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Mr. Chaytor: Can the hon. Gentleman explain to the House why, through that long period when university education was entirely funded out of general taxation, the proportion of working class young people going into higher education remained at virtually zero?

Mr. Willis: Of course I can. One of the great opportunities that we have in these debates is to tackle that very issue. I was a working-class child, and I was the first in my family to stay on in education when I went back to school after I had failed as a footballer. My father had aspirations for me, but opportunities were few and far between. Under the grammar school system, only 10 or 20 per cent. of youngsters went to schools with the aspiration of putting pupils into post-16 education and beyond. Fortunately, successive Governments—not just Labour Governments—have

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moved away from that and opened up opportunities for pupils post-16. The hon. Gentleman must realise that the whole basis of our working society has changed. His hon. Friend the Member for Barnsley, Central (Mr. Illsley) will know from his pit communities that the aspiration was for their young men in particular to leave school at 16 and go down the pit like their fathers had. That was the culture in many of the old industries of Britain, but that has all changed for the good. Aspirations have changed, and it saddens me that we are pulling up the ladder of opportunity behind us.

The Secretary of State for Health (Dr. John Reid): I have listened carefully to the hon. Gentleman. I come from the same background as he does, and I noticed all those changes. Like him, I was fortunate enough to have parents who went to great lengths to ensure that I got to university. All the changes that he mentions, including changes in aspirations, are one thing, but he has not answered the question that my hon. Friend the Member for Bury, North (Mr. Chaytor) asked. Despite all those changes, despite people's aspirations and despite the structural changes, for the past 50 years the percentage of people who come from my background and that of the hon. Gentleman and who go to university has not changed at all. He must not speak as though great progress has been made and huge numbers of people from our background go to university, and that that trend has suddenly been abandoned and reversed by my right hon. Friend the Secretary of State for Education and Skills. Our proposals are designed to break the deadlock, because that percentage has not increased.

Mr. Willis: I am arguing that the impact of tuition fees since 1998 has been to reverse the trend that was at least going in the right direction, especially after 1989 and after the incorporation of the universities. [Interruption.] The Minister should refer to his own documents, because he has told me in a parliamentary answer that that is the case. If he is saying that loading additional tuition fees and differential fees on to poorer students will encourage them to go to university, then he and I live in different lands.

The Minister for Lifelong Learning, Further and Higher Education (Alan Johnson): Will the hon. Gentleman confirm that when the leader of his party said in a speech last July that the percentage of university students from the bottom social classes had decreased since the introduction of fees, he had got his facts wrong and his comments were misleading? What the right hon. Gentleman said was a 7 per cent. fall was actually a 1 per cent. increase. That was corrected by my right hon. Friend the Secretary of State for Education and Skills in a letter, but that correction has never been acknowledged.

Mr. Willis: I acknowledge that now on the Floor of the House. It would be quite wrong of my right hon. Friend or me to provide statistics that are incorrect, and I have no wish to do that. The statistics that I shall provide later in my speech have come from the Department, so I think we would both agree on those.

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We should study the analysis of the impact of the policy of differential fees on student participation and institutional direction. Nothing in the White Paper or in what the Secretary of State has said today allays fears. There is no guarantee that universities will not have state funding removed in proportion to their fee income, as has happened since the introduction of the tuition fee in 1998. It is all very well for the Secretary of State to talk about increased resources since 1998, but virtually pound for pound has been taken away in grant from the Higher Education Funding Council as has been put in from students. That is not acceptable, and if that happens to top-up fees universities will be short-changed.

Seldom do I agree with Conservative policy on education, but the Tories are right about the introduction of the new regulator that we call Oftoff. Artificially skewing intakes to universities by some glorified plan of social engineering will merely add a layer of bureaucracy, and increasing student debt will be the major deterrent.

