Examination of Witnesses (Questions 280
- 303)
MONDAY 17 APRIL 2000
BARONESS BLACKSTONE
AND MS
BEVERLEY EVANS
Dr Harris
280. For mature students there was a fall off
and in your answer you argued that one way of increasing money
into universities was to take money in the form of grants from
lower income students and replace that with loans and use that
to fund higher education, the majority beneficiaries of which
are the middle classes and the well-off. Cubie felt that that
was the wrong approach. Do you think there is anything peculiarly
Scottish about debt aversion, which he thought was the problem
this has created, which would not apply his conclusions to the
rest of the country?
(Baroness Blackstone) Of course I respect Andrew Cubie
and I respect the work that he has done in Scotland, but I actually
do not agree with some of his recommendations, including this
one. I think that what we are doing is providing a system which
is supportive of students from all social groups, but in particular
from those social groups that have been under-represented. There
has not been a decline in their numbers. We have been through
the point about the mature students where there has, I readily
admit, been a small decline, but there are many reasons for that
of which the student support arrangements are only one. Moreover,
we have introduced some changes there in response to that to make
sure that mature students are given some extra help. That was
not done under the previous arrangements where grants were available
for large numbers of students. The amount of money that students
are getting to sustain them through their period as full-time
under-graduates has not gone down. That I think is the key factor
that we have to take into account.
281. If the Scottish experience showed that
there was an increase following the changes in not only the overall
number of people, which compared to the similar period last year
appears to have gone up according to Scottish UCAS, but if there
was also shown to be an increase from less well represented groups,
would you think again about using a version of the Scottish proposal
as a way of improving access from those under-represented groups
into higher education in the rest of the United Kingdom?
(Baroness Blackstone) First of all, there has not
been any change in the overall numbers applying to go to Scottish
universities as a result of the Scottish Executive's decisions.
There was a slightly misleading press notice put out by UCAS.
There was an increase over a particular period of time when I
think that applications may have been held up in Scotland while
there was some uncertainty and students were waiting to see what
the outcome of the Cubie recommendations was going to be, but
if you look at the overall number of applications at the same
date last year as this year, the total number of students that
have applied in addition this year is 20. That is 0.1 per cent
of the total number of applications so I think you have to conclude
from that that there has not been a change.
282. There might have been a drop, but you did
not answer my question.
(Baroness Blackstone) That is a completely hypothetical
question as to whether there would have been a drop.
283. My question was if the Scottish experience
shows that there is an increased number of applications from less
well represented, ie lower income groups, in Scotland following
these changes, would you consider it as a means of improving access
to higher education in the rest of the United Kingdom?
(Baroness Blackstone) I would want to look at the
impact of other changes that we are making first. In the rest
of the UK we are introducing a bursary scheme for students from
very low-income families so I think it would be right, rather
than starting to think about ever more new measures, to make sure
that we have followed through and implemented the measures that
we are currently proposing in order to help those sorts of students.
Chairman
284. As a good social scientist, I presume,
Minister, that you would consider anything that pointed in that
direction?
(Baroness Blackstone) Of course. I am open minded
about doing things that will help students who have the potential
to benefit from higher education doing so. We all share that as
a goal I am sure.
285. What the Committee is a little bit worried
about is that the previous evidence we have had does point out
to these problems. First of all, the NUS and other students who
came to give evidence were very concerned. There is not a real
barrier but certainly a psychological barrier with the complexity
of the system. As you have given evidence, it does seem that it
is alright if you are the Minister and you understand it all—and
I must say that I must point you in the direction of some of your
colleagues who when they looked at the revision of the National
Curriculum recently they actually realised that the National Curriculum
and much associated with it was very dense to the teachers and
pupils and parents who had to try and understand it. The learning
journey and the change there has opened up the curriculum in a
way that did not exist before. I hope you do bear in mind the
possibility that there is out there a view that these are very
complex regulations that they are not quite comfortable with and
certainly those coming from a less middle class background, less
professional background, find it more difficult to disentangle.
(Baroness Blackstone) I do entirely accept that. Everything
that we have done since we arrived in Government nearly three
years ago has been to try to simplify the system, where we can,
rather than making it more complex. There have been many, many
ways in which we have tried to do just that. Beverley can give
you a few examples if you want them. It is important that we do
not have extraordinarily complex sets of regulations that are
incomprehensible to people who have to operate them, let alone
the beneficiaries. I always say "let us try and keep it simple",
but as soon as you try to do extra things for certain groups of
students and you have particular eligibility requirements inevitably
it does make it a little more complex. I think the system for
the vast majority of students is beginning to be understood now
and I hope it will go on being better understood as it becomes
even more bedded down.
