Higher Education Bill

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Jonathan Shaw (Chatham and Aylesford) (Lab): I hope that my hon. Friend can return to the point of the amendments and, in particular, the intervention made by my right hon. Friend the Minister. If there is a fixed fee, as my hon. Friend advocates, why will that not put families off? If the fixed fee were £3,000, where is the justification in my hon. Friend's argument? Moreover, the Select Committee on Education and Skills heard from the Mixed Economy Group of Colleges, which said that it did not expect to raise fees to the maximum, because it wanted to encourage wider participation.

Mrs. Campbell: I partly addressed the point that my hon. Friend makes and the point made by the Minister in saying that what I object to about the proposals is the introduction of a market system and the imposition of a further level of choice on a student who may find it difficult to predict—or aspire to—the sort of salary levels that have been mentioned.

Another problem is the differing levels of university income, which I intend to tackle in a moment.

Dr. Hywel Francis (Aberavon) (Lab): Would my hon. Friend not acknowledge that for a long time there has been a market system for part-time students? I am grateful to her for reminding me that I signed that early-day motion, but a lot has happened since then, particularly with the Government announcements in support of part-time students for the first time. Their situation is regulated and has improved, and I am surprised that she has made no comment about that 42 per cent. of the student population.

Mrs. Campbell: The fact that a system exists does not prove that it is right. There are many reasons why part-time fees may be variable. For example, there are different lengths of courses and hours of study. I have not addressed part-time courses but I know that they will be dealt with later in our proceedings. My constituency contains Anglia polytechnic university, and 35 to 40 per cent. of its students are part time. They are an important consideration.

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Mr. Chaytor: Will my hon. Friend give way?

Mrs. Campbell: If I may make a little more progress, I will be happy to give way later.

I was in the middle of making a point about people whose family income is about £32,000 or more, particularly if they come from a part of the country in which housing costs are high. Those students will not benefit from a grant and may try to reduce the length of time that it takes to pay off the debt by going to a cheaper university or course.

The problem is that variable fees will strengthen the perception that the elite universities are more expensive. We heard a prime example of that during our last sitting, when the hon. Member for Harrogate and Knaresborough (Mr. Willis) perpetuated the myth that Cambridge university was asking people to produce proof that they could provide large amounts of money before admitting them to a course. I have written to the hon. Gentleman, but I have not yet received a response. I hope that he intends to reply, because it is a damaging perception. The elite universities—certainly Cambridge—are not expensive, because rents are subsidised and generous bursaries are available. That makes Cambridge university cheaper than Anglia polytechnic university, which is contrary to the perception that many people have.

I am also concerned that the Bill will change the perception of higher education. It will be seen as a financial investment and a route to a highly paid job rather than something to be done for love of learning. A flat fee has the advantage that it is seen as a passport into higher education, while a variable fee makes the student concentrate more on the marketability of the course that they are about to study.

Given the length of time that it will take for someone on a low income to pay off a loan, I am also concerned about the recruitment of public sector workers from the cohort of new graduates. I know that later amendments—[Interruption.]

The Chairman: Order. A lot of conversation is taking place. The hon. Lady is gently spoken, and the Chairman wishes to hear her.

Mrs. Campbell: The recruitment of public sector workers from the cohort of new graduates will be more difficult. I know that later amendments deal with that issue, and it was discussed in the original White Paper. I look forward to debating it at a later stage.

Jonathan Shaw: I did not go to university. I did my public sector social work training in a further education college, and the fee, which my employer was charged, was variable.

Mrs. Campbell: My hon. Friend makes a valid point, but it does not change my opposition to the variable fee for full-time students.

Mr. Chaytor: I want to pursue the previous point and link it to the question of variability and part-time degrees. Does my hon. Friend not accept that the logic of her argument against variability for full-time undergraduates should have led her to table a similar

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amendment to rule out variability for part-time degrees and all further education courses? Why are variable fees unacceptable for mathematics, law or economics, but not for hairdressing, electronics or surveying?

Mrs. Campbell: The issue that bothers me is the market system being introduced into higher education in a way that will be damaging for students who are considering what three-year course to take. That is why I object to the Government's variable fees proposals.