Mr. Chaytor: The hon. Gentleman will know that two-thirds of all the students in the United Kingdom who obtain the highest A-level grades come from state schools. He will also know that only half the students in Oxford and Cambridge come from state schools. Does he accept that that is the result of hundreds of years of social engineering? Is it not about time that we had a better balance between the grades obtained, the pool of talent coming out of the system and the places reserved in our leading universities? Is not that the most powerful argument for some intervention in the admissions process?

Mr. Willis: I have great respect for the hon. Gentleman, and do not disagree with the figures that he presented. However, I disagree with the bureaucratic solution to that problem. When the Chancellor made his ill-timed remark about Oxford university two years ago, and when we had the debate last year on social engineering in the admissions policy at Bristol university, the issue involved was how to choose which students to take from among the candidates with the same or similar grades. If the Government are proposing that Oftoff must require that a proportion of students from particular socio-economic backgrounds are chosen to enter a university on the basis of those grades, my goodness we are looking at our universities in a totally different way. That is the debate that we must have. At the end of the day the hon. Gentleman may be right, but at the moment I believe that universities do not need this layer of bureaucracy. We should challenge vice-chancellors and the courts of universities, and those of us who are on those courts, to get their act together and find solutions that satisfy the Secretary of State.

Peter Bradley (The Wrekin) (Lab): Will the hon. Gentleman give way?

Mr. Willis: I shall make a little progress.

Mr. Francis Maude (Horsham) (Con): Will the hon. Gentleman give way?

Mr. Willis: If the right hon. Gentleman does not mind, I shall make a little progress.

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Mr. Maude: It is on the point with which the hon. Gentleman is dealing.

Mr. Willis: I am sorry, but I have turned down the hon. Member for The Wrekin (Peter Bradley).

Peter Bradley: The right hon. Gentleman can go first and I can go second.

Mr. Willis: No, no.

We want students to choose courses because they have a desire to study in a specific area, not because those are the courses that they can afford. We want them to leave university with a desire to contribute where they feel they are most needed, not where they will get the most money to repay their debts. Sadly, today's debate, like most of our debates on higher education over the six years that I have been in the House, has been about balancing the books and not about higher education.

The current debate is about stage two in the Government's grand plan to move the burden of paying for our universities from the state to the individual. The Secretary of State said in the House that

Who was he trying to mislead? It was simply not true at that point. It was not for the next two decades—it was for the lifetime of that Parliament until the Government introduced the next ratcheting up to ensure that students paid more. He was clearly not trying to mislead his master at No. 10, because the 2001 manifesto pledged not to introduce top-up fees. The Government are now legislating again, so that was either deceitful or cynical. The reality was that there was no intention to maintain that pledge. I would have more time for the Government if they said that they got it wrong; that they made a mistake and now have to do things differently, because that is grown-up politics.

Where is the Government's vision in their proposed Bill? There is an assumption that our university system, which has mushroomed from the highly elitist pre-Robbins structure to the current mass higher education product, is somehow fit for the purpose in the 21st century. The only question to be answered, as in 1997 following publication of the Dearing report, is: how do we pay for it? Neither the White Paper nor the proposed Bill attempts to engage with employers or the new generation of students about the future of the system.

Regional universities are to be downgraded to teaching-only universities, ignoring their crucial role as economic generators and their relationship with regional development agencies, sector skills councils and the future regional assemblies. "Corporate universities" hardly get a mention, despite the success of the National Health Service university and corporate higher education institutions run by Motorola, IBM and others. The FE sector, which already delivers a significant amount of higher education at foundation level, is almost sidelined. The Higher Education Funding Council for England has made huge strides with the e-university, but the virtual university appears to have been lost in the ether. The growing army of mature students who increasingly study part-time, in the

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workplace or using bite-sized units are given scant consideration, with proposals for credit accumulation and transfer being left to the vagaries of individual institutions.

