Examination of Witnesses (Questions 240-259)
WEDNESDAY 12 FEBRUARY 2003
MS SALLY
HUNT, DR
STEVE WHARTON,
MR TOM
WILSON AND
DR ELIZABETH
ALLEN
Ms Munn
240. Can we move on to higher education funding
and expansion? In terms of the proposal for universities to be
allowed to charge up to £3,000, do you have a view about
whether all universities will apply to go for a £3,000 fee
for all their courses, for some of their courses, or may we get,
particularly in some places such as my own city where you have
two universities, a bit of competition between them which might
mean that that would push down fees?
(Ms Hunt) I can relate to you the initial feedback
from various vice-chancellors which can be characterised by one
of them saying, "Why wouldn't I, on the basis that I want
to put my institution alongside the best institutions." The
initial reaction is that the best institution is the one that
can charge the maximum fee. It is a lot more complex than that.
Once there is some consideration of the options within that figure
for them, some variation may come out. I do not think at the moment
that any institution is looking at it in such a way that they
can afford necessarily to charge less than that. It is being driven
by the sense of underfunding and how are we going to make up the
shortfall, very much the points that you were asking earlier in
terms of is the funding that is going to be generated by this
route going to be taken away by another. I think that is very
much the driving force behind the initial reaction from a lot
of institutions. In terms of whether they charge differential
fees within institutions, what I can say very clearly from feedback
from our members which has come in thick and fast in terms of
us asking for it on the back of this paper, but also doing a much
more structured membership survey, is that they are absolutely
horrified by the idea that an internal market may well develop
in terms of some departments, some courses, being able to charge
certain amounts and some others. Their sense of that is that it
will go to the heart of how a university works and it will do
some very great damage.
241. One of the issues raised with us in the
seminar was that some of the most popular courses—therefore
the ones which could happily charge the £3,000—were
the cheaper ones to run and some of the less popular courses were
the ones which were more expensive to put on but had less demand.
(Ms Hunt) The point about universities is that you
do not have costs that are absolute to a course. A library serves,
for example, a whole range of courses. The administration structure,
the support structures, all of those things are ones that are
across the board. What is concerning individuals who are coming
back to us within the union is that what they are being asked
to do is to say that my responsibility ends at the end of the
corridor. They do not believe that that is something that is reasonable
or something that they want to see themselves as in terms of the
academic community, be it on a subject level or on a university-wide
level. It is simply not something that has the support of those
who are being asked to deliver.
Chairman
242. Surely you can cost it? It is common sense
that some subjects are very expensive—certain kinds of engineering,
medicine, dentistry. I understand your point about common core
costs but surely in any well managed institution you can, and
they do, evaluate how much each course costs. Some are four or
five times more expensive than others.
(Ms Hunt) To a certain extent. The point that I am
making is purely feeding back to you that which our members are
saying in terms of their reaction to this. They do not perceive
the way that they deliver higher education as something that should
be absolutely driven by their single, core costs according to
their subjects. They see that as something that would be very
damaging to the way the university functions.
(Dr Wharton) An important issue is that of collegiality
which obtains in universities. For example, if you have a programme
which brings in a lot of money, because of the principle of collegiality,
you are perfectly willing to see cross-subsidy of those less popular
courses. Without that, many departments of many universities and
institutions of higher education in the UK would have closed.
I do not think an internal market with differential fees is a
good way of responding to or trying to control demand. On the
question of competition that you raised between institutions,
what you are going to get I fear—and this is a purely personal
point of view—is a bandwagon effect. Once one institution
charges high, the next one is going to. We have already seen in
terms of A level grades required of universities that, if you
want to ensure that you get the best students, you put up the
A level grades. It is the putting up of the A level grades that
encourages people to come in. I am sure that the same thing could
very well happen with fees which would go completely against the
whole concept of widening access, which surely the White Paper
is seeking to do.
(Mr Wilson) In any market, if there are not any independent
indicators of quality, whether we like it or not, price is taken
to be an indicator of quality. That being the case, not many institutions
are going to wish to advertise that their courses are perceived
to be or likely to be perceived to be second rate. For them, it
is a very difficult calculation because there is not much information
on which to base these judgments. The calculation that many might
make is that were they to lower the price of their course they
might attract fewer students. If you look at it from the students'
point of view, if there is just a relatively small difference
in the price of the course—let us say, £2,500 as opposed
to £3,000—the difference that makes to the overall
debt at the end of their assumed three year programme is relatively
small. For them, there is then a difficult judgment about whether
that is worth it in terms of the perhaps lower employability factor,
which would then last a lifetime.
