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6 Jan 2004 : Column 25WH—continued

Tuition Fees

11 am

Mr. Eric Joyce (Falkirk, West) (Lab): I want to raise three broad issues concerning the principle of variable tuition fees for undergraduates at higher education institutions in England. I expect the principle to be contained in the Government's higher education Bill, which is likely to be published later this week, but I understand that under the rules of this Chamber hon. Members may not use Adjournment debates to propose or to seek to influence legislation, so I shall restrict myself to asking the Minister to comment on the nub of the three matters. Those are: how variable fees will affect people from a working-class background; the implications of variable fees for England-domiciled students studying in Scotland or Wales and Scotland or Wales-domiciled students studying in England; and how variable fees will affect the funding arrangements for students of midwifery in England.

As we enter the 21st century, people who are privately educated make up around half the students at many of our universities or, for the purposes of this debate, higher education institutions. The institutions in question tend to be what we now refer to as Russell group institutions and I shall use that term, although from my point of view it also includes a number of institutions that are formally outside the Russell group, such as Bath university, a number of art colleges and one or two other institutions.

The rate of attendance at private schools in any year has been more or less stable for some years at around 7 per cent., so a privately educated child is around 13 times more likely to attend a higher education institution. If we move to the next stage of a graduate's life, we discover that fast-stream entrance to the civil service, the acquiring of places in prestigious chambers by law graduates, training in the dominant accountancy practices and the marking up for consultant status of medical graduates—in short, recruitment to those appointments that will provide the new graduate with the greatest chance of reaching the top of their elite field—are utterly dominated by Russell group graduates.

That trend needs testing to see whether it is contemporary rather than historical, and if some sceptics feel that many non-Russell group graduates are moving towards the top of their professions they should look forward a couple of decades in a graduate's life to the origins of today's new QCs, hospital consultants, partners in large accounting firms, grade 3 civil servants, rising chief executive officers and potential CEOs of private sector companies. They will find only a modest change in social class terms during the past few decades. If they move on another couple of decades, they may find a judge or two who did not attend Oxford or Cambridge, but pluckily fought their way up from modest beginnings at Bristol, Exeter or Durham universities after public school. However, that hardly matters because all those non-Oxbridge alma maters that we see cropping up in the curricula vitae of the odd new circuit judge today indicate that they attended a Russell group university.

The pattern is simple. Someone who attends a private school is massively more likely to attend a Russell group university. Someone who attends a Russell group

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university is massively more likely than someone who did not to become a leading member of one of our most influential institutions, whether in the public or private sector. Nothing much has changed for years or, indeed, for decades.

The price that we as a nation pay for such a preposterous state of affairs is high. It is a matter of national shame that a modern democracy should have a collective education system or systems that produce an outcome of such staggering unfairness. It is also deeply inefficient, as we are excluding millions of people with the potential to excel in any one of a large number of professions.

Enter the Government's plans to permit higher education institutions to levy an additional charge over the common contribution from students up to a limit of £3,000, depending on the course and the institution. What implications does the variable fee principle have for the injustice and inefficiency so clearly displayed in the present allocation and pattern of higher education places, and therefore in so many national positions of institutional leadership?

Some people may believe it perfectly reasonable to view our entire layered higher education system as so unjust that it could effectively be dismantled through allocating resources away from the Russell group universities, controlling all admissions centrally and perhaps requiring recruiters to apply positive discrimination measures to skew recruiting away from the privately educated or, perhaps, the Russell group educated. Yet that would not only have a significant and negative impact on the ability of a relatively small group of UK institutions to compete in the world research market, but it would remove the power of each university to be fit for a given purpose. Fitness for purpose is at the centre of the higher education debate.

One of the Government's great successes is to have continued the expansion of higher education so that about half our young people will enjoy a higher education of some description. However, although the Organisation for Economic Co-operation and Development figures show that the rate of return on investment in a university degree remains higher in the UK than in any other country, the fact is that the new era has brought about a need for a highly diversified higher education sector that supplies a range of different needs—some highly vocational and some oriented around local needs with some institutions configured for competing with the best in the US and other countries, such as China. Many of those rising countries are about to overhaul this country, unless appropriately organised institutions in the UK respond to the global challenges presented to them.

In such an environment, it is clear that although all universities must be excellent in terms of their own purpose, some will continue to have the purpose of providing the upper professional echelons and many professions, although not all, with talent. The pragmatic policy, therefore, is to recognise that fact and ensure that access to those university and institutional places is opened up to everyone regardless of social background. Only by doing that we will open up the leadership of our leading national institutions and companies to all, regardless of social class background.