286. I want to bring some colleagues in but
to shift the questioning for a moment. There was quite a concern
from CVCP and from students about the degree to which students
are now taking a lot of paid work which is affecting their studies.
Even if you look at the drop-out rates, I know the CVCP suggested
they have not changed in quite a long time, the failure to complete
rates, it is still of great concern that we attract students into
higher education and a very high percentage then drop-out before
completing their studies.
(Baroness Blackstone) The percentages that drop-out
are always too high, of course. I do not want any student to drop-out
and I think we should all work very hard to make sure that we
have systems in place to try to reduce the amount of drop-out.
I expect HE institutions to really work at this. If you admit
a student and then for one reason or another they do not complete,
it is a failure in a sense. It is a failure for the individual
and it is a failure for the institution. Having said that, I think
we need to look at these figures in the context of international
comparisons. We have the lowest rate of drop-out of every OECD
country bar Japan and I think that is a record of which we can
be quite proud. Moreover, although the drop-out rate has gone
up a little bit, it has gone up by a very tiny amount. I think
part of that small increase may relate to widening participation
and access, taking in some rather more marginal students than
was the case in the past as a result of the expansion. At the
same time I think we should do that and give people a chance and
work to keep them there but a few of them will fall through the
net.
Mr Marsden: You said to Evan Harris on the issue
of Individual Learning Accounts that they should be seen, I think
you said, more as a mechanism for part-time mature students—
Chairman: That was to me.
Mr Marsden
287. Sorry, I beg your pardon, Chairman. They
should be seen more as a mechanism for part-time mature students
for short-term things. Given what you said earlier about the historic
under-funding and under-support in FE, which Government is now
rectifying, should we be more ambitious with Individual Learning
Accounts in terms of the way in which they are used and the money
is split up?
(Baroness Blackstone) I think we are being very ambitious
already. Getting them off the ground, and we have a target and
a commitment and we will achieve that, we are very determined
to do that, that in itself is a very big undertaking. Many of
the people who benefit from Individual Learning Accounts will
be adults who have decided to do part-time courses in FE, so it
is a way of helping just that group.
288. I am talking now about the actual sums
of money that will be put up front. Some might say, notwithstanding
what you have said, that they are too small to act as an incentive
and some might also say if we are looking at levering further
funding into the further education situation, other than by Government
grant, you need to look at other areas in which one might do so.
For example, what might you think of the issue of business contributions,
which was something that the NUS argued when they came here, business
contributions into ILAs with possibly some form of tax credit
in return?
(Baroness Blackstone) Yes, we are very keen that ILAs
should be seen as something to which the individual contributes,
the Government contributes and, indeed, employers contribute.
We are encouraging just that through the arrangements that we
are making. In particular we are focusing on reducing the cost
of courses for those who have taken out ILAs and I think that
will be something that employers will find attractive as well
as the individual.
289. Are there ways in which the new Learning
and Skills Councils at local level could pilot some schemes in
this respect?
(Baroness Blackstone) I think we are very open minded
about the development of ILAs over a longer time period. I think
we need to get them established and we can then build on what
we are doing and in the longer term we might want to extend the
kinds of groups who use them, we might want to make them bigger,
but I think it is very early days to make any commitments on that.
Chairman
290. Is it not strange Minister—I am always
uncomfortable with LSCs because you and I have a different familiarity
with the LSE rather than the LSC—that the Bill is going
through the House of Commons, and many of the people on this Committee
are standing on it, but higher education is not part of its remit?
If we are trying to encourage mature students to be involved in
higher education it does seem that there ought to be some linkages
that do not exist in the Bill at the moment. I am sure that you
are not able to say anything about that, are you?
(Baroness Blackstone) I think I am. We have bitten
off quite a lot in the new arrangements that we are proposing
that bring together college based learning with work based learning
under a single system rather than the pretty incoherent mishmash
that existed before. We are setting up a system which will be
dishing out £6 billion worth of public money through the
national and local Learning and Skills Councils. To try to bring
higher education into all of that would have made it an absolutely
vast and complex apparatus. Again, I think we need to introduce
reforms in a way that we can actually manage them properly rather
than trying to reform the whole world all in one piece of legislation.
I think that these reforms are very important. HE will be involved
in the sense that we expect to have HE representation on the Learning
and Skills Councils, we are encouraging far more co-operation
and collaboration between FE and HE and we will be doing that
particularly with the introduction of foundation degrees.
Chairman: I think I am taking us off the main
track here.
Mr Foster
291. I want to come back to the Cubie and Scottish
Executive proposals. How much would each of them cost if implemented
in England?
