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Mrs. Browning rose—

Andrew Selous rose—

Alan Johnson: I shall give way once more, and the hon. Member for Tiverton and Honiton (Mrs. Browning), because of her bondage joke, gets the vote.

Mrs. Browning: This is a bondage-free question. Has the Minister made any assessment about the 2005 intake? The increased fees are due to kick in in 2006, but we are already receiving representations that many students who would otherwise have taken a gap year in 2005 will not do so, which will lead to a massive increase in applications in that one year. How will he ensure fairness and justice for the 2005 intake?

Alan Johnson: First, I appreciate that the prospectus needs to be ready 18 months in advance, but we are giving plenty of notice that the measure will not be introduced until after the next general election—until 2006. If we can avoid the problems to which the hon. Lady refers in any other way, as she raises pertinent points, we shall look to do so.

The proposed arrangements, including the graduate contribution scheme, are progressive rather than regressive. I have dealt with the arrangements for repayment. As Professor Nick Barr of the London School of Economics has pointed out, although we are talking about this as debt, it is in fact payroll deduction: it will be paid through the tax system. It is not like a credit card debt. It is important that we look at it in that way.

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The regime is not pernicious or regressive. Part-time, overseas and postgraduate students—who make up around 50 per cent. of the student population—already pay such variable fees and always have done. As part of our proposals, we will give assistance to part-time students for the first time.

There is one issue, which has already been raised, which unites me with the hon. Member for Harrogate and Knaresborough. I do not doubt his commitment to bringing more talented youngsters from working-class backgrounds into higher education, and I hope that he will not doubt my passion to see access widened. He makes the assertion that these proposals would deter youngsters from poor families. The first point to make, which was raised by my hon. Friend the Member for Birmingham, Hall Green in an intervention, is that students from a middle-class background were three times more likely than those from manual and unskilled backgrounds to go to university 30 years ago when there were no fees and a generous, non-repayable grant, and they are still three times more likely to go to university now with a £1,100 upfront tuition fee and no maintenance grant. There has been no deterioration in the position since tuition fees were introduced.

The reasons for this social gap are varied and complex. We do not contend that they are related to university admissions policy. All the evidence indicates that the principal problems concern raising achievement and stimulating and supporting work to widen the range of applications.

Mr. Roger Williams (Brecon and Radnorshire): Will the Minister give way?

Alan Johnson: Not yet. I shall do so later.

Acknowledging that students from low-income backgrounds and their families will be concerned about the affordability of studying for a degree, we have proposed that higher education institutions should enter into an access agreement with the new office for fair access before being allowed to charge variable tuition fees.

The agreement will cover a five-year period. It will set out the level of the fee and the courses to which the fee applies, and encourage applications from people with disadvantaged backgrounds. In particular, it will record how universities propose to extend bursaries and other financial agreements that they offer. Higher education institutions will also be asked to show how they intend to provide financial advice to prospective students and to explain to them the financial support that they can expect to receive. That will ensure that the graduate contribution scheme and improved student support are not introduced at the expense of our parallel ambition to widen access. Indeed, the concentrated focus with co-ordinated activity at all levels offers a real opportunity to resolve a problem that has blighted our society for too long.

Mr. Williams: Has the Minister's Department made any assessment of the arrangements in Wales and Scotland that have led to greater access for students from poorer economic situations? Perhaps he can explain that in terms of the water?

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Alan Johnson: I am advised that that has not been the case in Wales. I shall examine the situation in Scotland, but Scotland has always had far greater participation in higher education by youngsters from working-class backgrounds.

Andrew Selous rose—

Alan Johnson: I shall not give way just yet.

Our policy is one of expansion, investment and widening participation. The Liberal Democrats' policy, according to evidence given to the Select Committee on Education and Skills by the hon. Member for Harrogate and Knaresborough the week before last, represents work in progress. When the hon. Gentleman walked into Committee Room 11 to appear before the Committee, he had a policy of providing a £2,000 endowment grant. By the time he left the Committee Room, it had vanished.