(Dr Allen) If we are trying to make judgments about
the in principle effect of the introduction of top-up fees, I
for one do not think we should do that on the basis of a figure
of £3,000. Once this has been introduced and in this instance
is in place, I do not believe that the figure will stay at £3,000.
I do not suppose many other people do either. At the moment, if
you talk about the difference between £1,100 and £3,000,
it does not seem vast. It seems just about tenable that all institutions,
based on the factors that you were talking about, might judge
that they had best go for the full whack. Once we see that cap
come off and once some institutions are charging quite significantly
different levels of fees, which I think will happen if we let
top-up fees come in, that is just not going to be feasible. There
are already two categories of either institutions or departments
within institutions: those that select their students and those
that go out actively and recruit their students, albeit at the
right standard of qualification and so on. Those that recruit
are not going to be in the same position as those that select
to charge high fees. I have no doubt we will see differentiation
between institutions.
Chairman
243. One of the things that worries me and some
other members of the Committee is the debate over flexible fees
or top-up fees, whatever we call them. There seems to be out there
a view that if we all acquiesce to top-up fees it will introduce
a two tier system in universities, but if you ask most university
teachers and students they know in all the 100-plus degree giving
institutions there is a hierarchy. A 17 year old will give you
the hierarchy not only of the top ten, the middle ten and the
bottom ten but all the positions in between reasonably accurately.
Is it a kind of hypocrisy that we talk about all universities
being the same when people know they are not? Indeed, some of
them already charge differential fees, do they not?
(Dr Allen) There is a degree of truth in that and
one answer is to say that what this would do is entrench it even
further. One thing where we do not have differentiation at the
moment is at the point of student choice about which institution
they attend in terms of what they have to pay when they go to
that institution. One of our fears is that there may be bursaries
for a few of the poorer students but there are not going to be
bursaries for all those who are going to struggle financially.
Poorer students will make decisions based on cost in the way that
they do not have to do at the moment, particularly if top-up fees
increase in the way that I foresee. Having made that decision,
which will be based on cost and will also be based on the fact
that they may have to go to the institution closest to them because
there is not adequate maintenance support for them to travel away
from home, the institution that they then go to on the basis that
it is cheaper for them to go to it is also getting less money
because it is not able to charge top-up fees. There is a double
whammy. They have less choice but also the institution itself
is receiving less money for teaching. At the moment, there has
been an attempt to equalise the funding available for teaching.
When institutions are charging top-up fees in a few years' time
and getting significant amounts of money through that route, those
institutions will have a lot more money to spend on their students.
Poorer students with less choice will end up in institutions with
less money to spend on them.
244. This is a strange argument coming from
two trade unions, is it not? One might expect your members to
expect you to be out there, batting for new income to come into
universities so that you can pay your members better pay. We have
already heard from Universities UK that there is no assurance
in terms of the White Paper that there is going to be better pay
for people working in universities, either lecturing and researching
or the back-up staff. If there is a limited amount of money, surely
in one sense if you were acting as traditional trade unionists
you would be welcoming the students paying something towards their
courses because that would enable your members to get better pay.
(Mr Wilson) Traditional trade unionists have always
cared about fairness and equity. The most militant trade union
in the world has always had an equal passion for fairness and
a decent sense of social justice and our two unions are no different
in that respect. We care passionately about what is fair and decent
for students.
245. You have presided over a profession that
for the last 20 years has had hardly any real increase in real
terms. That is taking the broader social goals a little bit far.
(Mr Wilson) I think that is a bit of an unfair reading
of history. We have struggled, campaigned and fought very hard.
It is very arguable that without our efforts academic pay would
be even lower and even more unfair than it is. We have had to
take pretty strong strike action on a number of occasions to make
sure that vice-chancellors did not impose the awards they originally
tried to.
246. The reality today is that people are leaving
your profession to go into regular school teaching because pay
is better. It is not a great success record of a union that has
delivered the goods to members.