The Prime Minister talks about creating a market in higher education, with different products attracting top-up premiums. The reality is that the proposed legislation will not create a market that offers students choice. It will merely reinforce a hierarchy of institutions that will be able to perpetuate their current positions on the back of a top-up fees structure. That is the reality. We are creating a hierarchy by law, rather than the market that the Prime Minister wants. I hope that, when the Bill is eventually published, it will seek to broaden its narrow remit, so that we can enthusiastically engage with the re-engineering of the whole higher education product.

However, we are where we are, so let me make some common cause with the Government on some issues. The Secretary of State for Education and Skills mentioned three significant planks to his argument. Liberal Democrats accept the need to increase opportunity for more students with the relevant qualifications to access higher education. The hon. Member for South Suffolk (Mr. Yeo), both on the "Today" programme this morning and in the debate today, said exactly that. He said that Conservative policy is to provide a place for all those with the relevant qualifications; I think that those were his words.

We agree with the Government's analysis that the United Kingdom will need to rely increasingly on its human capital to succeed in a global market. Indeed, as the recent Machin report, commissioned by the Department for Education and Skills and the London School of Economics, emphasised, the biggest impact on productivity and competitiveness by region and sector is made by graduates. However, the 50 per cent. target is distinctly unhelpful. In reality, that level of participation has already been reached in Scotland—it is 53 per cent.—and it will be reached in England and Wales given the current level three trends. The challenge is not simply to enlarge the number of students to meet a target but to encourage entry from less traditional routes.

Currently, 90 per cent. of 18 to 19-year-olds with two A-levels go into higher education, yet fewer than 50 per cent. do so with an equivalent vocational qualification. The need to encourage more students with vocational backgrounds to enter higher education is a real challenge, particularly given the changes to the 14 to 19 curriculum and the way in which vocational education will have a much larger part to play.

Another area of common cause with the Government is the need for universities to access increased funding following a 40 per cent. real-terms cut in per student funding under successive Conservative Governments and a 7 per cent. cut during Labour's first term in office. Universities UK made a compelling case to the comprehensive spending review for increased investment but received £1.8 billion less than it sought. Its bid for a further £8 billion to £10 billion for the years 2005–06 to 2007–08 reflects the continuing decline in university resources. If we are to produce world-class research, significantly to improve the infrastructure of the sector and to invest in high-quality teaching, resources must be forthcoming. We as a party accept that and, indeed, have tried to find a solution to it.

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Most of our competitors have increased the percentage of GDP spent on higher education, but ours has reduced from 0.88 per cent. in 1997–98 to 0.78 per cent. in 2003–04. We are now 16th out of 28 in the Organisation for Economic Co-operation and Development league table of expenditure per student on higher education, so let us not say that our investment in higher education is generous. It is not.

I ask the multi-tasking hon. Member for South Suffolk to defend Conservative policy. Expenditure on higher education should, according to his party, be lower than that of Turkey, Mexico, or Slovakia—we are below them in the league table at the moment. I ask him how he can support a policy that, by the year 2010, would see 450,000 fewer places in higher education—the equivalent of 850 places for each of the current English constituencies. Those are not my figures; they are from the Higher Education Policy Institute. That is the estimate. If hon. Members go away with only one fact from the debate, let it be how many children currently at school will lose their place under the Conservatives' proposals—let them put it in a news letter.

Incidentally, not a single penny is allocated to the new so-called vocational vision. It is all right transferring youngsters from an academic university route to some other route that is called vocational, but it has to be paid for and it is very expensive. However, last Wednesday on Sky's lunchtime programme, the hon. Member for Reigate (Mr. Blunt) came up with a solution. He suggested that British business would find the £1 billion shortfall. That is a new tax going on to business.

