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Mr. Clarke: The whole purpose of the package is to link repayment to the ability to pay. That is the nature of our proposals, which are an improvement on the current state of affairs.

Rev. Martin Smyth (Belfast, South) (UUP): I understand universities' need. In Northern Ireland, they have been underfunded by 30 per cent. compared with English universities. However, our universities have a higher proportion of people from lower-paid families who, with others, have written to us because they are concerned about the imposition that the legislation will make on them.

Mr. Clarke: Our proposals will help universities in Ireland and elsewhere. The hon. Gentleman is right that there are different cultures in Northern Ireland and Scotland concerning universities and their development. There is greater working-class access and participation in some parts of the country, but our proposals will help across the range.

Turning to our proposals on student support, the first key point is one that Members on both sides of the House must weigh very carefully indeed. Our proposals will eliminate up-front fees, which are currently a clear barrier to people going to university. At the moment, students and their parents must find £1,125 a year, which would increase to £1,200 a year by 2006, just to be able to get access to the campus. There is no doubt whatsoever that those up-front fees are unpopular—[Interruption.] They are unpopular, and they are the precise reason why we rightly decided to review the policy. The Opposition parties should acknowledge the fact that if they vote against the Bill today they will be voting to keep up-front fees. That is their decision. The opinions that they have just expressed are simply

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crocodile tears. The only way to get rid of up-front fees is to vote for the Bill. Every vote against is a vote to keep up-front fees, and every elector will know it.

Mr. James Gray (North Wiltshire) (Con): Will the Secretary of State apologise for having brought in up-front fees in the first place?

Mr. Clarke: I made that point one second ago.

Mr. George Howarth (Knowsley, North and Sefton, East) (Lab): Does my right hon. Friend accept that those of us who chose to judge these measures according to whether they made it easier for able working-class kids to go to university are now satisfied that he has addressed that issue fully? Will he go a little further and promise that in any future review, when he looks at the costs and the repayment regimes that will kick in, housing costs will be taken into account?

Mr. Clarke: Yes, I can give my hon. Friend that assurance. The review process that we are describing will take those factors into account.

Several hon. Members rose—

Mr. Clarke: Before I give way, I shall make a little progress.

The second important aspect of student support is the establishment of a £3,000 package for all students from working-class families going into higher education. In my statement to the House on 8 January I set out a minimum £3,000 support package for students from the poorest backgrounds attending the most expensive courses, which was made up of £2,700 from the Government and a minimum £300 bursary from universities. This £3,000 package will ensure that no student qualifying for the higher education grant will be any worse off as a result of variable fees, and many will be better off.

Many universities are beginning to develop and announce bursary proposals that go far beyond those minimum requirements. We already have £4,000 bursary packages for a number of universities, such as Imperial college, Cambridge university and Essex university—substantial bursary packages that lead to students getting support of up to £6,700 a year to go to some of our elite universities. That is a significant development.

I also told the House that I was minded to combine the fee remission and the higher education grant into a single combined grant. Last week I published a discussion paper setting out the details of how making a single up-front cash payment of up to £2,700 from the Government to go with the £300 bursary from the university might work. My officials have been addressing the practical and financial implications of merging the two grants, and I can tell the House that from 2006 we will be offering all students from low-income backgrounds a single grant of up to £2,700. I intend that the detail of that should be discussed in Committee.

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About 30 per cent. of students will be eligible for the full grant and a further 20 to 25 per cent., where the family income is up to £33,500, will be eligible for partial grant. That will give students real choice about how they manage their finances and will provide more cash up front to support them while they are studying.

Andy King (Rugby and Kenilworth) (Lab): I am grateful to my right hon. Friend for the commitment that he has made to open up access to those from the poorest sections in our society. That is real progress. Some of us have had some difficulties in relation to the variability aspect, and also with the possibility of the poorest students being forced into the poorest universities and the gulf widening. Can my right hon. Friend assure us that the aspect of variability will be looked at in the review?

Mr. Clarke: I can give my hon. Friend that assurance, as I will describe in a moment.

Hugh Bayley (City of York) (Lab): Is my right hon. Friend aware that York university is the only one of the top 10 universities in Britain that fully meets the Government's targets on access? The vice-chancellor of York university, Professor Brian Cantor, has written to me to say:

Does my right hon. Friend recognise that if the grants he is proposing are not brought in—if the Bill is defeated—fewer working-class kids will get to the best universities, like York?

Mr. Clarke: My hon. Friend is correct and I appreciate the support from him and from his vice-chancellor. Again I must make a political point. [Hon. Members: "Oh!"] Yes, listen to it. This package establishes a £3,000 package for students from working-class families going to university. That is the package that will operate if the Bill is supported today. Those who vote against will be voting against such a package, against grants and against the kind of opportunities for people from working-class families that are so critically important.

Mr. Kenneth Clarke (Rushcliffe) (Con): Does the right hon. Gentleman accept that people with wealthy parents will not be affected, because those parents will not allow their children to get into debt and they will pay the fees? Of course, children from the very poorest families will not be affected, because they will get the advantage of the bursaries that the right hon. Gentleman is enlarging upon to try to get a majority for his Bill. It is the ordinary student from the ordinary family who just fails to qualify for that help who will carry the burden of tens of thousands of pounds-worth of debt in the first years after they graduate. Does he seriously expect that that will have no effect at all on the willingness of such people to go in for the more expensive courses in higher education?

Mr. Clarke: I must say, this is the first time I have known the right hon. and learned Gentleman stand up as Mr. Ordinary. I always thought he was rather exceptional.

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For the ordinary student, we are removing the up-front fee. If the right hon. and learned Gentleman votes against tonight, he will be voting to keep the up-front fee. For the ordinary student, we are increasing the threshold of repayment after graduation from £10,000 a year to £15,000 a year, which is a direct reduction in the amount per year that all students have to pay. If the right hon. and learned Gentleman votes against the Bill today, he will be voting to keep the threshold at £10,000, rather than £15,000, so the ordinary students in his constituency will find themselves in a far worse position than they otherwise would be.

Finally, for the ordinary students in his constituency, if the right hon. and learned Gentleman votes for the Bill tonight, he will vote for a 25-year cap so that beyond that time, all debts will be written off. If he votes against, he will be voting to keep that debt going on for ever for the ordinary students in his constituency. So the ordinary students have a lot to gain from the Bill, too.

Tom Levitt (High Peak) (Lab): I am grateful to my right hon. Friend for explaining how the level of support will be far higher than the maximum fees that will be charged. Will he confirm for the record that had universities been charging £15,000 or £20,000 a year in fees, there is no way that a similar package of support to cover those fees could have been considered, and it is that anarchy in universities that we legislated against when we said that we were abolishing top-up fees in the past?

Mr. Clarke: My hon. Friend is correct. It is important to acknowledge that, although the Opposition will find that difficult. I shall come to points about variability for the future. Precisely because of the package that we have today, including the Office for Fair Access, major universities in this country, including the university that the right hon. and learned Member for Rushcliffe (Mr. Clarke) attended when he was young and fancy-free, are able to offer bursaries of £4,000 a year on top of what the state is offering for working-class children from his constituency.

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