I come now to differential income to universities, a point that was raised earlier. Some of the modern universities may have to charge lower fees to attract students to their courses, and statistics show that those higher education institutions are much better at attracting students from lower income backgrounds. They will therefore have a greater expenditure on bursaries, leaving them with few additional funds for teaching. It worries me that that will widen the gap between the elite and the modern universities.

The Association of University Teachers has compiled figures showing projections over a three-year period for the Russell group of universities and a group of modern universities. They assume that there are about 20,000 students in both groups, and that the percentage of courses charging the maximum top-up fee in the Russell group will be about 100 per cent. and in the modern group about 50 per cent. Over a three-year period that would lead to an advantage in income for the Russell group of £60 million more than that for the modern universities, taking into account the differential fee, the bursaries and all the other financial implications. That is a big difference and those of us who recognise that some universities are better than others want the standards to be raised throughout, rather than widening divisions between the top universities and the newer universities that have more difficulty in attracting students.

Mr. Patrick Hall (Bedford) (Lab): With regard to the proportion of income to an institution from tuition fees and variable fees, does my hon. Friend accept that in the so-called modern universities that do little research or postgraduate work and have few overseas students, variable fees will raise a larger proportion of their budget than in the so-called top universities? That is why the overwhelming majority of modern universities welcome the Government's proposals.

Mrs. Campbell: Nevertheless, some modern universities do not welcome the Government's proposals and my concern is that if those universities are not able to attract the same fee income as the top universities they will not be able to pay their staff as much and they will not have such good teaching facilities, which will lead to a second-rate tier of universities. That would be damaging for the UK; we have some excellent universities and I do not wish the relative quality of those universities to vary any more.

There is another worrying issue: that the proposals, which will do much to increase university funding, will not come anywhere near to closing the gap completely. That will lead to pressure to raise the cap, and

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although my right hon. Friend the Minister has tabled an amendment to prevent that from happening before 2010, it worries me, and many of my hon. Friends, considerably. The National Association of Teachers in Further and Higher Education has estimated that the top-up fee income will cover only 12 per cent. of the estimated shortfall. If my right hon. Friend feels that that is inaccurate it would be helpful to hear from him.

We have also briefly mentioned the criteria for a higher costs course. We have heard that Oxford is thinking of offering physics courses at zero cost. We heard today about the possibility of mathematics courses costing zero. I find it strange that one of the most expensive courses might be charged at a zero rate. That would mean that there would be no relationship between the cost of the physics course and either the fee charged to the student or his future earnings. In the market system, of course, universities will charge what they can get. The idea that the more one pays for a course, the more one increases one's earning power will simply not be borne out in practice.

Chris Grayling: Is the hon. Lady also aware that another complicating factor is that the Government envisage that foundation degrees will also be liable to fee payments? Foundation degrees are intended as entry-level degrees. Under almost any permutation of her amendment or the Government's amendment, it is possible that those students who are jumping over the hurdle into higher education will also build up substantial debts.

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Mrs. Campbell: Indeed. Foundation degrees can lead to quite lucrative employment. Certainly a plumber living in London is probably paid much better than some of those who studied more academic university courses. However, it is difficult to predict that in advance. We do not know whether those courses will be more expensive or cheaper.

My concern is about access. There are variable fees on the one hand and OFFA, the regulator, on the other. Variable fees will work against access and the regulator will try to reverse that. I shall wind up in a moment, as I know that many hon. Members wish to speak in the debate. I am surprised that the Government have chosen to make this part of the Bill such an important issue.

Dropping variability and introducing a higher fixed fee would bring in the additional money for the universities. It would have widespread public support and support in the House. It would instantly transform the Government's fortunes and would attract much additional support for their measures for higher education. It seems a fairly minor point, given that most universities will probably charge the maximum £3,000 fee for most of their courses and that any variability is likely to be small, at least in the first three to five years. I urge my right hon. Friend the Minister to think again about this aspect of the Bill. I look forward to hearing what other hon. Members have to say on the subject.

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Prepared 24 February 2004