Select Committee on Education and Skills Minutes of Evidence

Examination of Witness(Questions 440-359)

MARGARET HODGE MBE, a Member of the House of Commons, Minister of State for Lifelong Learning and Higher Education, Department for Education and Skills, was examined.

Wednesday 12 December 2001

  440. Would it not be sensible in 2003 or 2004 to have a target for 2015?
  (Margaret Hodge) Down the line of course one would have to revisit the target. Sitting in the year 2001, I am happy to look at 2010.


  441. Minister, I must push you on this. The target is ambitious at 50 per cent and you are full of enthusiasm for it. We have had the Learning and Skills Council appear before us. It is down-tuning its targets. That organisation told us that the target for young learners achieving level three qualifications was only rising from 85 per cent; those achieving a level two qualification, GCSEs and equivalent, by 2004 currently is 75 per cent.
  (Margaret Hodge) It is pretty ambitious.

  442. Fifty-five per cent receiving a level three qualification—A levels—by 2004. It is currently 51 per cent. That is only a 4 per cent increase. That seems to be timid. Does that timidity at the learning skills FE level square with the ambitious target of 50 per cent? Do they match up?
  (Margaret Hodge) The answer is yes, they do. There is joined-up work going on to ensure that what is feeding through the schools FE system is that those targets are appropriate to meeting the 2010 target. We are building that up. Coming back to a point made by David Chaytor earlier, I should say that there are a million people in that cohort, 21 to 29 year-olds, who currently have a level three qualification, but who are not engaged in higher education. There is another cohort of people there whom we need to attract.

  443. It is said you could only get 10 per cent of your target out of that cohort.
  (Margaret Hodge) It is interesting that they are convinced of that. We shall see. It depends how successful we are, for example, on the foundation degrees and work-based learning. We shall try our hardest to maximise things.

Mr Chaytor

  444. On the numbers and the targets, earlier you were asked about quality and whether it is the maintenance of standards or the improvement of standards. How do you measure quality in HE?
  (Margaret Hodge) So far it has been measured by the Quality Assurance Agency. For the past seven or eight years they have gone around and carried out extremely detailed subject reviews. The sector appears to be finding this incredibly bureaucratic and paper-chasing, but nevertheless every university to which I have spoken admits that having to participate in a quality assessment has improved the quality of their teaching. Now we have to look beyond that and see what systems should be put in place to encourage improvement in quality of teaching and to assess the quality objectively. I think we will come out with probably a mixture of things, partly incorporating student views, partly looking at the internal audits—and they will be assessed by the QAA—and partly looking at things like external examiners' views. Those are the sort of elements we are looking at.

  Chairman: Minister, we now want to move on to funding higher education.

Mr Pollard

  445. Minister, the UK proportion of GDP spent on higher education is 1.1 per cent, the OECD average is 1.3 per cent and in the USA it is 2.3 per cent. Do you need to raise significantly the funding for higher education to achieve the 50 per cent and all the other ambitions that you outlined so well earlier on?
  (Margaret Hodge) Yes.

  446. How?
  (Margaret Hodge) We are under-funded at the moment, but, again, let us not under-play ourselves; we are incredibly successful in higher education. We have one of the best graduate rates, we have the second-best retention rate and we have maintained that despite the huge increase in the number of students; we do punch massively above our weight on research and we are an increasingly popular destination for international students. So there is a lot of good stuff out there. So, not adequately funded but there has been a lot of good stuff. How do we intend to do it? We will put together, I hope, a very credible package of proposals as part of our bid towards resources. Like all ministers who appear before you and every Select Committee, things are much tougher post-September 11 than they were before. We will have to see both what the position of the economy is and what the position on the distribution of public spending is, but we will do our level best to have a good package which will support our ambitions in higher education.

  447. You indicated the fact that we make better use of each pound that we spend, perhaps, than some of our competitors.
  (Margaret Hodge) I think so. To be honest, when I come to this sector—and I have been in the job now for five or six months—I have been surprised about how well we have done. Right across the public sector there are whole areas of the public sector which are suffering from under-funding. I think HE has stood up better against those challenges than many, many other areas of the public sector.


