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3.35 pm

Mr. Tam Dalyell (Linlithgow): I beg to ask leave to move the Adjournment of the House, under Standing Order No. 24, to debate an important matter that requires specific and urgent consideration, namely,

Thank you, Mr. Speaker, for allowing me to make an application for an emergency debate. This matter is definite, in that there are constant reports of the consequences of the incursions into Macedonia--basically, a Slav republic--by official and unofficial Albanian forces.

I do not know whether news bulletins are an indication of the importance of items, but at 5 o'clock this morning the situation in Macedonia was the No. 1 item on the BBC World Service news. Indeed, the respected correspondent, Mischa Glenny--known to many of us because he frequently comes to the House--who is not given to gross exaggeration and is the historian of the Balkans, used the careful words that perhaps we are getting into the situation of another war in the southern Balkans.

We understand that, this morning, the Government of Macedonia appealed to the Government of the Ukraine, which is in the Chair at the United Nations, for some kind of UN help. We also understand that the Americans, so concerned are they about what is happening, are supplying night vision equipment and other important equipment to the Macedonian Government.

Surely, the House of Commons should have an opportunity to discuss these complex and serious matters before there is an outbreak of major and sustained fighting, rather than holding debates after such events have taken place and we can do little about them. On those grounds, I believe that we should hold an emergency debate on the situation in the southern Balkans.

Mr. Speaker: I have listened carefully to what the hon. Member for Linlithgow (Mr. Dalyell) has said. I must give my decision without stating any reasons. I am afraid that I do not consider that the matter that he raised is appropriate for discussion under Standing Order No. 24, and I cannot therefore submit his application to the House.

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Job Losses (South Devon)

3.38 pm

Mr. Adrian Sanders (Torbay): I beg to ask leave to move the Adjournment of the House, under Standing Order No. 24, to debate an important matter that requires specific and urgent consideration, namely,

Thank you, Mr. Speaker, for giving me permission to raise a matter of grave importance in my constituency. Four weeks ago, Nortel Networks announced 700 redundancies, and last Thursday announced a further 700, bringing the total to 1,400. Compared with the 1,300 job losses at Corus in south Wales, 1,400 such losses in our travel-to-work area, with its higher unemployment rate and lower incomes, are significant. Furthermore, our area has suffered for some time from the decline in agriculture, tourism and the fishing industry.

One of the big problems is that the losses are in full, all-year-round jobs rather than the seasonal employment on which our economy used to depend before the very welcome investment by Nortel. Those job losses and their effect are important not only to my constituency but to the constituencies of other hon. Members in south Devon and in the whole region, because south Devon has become the European centre of the fibre optic industry--a position that we want to retain.

The matter is urgent because we are beginning the 90-day consultation period between the company and the affected staff, and because the foot and mouth crisis is affecting the hinterland of south Devon. That has a knock-on effect on the other industry in the area--tourism. People are considering whether to take holidays in our area. This week, we heard the appalling news that the Austrian Government were advising people not to travel to this country. That affected one of the language schools--another industry in the area--in my constituency, at which a party of Austrian students were due to study an English course. For those reasons, I seek permission for a debate under Standing Order No. 24.

Mr. Speaker: I have listened carefully to what the hon. Member for Torbay (Mr. Sanders) has said. I must give my decision without stating any reason. I am afraid that I do not consider that the matter that he has raised is appropriate for discussion under Standing Order No. 24, and I cannot therefore submit his application to the House.


Food Poverty (Eradication)

Mr. Alan Simpson, supported by Dr. Jenny Tonge, Mrs. Alice Mahon, Mr. Dafydd Wigley, Mr. Tony Benn, Ms Diane Abbott, Mrs. Margaret Ewing, Mr. David Chaytor, Dr. Howard Stoate, Mr. John McDonnell, Mr. David Drew and Mr. David Taylor, presented a Bill to require the Secretary of State to publish and implement a strategy for abolishing food poverty; to require the setting of targets for the implementation of that strategy; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 20 July, and to be printed [Bill 56].

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Education (Student Loans) (Amendment)

3.40 pm

Mr. Nick St. Aubyn (Guildford): I beg to move,

The Bill gives all hon. Members a very special opportunity--the chance to spur the Government into correcting an injustice that was created by Ministers and that hon. Members on both sides of the House agree should be corrected. Nearly four years ago, the Government scrapped student grants and replaced them with loans, which must be repaid by graduates who earn as little as £10,000 a year. What has been the effect of that action?

Increasing numbers of school leavers from poorer homes have been deterred from taking up university courses. Their numbers, which had doubled in the 10 years to 1997, during the great expansion of higher education under the previous Conservative Government, have stood still since then. This Government's target, which was to build on our success by ensuring that up to 50 per cent. of school leavers went to university, is now in tatters. Yet again, we see how a Labour Government, who promise more and take more, have delivered less.