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The Government's plans for variable fees, which we must discuss in outline as we will not know the detail until later this week, will provide all higher education institutions in England with much-needed additional revenue. Assuming that a proportion of that revenue is earmarked in one way or another for the provision of bursaries, students from working-class backgrounds will, at the least, almost certainly pay less than at present. For a working-class student at a Russell group university, however, it seems likely that both additional front-end assistance and a reduction in back-end debt may be put in place through a combination of direct Government assistance and assistance from the institution. I have recently spoken to a number of working-class school students in my constituency with grade projections suggesting that their grades will come up to scratch to allow them to attend Russell group universities. I have seen no evidence that they will make less rational choices than their middle-class counterparts.

If there is a trend in my constituency, it is for working-class students to stay at home while they study. That is made more feasible in Scotland than elsewhere, perhaps, by the fact that the great majority of people and institutions are located in the central belt, so most institutions can be reached by most people in under an hour and a half.

Annabelle Ewing (Perth) (SNP): The hon. Gentleman touched on the top-up proposals, as well as the outline that we expect later this week, and on the fact that many Scottish students study in Scotland. He will have received a copy of the report of the Enterprise and Culture Committee of the Scottish Parliament, which concluded in December that the top-up proposals, in their current form, would have an adverse impact on higher education in Scotland. Does he intend to vote in favour of the proposals and, hence, against the Scottish interest?

Mr. Joyce : It is pretty self-evident from what I have said that I support the thrust of the Bill. I shall say something about the debate in Scotland and the report, of which we have recently had a copy. It is quite helpful, but it indicates that there are a number of weaknesses in the hon. Lady's argument. I shall come to it in due course.

The trend to which I referred does not extend to working-class students determinedly choosing universities that make offers lower than their grade projections or results. However, Scottish higher education institutions, such as those in Edinburgh and Glasgow, and indeed Glasgow art college, suffer the same working-class deficit as their English counterparts.

The reasons for the working-class deficit at so many of our higher education institutions go beyond issues of debt or, put another way, the best investment any young person can make. A number of interlinking factors, social and educational, need to be understood if we are to improve the situation. The key will lie in a regulatory regime that allows universities freedom to find their own solutions, but which holds them to account for any failure to increase yearly the number of students from working-class backgrounds who pass through their gates.

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I am conscious that some vice-chancellors might be tempted to pay lip service to the principle of better access in the early days, but to let things lapse over time. Can my right hon. Friend the Minister assure me that the office for fair access—which will, I am sure, be included in this week's Bill—will consider the interests in some of our Russell group institutions that could lead them over the years to lower the priority of attracting ever-increasing numbers of working-class students?

I shall deal briefly with the issue of Scotland-domiciled students in England, and vice-versa, and how variable fees will impact on the phenomenon. Every year, several thousand students from Scotland attend English institutions and many more travel in the opposite direction. The Enterprise and Culture Committee of the Scottish Parliament recently concluded an inquiry into, among other things, how the higher education White Paper will affect variable fees and how that will affect students in Scotland, as well as how it will affect research on other issues within the Scottish higher education system—if we see it as a discrete system, which is open to question.

As the hon. Member for Perth (Annabelle Ewing) said, the report was circulated to all Members representing Scottish constituencies. That was helpful, in that it informed us about the relative strengths and weaknesses of the arguments surrounding variable fees. The Enterprise and Culture Committee has said that to apply variable fees in England would be to damage Scottish universities and would affect what it calls the cross-border movement by students. It has been implied to colleagues in this House with Scottish constituencies that new variable fees for England are therefore undesirable. However, at the same time, the Committee has recognised the need for universities to be provided with increased funding so as not to disadvantage Scottish universities in competition with English institutions.

It would be odd to argue that Scottish increases should come about simply as a response to a new funding stream available to English institutions, rather than because additional funds will provide for higher-quality outputs. That would suggest that what is important is not quality, but funding equality, whether or not the funding is appropriate. It seems reasonable to assume that Scottish institutions and their supporters want the same funding that will become available to English institutions so as to make continuous improvements to the quality of their output. The issue, therefore, is not whether institutions in England and Scotland need more money, but where it comes from.

As you are well aware, Sir Nicholas, it is not for Members of this House to say how the Scottish Parliament should allocate its resources, but it is reasonable for us to suggest that the two systems can learn a great deal from each other's best practice. For example, the Scottish system provides for a back-loading of debt accrued through tuition fees. I believe that the UK Government have learned some interesting lessons from that. It is a principle that they might adopt in the higher education Bill, with an additional emphasis, I hope, on providing additional help at the front end for students from working-class backgrounds. Conversely, for those who call for central Government or the Executive to provide more extra funding from general taxation, or to raid another departmental

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budget in order to favour higher education, it is worth pointing out that, in social justice terms, that might be one of the least efficient uses of taxpayers' money.

