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5.22 pm

Mr. John Maples (Stratford-on-Avon) (Con): One of the abiding memories of today's debate will be the vision of Government Back Benchers queueing up to disavow not just their manifesto and their principles but the rebellion that they were apparently threatening until a few hours ago. It seems that the Secretary of State's powers of persuasion are as formidable as he is in person. I do not know whether he is aware of the fact that last Sunday was the day on which the Church celebrates the conversion of St. Paul, but he certainly seems to have learned some lessons from it and performed a similar feat.

We are on common ground over the fact that universities are short of money and that the fall in unit funding has had a dramatic effect. I should like to illustrate one of those effects. The other day, one of our, dare I say it, two greatest universities privately commissioned a study to see where it ranked in the world order of universities, and it concluded that it was about 14th. That may surprise us—it surprised me—but what is even more surprising is that every one of the 13 universities that ranked above it was in the United States. There must be a lesson to be drawn from that. Part of it is that the funding, certainly in Ivy League universities, is probably about three times per pupil what it is in a United Kingdom university, but we should be careful before we disavow the American model.

If we think that universities need more money, where is it going to come from? Well, people may say that it can come from the Government. For the taxpayer to pay for 50 per cent. of the population to go to university is probably not a realistic objective. I say that with some reluctance because, like many others who have spoken, I went to university on a full maintenance grant, with all my tuition paid for, and I like to think that that

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education has benefited not only me, but the people that I have worked for and with, both inside and outside the House. The idea of public benefit certainly applies to people who become doctors or judges, for example, because we all benefit from them. I view that as a strong argument for public funding, though not perhaps strong enough to say that everyone who goes to university should have all their costs paid.

Parents are another source of income and the Government's proposals will milk them further. Only a small percentage of parents earn enough to be able to dispose of large or significant sums of money in that way. Only 10 per cent. of the working population of this country earns more than £40,000 a year, and only about 20 per cent. earn more than £30,000—the cut-off for support under the Government's arrangements. The ability of parents to cough up much more is pretty limited, so we are left looking at students.

It is sometimes argued that graduates earn more money, but that means they pay more tax and if they earn £400,000 more over a lifetime, they will pay somewhere between £100,000 and £150,000 in extra tax anyway, making it a pretty good investment from the state's point of view. However, if we are looking to students to pay a greater contribution to their education, they can pay up front, pay a graduate tax or pay in arrears. The Government introduced up-front fees and I believe that there are serious objections to them. Personally, I do not like the idea of a graduate tax, because it removes a link or any choice on the student's part between how much they pay and where they go.

One aspect of the Government's proposals that I like is the introduction of some variety into educational provision. It may be that studying law at Cambridge will take three years at £3,000 a year, but some other university may be able to do it in two years. Buckingham university does degrees in two years and there is no reason why a typical undergraduate degree could not be done in two years. Something would be lost, but the student would end up owing much less money. The idea of making students pay a specific fee in arrears is probably the right way to proceed.

What I dislike about the Government's proposals is that, having done that, they further involve the means-testing of parents in financing the student's education. That seems to me to be fundamentally wrong. Why should a relatively poor parent of a child who became a partner in Goldman Sachs have subsidised the education of a child from a wealthy home who became a teacher? Even more appositely, why should parents on £31,000 a year have subsidised the education of a child of parents on £29,000 a year? One of my two objections to the Government's proposals is that if we are to have fees in arrears, they should be left entirely to the student and the parents' means should have nothing to do with it.

Peter Bradley: The hon. Gentleman must have read a different Bill, or certainly heard a statement that was different from that made today. The point of the Bill is to make repayments of tuition fees entirely income-

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contingent. It is the graduate who pays them. They have no connection or association with the income of parents before the school leaver attends university.

Mr. Maples: I chose my words carefully. I said that the parent over the limit would have subsidised the education of the child of parents below the limit. I understand the hon. Gentleman's point, but he should acknowledge that there is also a means test of parents, which affects who pays for which child's education. Under a fees-in-arrears system, I do not believe that that should be so.

However good the idea of students paying fees in arrears, it has been almost totally undermined by the Government's concessions in order to stave off—they hope—the rebellion. As I understand it, the concessions will amount to a greater cost to the Treasury than the benefits that the universities will gain from them. The Government have undermined their own proposals in those two respects.

My second fundamental objection to the Bill is about the access regulator. It is an awful proposal, which smacks of the worst sort of social engineering. Are universities to select people by postcode, as happens for hospital waiting lists? Are people to be selected according to the type of school they attended or their social class? I fully accept that the people who go to our best universities should be those who will benefit most, which means that it should be those who are going to get the best degrees.

It may be—some vice-chancellors have argued it—that A-levels are not a good predictor of what sort of degree students achieve, in which case we need a better predictor. The United States uses SATs, a system in operation for 50 years, which brings considerable benefits. We could invite the universities to set a different sort of A-level examination that would be a better predictor. However, making crude adjustment to A-level results on the basis of the school or the postcode or parents' income will not help us to get the best people into university. What we need is an objective and transparent system of deciding which 18-year-olds go to university and which do not. It must be transparent, objective and it must be seen to be fair. I accept that that system might well not be A-levels as they presently exist, but it should certainly not be A-levels that are adjusted by some political appointee looking at postcodes.

David Taylor: The hon. Gentleman says—I am paraphrasing—that he cannot conceive of an acceptable or workable system that would steer students to specific universities on the basis of postcode, income or education. However, surely we have that system at the moment, especially for those who attend Russell group universities. Are we not just trying to balance that up?

Mr. Maples: I accept that A-levels might not be the best criterion to decide who should go to a Russell group university. However, using A-levels that were adjusted by an arbitrary political criterion would be even worse. If A-levels are unsatisfactory, let us have an alternative system, but let it be objective and transparent so that people who apply to universities understand what they must do, what hurdles they must pass and whom they must beat to get in. They should not be told that their exam results and hard work will be arbitrarily adjusted

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because their parents happen to be middle class or to live in a wealthy suburb of Birmingham, but that seems to be the Government's intention. I am bothered that the regulator will be politically motivated because he will report to, and take instructions from, the Secretary of State.

I shall try to wrap my two or three points into a quick conclusion. Universities need more money. Although I hope that I can be persuaded that that could be funded by public funds, I suspect that I will reluctantly be persuaded that a greater contribution from students will be needed. However, they should pay in arrears and there should be no cross-subsidies between wealthier and poorer parents—or less poor and more poor parents, which is what the scheme will amount to if the cut-off is set at £30,000 a year. The system should be based entirely on what a graduate earns at the end of the day, and there should be no access regulator because that will create a problem.

I understand that the Government's proposals will result in universities collectively receiving just under £1 billion more—I think that the figure is about £910 million—and that the cost to the Treasury of all the grants, loans, subsidies and write-offs will be about £1.1 billion. It seems to me that there is an alternative to the Government's proposal. The Secretary of State could have saved himself from an awful lot of trouble, from today's debate, and from having to make half his colleagues ideologically stand on their heads in the Chamber by simply giving £1 billion directly to the universities, not having the fees and saving himself and the Treasury £200 million in the process.

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