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5.32 pm

Clare Short (Birmingham, Ladywood) (Lab): As has been said in the Chamber before today, asking Labour Members to vote against the manifesto on which each of us was elected to the House is a serious matter. It is a breach of trust with the electorate and a breach of a solemn promise. It is also politically foolish. People are more and more cynical about politics and politicians, and these events will increase that cynicism and undermine the public's confidence in our party and its promises in a serious and troubling manner.

We must ask what is the reason for such a serious breach of our promise. Why must we rush through the Bill even though it will not take effect until after the next election? We are told that we need more resources for higher education—that is agreed across the House—so that we may reach the Government's target of 50 per cent. of young people going to university. However, facts outlining the progress that we have made during recent years and the increased resources that the Government have made available for higher education show that the case for rushing, in a manner that will breach our manifesto commitment, completely falls.

The figures show that during the years of the Tory Government there was considerable progress on the number of young people going to university. The proportion went up from 12 per cent. of the age group in 1979 to 34 per cent. in 1997. Last year, after continuing progress under our Government, the figure reached 43 per cent. There is no need to panic about the 50 per cent. target because we are making good progress toward that objective.

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We are told that universities are desperately short of money. It is true that they need more money and that they suffered badly during the Tory years, as did most of our public services. Between 1989 and 1997, the universities suffered a drop in funding of 36 per cent. per student. So that enormous expansion in participation was paid for by the universities, and they did not get enough investment to reward that very important expansion. But the downward trend was reversed in 2001, and the Government have committed more money to higher education.

Spending on higher education will rise from a total of £7.5 billion in 2002–03 to almost £10 billion in 2005–06—a real-terms increase of 6 per cent. a year. So it seems to me that, yes, we have got an issue to solve, because of course we want every young person in our country who wants to go to university, and is capable of doing so, to be able to do so. I am sure that we will go beyond the 50 per cent. target in time, as our country develops and there is more and more access to quality education. But we have not got a short-term crisis, and all this proposal, which is such a serious breach of our manifesto commitment, will bring in is less than £1 billion, which will not solve the long-term funding needs of the higher education sector.

This seems to be really questionable and incompetent policy making, and we have to ask where it has come from. I am afraid, as I said in my speech when I resigned from the Government, that we have seen in our second term a pattern of very surprising proposals. I do not know whether they come from the bowels of No. 10, or some of the advisers that circulate around No. 10, but they are not consulted on or publicly discussed, and they are then driven through the House with appeals to the loyalty of Labour Members to vote against things that they know to be right. We have seen that over and again, and it leads to bad policy making. If we are to have a more presidential style of government, we must have a more independent Parliament that can say, yes, we are loyal to our Government and our party, but we will vote them down when they are wrong. Surely that is the right way to proceed if we are not consulted.

Jonathan Shaw: Of course my right hon. Friend voted for up-front fees and cuts in single-parent benefits. Tonight, will she support the Bill, which will introduce grants at the end of the year for poorer students?

Clare Short: That is not a very sensible intervention. Obviously, I will say before the end of my speech what I will do tonight. I will make that point in my own time if my hon. Friend will allow me.

I believe that the only logic in the Bill is that of the Russell group—a move to a market in higher education—but what has happened is that, because Labour Members have been brave and the rebellion has been strong, concession after concession has been made. Those concessions are welcome and good, but they are an attempt to try to squeak through a deeply flawed Bill, whose logic will drive us forward, as soon as it can be attained, to variable top-up fees and a market in higher education that will have lots of destructive effects. Young people will have more and more debt. All hon.

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Members must have had many letters and e-mails with anguished stories of families currently burdened by debt and who are troubled by their debts.

Mr. McLoughlin: Will the right hon. Lady give way?

Clare Short: Let me get on a little further.

