Select Committee on Education and Skills Minutes of Evidence

Examination of Witness (Questions 165-179)

7 JULY 2004


  Q165 Chairman: Secretary of State, as we allow people to settle down, can I welcome you and say that I feel doubly privileged to have been asking questions of the Prime Minister this time yesterday morning and you this morning; but I think you have got a larger attendance than the Prime Minister!

  Mr Clarke: I do not know why that should be. Probably the chairing of the meeting!

  Q166 Chairman: I think they were limited to passholders because of the security fears. Can I welcome you. Also, a word to the Press. Where were you last week when we did prison education? Not a single one of you; not one journalist. I have never known that ever. I was very upset that there was a lack of interest out there with prison education. It is a very important piece of our work and that is where many of the failures of our system end up. So I wish, when you go back, you would talk to your editors who can decide who comes to where as prison education goes on. Skills you hardly ever come as to well. We are going to do something about trying to make it more interesting. So, that is me doing my school master's bit!

  Mr Clarke: Can I issue a series of complaints about the media as well, Chairman?

  Q167 Chairman: When their mobiles go off I fine them £50, and I have never collected the money! Shall we get down to business. Secretary of State, I normally give you a chance to say a brief word of your own to get us started. Do you wish to do that or do you want to go straight into questions?

  Mr Clarke: Not really. Just to say I appreciate the invitation and thank you for being here. We are covering a wide range of things but just to reinforce, I very much value the relationship with the Select Committee. You have produced a string of reports this year; you have got some more coming out even before we rise, I think, and we take your reports very seriously even if we do not agree with every particular.

  Q168 Chairman: With what?

  Mr Clarke: With every particular.

  Q169 Chairman: Oh, with every particular.

  Mr Clarke: We value the relationship and I welcome this as a further stage.

  Q170 Chairman: Let us get down to business. I promised all sorts of people that I would very quickly mention one thing to you. It is the concern that has been running in the press over the weekend on bogus degrees. A lot of people are very worried, and when you scrape away at this problem it does seems more serious than we at first thought, that people can obtain pretty authentic looking degree diplomas with all the back up paperwork of exams passed, and so on. We do not have a registry of qualifications, and I know that this is a very difficult area. Is the Department aware of this and is it concerned enough to do anything about it?

  Mr Clarke: We are. I am glad you gave me notice, Chairman, that you would like to raise this question. It might be helpful to the Committee if I set out what the legal position is and how we are dealing with it in response to your question, firstly the general background. It is an offence under section 214 to 216 of the Education Reform Act 1988 for a UK body to award a degree unless it is recognised by the Secretary of State to do so. Where a foreign institution operates in the UK it must make it clear that its degrees are not British. Secondly, the Business Names Act 1985 makes it an offence for any business operating in the UK to use in its business name the word "university" unless approval has been granted formally by the Privy Council. There are two main types of bogus operator that can be reported by the Department to Trading Standards under the Education Reform Act. These are so-called bogus institutions that claim to offer UK degrees or degree courses but are not recognised by the UK authorities to do so. Some of these also claim to be universities and use the word "university" in the UK without the appropriate permission to do so. There are also "degree mills", where operators sell what they claim are UK degrees over the Internet, but they are then found to be bogus degrees. The majority of these Internet operators are based overseas, which does make prosecution under UK legislation difficult. We refer cases relating to counterfeit degrees to the Trading Standards Department who liaise with the police. It is a matter for the police to prosecute organisations that offer counterfeit degrees; and section 15 of the Theft Act 1968 makes it an offence to obtain property by deception, and section 16 of the 1968 Act makes it an offence to obtain a pecuniary advantage by deception. We refer all potential breaches of the Education Reform Act 1988 by organisations that are based in the UK and those operating via the Internet to Trading Standards, who have responsibility for enforcement action. We refer all breaches relating to the use of "university" in title to Companies House, who have responsibility for enforcement action under the Business Names Act. It is an offence for any business operator in the UK to use in its business name the word "university", as I have said earlier. It is also an offence to fail to declare ownership details on business stationery. With many unrecognised providers operating over the Internet and registered overseas, students to need to take some responsibility for ensuring they know the status of degrees, and to that end our website ( provides information about recognised degrees and higher education institutions in the UK. It describes the UK higher education system, warns of the problem of unrecognised degrees and directs people to recognise the UK institutions found under the heading "Who can offer you degrees?" on the home page. So that is essentially the position. We get very few examples of complaints from students who have unwittingly enrolled at bogus institutions, and we are working together with the Home Office to produce a list of registered colleges which are "pukka", if I can put it like that. I am sorry, Chairman, to answer at length, but I thought it might be helpful to place on record in front of your Committee what the legal position is; and we do take it very seriously.

  Q171 Chairman: That is useful. Some of us met with the British Council yesterday to discuss that and other issues. Would it not be advisable that you and the British Council—you as a department—work with them to almost put a sort of "kite mark" in to make that more apparent to foreign students intending to come to this country?

