Select Committee on Education and Skills Minutes of Evidence

Examination of Witness (Questions 20-39)



  20. The whole point of the document here is to look at the future of higher education for some years to come in every respect—students, expansion of students, competing with world-class universities and so on. Presumably all the different calculations must be based on some sort of estimate of what is the gap in funding for the universities now and how is that gap going to be filled by the Government or by top-up fees or business sponsorship over the next 5-10 years. What is the gap that you base your calculations on?
  (Margaret Hodge) It is very difficult to be completely specific about the size of that gap because it depends on views you take around, for example, pay differentials that exist between here and the United States, and try as we might to home in, if I take that as an instance, on what the gap in pay is, it was very difficult to bottom that out, so there is a range of figures around. I think we can be pretty specific about the capital gap. There have been quite good studies done on the lack of capital investment both in teaching and research facilities and on the need for investment and maintenance. It is much more difficult to look at the revenue gap, and equally it is very difficult when you are talking in terms of gap, for example, to be totally specific about the additional costs of educating somebody from a disadvantaged background. HEFCE are raising that premium for teaching somebody from disadvantaged background we hope from 5 to 20%, which I think fits in well with the deliberations that you had when you looked at this issue a couple of years back, Chairman, but is that enough? Only time will tell whether that meets the real additional costs both in teaching and support that are required to ensure that students from disadvantaged backgrounds do get a fair chance at university, so we have not been specific but for very good reasons.

  21. You said you could be fairly specific on capital gap and less on other areas. Can you give the Committee the figures, specific or not, that you have worked on in producing in this document?
  (Margaret Hodge) No. That is why I have said to you we have deliberately not used a figure on the gap although we have been clearly looking at areas like the issue of pay, like the additional costs of teaching, to try and ensure whether or not we have enough money. We have got Universities UK's own assessment of what the gap will be—that is one we have regard to—and we hope that we are making, over this comprehensive spending review period and with our proposals around in the introduction of variable fees, some real progress towards ensuring that we can put universities on a sound financial footing and give them some independence of funding from government as well which is another purpose. I am not going to give you, if that is what you are after, a figure for what we think the existing gap is because it is far too difficult and complex to calculate, and if the Committee has managed it I would like to look at that with interest.

  Chairman: I promised Andrew Turner who is on a Standing Instruments Committee shortly that he could ask you a question slightly out of sync in terms of flow.

Mr Turner

  22. I am tempted to take advantage and ask how on earth you think you can set up a policy which fills the gap if you do not know what the gap is?
  (Margaret Hodge) We do know that the Conservatives cut spending—

  23. Yes. I know that as well but could you answer the question and tell me what the gap is? You could not answer it in the chamber of the House, and you are now trying to convince us that you have filled the gap but you do not know how much the gap is. That is absurd.
  (Margaret Hodge) No, I have not. I have said there are huge difficulties in putting forward a clear figure which would properly reflect the need for universities to pay market rates on their salaries and which might, for example, properly reflect the additional costs of teaching students from disadvantaged backgrounds, and I gave those as two examples. What I am clear about, and I will be delighted if you accept this, is that a 36% cut in unit funding which the Conservative Government are responsible for left the universities in a dire funding state, and the further 6% cut that the Conservative Party at that time proposed in university funding would have left us our universities in a totally perilous state, unable to compete globally and unable to meet the demands of students in this country.

  Mr Turner: I am sure that does not answer the question—

  Chairman: Ask another question then.

  Mr Turner: I would like an answer to the question I have already asked.

  Chairman: Put it another way or ask another question. I do not think it is enough just to say that it is not an answer.

  Mr Turner: Do you think the response of the institutions to your comment about Mickey Mouse degrees was unfair or defensive?


  24. And why did you demonise Mickey Mouse? Why has it never happened to Daffy Duck or Bugs Bunny?
  (Margaret Hodge) Most people understand it. The context in which I said that is something which I feel passionately is really important. There are some universities where the drop-out rates are just too high. On the whole, as a nation, we do well on drop-out rates. We have one of the lowest drop-out rates and the best completion rates among the OECD comparable countries, but in some universities it is just too high. The last figures I saw for the University of North London had a drop-out rate of 45%; University of East London and Central Lancashire had drop-out rates of 33%. That is too high. Setting students up to fail is pretty unforgivable and that is really the context in which I was talking. Now, why do students fail? The main reason from all the research we have seen is the course. It is not to do with the financial circumstances in which they find themselves; it is the nature of the course. So in that context, if you do not have a course of sufficient intellectual rigour with a clear purpose, it is a Mickey Mouse degree which should not be offered by a university.

