Higher Education Bill

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Mr. Collins: Under a Conservative Government.

Mr. Thomas: Indeed, under a Conservative Government, just before my community was ripped apart by the miners' strike and the end of any sense of community values.

Going in that year, I got a full grant under a means-tested system—something like £1,500 per year and no tuition fees, of course. At that stage, in the coal-mining community in south Wales that I came from, I was unusual. At that time working-class people were not making the choice to go into higher education. Yet there was a full grant available and there were no tuition fees. It was attitudinal problems, ideas and—[Interruption.] I think the Under-Secretary said ''culture''. It is stronger than culture—it is stereotypes and people's perceived attitudes.

It is 20 years later and things have changed, but what do we still have now? When the first tuition fees came in, we in Wales commissioned the Rees report, an important report to the Assembly Government. On 12 February 2002, this is what the Labour Minister for Education in the National Assembly, Jane Davidson, told The Guardian:

''Rees told us our concerns that potential students are put off applying for courses because of student hardship—either real or perceived—were well founded.''

We are talking about reality and perception here. The first point to make about attracting poor students to university is that the evidence—certainly in the Welsh context—shows that student hardship, as well as the perception of it, is a real barrier. Does the Bill address that? In a way it does, because it provides grants. We have had grants in Wales for the three or four years since the Rees report. We have addressed that issue in Wales—outside the Barnett formula, it has to be said.

In one sense, the Bill addresses the issue; in another, it knocks down any advantage by promoting the idea of the deferred payment of tuition fees. That results in a neutral at best, and I would tend towards the conclusion drawn by the hon. Member for Leeds, East

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that it is in fact a deterrence. In my view, it is certainly not a great attraction to such students to go to university.

Mr. Chaytor: Could the hon. Gentleman explain why, since the individual costs of going to university have increased—first, by the introduction of the part-loan, part-grant scheme in the early 1990s, and secondly by the introduction of fees in 1998—the numbers have continued to expand?

Mr. Thomas: The numbers have continued to expand, but the proportion coming from poorer backgrounds has remained static.

Mr. Chaytor: No.

Mr. Thomas: It has, just about.

Alan Johnson: I am grateful to the hon. Gentleman for mentioning the issue. To set the record straight: numbers have not fallen, as the Liberal Democrats claimed at one time, but there has been a tiny 1 per cent. increase in participation for social class VI. There has been no change either way: youngsters from poorer backgrounds have not been put off and there has certainly been no push to attract them to higher education. The result has been neutral.

Mr. Thomas: I say static; the Minister says neutral. I think that we are about the same and that he will agree—I hope that the hon. Member for Bury, North, having had that reply, will do so as well—that it is a reasonable test of the Bill to try to perceive whether it would increase the number of people from poorer backgrounds who go to university.

The second question we need to ask ourselves is what factors could change the number of people from such backgrounds who go to university. We can look at the institutions that are already active in that field and ask ourselves what the best practice is. What really works and attracts people from that background to university?

Several points can be made about successful practices. The first has already been mentioned, but I have seen it working. The university of Wales in Aberystwyth runs a summer school. There are no expectations of the young people who attend and they do not have to sign up for a university course afterwards. They come, aged 16 and 17, to a relaxed, non-threatening, almost non-academic environment and they are gently encouraged to put university education further up their agenda themselves. It works well. To do more of that, universities will need more money—that is clear. I will just park that idea for a second; I will return to the funding gap shortly.

The second successful practice is the principle of bursaries, which is tied up in the Bill. I do not want to get too much into a discussion about the issue of £3,000 or £300 because we have already had a reasonable debate on that and also because it is an England-only part of the Bill. I bear it in mind that Wales might have a very different system. Nevertheless, it seems to be quite useful for universities to be able to tailor bursaries to individuals. That individual feels encouraged by receiving that bursary to make that leap and to determine to go to that university to study that subject.

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From a personal point of view, it certainly worked for me. I was fortunate enough to do that.

Those are just two ideas. I am sure that there are many other examples of good practice of outreach work, going into communities, using part-time courses, encouraging people to consider graduate courses as a result of part-time study and so on. All those things are happening; they all need money.