Last week, in a first-class article in The Guardian, Polly Toynbee flagged up research on the linguistic skills of children that was recently conducted in the United States. A number of astonishing details emerged, all of which point in the same direction in terms of education policy. By the age of three, the children of professional parents have vocabularies over four times larger than those of the children of parents whose only income is state benefits. Indeed, at the same age, the privileged children have larger vocabularies than those less well-off parents. There was an almost total correlation between linguistic ability at three and subsequent success in the education system.

Other recent research has shown that until the age of around 22 months, the latent intellectual abilities of children appear to outweigh the effects of social experience. Thereafter, latent intellectual ability pales almost into insignificance, and by the age of six the least bright children from more privileged backgrounds have easily overhauled all but the very brightest children from less well-off backgrounds.

The lesson is clear. If we wish to deploy new resources to have a direct and specific impact on social equity and justice, including future patterns in the uptake of higher education, they should be spent on young children—on increasing the income of the least well-off families and on early-years and pre-school education. The debate on variable fees should be put in that perspective. It is not good enough simply to demand more money from the Government—as some organisations, such as Universities Scotland, are doing, and as the Scottish Parliament's Enterprise and Culture Committee appears to have done—without a thought for where those resources might come from, nor for where they might produce better and fairer returns for the least well-off.

On the matter of cross-border students, it has been proposed by Universities Scotland that England-domiciled students should pay fees if they attend Scottish universities, while Scotland-domiciled students and those from other European countries should not. That is a recipe for a simple binary divide in Scotland, with universities such as Edinburgh and St. Andrews positively touting for more English students, thereby leaving Scottish-domiciled students at a disadvantage. Indeed, the proposal is so weak that one wonders whether Universities Scotland may have some other agenda altogether, not yet fully exposed.

On the basis of what I have said—I do not have time to cover several points that I wished to raise—will the Minister confirm that he intends to maintain regular contact with the Scottish Parliament and its Ministers, the Welsh Assembly and its Ministers and, in due course, the Northern Ireland Assembly and its Ministers to ensure that we learn the lessons of best practice from each other?

Finally, I want to speak about students of midwifery in England. The position of student midwives with regard to tuition fees was set out in a parliamentary

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answer to my hon. Friend the Member for Leyton and Wanstead (Harry Cohen) by my right hon. Friend the Minister:

The Royal College of Midwives certainly wants the situation to continue, particularly in view of the continuing shortage of midwives in the NHS. To say the least, the college welcomes the fact that the head count of midwives is increasing under this Government. However, the Under-Secretary of State for Health, my hon. Friend the Member for South Thanet (Dr. Ladyman), has accepted the specific difficulties of recruitment and retention among midwives. That has led to the college being concerned that if the higher education institutions at which midwives train choose significantly to raise the price of their courses, it may discourage potential midwives from entering training.

On reflection, it seems to me that a sound pricing mechanism should prevent that, as it would satisfy demand. Faced with a guaranteed sum from the NHS to cover the fees of each student, some education institutions might be tempted to increase fees beyond a true or reasonable market rate. However, I am sure that my right hon. Friend the Minister will have given the matter thought. I hope that he clarifies the position vis-à-vis student midwives.

11.18 am

The Minister for Lifelong Learning, Further and Higher Education (Alan Johnson) : I congratulate my hon. Friend the Member for Falkirk, West (Mr. Joyce) on securing the debate when this issue is mildly topical. He raised four points. The first was the social class gap—a crucial issue that is central to the Government's thinking on the subject. The second was liaison with the devolved Administrations. The third was the regulator—the proposed office for fair access—and the fourth the position among midwives and nurses in the NHS. I shall try to cover all four in the short time available.

My hon. Friend was right to talk of the social class gap. You and I, Sir Nicholas, are far too young to remember this, but just over 40 years ago the Robbins report of 1963 considered this question, when university education was the preserve of a small elite—between 5 and 6 per cent. of 18 to 30-year-olds. The report said that if we introduced free higher education with generous maintenance grants we would close that social class gap, but the evidence of the past 40 years is that the social class gap did not narrow—in fact, it widened. Many other benefits were achieved from the Robbins report, but that central issue—I do not think it hyperbole to describe it as an obscene social class gap—continues stubbornly to live on in this country.

This is not simply a matter of entry to higher education, and the social class gap exists for a number of reasons. As we set out last June in our report on widening participation, it begins with the under-fives. All the analysis and research indicate that at around the age of 22 months some social class divisions begin to show. There is a problem with attainment in literacy and numeracy in particular among primary school pupils.

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That is true in England more so than in Scotland and Wales with the drop-out rate at 16, and there is also a problem of aspiration. All those issues must be considered together and we describe them as the four As—attainment, aspiration, application and admissions.