(Ms Hunt) You say that with such a nice smile on your
face. Success can be judged by people joining and we are one of
the fastest growing unions in this country so we could argue that
point backwards and forwards. The key point here is that what
we should do is represent our members' views. It might not be
popular but the survey results that I have had back from our members
show that well over 80% of them—i.e., 88%—would prefer
general taxation to be the route that we did all of this work
by because that is what they believe. It might not be something
that is fashionable or that you believe is feasible but I think
it is worth putting on record that those in the profession do
believe that they need extra funding, very basically, for their
declining levels of pay. They believe that that should be something
that we should take society-wide responsibility for. Within that
though they believe that it is right that they should take a view
on how the funding debate is going. What they would say is, first
off, they do not believe that up front fees would work. They welcome
the change in that, therefore. They do not believe that it is
reasonable to have differential fees because they believe that
that will impact on their ability to make the choices and help
people on the basis of their academic ability rather than their
ability to pay. It is right and proper that those people in the
profession should have that view. If they are being forced to
make the choice therefore, they say it is through a graduate tax
route that they would prefer. That is as clear as I can be. That
is what a union should do. It should tell you what its members
are saying to it and that is what our members have been saying
to us very clearly over the last three or four weeks.
247. Some people would describe it as a deeply
conservative position, with no change. Everything should come
from the taxpayer. No change. No diversity of income. Nobody else
pays, just the taxpayer. 50% of the people that we represent do
not go to higher education and they would be very unhappy to pay
even more taxation for higher education that their children are
not going to benefit from.
(Ms Hunt) I take your point but I think it is worth
me saying to you that that is what our members are saying to us.
I do not think it is conservative.
248. I did say it with a small `c'.
(Ms Hunt) I realise that. I think it is reasonable
for members of the profession and society to take a view about
where higher education ought to sit within the economy and the
culture of this country.
249. That is what we are trying to draw out.
(Ms Hunt) How much clearer do you want me to be?
Mr Jackson
250. Could you say something about the pie in
the sky observation?
(Ms Hunt) The pie in the sky is what we then went
on to tease out. I do not call it "pie in the sky";
I call it "other options" if you have not got the option
being presented to you by those who are going to make the decision.
What they are very clear about indeed is that they do not believe
there should be variation in fees. They do not believe in the
concept of top-up fees. Faced with those choices, it is an across
the board graduate tax that they believe is the most reasonable
way of taking this forward. That is not me reinventing the wheel;
that is me telling you what our members think.
Chairman
251. 88% would like all money to come from general
taxation. How many people want a graduate tax?
(Ms Hunt) I cannot give you the exact figure. It is
between 50% and 60%.
(Dr Wharton) On the comment you made about 50% of
your electorate or indeed many more perhaps do not go to university
so why should they pay for it, universities make a tremendous
contribution to the national economy which is recognised in the
White Paper. It is through universities that doctors are trained,
that lawyers are trained, that the professional engineers are
trained who build the bridges, design the trains and so on. The
entire economy as a whole benefits from the higher education sector
in the United Kingdom. Therefore, it is surely only right and
fitting that there should be a considerable contribution from
the taxpayer towards that.
252. There is a very large contribution from
the taxpayer and the White Paper, as you know, will increase the
zero interest rate loans to students. Professor Barr of the London
School of Economics suggests that that subsidy will now increase
to £1.2 billion. That is a subsidy that my constituents who
do not go to university do not get offered. Someone starting a
new business which is very creative, that employs people and creates
wealth goes to the bank but they certainly do not get a 0% loan
to start a business, to employ people, to create wealth. You could
say that they also make a very useful and valuable contribution
to our society.
(Dr Wharton) Indeed they do and some of your constituents
who start those businesses may well do so in conjunction with
universities through knowledge transfer and other things, so there
is a dynamic interaction between the two. I do not believe, echoing
the views of our members, that it is sensible to exclude the possibility
of providing the income through general taxation, although there
is a recognition as we have also said that if it must come in
the form of some contribution it should come through a graduate
tax rather than anything else.
Mr Pollard: I work very closely with
my local NATFHE branch and I think you have done a cracking job
personally. He does not think so but I do.
Chairman: My questioning does not imply
that I have any view about the effectiveness of NATFHE.
Mr Pollard
253. I was just declaring my view. The Government
is to increase the so-called postcode premium from 5% to 20%.