(Baroness Blackstone) Oh dear, I am not sure I can
give you the precise figure. I know that it would cost £500
million in England and Wales in the first instance and would eventually
cost about £335 million, something of that order. Normally
we would multiply by ten the cost of changes in Scotland for the
rest of the UK.[1]
(Ms Evans) Yes, it is £50 million
in Scotland and we think it would be ten times that to implement
in England and Wales.
(Baroness Blackstone) That was the Scottish
Executive as against Cubie.
292. What effect do you think that will have
on the overall financing of higher education within the English
system?
(Baroness Blackstone) I think if we were to put that
much additional funding into HE student support it would almost
certainly have an impact on what was available for providing high
quality HE. Maybe the Treasury would say, "Fine, you can
have all of that extra money for student support and you can also
have a lot more money for improving the infrastructure, academic
pay, expansion, all the other things we have to do, but I think
it is important to set student support against our other priorities
and I think we also need to look at student support for HE in
the context of the needs of other groups including those in FE,
which you raised earlier.
Dr Harris
293. On the Cubie proposals and indeed the Scottish
Executive's proposals, Cubie was quite clear that he thought the
system of tuition fees (up front at least) was discredited. We
have heard evidence that the loss of grant, which was one of the
other parts of the scheme, does cast doubt in academic circles
at least on the ability to attract lower income students, certainly
for mature students. Does that give you pause for thought? Can
you so easily dismiss what you might see as an experiment north
of the border that affects a number of people in a pretty comparable
higher education system?
(Baroness Blackstone) I think I have covered the points
you have raised about grants and loans already. On the issue of
fees, I am afraid I have to disagree with Cubie and his colleagues
who produced the report. 44 per cent of students in the rest of
the UK pay no fees at all, they are means- tested, they are income-related,
and I therefore think that we have solved that particular problem.
The Dearing Committee in fact recommended that everything should
pay fees, admittedly on a slightly different basis. We decided
that that would be wrong. Only about 35 per cent pay the full
amount. They are from income groups where this kind of contribution,
which we have to remember is only 25 per cent of the average cost
of the course, 75 per cent is still being covered by the taxpayer,
seemed to us to be the right kind of balance. But coming back
to your underlying point. Of course we will want to see what happens
in Scotland. I do not want to pretend that we are not interested
to see what the outcome is but I think we also have to look at
this in terms of the costs as well and what it would mean for
other areas of expenditure were we to go down this route.
294. Have you had any discussion with the vice
chancellors or have any of your officials had any discussions
with the vice chancellors of the Russell Group about the possibility
of top-up fees?
(Baroness Blackstone) I talk to vice chancellors from
all groups very frequently and I know that there are some who
are in favour of top-up fees, I also know there are many who are
opposed, but we shall look forward to the CVCP report which is
going to look at all aspects of top-up fees, the pros and cons.
We would also look forward to seeing the report from the very
much narrower group, the Russell Group, which I think will come
out much earlier.
295. So you do not rule them out?
(Baroness Blackstone) The Government's position on
top-up fees is unchanged. We are not in favour of top-up fees.
We took legislative action to make sure that they were not imposed
by making it possible for the government to have a reserve power
to reduce grant to any institution that introduced them, but what
both David Blunkett and I have said is that the issue is being
raised by some members of the Russell Group and others and we
should have a proper, mature debate about it.
296. But you do not rule them out?
(Baroness Blackstone) I simply say our position has
not changed, which is that we rule them out.
Mr Marsden
297. Can I ask you to confirm as a matter of
record not of opinion: that it is the case at the moment that
if top-up fees were to be introduced there could be no guarantee
that the additional funding thus acquired would be hypothecated
to the university concerned and in fact the Treasury might in
certain circumstances reduce block grant to those universities?
(Baroness Blackstone) I cannot speak for my Treasury
colleagues but I think it would be a little naive for us to assume
that they would not take this into account in any way.
Helen Jones
298. Can I follow up what Evan was saying because
I do not subscribe to this theory of the golden age of the grant,
I have to say, because many working class families were paying
large contributions towards their grants. While it is correct
that 44 per cent of students do not pay tuition fees, do you accept
that there is a problem of perception amongst many low-income
families that they believe they will have to pay? Certainly we
have received evidence of that and it is certainly my experience
amongst people in my own constituency who believe they will have
to pay even if they will not. While I accept that there are lots
of reasons for the low participation rates among low-income families,
do we also not need to tackle this problem of perception and how
can that be done to get over to people on low incomes that they
are not going to have to pay vast amounts?
(Baroness Blackstone) Absolutely, I agree with you,
there is a problem of perception and this partly goes back to
misreporting by some sections of the press at the time the tuition
fees were introduced. Again, I always keep coming back to this
point, and I am sorry to be tedious and boring about it, the proof
is in the pudding. We have not seen a decline in the number of
students from low-income backgrounds coming into higher education.