Earlier, there was an interesting exchange about what the endowment grant is. Hon. Members will recall that it is the £2,100 fee paid by students in Scotland after they graduate. It is described as an endowment but it is not entirely dissimilar to the graduate contribution scheme that we plan to introduce. The Liberal Democrats say that charging graduates is wrong, but support charging them £2,100 after they graduate. They call it an endowment fee and say that it will go toward student maintenance grants. It is a non means-tested fee that is payable by all students when they graduate in Scotland, but we are told that there is a huge difference between that and the progressive system that we are introducing in England.

The original policy of the hon. Member for Harrogate and Knaresborough, which we saw in a Liberal Democrat policy document in January, was to increase the figure from £2,000 to £3,000 in England. It was then reduced to £2,000 in the Liberal Democrats' response to the White Paper in March. In June, the proposal vanished completely.

Mr. Willis: It did not.

Alan Johnson: The hon. Gentleman says that that did not happen, but the Select Committee's verbatim report suggests that it did.

Mr. Willis: I know that the hon. Gentleman is new in his post but surely literacy must feature large in its remit. May I explain the situation, because it is very simple? In Scotland, students may apply for a maintenance grant of up to £2,100. In England, the Government propose to introduce a £1,000 grant. Our latest policy document, which I was asked to present to the Select Committee, as I have done, suggests increasing that amount to £2,100 to match what students receive in Scotland, and says that, rather than having an administrative charge of more than £200 million, it would be far better simply to give students that money. That seems to be sensible.

Alan Johnson: As I said, the policy changed, as is clear in, I think, paragraph 6 of the report presented to the Select Committee. That was one policy that changed in the work in progress.

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It was also Liberal Democrat policy to increase the threshold for repayment of student loans from £10,000 to £13,000. When they read our White Paper with the proposal to increase the threshold to £15,000, they followed suit. That smacks of making it up as they go along. It also shows that they aim to imitate the left in some parts of the country by matching one element of Labour's progressive package and to outflank the Tories by following their agenda of no graduate contribution whatsoever, irrespective of how that affects their costings.

Worse than that is the misrepresentation by the Liberal Democrats of the issues at the heart of the debate, in particular social fairness. Just over a fortnight ago, the leader of the Liberal Democrats, the right hon. Member for Ross, Skye and Inverness, West (Mr. Kennedy), made a speech entitled "Labour is failing the poorest on education". It was based on a central tenet, highlighted in their press release. The right hon. Gentleman said that six years ago 17 per cent. of students from socio-economic groups D and E went to university and that today the figure is just 8 per cent. The main feature of his speech was to state:

D and E—

One of the greatest indictments of the Liberal Democrats is that they cannot get their figures right.

The Liberal Democrats compared two separate sets of figures. Perhaps the hon. Member for Harrogate and Knaresborough will correct me if I am wrong, but as my right hon. Friend the Secretary of State explained in a letter that he immediately sent to the leader of Liberal Democrats—he has yet to receive a reply—when a proper comparison of the proportion of people from economic groups D and E who attend university is made, it is clear that it has increased slightly, by 1 per cent. Hon. Members should remember that that is since 1997, after the introduction of tuition fees. The Liberal Democrats' main contention is that tuition fees have affected the number of poor students going into higher education.

In the same speech, the right hon. Member for Ross, Skye and Inverness, West also said that income per student has continued to decline since Labour came into power. It has not. When we came into office, it was £5,059. It is currently £5,155 and it will be £5,338 by 2005–06. Perhaps with the benefit of that fresh information, in the moveable feast that passes for Liberal Democrat policy making, Liberal Democrats will arrive at a point where they drop the dogma, ditch the opportunism and face up to the hard facts. Their policies cannot guarantee extra resources for universities. They do not promote an expansion in higher education, so they jeopardise economic growth in the knowledge-driven economy of the 21st century. They would squander the huge advances that we are making in all parts of our education service. It is a fiscally irresponsible cop-out from the problems that our White Paper seeks to address.

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