  Mr Clarke: That is precisely the reason why we are currently drawing up the list that we are which we intend to publish by the end of this year. In addition, I should say, quite apart from the activities to which you refer which are reported in the papers, there are some bogus institutions which have been set up to facilitate illegal immigration to this country by a variety of means; and so we have worked very closely with the Home Office and the Home Office has raided a number of these places to identify them for what they are, and we have come to the view, precisely as you suggest, Chairman, that with the British Council and the—I should say not just the British Council but also the association, particularly of language schools, ours as was and is now the new organisation, to work together for a proper "kite mark" in the way you suggest so that people cannot be fleeced because they do not have the opportunity of knowing what is really taking place.

  Q172 Valerie Davey: Can I follow that up? I hope that the collaboration extends within the Home Office to the granting of visas so visas are only given for kite marked institutions?

  Mr Clarke: That is precisely correct. When we get the list finally resolved, which we are working on at the moment and, as I say, will be finally resolved later this year, then the position of the Home Office will be precisely as you suggest, Ms Davey, that visas will only be granted to students going to those recognised institutions; and that is the path that we are now following to try and clear up what has otherwise been significant abuse.

  Q173 Chairman: Thank you for that, Secretary of State. We have that concern. One of our inquiries is looking at the market for our university institutions overseas. We have recently had a couple of evidence sessions on that from HEFCE and from the British Council. It is such a valuable, can I call it, industry which rests very much on the quality of the provision for higher education. It would be serious if it was undermined.

  Mr Clarke: I completely agree. Perhaps I could mention to the Committee, Chairman, that we are trying to give a higher profile to the international work that we do in the education field, both through our work with DFID but also with the DTI and the Foreign Office, and we are hoping to publish a policy document later this year to coincide with International Education Week in November setting out—putting the "world" in "world-class education"—how we can develop this much more positively in a variety of different ways.

  Q174 Chairman: Are you using higher education income to balance the fact that . . . If you look at all the education spending in your Department, everything is rising quite robustly right across the piece until we get to HE, which is a little bit of an increase, but not much. When we started the whole debate about higher education and finance we talked about, certainly the Universities UK talked about, an £8 billion gap, and in the discussion over top-up fees we had a figure between £1.5 billion to £2 billion that would come through that source. Still leaving £6/£6.5 billion, according to Universities UK. Are you putting all your eggs in the overseas student market?

  Mr Clarke: Not at all. I think if you went and talked to the universities, both the UK and the universities individually, they would acknowledge first that the funding stream has started to go up on a per student basis, albeit slowly, for the first time for decades and is beginning to go up; secondly, the additional income stream that we have suggested through the fee regime, which has now got royal assent, I am going to say; and, thirdly the research increases which we have identified, and I think a paper produced by the Treasury and our Department to be published shortly on science will indicate a continued very strong financial commitment in that area. All are sources of income for universities which, I think, will put them in a better position than they have been for a very long time. I do not accept the description that you give of HE spending being static while the rest of education is moving forward. I do accept the point that you make that we have given a greater priority to primary and secondary education. So it is in a relatively worse position than schools, but I do not think it is as bad as you suggest.

  Q175 Chairman: But, Secretary of State, I have got the fees in front of me, 1998 through to 2003, 2004 and the change over that period: schools plus 41.9%; under fives plus 17.8%; primary plus 34.2; secondary plus 34.5; other plus 74.2; school capital, nearly a 100% increase; further education and adult (John Brennan will be very pleased with this) 53.2%; higher education 11.3. So it is pretty stark compared to those figures, is it not?

  Mr Clarke: It is true that at the beginning of the Government, from 1997 onwards, we specifically did give priority to primary and secondary education, and that was an explicit act of policy because we felt as a government that that was where the priority needed to be; but I think in the second Comprehensive Spending Review 2002 settlement we gave a significant extra commitment to higher education which had not been possible earlier on, and, for the reasons that I said, we are committing now in the way that we are, but I make no . . . It was almost . . . I know you are a non-party in the role that you play, Chairman, it was almost a party political, the list of significant increases in expenditure through the course of this Government are in all aspects of education, which indicates how we have been able to invest in the ways that we have; and the fact that is, we do give priority to schools, and I defend that without any qualification, but we are now able to spread that progress throughout the system in the ways that I have described.

  Q176 Chairman: Thank you for that. Can I ask one further question about that? Everyone is talking about the demographic change of our country; that we are having much less population in the primary and junior schools; the demographic curve is changing; we are going to have an excess of teachers in the primary sector and that is going to move through the system. As that moves through the system are you going to be able to, and will you want to, shift resources from that end of the spectrum through to higher education and further education where the bulge is still moving through? Is that part of the plan?