That does not mean to say we still should not work very hard at
dealing with the perception problem. Here I do think I can go
round saying that poor students do not pay, indeed 44 per cent
of students do not pay, and that may or may not get reported,
but everybody has got to say this. We need to work really hard
at it. Above all, the people who are in a position to advise young
people and their parents have got to take this on. People who
advise youngsters in their schools and FE colleges about entry
into higher education have got to work hard to get this across.
We have got to do a good job too through this sort of document,
through the Making a Difference pamphlets, which does make
these figures quite clear.
Dr Harris: Just on this subject, there may be
some doubt that 44 per cent of students do not pay tuition fees,
but do a lot of that 44 per cent now find they are not getting
their grants? That is a clear perception. I know that Helen Jones
does not subscribe to the grant philosophy
Helen Jones: I did not say that.
Dr Harris
299. Previous they thought that they would get
a grant, and they were right, now they know that they will not
get a grant. Could that affect the decision of a family and student
to apply to higher education?
(Baroness Blackstone) I do not think it will. Again,
we have not seen a fall-off in the number of low-income students
and I think it is becoming accepted by students that as far as
their maintenance costs are concerned it is reasonable that they
should take out a loan and then pay it back as and when they are
graduates as and when they can afford it. It is a fairer system.
If you are on a very low income your repayments are much lower
than if you are on a very high income. I believe that this will
become recognised as a reasonable system that everybody expects
to work for them, that they understand and that they then take
out their loans. The take-up for loans has not gone down either
since the new system was introduced, it has gone up actually.
300. With regard to the overall level of debt,
because the grant has been converted to loan, on average the amount
of debt has increased unless people take paid work. Do you think
there is a problem for the public sector in attracting the best
graduates when those graduates are more likely to be indebted
and may be more attracted to higher starting salaries or joining
bonuses in the private sector, as an example perhaps entering
teaching?
(Baroness Blackstone) I really doubt if the size of
the student loan debt is going to be a key factor here. It is
tiny compared with the lifetime earnings of graduates, it really
is very, very small. It would be absurd for any young person to
decide not to go into higher education because they were taking
out a loan. They really would be cutting off their noses to spite
their faces. The average loan is about £12,000 and their
additional earnings from graduating will very quickly be hugely
more than £12,000. Similarly, I think in deciding whether
they want to take a job in the City of London, whether they want
to be a doctor, whether they want to be a civil servant, their
decisions will be based on many, many factors other than the fact
that they have got what in lifetime earnings terms is a very small
debt to pay.
Chairman
301. Minister, this is the last question unless
any of my colleagues have anything else but I think we are winding
down now. Some of the witnesses who have been before us have suggested
that what we really need to do is to look much more carefully
at the whole principle of graduate tax. One of the hallmarks of
this Government, especially in education policy, has been its
pragmatism. If the system works and there is a research base for
it then we can use it. Why not go back and have a look at the
graduate tax in a rather different way than we have in the past?
We all know that the Treasury is rather changing its mind on hypothecation,
perhaps this is a window of opportunity for the Education Department.
(Baroness Blackstone) I am all in favour of pragmatism
and I think it would not be pragmatic at this stage, when we have
only just introduced a new scheme, to start talking about totally
new approaches. We are, of course, using the Inland Revenue to
collect the repayments under the new scheme which I believe will
be a much more efficient system than the one that existed before,
which will lead to far fewer problems about collection than existed
before, and I really do think we should let a scheme which bears
a little resemblance to a graduate tax without being one, in that
it is based on the level of your earnings in terms of how much
you pay back, before we start scrapping what has only just been
introduced and starting all over again.
302. Minister, thank you very much for your
evidence and, Ms Evans, thank you too for your contribution. I
hope that when we produce our report you will look kindly on it
and respond positively to it.
(Baroness Blackstone) Thank you very much for your
questions. I certainly look forward to receiving the report and
I cannot believe that I will be anything but positive.
303. And pragmatic!
(Baroness Blackstone) And pragmatic.
Chairman: Thank you.
1 Note by Witness: The cost of implementing the Cubie
proposals and of the Scottish Executive package in England and
Wales has not been fully calculated. However, as fas as the Cubie
proposals are concerned, our best estimate is that it would cost
around £700 million in the first full year in England and
Wales. The basis of that broad estimate is that we multiply by
ten the cost of changes in Scotland to arrive at the cost for
England and Wales. The cost of the Scottish Executive package
is £50 million in Scotland and so it would be around £500
million to implement it in England and Wales. Back
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