Will this increase help to attract and retain significant numbers
of disadvantaged students?
(Mr Wilson) It will certainly help to make sure that
they are properly funded when they arrive at universities. In
response to a question which was asked in the earlier session,
we reckon that the increase in total funding for that will be
of the order of 25 million up to around about 50 or 60 million,
which is a substantial increase in funding. If that is distributed
as we expect, the great majority of it would go to the post-1992
universities that take the great majority of those kinds of students.
That is very welcome and useful but it is very wrong to see that
as some kind of incentive for those universities to go out and
recruit such students. It does not work like that. It is there
to pay for them when they arrive and even at 25%, as your own
Committee acknowledge, it will not meet the full cost. The way
it works in terms of incentives is that most of the post-1992s
and many pre-1992 universities make enormous efforts to recruit
students from across a very wide range of social backgrounds because
they are committed to that in principle and because that is a
fair access policy. That is why they do it, not because they want
the money. Can I go back to a related point about top-up fees
again? The key thing about top-up fees is that they will at a
stroke destroy the principle that a subject is funded at the same
level of funding irrespective of where it is delivered. In other
words, at the moment HEFCE's funding system says that a sociology
undergraduate degree at Oxford is paid the same as a sociology
undergraduate degree at the University of North London. Once you
have top-up fees, that goes. What goes with that is the notion
that the kind of students we are talking about here, access students
from the most disadvantaged backgrounds, have some sort of chance
over time of a system in which they have an equal opportunity
of equal funding. That is why our members are so passionately
concerned about that. What also goes on the back of that is to
reply to the points made earlier about funding. If we had to rely
for pay increases on a system which was so heavily orientated
towards the market, was so unstable, which depended on institutions
having some kind of careful, internal markets between courses
and between institutions, our view is that is not a sensible way
to fund general pay increases anyway. It is not as if there is
some sort of quixotic trade-off between altruism and self-interest
here. It just does not work like that. All these issues are tied
up together. To answer your point, yes, it will make a difference,
but in terms of funding not incentives.
(Dr Allen) I wanted to say a little more about the
postcode premium. We are glad that it is going to be redefined.
It is important that support for wider participation of students
is not just seen as a welfare issue. It is about changing approaches
to learning and teaching in general. It is also about having more
staff. There is lots of evidence that the successful retention
strategies, particularly in that critical first year for students,
often involve a level of support and personal contact that a lot
of universities are not able to provide at the moment. FE is very
good at providing it and I think HE could learn quite a lot from
FE in this regard. It would be nice to see some of the money that
has been earmarked for performance related payments for teaching
in other parts of the White Paper perhaps freed up for more creative
spend in terms of staffing and learning and teaching support in
relation to the access agenda, rather than being defined in the
rather narrow way that it has.
Chairman
254. What is your view on the expansion that
the Government has suggested, 43% rising to 50% would be in
foundation degrees, not across the board in the broad range of
undergraduate degrees?
(Dr Allen) There is a real confusion between the value
of foundation degrees and the widening of participation and changing
the social mix. I think foundation degrees have the potential
to be a valuable qualification and to meet some of the skills
issues that people were talking about earlier. There is not any
indication yet that there is great enthusiasm for them but there
is a potential for them to do that, funded in the right way, with
the right level of support for FE colleges who will be delivering
a lot of foundation degrees. They could be a very valuable qualification.
They are not the same thing as changing social mix in universities
and getting more working class students into universities. I do
not think you can engage in all the outreach work that is currently
going on between universities, schools and colleges where you
go in with children who are as young as those at primary school
and try and convince them that higher education is for them and
then say, "By the way, it is a foundation degree. That is
what you are going to get." I know I am simplifying it, but
that is the message from the White Paper and I think that is really
disappointing.
255. You may have noticed a slight disagreement
amongst some members of the Committee at the interpretation of
what Margaret Hodge said to us on Monday. My belief was that the
rules are going to be changed for foundation degrees and there
is not going to be any natural right to move from a foundation
degree to a full degree. If that was the case, what would your
view be on that?
(Dr Allen) I would be staggered if that was the case.
All the work that is going on in relation to wider participation
is linked into creating through routes for progression, articulating
different levels of qualification so that people can progress
through. To create this new foundation degree and then say they
want HNCs and HNDs to be part of the foundation degree to bump
it up and so on and then put some sort of cap on it would seem
to me to be counter to all the other work that is going on.