As the Secretary of State for Education and Employment told the House only the other week, the number of students from the very poorest homes has risen slightly since 1997--by about 500--to 5,000 a year. However, the total number of students from poorer homes--totalling about 65,000 a year--has declined during the first three years of this Government.

It is no use blaming the universities. The Chancellor of the Exchequer tried that last year, and all the evidence since has shown how wrong he was. Our universities try as hard as they can to attract the top talent, wherever it comes from. Labour's decision to force students to repay their much bigger loans when they earn as little as £10,000 a year is the real deterrent today.

The Bill gives the House the chance to choose between two ways in which to correct that injustice. The first is Labour's way. Labour want to focus on where students come from, offering them extra support if they live in deprived areas, as designated by Whitehall officials. That will simply create a postcode lottery. A child from a Georgian house in Lambeth will qualify for the grant; a school leaver from a Guildford council house will be denied the support that he or she needs.

Universities UK told me in a letter today that it shares my concern about the accuracy of using postcodes, saying that

Yet again, we see how Labour's obsession with people's backgrounds fails to address the real problem. I want to focus on where students go, not where they have come from. That my way and is what my Bill would achieve.

Most students make it into well paid jobs. The average starting salary for graduates is £15,500 a year; for those in graduate-type jobs, it is more than £18,500 a year. Most graduates can therefore afford to put back into the system a fair share of what they have gained from it. By so doing, they help others to follow in their footsteps.

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Some graduates, however, will never earn a high wage. Students from homes whose family income has only ever reached £10,000 a year must think twice before embarking on a course at university when they have to repay a loan despite earning just £10,000 a year. My Bill will require graduates to repay their loans only when they are earning £20,000 a year, sending a clear signal to those from less well-off homes that we really believe in their potential.

Graduates who will never earn £20,000 a year will be let off the hook. That must be paid for, and I will explain how. Indeed, I would not be allowed to introduce the Bill if its framework did not provide the means to pay for that. One of the scandals of the Government's handling of student finance is the way in which they have sold off part of the student loan book at the thumping loss of £150 million. Students were charged £150 million in tuition fees, but what did the Government do with the money? They blew it on a lousy deal with banks in the City, because the student debt was unmarketable. Now they are creating even more of that unmarketable debt through their loan system.

I know that the previous Government had pencilled in the sale of the student loan book, but we would never have let it go at such a low price. As the Under-Secretary of State for Education and Employment, the hon. Member for Barking (Ms Hodge), knows--she was the Chairman of the Education Sub-Committee of the Select Committee on Education and Employment--I wrote a memorandum on this subject and it appeared in our Committee's first report. I suggested that universities should manage the debts, so that if debts had hidden value it would be unlocked in the hands of those who need it most--the universities themselves.

The next Conservative Government will not repeat Labour's mistake. We will hand over the outstanding debt to the universities at the same time as freeing them from being tied to the grant system of the Higher Education Funding Council for England. We will ensure that the hidden value in the loan book is unlocked in the hands of the universities.

The thrust of my Bill is to reform the student loan system, so that it is transparent, efficient and, therefore, properly fundable without our ever having to give money away to the banks again. That means that the loans must bear a market rate of interest. Today's loans are charged at the rate of inflation--about 2 per cent. a year. A market rate in line with mortgages would be about 6 or 7 per cent. a year.

The Government tell us that the cost of the interest rate subsidy is 20 per cent. of the amount of the loans. The typical graduate now leaves university with a loan of about £8,500. The cost of removing the subsidy would, all things being equal, be about £1,700 per graduate. However, we do not stop there. The Conservative plan promises a tax change. It is outside the scope of this Bill, but it will be within the scope of tomorrow's Budget. Tax relief on loan repayments can and should offset completely the additional interest charged for students.

On that basis, I am glad to welcome the support of the National Union of Students for the principles behind the Bill. Earlier today, it told me:

6 Mar 2001 : Column 157

We would not expect the representative body of students to endorse the raising of the threshold if that were funded by a shift from a subsidised rate of interest to a market rate. However, when taken with the Conservative tax pledge, we are not proposing to do that. The Bill's proposed changes would be paid for out of the efficiency gains from making the loan system simple and transparent.

My Bill will address one other vital issue. Universities UK also told me today:

I agree. The Education Sub-Committee heard evidence that in many colleges the Government have cut grants for providing students with careers advice by up to 50 per cent. That is a disgrace. We must properly fund the advice that people receive before they take their exams because that is when they decide whether to go to university and obtain a degree.

The combination of my Bill and modest changes in tomorrow's Budget would allow us to tackle the problem. The Government were recently big enough to admit their mistakes on secondary school reforms and to congratulate Guildford on the changes that we have made at one of our schools. Will they learn from Conservative policy on this matter and help our students as well?

Question put and agreed to.

Bill ordered to be brought in by Mr. Nick St. Aubyn, Mr. Stephen O'Brien, Mr. David Ruffley, Mr. Andrew Robathan, Mr. Patrick Nicholls and Miss Julie Kirkbride.

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