Surely no sensible member of the Conservative party would support such a regressive and economically illiterate policy. I take my hat off to the hon. Member for Wantage (Mr. Jackson), who is not in his place, for his honourable stance in arguing the case for at least increased investment in the higher education system.We know that Tory Front Benchers do not support that policy. It is purely political opportunism—that is what it is all about. He and most of his colleagues, including the leader of the Conservative party, supported the imposition of a flat-rate tuition fee as proposed by Lord Dearing: they voted for that in their amendment on 16 March 1998. They tabled two early-day motions supporting their policy. Early-day motion 24 has 25 signatures and early-day motion 124 has 23 signatures. They cannot even get a fifth of their party to support their policy in an early-day motion, which hon. Members only have to sign.

When the right hon. and learned Member for Folkestone and Hythe (Mr. Howard) was elected leader, the first thing he said was that he doubted that the higher education policy would remain. I am sure that the hon. Member for Huddersfield will confirm that Conservative members of the Select Committee on Education and Skills have all supported a policy of tuition and top-up fees. The hon. Member for Ashford (Mr. Green), the predecessor of the hon. Member for South Suffolk, said on 19 January 2003 on GMTV:

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One could not have a clearer statement of where that party is actually at.

The Conservative party's conversion to an anti-fees policy is as unbelievable as its policy to confine future asylum seekers to an unknown island somewhere in the world. Lord Baker was right when he wrote in The Daily Telegraph on 7 October that the policy was

What a fitting tribute from a former Secretary of State to the shadow Secretary of State and the policy.

The sadness of the debate is that the Government have taken the lead from the Conservatives in the development of their higher education policy. The proposals in the White Paper, and those that will be in the Bill, are classic 1980s thinking from the Thatcher-Joseph school of social justice, the only difference being that Baroness Thatcher did not believe that she could get the proposals through her party. That shows how far we have come in the juxtaposition of two great parties. [Interruption.] I shall rephrase that; one great party.

When the declared intention of the Government is to enable more young people to benefit from higher education, how can Ministers justify an increase in fees that will place severe financial and psychological barriers in the paths of participation? The evidence is clear. Since 1998, the Government's policies have widened and not narrowed the social gap. The UNITE-MORI research shows that the proportion from the lower socio-economic classes—C2, D and E—going into higher education has fallen from 20 per cent. in 2000 to 17 per cent. in 2002. The White Paper, written by the Government, acknowledged on page 17 that the gap has widened. The National Audit Office has said that, since 1998–99, the final removal of the means-tested grant is likely to have widened the gap between the social classes.

In her research for the DFES on student income and expenditure, published a few weeks ago, Professor Callender concluded that the shift in student support had benefited wealthy students and not those from poorer backgrounds. There is clear evidence that debt deters students from poorer, non-traditional backgrounds, yet student debt will increase dramatically if top-up fees are introduced.

The Secretary of State poured scorn on the figure of £33,708 as the average debt in 2010 and said that it did not come from a reliable source. I presume that Barclays bank is now an unreliable source. [Hon. Members: "It is."] I hope that hon. Members do not bank with Barclays. However, they will admit that one of the most valuable sources of statistics on student debt has been the Barclays student survey. Without it, we would be all the more impoverished. [Interruption.] That was a pun.

The Callender report showed that the poorer students were 43 per cent. more in debt than the richest ones. Professor Callender, who wrote the report for the Secretary of State, finished it by saying that

There is clear evidence that poorer students are not only the most in debt, but the most likely to have to work.

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Already, poorer students are not applying for particular courses in medicine and other long courses because they cannot sustain the debt. The British Medical Association concluded recently that

The Government are saying that they will put in place mechanisms to support poorer students and that no student will have to pay up-front fees. We have argued that case ever since the introduction of the Teaching and Higher Education Act 1998. My colleagues and I tabled an amendment to the Bill that was dismissed as nonsense by the Secretary of State and his Ministers. I say to them that they have to get out of their ivory towers and meet real students on real council estates—the sort of kids I taught all my life, who look at debt as a huge burden. It is no answer to tell debt-averse students and those from particular ethnic minority backgrounds that they will be able to pay three years later or that debt can be racked up and paid over a lifetime.

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