriminate subsidy to the middle classes who need it least.

"the arguments about access are bogus."--[ Official Report , 20 October 1989 ; Vol. 158, c. 422.]

Those are not my words, but the words of the Secretary of State's hon. Friend the Member for Chichester (Mr. Nelson). Those who need it most will be denied the greatest amount through the immediate loss of housing benefit, worth up to £400 or £500 in some cases, and by an immediate cut in the real value of the grant.

A scheme designed by the right hon. Member for Mole Valley to be run by the banks is now in administrative chaos. I shall quote from a piece of ancient history :

"Baker wins bank loans for students".

The right hon. Member for Mole Valley persuaded an ever compliant Sunday Telegraph to write that just nine months ago. He did not win bank loans, because his hyperbole had no substance. The curse was working and the banks cut and ran, ready to risk the fizz and fury of the Prime Minister to protect their market share.

Conservative Members should think again before voting for the motion, because they will be voting for the early introduction of a new nationalised corporation. Such was the desperation of the Government when faced with the collapse of Baker's scheme that they had to set up a new nationalised corporation to run it.

Like the poll tax, the loans scheme is morally offensive. It takes money from those who need it and gives money to those who do not want it, and it wastes millions in administration. It is born of that unique combination of arrogance and incompetence, the hallmark of the Government.

"Walk carefully, do not wake the envy of the happy gods. Shun hubris",

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wrote C. S. Lewis. This modern Conservative Government have walked carelessly and dealt carelessly with the lives of others. Through that arrogance, pride and haughty spirit, they have made careless decisions on the poll tax, on schools, on the Health Service and on student loans. They will pay for their hubris by nemesis, by crushing defeat, and the Education (Students Loans) Bill will play a major part in that defeat.

I once thought that the instincts for survival of the Conservative party went before all. If Conservative Members vote for the guillotine, it will prove not only that they will lose but that they want to lose and have lost the capacity and will to survive. I oppose the motion.

5.15 pm

Mr. James Pawsey (Rugby and Kenilworth) : We have listened to a somewhat unusual speech by the hon. Member for Blackburn (Mr. Straw), suited more to the Palladium than to the House of Commons. We have heard the ritual moans about time and the ritual synthetic anger and references to an anti-democratic guillotine. I remind the Opposition that the guillotine record stays with them and that the right hon. Member for Blaenau Gwent (Mr. Foot) introduced five in a day. He gave a new meaning to the expression "a bunch of fives". If there was a cup for successful guillotining, it would be held by the Opposition. They would have it firmly bolted to their mantelpiece, because they are the experts in guillotines. The right hon. Member for Blaenau Gwent, the great democrat, was at that time the great dictator, the arbiter of parliamentary time.

The debate and the time that it takes will be the real measures of the Opposition's concern. The quicker we start to debate the substance of the Lords amendments, the more time there will be for constructive discussion. It occurs to me, as I am sure it has occurred to my hon. Friends, that we have listened to all the Opposition arguments. We listened to them on Second Reading, in Committee and on Third Reading and we know just how feeble those arguments are. We know that the Opposition's case is discredited and I am certain that they will therefore seek to run the guillotine motion for the full three hours.

The justification for the measure is to be found in the need to attract more students in advanced education and to generate the new money that makes that possible. No hon. Member doubts that there must be a limit to the number of students that the taxpayer can support on the present grant- only basis. It is not possible to soak the taxpayer for every single penny. The loan is £420 and it is interest-free. It is not repayable until the student leaves university, commences employment and earns 85 per cent. of the national average wage. There will be no negative dowry, because we all know perfectly well that, if a woman chooses to start a family, she does not start to repay the loan until she starts to earn.

It has been argued inside and outside the House that high taxpayer support is necessary to guarantee a high level of admissions to advanced education. Since 1979, the value of the grant has steadily reduced, but despite that reduction, the number of students has increased by 200,000. Therefore, there is no case to answer that a reduction in grant equals a reduction in student numbers. Those 200, 000 extra students help to underline two specific points : first, the success of my right hon. Friend's policies

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on advanced education, and secondly, the fact that we have had success with our general education policies. There is no point in seeking to increase access to higher education unless the appropriate number of young people come from schools to take advantage of it and clearly that is the case in the United Kingdom. We have been successful in raising the standard and quality of state education. I do not believe, as Opposition Members have said, that top-up loans will discourage those from blue-collar backgrounds from going into advanced education. Such people currently account for about 61 per cent. of the population, but they account for 21 per cent. of admissions to universities and 24 per cent. to polytechnics. Therefore, it seems that the present grant-only system has not been a conspicuous success for youngsters from blue-collar homes. They are the same young people who are prepared to borrow, and at commercial rates of interest, to finance a second-hand car and purchase video equipment, and will certainly borrow to facilitate their education, which, in turn, will assist them to attain a better standard of income once they have gained their degree. Those Opposition Members who say that they will not actually patronise young people. Young people going to university seem to have more common sense than some Opposition Members who argue that point.