  448. Minister, you would admit there are concerns about retention and attracting new staff. In particular subjects you have to train to PhD level and beyond, and then retain them into the teaching profession. We have been heavily lobbied by the computer scientists in society who are desperately worried that there will be no staff coming through, being retained to teach the computer engineers and computer scientists for the future. That is a real concern not just in computer science but in a number of other areas. I am getting a little bit of a feeling of complacency. You say we punch above our weight and make better use of resources, but you can only push that so far when you look at OECD averages, which are significantly above us, and the Americans where twice the amount has been spent on higher education.
  (Margaret Hodge) I am not complacent. One of the manifesto commitments we had was to introduce golden hellos into HE around shortage subjects, and we will pursue that. I am very conscious of the relative salary levels in the UK and, for example, Australia and New Zealand and at professorial level in comparison with universities in the States. There is a gap. Equally, the other side of this coin is that when we ask the universities to produce evidence of their difficulties in recruitment and retention, they are pretty reluctant, if I may say so, Chairman, to actually put pen to paper and give us that hard evidence. What you tend to get is anecdotal evidence of "I have not got as many people to choose from", or "There was only one person really up to it", so you get a feel of a tightening of the labour market but you do not get the feel of the problems that face us in, again, other parts of the public sector, both in education and elsewhere.

  449. There is a concern that things might get tougher. If there was a decision, for example, as a result of your review of student finance, to get rid of the fee, the universities would lose that as a significant source of income. I think they said that would mean two-thirds of £650 million lost to university budgets. If that happened, would you guarantee to make the shortfall?
  (Margaret Hodge) Their figure, I think, is wrong.

  450. I am looking at colleagues, but I think it was £650 million.
  (Margaret Hodge) I think that figure is wrong. Anyway, given that only 50 per cent pay any fee and only a third pay a full fee, I think the current income from fees is about £400 million.

  451. We have got it on our transcript. It is a lot of money for the universities to lose.
  (Margaret Hodge) We need to ensure that we have a proper balance between student contribution and state contribution. I come back to that, and I am equally conscious—and I know you are, Chairman—that we have to ensure we fund the higher education infrastructure as soundly as we want to fund individual students.

  452. Would you make up the shortfall?
  (Margaret Hodge) I am not sure. We will have to ensure that higher education institutions are properly funded. All I can do is come back to you with absolute honesty and say I think we have got a legacy of under-funding. We have to start tackling that. We will have to see where we go on the CSR.

  453. Why do you not knock on the Chancellor's door and say "We want a higher education tax dedicated to universities becoming really world-class"?
  (Margaret Hodge) There is a commitment in the manifesto, which we will be hoping to hold everybody to, on the proportion of GDP spent on education. That is probably the more appropriate way of doing it.

  454. Hoping or determined to?
  (Margaret Hodge) We will.

  455. "Hoping" sounds a bit flaky.
  (Margaret Hodge) Sorry. I am certainly not flaky.

Valerie Davey

  456. Coming specifically to the review of student support, have you published the terms of reference for that review?
  (Margaret Hodge) I think we have said that we are looking at simplification of the system to see whether we need to give more up-front support to students, particularly those from lower socio-economic groupings, and we want to look at the issue of debt and fear of debt. Those are the key issues that we have set.

  457. Does it cover FE as well as HE?
  (Margaret Hodge) No.

  458. FE students are not included in this particular review?
  (Margaret Hodge) In this particular review, no, but we are looking at the position of support for FE students and, actually, all adult students in the context of the Comprehensive Spending Review. You will know that we have got the Educational Maintenance Allowance pilot going on in a third of the country, and we are waiting for the assessment of that to come through, but it is showing very positive results.

  459. So in joined up thinking, all of those are being accounted for within the department, even though that may not be within the review that you are initiating on student support for higher education?
  (Margaret Hodge) Yes.

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