Mr Turner

  25. And your judgment is largely that it can be demonstrated by drop-out figures. Could you give some examples?
  (Margaret Hodge) No, I am not prepared to. I know it is something that the Conservative Government used to love doing—naming and shaming—but I am not prepared to. What I have said is that the criteria I would use would be, firstly, about the rigour of the content of the course and, secondly, about the purpose of the degree so it had a clear purpose. Universities themselves are pretty clear about which degrees they offer which do not have the appropriate rigour and appropriate purpose. What I can reflect on is the drop-out rate.

  26. Are you saying you are not clear or you are just, for some reason, prepared to conceal this information from the Committee?
  (Margaret Hodge) No, I am not prepared to make my own personal judgment. I think this is a judgment that universities themselves must make.

  27. So the Department does not have a view?
  (Margaret Hodge) The Department does have a view on the importance of having courses that are of appropriate rigour and content and purpose, and that we should not set students up to fail and they can complete their studies, get their degree, and take with them the benefits that that degree offers.

  28. So basically the Department has a view on those broad philosophical issues but it is not prepared to give advice, even to people who may be committing three years of their lives and a good deal of their money?
  (Margaret Hodge) It would be inappropriate, as you well know, for us to interfere with the academic freedom of institutions to determine their own courses and set their own degrees—that is a pretty basic tenet of a university. What we are doing to deal with this problem is opening up universities to better public account, and I will give you two or three ways in which we are proposing to do that in the White Paper. Firstly, we are going to have this annual student survey which will be validated by the National Union of Students working together with HEFCE, and I think that will give students much better information on which to make a judgment of which university to go to and which course to follow. Secondly, we are going to publish external examiners' reports which has not been done before, which I think also will give a pretty strong take to potential applicants about the quality of a course and the content. Thirdly, there is the continuing QAA institutional assessment which we will proceed with. All that, plus allowing the market a rather stronger force to bear on which courses are on offer raising the level on which student numbers are based, will give better information to students to make their judgments, but if you are asking me to intervene and tell universities which courses they should or should not offer, I think that would be an unacceptable intrusion on academic freedom.

  29. That is why I was not asking you to do that.
  (Margaret Hodge) You were actually, but never mind!

  30. No. The record will show I did not ask that. What you seem to have done, then, is illustrated as some examples those universities which have a high drop-out rate. Can one conclude that those are Mickey Mouse universities?
  (Margaret Hodge) That is not what I was saying.


  31. Minister, I think you know my own opinion of the comment you made, and I regretted that you used that phrase because a lot of other people have used the phrase and they tend to conjure up courses they particularly do not like. When we have looked at those courses, many of the courses that those people do not like are perfectly good courses with good intellectual content where the graduates graduate and get very good jobs—indeed, people are queuing up—and media studies is one which is much used and abused. The fact is that any of us can come up with prejudiced views of which courses would fit that particular silly name—and it is a silly name, Minister, you must admit. Let me push you a little further and go on to say that as we expand higher education and try to draw people from poor backgrounds in we are going to need a much tougher prospect, and when this Committee looked at retention what we found in terms of our research and the evidence that we took was that, although student debt played a role in putting students off from poorer backgrounds, the real key was that it needed to be the right course in the right institution in the right place, and very often it was not even the fact it was the wrong course; it was by clearing or not getting to the institution and the course they wanted that they got on to a course where they were poorly advised. So it was the quality of advice.
  (Margaret Hodge) Firstly, I have interestingly enough always defended the media studies courses because they have a good record of employment after people have studied, so that is not a course that I have particularly questioned. Secondly, you are quite right to say that the advice and counselling that prospective students get before they embark on their course is very important and I agree, and I did say this in that particular speech, that, when it comes to clearing, trying to fill your numbers without giving appropriate advice and support to ensure that students do go on courses which suit their talents is a worry. Having said that, however, I still think it is the case, if you were to look at it, that there are some courses where the content is not of sufficient rigour and where the purpose is not sufficiently well-defined, and where after a year or so people will think, "What am I wasting my time on?"

  Chairman: Perhaps this is a subject the Committee should look at in some depth.

Ms Munn

  32. You have mentioned a number of times the market in higher education and you have talked about the White Paper encouraging market forces. Why do you want to do that?
  (Margaret Hodge) I think the introduction of a regulated market in a higher education will ensure that the supply of courses meets the demand of students, and I think that is really important; it will drive up the quality of what is on offer in our universities; and over time it will lead to an increase in standard and output from those who go through our universities; also, as higher education becomes more globally competitive, it is important that within the nation state we maintain our competitive edge, and introduction of regulated market forces within United Kingdom higher education will support our global competitiveness.