I do not know what will happen when Mr. Speaker rules on the question put to him by the hon. Member for Blackburn, but I should like to briefly touch on the subject of social security benefits, because they are relevant to the matter under discussion. The estimated value of social security benefits likely to be claimed by each eligible student in 1991 is about £300, but the top-up loan is £420. Therefore, there is a substantial increase in the resources being made available to students.

I see little virtue to the taxpayers in student loans and social security benefits being made available at one and the same time and to one and the same beneficiary. Most of those in receipt of social security benefits do not have the benefit of receiving a grant from their local authority to continue their studies. Students seem to be in a different category from most other claimants or recipients of social security. I am firmly convinced, as I am sure are my hon. Friends, that the Government's proposals will result in the great mass of students receiving more support in the form of a loan than they could have claimed in benefit.

I acknowledge immediately that some students will be worse off as a result of the changes. In their case, the level of benefit that they were receiving may have been higher than the £420 interest-free top-up loan, but--and this is a big but--such students will be able to turn to the access funds for help. Students currently claiming benefit receive about £68 million a year. The value of loans is £200 million a year. Therefore, it is clear that there is a substantial increase in the amount of resources being directed at students. It is fair to remind the House of a point that was well made by my right hon. Friend, the Secretary of State, that next year resources for students will be increased by 25 per cent.

Dame Elaine Kellett-Bowman : Is it not likely that many of those in receipt of housing benefit will probably live in

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the sort of area where holiday work can be found and, therefore, they will not encounter difficulties in supplementing their income?

Mr. Pawsey : My hon. Friend makes a genuinely important point, which I can reinforce by saying that my five sons who went through college all earned money during the vacation. My hon. Friend the Member for Billericay (Mrs. Gorman) has told me that she went through university without the benefit of a grant and had to rely on loans on which she paid a commercial rate. Clearly, interest-free loans would represent a substantial benefit.

Mr. Harry Barnes : Is that why the hon. Gentleman refused to pay his parental contribution for the five children whom he sent through college? I believe that that was what he told us in Committee. Obviously, the legislation is directed to help children who are in the same plight as his children were, but it is of no benefit to people from working-class backgrounds.

Mr. Deputy Speaker : Order. In dealing with that point, I am sure that the hon. Member for Rugby and Kenilworth (Mr. Pawsey) will bear it in mind that we are discussing the allocation of time motion.

Mr. Pawsey : I am obliged to you for reminding me of that, Mr. Deputy Speaker. I shall, in due course, and in the friendliest way, take the hon. Member for Derbyshire, North-East (Mr. Barnes) outside and put him right about the points that he made. I have already mentioned the various benefits for young people from blue-collar homes. My five sons all received a parental contribution, but I did not make it up to the appropriate amount. My sons had to obtain work in order to get through college.

In debate after debate in the Chamber, I have called for the access fund to be substantially increased from the original figure of £15 million. I unreservedly congratulate my right hon. Friend the Secretary of State on the substantial increase that he has announced. The House will be aware that the Government have increased the size of the access fund, designed to assist students who face financial difficulties, by £10 million. That is deeply appreciated, not just by Conservative Members, but right across the House. It will be of substantial benefit and assistance to many students. The total value of access funds stands at £25 million in place of the original figure of £15 million.

The three prongs of student support--loans, grants and access funds--will more than make up for any loss of benefit. Social security benefits are targeted where loans are not. Benefit targeting is not always effective, if only because the student's family circumstances are not taken into account and those parents well able to pay more towards their children's upkeep at college are not asked to do so. That comes back to the point made for me by the hon. Member for Derbyshire, North-East. The benefit system does not represent a good, reasonable or effective use of scarce resources or good value for taxpayers' money.

Some students live in accommodation provided by the institution. The rent currently charged reflects an element for the rates and, as those rates have been abolished and the community charge introduced, those students should receive a rent reduction equivalent to the saving made by the institution. Students should not be required to pay the

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