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Chris Grayling: Will the hon. Gentleman give way?

Mr. Sheerman: No; I am coming to the end of my speech.

I am worried that universities might be turning out rather one-dimensional people. Although they may be good at their subjects, their education is less broad and well balanced than previously. When I talk to students in the United States, where I have taught as a visiting lecturer in Cornell university for many years, I find a greater breadth and depth across the piece than in our students. We must think about the quality and dimension of our university education and consider whether we are turning out what used to be called well rounded and multi-dimensional individuals. To be elitist, such people used to have an understanding of the arts, philosophy and a broad range of subjects. We did not just turn out social scientists, mathematicians, chemists, doctors and dentists. All our parties must consider the people whom we are turning out.

On the night before John Smith died, I heard him make a moving speech, part of which questioned the way in which the educational system no longer seemed to turn out enough people who wanted to enter public service. I must say that he was talking towards the end of the Thatcher era. He thought that too many people who left education wanted to be have a high income with a job in the City. He talked about the need for people to be motivated towards public service—albeit properly rewarded—and dedicated to giving something back to the country in which they lived and to which they owed much. As we talk about higher education in the coming months before the election, I hope that that tone can be inserted into the debate.

Several hon. Members rose—

Madam Deputy Speaker: Order. Several hon. Members are clearly hoping to catch my eye in this relatively short debate. If their remarks are concise, more may be successful.

2.58 pm

Mr. Robert Jackson (Wantage) (Con): It is always a pleasure to follow the Chairman of the Select Committee and I shall endeavour to be briefer than he was.
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We are all grateful to the Liberal Democrats for offering the obscurity of one of their Supply day debates to enable the House to discuss the current state of, and future prospects for, higher education. That is especially useful now because we are plainly in the run-up to a general election, but we have not yet reached a point at which strategies and policies are set in stone, so there is still time and an opportunity for all parties to reflect on what is said in today's debate, as I am sure that they will want to do.

I feel today an optimism about the prospects for our universities that I have not felt since the late 1980s when the Conservative Government in which I served took the first steps down the road on which the Government are making such good progress. We have reached and passed a historic turning point. With luck and good leadership, we will move steadily towards the high-quality, large-scale, diverse and accessible higher education that Britain needs as global competition intensifies and the new knowledge economy unfolds.

There are a number of people whom we have to thank for this happy development, and I would like to mention them. Most immediately, there is the Secretary of State and the former higher education Minister, the right hon. Member for Hull, West and Hessle (Alan Johnson), now deservedly promoted. I wish his successor all success; as has been said, he has a hard act to follow. The Secretary of State and his former junior Minister picked up a difficult brief and delivered on it with a combination of charm and brutality that has been widely admired. Above and beyond them, however, there are two other important figures whose role also deserves acknowledgement.

In the first place, obviously, there is the Prime Minister, together with his immediate advisers. They deserve the credit for recognising that a radical change in direction was needed and for giving the strong and courageous lead that was required. Then there is the Chancellor of the Exchequer. It is customary nowadays to dwell on differences between No. 11 and No. 10; indeed it was said at the time that there were differences between them on the question of university fees. I shall return to that in a moment. However, it is important to recognise what the Chancellor has personally contributed to the more hopeful university scene that now lies before us.

Since 1999, there has been steady growth in the funding of higher education. Above all—I know this from my constituency, which has so much science in it—the Chancellor, with Lord Sainsbury, has recognised the importance of investing in scientific research, and it is right to pay tribute to him for that. It is said that the Chancellor's concern about the fees policy related to two key issues: equity and accessibility, and the efficiency and effectiveness of university governance. Those are perfectly reasonable concerns, but I believe that experience will show them to be unwarranted. Let me explain why.

As the stream of income paid by students increases, many universities will reach a "tipping point" at which their overall income from sources other than the Higher Education Funding Council will give them a real sense of responsibility for shaping their own future. As that happens, I believe that they will sharpen up their act and
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improve their internal governance in ways that no amount of Government exhortation and interference, of which we have had so much over the last two decades, can possibly hope to achieve.

The concern about equity and accessibility will be met in the same way. Under the new policies, the universities will have a serious economic incentive to recruit and retain students. That will do more for equity and accessibility than 100 regulators. The Chancellor is known to be committed to evidence-based policy. I urge him to keep an open mind about the working out of the new policy, and I urge the Government as a whole, in framing their manifesto, to seek to retain the political flexibility to respond speedily to the positive evidence of success that I firmly expect to emerge in the new Parliament.