(Dr Wharton) After all, what is the purpose of a foundation
but to build upon so it can be an ideal stop up point if that
is what the particular student requires but if they then want
to add that to an honours degree that path has to be open to them.
Mr Pollard
256. You were all very disparaging earlier about
the £1,000 grant. Surely you would welcome this fundamental
step change, even though you might argue about the level? What
level do you think it should be geared at? Should it just be for
the very poor students or are you advocating going back to where
we were previously? If you were advocating that, it would amount
to about half the defence expenditure. Some might argue that is
a good thing anyway. How do you pay for it all?
(Mr Wilson) At the very least, the threshold for repayment
should be the same as the thresholds for other kinds of means
testing. We cannot see a justification for a distinction there.
Certainly we cannot see a justification for it being as low as
£10,000. That seems a cut off which is designed to remove
93% of all households, but we think something like 98% of all
students, excluding mature students. If mature students are the
justification for the apparent calculation of 30% of students
who will receive it, that is frankly disingenuous because they
are being included because they have no other income. in this
instance s not because of their own family background. The way
the White Paper presents this it is quite clearly designed as
a means of inducing students from very poor family backgrounds
to come to university. They are at such a low level it is very
hard to see why it would. The important principle that we would
want to see applied is fairness between FE and HE. For that reason,
at the very least, the EMAs which have been rolled out now to
FE could be applied equally in a seamless transition to HE. That
is by no means enough but it would at least be a start.
Chairman: That was the recommendation
of this Committee.
Jeff Ennis
257. Why do you think the Government have insisted
on introducing the access regulator and is it a good thing for
widening access?
(Ms Hunt) We have no idea. We strongly support the
policy in terms of increasing access and making sure that the
public moneys that are going into universities with that kind
of policy behind it are ones that are being monitored and looked
at. We have no issue in that because that is fair and reasonable.
We question what it is that the Access Rgulator is going to do
other than increase the level of bureaucracy which goes against
the Better Regulation Task Force report. We are also very concerned,
if we understand correctly, that this might not be in place until
after the top-up fee regime is in. That leaves us very concerned
because that is the tail wagging the dog somewhere along the line.
I do not quite understand, if it is so central, why it is reasonable
for it to come in that late in the day. I do not think that is
a healthy way of looking at access and your means of assessing
it, if you feel it is that important. It is something we would
question very strongly. In terms of making sure that there is
some kind of ability to know that universities across the board
are genuinely doing the job of making sure that access is there
regardless of your class and background, that is something that
we would very much support. You have to look at it though in a
very complex way. You cannot simply look at it in terms of saying
outcome is X because that will not necessarily tell you about
the outreach work that is going on in a particular school. It
will not tell you about the differences between departments. It
will not tell you all sorts of the detail that is going on. The
jury is out on how it will be done. We will participate fully
in trying to make it work though.
(Dr Wharton) By the same token, universities are required
as part of their widening participation strategies to demonstrate
that they already have mechanisms in place. In some respects,
this would seem to be another layer of unnecessary bureaucracy,
almost, one might argue if one were cynical, as a sort of sop
to, "This is a way that we are giving you money but we have
to show that we are being sensible about it." Universities
are already sensible about the way they deal with widening access
and participation, as demonstrated through the strategies that
they put forward through HEFCE.
258. You seemed to be advocating in your responses
to earlier questions a graduate tax as a better mechanism for
student support, particularly for students from poorer backgrounds.
That model is quite attractive to me. Personally, I would prefer
that sort of system. If the Minister was here, she would tell
you that we are trying to establish world renowned universities
and attract students from abroad. If we have a graduate tax, the
foreign students will come over here, get their qualifications
and go back to their home country and will not pay the graduate
tax. What would you say to that?
(Dr Wharton) That already happens to an extent. You
have students who come over and, if they are European Union students,
the fee they pay is only the up front fee that they would currently
pay.
259. I am not on about fees; I am on about the
graduate tax after they have qualified and are working back in
their home country, not in this country.
(Dr Wharton) That could happen to any student in the
United Kingdom. Sorry; was your initial question aimed at overseas
students who come to the UK and then leave?
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