We think that admissions, which in this respect means universities discriminating deliberately against youngsters from working-class backgrounds, is the least part of that problem. This may not have been true 15, 20 or even 30 years ago, but we are convinced that all universities, which includes the Russell group, modern universities and the 1994 group, are serious about widening access. Although a separate piece of work is being produced on admissions, I want to concentrate on the other issues—aspiration, application and attainment. Our policy has to be seen as starting with the under-fives—the Sure Start programme makes an important contribution to that debate—and with literacy and numeracy among primary school students, the figures for which are still a problem, but far better than they were six years ago in terms of attainment at age 11 in literacy and numeracy.

Serious work has been carried out on the drop-out rate at 16 and on how to encourage youngsters from a poorer background to stay on at school past 16. In a situation where jobs are available and the unemployment rate is at its lowest for many years, what they will earn in the job market is obviously a factor. The education maintenance allowance, which was introduced and piloted in my constituency and others, has had a marked success, which is why later this year we will roll it out nationwide and there will be £1,500, or £30 per week, for every student from poorer backgrounds to stay on in education.

I turn to aspiration, about which my hon. Friend raised an important point. If we can get youngsters to the right attainment level—two decent A-levels—nine out of 10 will go on to higher education. There is still a problem, because the 10 per cent. who do not do so generally come from non-traditional backgrounds—to use the jargon he mentioned. We should see the nine out of 10 who continue as an important statistic. Once they reach the required attainment level, however, they do not always apply to the universities that would best match their abilities. In other words, we see a large gap between the number of students from working-class and from other backgrounds who even just apply to some Russell group universities, all of which are trying to solve the problem and to attract more applications. That is why the issue of applications is important.

Some people—such as Peter Lampl, who runs the Sutton Trust—suggest that we should have post-qualification applications. Why should youngsters apply before they know their results? Youngsters from non-traditional backgrounds would feel more confident in applying to Russell group universities if they knew their results beforehand. That is an important point that the Schwartz group on admissions has raised.

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In the context of the Government proposals on variable fees, my hon. Friend was right to raise the fact that there is a new element. We say that we have to introduce the funding from somewhere, to expand higher education and invest more in it. I will not go into detail, but we believe that our proposals are the right way to bring that money in. On the social class gap, our proposals get rid of upfront fees. Although poorer students did not pay those, many had lodged in their minds the fact that they would have to pay or get their parents to pay for them to go to university—so that problem goes. We will reintroduce a maintenance grant for poorer students. We will carry into the new arrangements fee remission up to £1,125, which exists at the moment. We will increase the repayment threshold, which currently applies to loans but in future will apply to a loan plus fee, from £10,000 to £15,000.

We are also to introduce the regulator, and I assure my hon. Friend that it will have teeth. Incidentally, all universities are free to charge between nothing and £3,000, so charging at the higher end is not just the preserve of Russell group universities. That will be a difference between courses rather than universities. The office for fair access will say that to charge more than the current fee of £1,125, universities must reach an agreement with it. Without an agreement, the universities will not be able to increase their fees—that is a real financial imperative. Such agreements will last for six years. If the regulator, which will receive an annual report, believes that a university is failing on any of its commitments in the agreement, it can fine it through the Higher Education Funding Council for England funding, which makes up 90 per cent. of university funding. So, this is a regulator with teeth.

Liaison with devolved Administrations is crucial, particularly as the Bill will be needed to devolve student finance completely to Wales. Student finance is devolved completely to Scotland, but only partially to Wales. This is not true confessions time, but I would not say that we had the best liaison when we published the White Paper a year ago. However, we have learned from those errors and we are in close contact with the devolved Administrations on such matters. On the issue of the Scottish Parliament report, which was raised by my hon. Friend, I support devolution on the basis of what it means—it might mean that arrangements differ from one country to the other. However, we are learning from the Scottish experience, in particular from the fact that graduates repay after they have graduated and once they are earning decent money.

For my final point, which I wish to make about the national health service, I shall refer to a text because it is a matter for another Department. However, I think that I will be able to give my hon. Friend the assurances he is looking for. He is right that the NHS contracts directly for pre-registration student places in nursing and midwifery. Those places are funded by the NHS and not, as all other student places are, through a combination of fees and HEFCE grant money. He is right to say that such students do not pay student fees. The NHS contracts at a local level; the contracts specify the price charged for training and the fact that the students do not pay.

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The Department of Health will continue to monitor demand for places and a national model contract, which is being developed, will continue to preclude higher education institutions from charging increased tuition fees for NHS-funded courses. The simple answer for the Royal College of Nursing, which is concerned about the matter, is that at the moment the courses are free and that in the future, whatever the fees under the variable-fee system, the midwifery courses will continue to be free.

11.30 am

Sitting suspended until Two o'clock.

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