My final point is about the funding gap and the way that we are trying to address such things. We do not know for certain what the funding gap will be. A figure of £8.8 billion has been calculated by Universities UK, which is similar to that used by many experts in the past. We know that the Bill will not raise £8.8 billion in 2006 or 2009 because it is capped. It will raise a significant amount of money and, through the other mechanisms involving OFFA, a lot of that money will be used to encourage students that university is a good lifestyle choice. There is no problem with that in principle, but the fact that that system of variable tuition fees will not, as we must all acknowledge, meet the funding gap raises the question of what the system is for.

In that context, the inevitable conclusion is that, at some stage, universities in England, Wales and Northern Ireland will have to ask the Treasury for more money, whether directly or through the Barnett formula. The Bill will not provide enough funding to meet universities' current requirements as well as their new obligations to encourage more students from particular backgrounds to attend university. The universities will therefore have to find more direct funding, which will come from tax. Is the Bill, in making students pay directly, simply preferable to facing up to the tax implications of funding university education to the Government's targets through the taxation system?

It is worth putting on record the figures given in the Universities UK report on public expenditure on tertiary education as a percentage of gross domestic product. At the top of the list is Finland with 1.7 per cent. of public expenditure going to tertiary education. The UK is No. 26 on the list with 0.7 per cent., lagging behind Mexico, Slovakia, Ireland, New Zealand, Greece and Turkey, which are all countries with varied educational achievements and investment.

The final nail in the coffin of the Bill should be that it does not deliver the necessary funding. Betrayal might be too strong a word, but the Bill will lead to false hopes in the university sector and certainly among young people. Realistically, young people will not feel able to access the funds needed to support them at university, and universities will not be confident of having enough money to invest in the programmes that we want them to.

The final cruel aspect of the Bill, which we have not even mentioned in the past day and a half of debate, is the particular effect that the method of funding and type of market could have on some universities. Let us forget about the students for a moment and consider the universities as institutions. How will some universities face up to the needs of dealing with the tuition fee system and its implications? Could that

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create a two-tier system? Could it exacerbate existing trends, whereby some universities have lots of money and facilities for research while others are, de facto, little more than teaching institutions and more like old polytechnics?

How will those circumstances and the funding gap that will remain help the poorer universities—there are poorer universities as well as poorer students—to address their funding needs and move on? How do these measures link to the proposals being made, which are opposed by the Association of University Teachers, on the new way of teaching for academic and related staff? Should all this make us concerned about the possibility of having a higher education system that not only fails to be inclusive—a system that we have not given sufficient resources to be inclusive—but, over time, develops into a two-tier system? We have seen that with markets generally in secondary education and particularly in the health service.

Those are the reasons behind my concerns. This is why the amendment is so important and why it goes to the heart of the Bill. This is why we have spent so long discussing it—the other amendments are not somehow irrelevant, but everything flows from this one. We will talk shortly about devolution, for example, but until we sort out this issue at UK or England and Wales level, there is little point in talking about devolution. That is the core of the issue; it is part of the vision. With all respect to Labour Members who made impassioned and well-thought-out arguments for the poor people in their communities, somehow I remain unconvinced that their enthusiasm and the principles that I subscribe to are reflected in the Bill.

4.30 pm

Finally, what happens after 2009–10? Let us say that the principle of variability and variable tuition fees are introduced—and the fees capped, for obvious political reasons. Governments do that; this is not a criticism, but an explanation. What happens after that? The pressures in certain areas of the higher education sector are too great. The argument is led by the Russell group, but other institutions are involved. The pressures are much too strong to allow me to be confident, with the social conscience that I want to have in politics, that such a market can be properly regulated and controlled by the House, so I do not want even to step on that path.

Perhaps things will be okay for the next three or four years, but I see dangers down the line and I do not want even to start that journey. That is why I hope that the hon. Member for Cambridge will press her amendment to a vote. I also hope that the House as a whole gets an opportunity to vote just on this central principle.

The Government, by saying that they have no plan B and that this is the only thing on offer, are putting every part of their vision for higher education behind variable fees. That is a mistake, but I also have major concerns about where it will lead us. Therefore, although I share many of the objectives of the Bill

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and Labour Members in particular, I think that we would be wrong to maintain this aspect of it. I still hope that Labour Members, who have had a lot of influence so far, can wield a bit more on the Bill.

 

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Prepared 26 February 2004