So much for the Chancellor's concerns. Let me just mention two of my own concerns. The first, I know, is shared by the Secretary of State. Perhaps the biggest challenge now facing many universities is the introduction of the new two-year vocational degrees, with rising take-up for them and a high-quality learning experience for those who go into them. The chief justification for the massive expansion of higher education is that it will expand the skill base of the new knowledge economy more effectively than older forms of work-based vocational training. It is critical for the universities and the country that that expectation is met successfully.

Turning to my other concern, I do not know whether the Secretary of State shares it, but it has an important bearing on the decisions that he will have to make soon about the Tomlinson proposals for the future of school qualifications. My concern is this: for many years, since as long ago as when I was a Minister, it has been fashionable to say that British education does well by the most academically gifted but lets down the rest. There may indeed have been some truth in that claim, and of course it is right that opportunities for every type of student should be increased and expanded. But there is a danger that we may make the mistake of taking for granted the quality of our offering to the brightest students. In a world economy that competes not only in skills but in brains, the whole country will suffer if we do not challenge and stretch our best young brains.

That something is awry is very evident. We can see it very clearly if we look at the figures for the proportions of A grades at A-level in hard subjects that are achieved by students in the independent sector. Until 2000 the statistics on that were presented in a more transparent way than they are currently, and they showed that in that year the proportion of such students from independent schools was in the range between 42.1 and 46.1 per cent. in maths, chemistry, physics and biology. That is to say, in those subjects almost half the A grades at A-level went to students in independent schools. Yet the independent sector educates only 7 per cent. of our young people. There is clearly a lack of real academic challenge and aspiration in the state sector. There is a danger that the Tomlinson proposals will make the situation even worse and perhaps widen still further the academic gap between the public and the private sectors. To coin a phrase, we need academic challenge and aspiration "for the many, not the few".
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It is right that I should say a few words, in conclusion, about my own party's recent announcement of its policy for higher education. My message is simply this: it is still not too late to think again. There are two main elements in what is proposed, and both involve a regrettable sleight of hand. The Conservative party proposes to introduce vouchers for higher education. That is presented as a great boost to university freedom, but in any voucher system, or system of per capita funding, the critical questions are, "Who fixes the numbers of vouchers and their value?", and "Can the vouchers be topped up?" Since our universities already admit their own students and their teaching funding is already based on student numbers, there will be nothing new in them administering a voucher system; in fact they already do something of the kind. But as compared with the Government's policy, the Conservative proposals, I fear, represent a step back in terms of university freedoms.

The effect of the Government's policy will be to enable each university to fix the value of its voucher for all its students and for each course, by allowing a top-up subject only to an upper limit. By contrast, the Conservative proposals will retain a system in which the centre decides both the number of the vouchers and their value. That will in practice mean the state deciding, first, how many students there should be in total; secondly, how many students there should be at each university; and, thirdly, how many students will be admitted to each course. The paradox is that the Government's policies represent a real liberalisation of higher education, while the Conservative proposals represent a real move back to "big state, small people".

The second Conservative proposal is to commercialise the student loan system by charging a positive rate of interest for student loans, and to use the revenue from that to fund universities. I welcome the advocacy of a positive rate of interest; the idea was proposed by the Select Committee. The current level of taxpayer subsidy to graduates is not justified by any evidence that it really supports access. But the Conservative proposal envisages, on the one hand, an increased charge to graduates, and, on the other, the use of the funds arising from that

It does not, as advertised, retain the principle of free higher education.

The fact is that a surcharge will be applied to the repayment of loans for student maintenance, and that revenue will be used to pay for university teaching. The proposal thus smuggles in a graduate contribution to university teaching costs—to use a phrase with which the shadow Secretary of State will be familiar, it smuggles in top-up fees "through the back door". As compared with the Government's much more transparent policy, that indirect approach is again to the detriment of university freedoms. Because the vehicle for the new charge is to be the financing of the student loan book, the sums arising will have to be centrally administered. The Conservative proposal is that that will be done at arm's length from Government by way of a new charitable foundation. But I do not think that there would be much difference in practice between such a foundation and the funding council system. The real difference between the Government's policy and the Conservative proposals is that the Government are
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giving an initiative to the universities, working from the bottom up, while the Conservatives would retain top-down resource allocation from the centre. Once again, it is a question of "big state, small people".

To conclude, the future of our universities is not a central issue in electoral politics. Nevertheless, their strategic importance in the new global knowledge economy is immense. We look to the universities as a prime source of intellectual innovation and increasingly as a vehicle for flexible skills training. As things stand, it is clear that the Government understand that fundamental point, but I fear that that cannot yet be said of either of the two Opposition parties.

3.10 pm

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