  33. I accept entirely that you are putting some regulation into it but is not one of the problems with markets that people with less money generally do less well because they have less to spend? One of the concerns we were discussing last week in the seminar is that, in spite of the very welcome reintroduction of some grants for poorer students and the back-ending of tuition fees, there is still a certain perception, and I was interested in your response to our earlier paper where you say: "We know from research that potential students from non traditional lower income backgrounds tend to be more deterred by the prospect of incurring debt". They are going to be looking at this and saying, "Okay, if I go to my local university then I can live at home which is going to reduce my outgoings; it is a course which is charging £1,100 which I do not have to pay as opposed to one which is charging £3,000". Do you think you have done enough to encourage these students against the benefits which are very obviously there for the better off, middle-class students who are already going and who are going to be less put off by incurring higher debt?
  (Margaret Hodge) I do not think any of us are running away from the fact that the issue of fear of debt and actuality of debt is a particularly important constraint on behaviour among students from lower income backgrounds—working class students. I put that in the context of saying that getting them to stay on in school and achieve higher and aim higher is as important, if not more important, so it is one of several factors which has led to our failure to close the social class gap in participation in higher education over the last 40-50 years—only one. That is the first point to make. Then, if you look at whether we have done enough, I think we have done one heck of a lot because we are introducing grants and you will remember those are on top of the loans, so for a student from a low income background they will get their whatever-it-is—


  34. A very low income background.
  (Margaret Hodge) Well, the £1,000 grant will be available to 30% of the cohort. Grant will be available to 30% of the cohort, I think that is the right way of putting it, so having a grant reintroduced for 30% of the cohort is not bad, and remember it is on top of the loan[1]Secondly, getting rid of the upfront fee was a great inhibitor. It was another perception issue, really—it was perceived as an additional burden—and I think bringing that to an end will help.

  35. But you kept saying to this Committee on previous occasions that the upfront fee did not deter anyone. Consistently you said that an upfront fee did not deter anyone and you said the departments were comfortable with that and now, I do not know why, you are totally reversing yourself, Minister.
  (Margaret Hodge) Chairman, I have always said, and I will reiterate it here this afternoon, I think the other factors are more important. I think the issue of prior attainment, getting people from a working background staying on at school, getting them to see that university is an option for them and not just for other people are the vital issues. What I do accept is that fear of debt is an additional factor in inhibiting the choices of young people who get the qualifications.


  36. You used to give examples of students drinking lots of beer, smoking cigarettes, you regaled this Committee with satellite and—
  (Margaret Hodge) Now it is mobile phones.

  37. Can you see what a dramatic conversion this has been, Minister.
  (Margaret Hodge) I would accept that it is a factor. I think the more recent research we have had has demonstrated that probably more forcefully.

  38. So this is a research-based policy?
  (Margaret Hodge) Our policy is always evidenced-based. Just to come back to what students do with the income they have, that is different from how debt and the fear of debt inhibits access, inhibits choice and determines an individual's choices. Have we done enough? I think we have. The other thing I was going to say is the only argument that I think has some validity, and we have put our mind round, is whether variable fees will particularly inhibit those from low income backgrounds who, more than anybody else, have a fear of debt. I think my answer to you there would be that the mixture of the grant, not having the up-front fee and the introduction of bursaries by those universities that introduce variable fees will tackle that inhibitor. We have to be very careful as we implement this policy to ensure that we do not add an inhibitor in there. The other thing I would say to you is the Access Regulator, who will ensure not just that the admissions procedures ensure a fair and level playing field and will also expect institutions to achieve against their own ambitions, I think will support us in a once in a lifetime opportunity to break down the class gap in participation in higher education.

Ms Munn

  39. I agree entirely that it is not the only indicator raising aspirations and doing a lot of other things to encourage people who had not considered going to university before which is important. It just seems to be very strong in terms of variable fees. If somebody says that you can go down the road to Leeds or Sheffield, or whatever, to somebody who lives in Jeff's patch then they will think about doing that—of course I would say that Sheffield is better anyway—instead of saying, okay, we can go to Oxford or Cambridge which, regardless of what we think, is a good idea. We know that there is a differentiated university system, we know that certain universities are seen as better than others—I would not encourage people to go there as opposed to going to Sheffield, obviously—but if we are saying that people from all backgrounds ought to have the same level of choice and variable fees if they do particular courses, for example medicine or dentistry, or whatever, costing more than something else, and people where perhaps nobody in their family has been to university before are thinking about it for the first time are they going to go for the local university and the cheaper courses rather than either a prestigious university or one that is further away or a more expensive course?
  (Margaret Hodge) I think you have accepted in what you have said that there is a differentiated situation that we are dealing with. If you look at Cambridge as an instance, they actually take 9% of their students from the lower 3 socio-economic classes as against their benchmark of 13%, so they are not meeting their benchmark.

1   Note by witness: The Government's intention is that 30% of the cohort will receive the full £1,000 grant. Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2003
Prepared 10 July 2003