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Mr. Forth: I am following my hon. Friend's well-thought-out and erudite analysis--as ever--closely and with fascination. I wonder whether he means to suggest to the House that, over a period of time, the Government have in any way transgressed on higher education's traditional academic freedom as opposed to the financial relationship between the taxpayer, through the Government, and universities. Or does he feel that the increasing attraction of private sector money--a very successful trend recently--ameliorates the process that he has described?
Mr. Jackson: It is my argument that there should be a great deal more private funding for universities and I shall develop that point later. It is a profound mistake to think that there is no connection between funding arrangements and academic freedom--they go hand in hand. Although there is no desire, will or evidence of any policy to infringe academic freedom, the fact is that the conditions in which academic freedom could be infringed are steadily being created by the nationalisation of higher education that I have been describing. We should do something about that. I believe that in the process of the bureaucratisation of the nationalised system of higher education, values of intellectual independence and academic responsibility, which are central to liberal higher education, are increasingly at risk.
Mr. Colin Pickthall (West Lancashire): Will the hon. Gentleman extrapolate from what he has just said, and comment on what my hon. Friend the Member for Oldham, Central and Royton (Mr. Davies) said--that the banks that will administer the loans will have a say in the courses to which they prefer to give awards? Would not that be an infringement of the liberal education that he is espousing, and with which I agree?
Mr. Jackson: To the extent that there is a reliance on private sector funding, all sorts of influences will certainly come from the private sector. If a higher education system is funded from a variety of different sources, public and private, and those private sources are in turn diversified, the conditions for autonomy are maximised. What is undesirable is for the university institutions to be exclusively dependent on one source of funding--the Government. That is what I am arguing against.
The universities, faced by that position, have tended to cling to traditional constitutional and legal formulae to protect their position. It is time that they recognised that their approach is obsolete. It worked for half a century in the era of the University Grants Committee, when the size of higher education--and therefore the cost to the taxpayer--was still quite small. The growth of state spending on higher education to its present volume and the development in Whitehall of a less discriminating and more unsympathetic approach to accountability have simply made the old cosy structures unviable--the old system of lunches in the Athenaeum. The best way--I now believe the only way--for university autonomy to be secured is for the universities to acquire a substantial flow of income that is essentially independent of the state. I emphasise that by this I do not mean that I believe that the whole of the present taxpayer subsidy could or should be replaced from private sources, but rather, as with the
American public university system, that there should be a partnership between public and private funding, with private funding at a level sufficient to give the universities the critical extra margin of financial manoeuvre necessary to safeguard their autonomy.
Mr. Pickthall
Does my hon. Friend agree that the sort of funding system that he is advocating would also lead to a revolution in academic salaries, which we really need in this country if we are to continue to attract the best and the brightest in university teaching and research?
Mr. Jackson:
My hon. Friend is absolutely right. One of the most serious social trends in society over the past 20 years has been the pauperisation of the academic profession, which has profound implications for the future of our country. I believe that one of the causes of that pauperisation has been the nationalised bureaucratic system in higher education, which I am criticising.
Before I go on to explain how I think we could get that extra margin of manoeuvre for universities by using the mechanisms provided in the Bill--I am coming back to the Bill--let me say why I believe that objective should commend itself to all hon. Members.
One of the great themes in the constitutional debate that is increasingly at the centre of British politics is the desirability of greater decentralisation in Britain. This is not just a question of devolution to Scotland and Wales or of the relations between central and local government. The Government and the Opposition need to think deeply about the relationship between the institutions of national government in Whitehall and Westminster and the whole range of non-governmental institutions that make up the fabric of our society and our culture.
If the Government and the Opposition are serious about decentralisation, we have to think about how to restore powers not only to local government but to institutions such as universities, which have recently seen their autonomy and their capacity for self-determination increasingly eroded.
To my own party I would say that I have never understood how the creeping nationalisation of our universities, which we have promoted, can be consistent with any recognisable Tory philosophy. To new Labour I would say--
Mr. Jackson:
I want to finish this point. To the new Labour party--the hon. Member for North-East Derbyshire (Mr. Barnes) is old Labour--I would say that I do not understand how sustaining and deepening the nationalisation of the universities is consistent with its new thinking about the need for a more decentralised political and civil society with greater scope and initiative for communities of which the universities are, or should be, a primordial instance.
Mr. Barnes:
If the hon. Member feels that way, why did he usher through the House the original student loan scheme? According to his philosophy, that scheme was presumably a nationalised, centralised loan scheme, which is now being altered by the Bill.
Mr. Jackson:
It was not the student loan scheme that I wanted. We wanted a loan scheme run by the banks, and it would have been much better if they had played the game and gone along with it. The principle of the student
I shall assume that I have carried the House at least part of the way with these philosophical considerations about the need for decentralisation and university autonomy that I have outlined. My argument is that greater independence for universities cannot be secured by constitutional and legal devices alone, and that the best way to secure that greater independence is by giving them an independent source of funding. In my view--this is the answer to the hon. Member for North-East Derbyshire-- fee income from students, supported by loans financed against their future income, is the only way to provide such significant independent financial resources for universities; and that brings me back to this little Bill.
A major defect in the Bill is that it does not address the central defect of the Education (Student Loans) Act 1990--against which I fought tooth and nail when I was a Minister but lost--by which the student loans scheme is limited to the provision of loans to support student maintenance only. The 1990 Act must be amended, perhaps by this Bill, to enable loans to be advanced to students to pay the fees charged by universities. Nevertheless, what is positive and significant about this Bill is that it opens the door to loans being advanced to students with private money and by the private sector. Let me explain why I think that is so important.
Even if the 1990 Act were amended to enable loans to be provided to pay fees, so long as the money being used to finance the loans was coming from the Treasury and counted against the PSBR, the Government would have a legitimate interest in limiting the overall funding provided for loans against fees. Because of the way things are in Whitehall and, indeed, in Parliament, that could all too easily turn into a Government policy on the size and shape of fees charged by universities. In that way, the top-up private fees would be not the instrument of the greater university autonomy which we should all be seeking but an instrument for a further extension of Government control of universities.
If, however, the loans to pay the fees were to come from the private sector, there could be no justification for the Government determining the fees policy of the universities, which would be private institutions deciding for themselves the terms and conditions on which they admitted their students. The strategic thought behind my initial proposal for a private sector loan scheme, which I described earlier, was precisely to give the universities that greater freedom. Although that thought came to nothing in 1987, I regard the Bill, and the relaxation of Treasury doctrine that it implies, as marking a potential step in what I consider to be fundamentally the right direction.
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