The logic of that change will be that young people will start to decide which subjects to study, where to study and, even more significantly, to decide their career and profession on the basis of debt, money and cost. Surely we do not want to live in that kind of country. Surely we want access to higher education to include people who want to do mediaeval history, poetry or philosophy. Yes, we all know that investment in higher education is of benefit to the economy, but it is also of value in itself. Surely we do not want people's decisions in their lives to be distorted by those differential costs in higher education—most certainly, I do not. I fear that that change will downgrade the commitment of young people to choose a vocation and public service in their lives because, as they are saddled with debt, they will start to look for the jobs that give a high salary, rather than the jobs that represent a dedication to public service. We will diminish those values in our society to our great cost.

All honour to the leaders of the rebellion for prising out of the Government all sorts of beneficial commitments. It is good that young people should not have to pay up-front fees. It is good that there are to be maintenance grants—though the cut-off point will be a big problem for many families. Some desirable elements, which could have been put in another package, have been introduced to persuade certain Labour Members to vote against the party manifesto on which we stood and against the principles of a good system of higher education funding. A free vote would not carry this Bill in the parliamentary Labour party.

The right course would be a review of how to get more money into higher education, then include in our next manifesto a commitment to introduce a new system. I am highly attracted to the idea of a graduate tax, which could easily be paid over to the Higher Education Funding Council. It could be set down in legislation that the Treasury could not vary the amount, and so on. Thorough discussion, more detail and costings are needed to find the answer—and we should try to achieve national consensus because this matter will affect generations of young people to come.

Mr. Connarty : Is it not indicative that the principal of the university of Essex told me that universities want £5,000, but £3,000 is all that they are allowed? They see the funding gap as being much greater. Is there not a conflict in the Bill between a market in which people want more for their courses and a Government who will not give that to them?

Clare Short: I agree absolutely. The Russell group logic is the logic in the Bill. The concessions have now pushed the other way, but that logic will still break through over time—which would be destructive to the quality of higher education. The elite universities are not

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the best at everything. Undergraduates should not have to fund all the research. We should have leading-edge, world-class universities to undertake good research, but we must find a way of distributing funding according to ability—not create a market based on snobbery and elitism.

I appeal to all right hon. and hon. Members to vote down this deeply flawed Bill, then urgently discuss how to achieve better long-term funding of higher education. Each party should fight the next general election on manifesto commitments about the right way of doing things. That would be the honourable way through. The measure being proposed today is deeply dishonourable and will increase cynicism about politics and damage the reputation of our party.

5.42 pm

Mr. Ian Taylor (Esher and Walton) (Con): I particularly noted two speeches in this interesting debate. One was by the hon. Member for Norwich, North (Dr. Gibson)—whom I respect and with whom I served on the Science and Technology Select Committee in the last Parliament—who advocated arguments against the Bill. The other was by my hon. Friend the Member for Wantage (Mr. Jackson), with whom I find myself very much at one, who indicated that the Bill was moving in the right direction.

The best oratory in the debate came from my right hon. Friend the Member for Richmond, Yorks (Mr. Hague). He made a powerful speech but was particularly unwise to base it on the fact that Conservative Members should observe what was in their last election manifesto. There are fewer of us on this side of the House because we did observe our last manifesto. [Laughter.]

I have no problem in saying that because the facts have changed, I have begun to rethink my approach to this policy. Universities are in a crisis that is getting worse and we must do something about it. As the last science and technology Minister in the previous Conservative Government, I wrestled with a lot of problems but did not manage to persuade my Chancellor of the Exchequer to put as much money into research and development within universities as the current Chancellor has done. I give the Government credit for that.

Research is a vital area. More money should be put into research infrastructure—not just into research. Academics are seriously underfunded and many of our best academics are again beginning to look abroad for their future. Given that situation, everybody should rise above party politics to some extent and start thinking about what can be done to plug the gaps in the university system. Nobody who goes to university will benefit from such a situation. If standards are declining because of the pressures on universities, students will suffer, whatever their background.

Access is a problem, and we should do our best to widen it. However, we should not talk about it as if the universities themselves are not seeking talent. In many cases, if they identify the talent they do not have enough resources for bursaries to encourage it.

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