  Mr Clarke: It is an entirely correct question, and I will confess to you, Chairman, in the confidence of this room, that the biggest difficulty we have with our CSR settlement, which is generally a good settlement which the Chancellor announced in the budget, is making sure we can properly resource the expansion which will come, for two reasons, in the post-16 sector, particularly in FE. The first is the demographic pressure that you indicate and, secondly, the fact that we are increasingly successful in our policies and more people are staying on at 16. So you have a double pressure coming in on the resource in those areas, and, as it were, the penalty of success in those areas is that we are under greater financial pressure, and that is what we have been wrestling with. At the bottom end of the demographic pressure we are continuing with the position of saying that we are not prepared to fund schools above their roll now that the falling school roll is a real factor in the situation, and that does give pressures in a number of junior schools and primary schools in the country, particularly in certain areas. In that sense we are rolling forward the money. The money follows the change in the age group. I do not think it specifically is an issue for HE so much; though as we succeed in moving an expansion of the number of people who go into HE, then the resource issue will follow, but I think in both post 16 generally and HE in particular it is entirely possible to foresee resources coming in from other areas in the ways that we want to see. If you see some of the new foundation degrees which are being established, for example, there is a significant contribution from the relevant employers in that area, and we are hoping, of course, with our modern apprenticeships and the rest of it, to get significant employer contribution.

  Q177 Chairman: There seem to be two opportunities that have been presented to this Committee. One is that as this demographic change takes place you can use the large number of primary school teachers that will be trained and find it more difficult to get a job, and are already finding that, but you could also use that in terms of the Early Years where there is a dearth of highly trained, especially teacher-trained, personnel in that Early Years situation. Is there any ambition to do anything in that area?

  Mr Clarke: Absolutely. You are entirely correct. Without revealing significant details of our proposals, we have already announced the commitment towards extended schools which does bring together children's services in a wide variety of different ways and extends the capacity of the school to offer services to the local community in a wider range, but also we have announced the significant expansion in what we are doing for under fives, and we will continue to do that; and, as you correctly imply, both in terms of the physical building in the case of primary schools with less numbers of pupils and in the case of the staff, not just teachers but non-teaching staff as well, there is a potential there for ensuring that our whole under-five offer is improved in a very significant way, which is a major priority of the Government. So in answer to the dilemma which you indicate, my own belief is that as you get falling rolls at the bottom end of the age range that resource would get switched to under-fives and to the extended school function in that area rather than teachers, as it were, being redeployed into FEs, what I expect to be the main thrust of what happens.

  Q178 Chairman: You have just said that this is an all party Committee, and it is, and our job is to look at the way in which tax-payers' money is spent in a way that gives value for money. That is one of our central missions. When we look at expenditure on education, many of us every time we see an increase in expenditure throw our hats in the air and say, "Hurrah. That is really rather good. That means better achievement of people", and so on. The Treasury certainly boasts, and has boasted fairly recently, that greater expenditure leads to higher achievement in education, but the figures do not really bear that out very well, do they? If you look at the run of figures over the last decade, there are periods in which low levels, relatively low levels of expenditure on education produce very good results, whereas periods of high intensive expanding education expenditure do not achieve very much better?

  Mr Clarke: My view is that higher spending and higher investment is a necessary but not a sufficient condition for education improvement and performance. It is a necessary condition because the number of teachers, non-teaching staff working in a particular school or college is a significant factor. Training of teachers, continued professional development, which costs money, is a significant factor, so that teachers improve, and basics like the facilities that are in a school, the ICT that is available and so on, can reinforce performance, but it is not a sufficient condition because it is entirely possible to have all that but for it not to be focused properly on improving educational standards in the way that we all want to see, and any survey of different schools throughout the country will show that there are schools with similar social issues—free school meals, for example, or resources being broadly similar—which are achieving dramatically different results for their children, and that is why we have to focus on a reform agenda which tries to raise that performance and carry it through. I am not one of those who believes you simply pump in more money and that solves the problem—I do not think it does—but I do think you need more money for many of the things which obviously we see around.

  Q179 Chairman: But it is quite surprising, when you look from 1990-91 to 1994-95 and we look at the five GSE grades A to C, the improvement was plus 6.7 in that period. The increase in real terms was 11.4%. So you get an 11.4% increase in expenditure, a 6.7 increase in improvement in grades. Then you move to what I think is the most interesting middle period, 1994-95, and you see only a 3.4% increase in current expenditure in real terms, but you get a plus 4.4 increase in grades A to C. That is the central conundrum. Then the latest, 1988-89 to 2002-03, you get a 5% increase—not much more than the previous period—a 5% increase in grades at A to C, with a 31.6 increase in expenditure. How do you explain that middle band?

  Mr Clarke: I am noting down the figures as you go, but, simply by reference to what I said earlier, I do not think there is a direct linear relationship between expenditure and performance. I simply do not think that is the case. If you take the different faces that you are describing and the description you have just given, the first phase you are talking about, I would argue, was a period when there was a significantly demoralised education in the world which existed, which did not feel motivated and positive about what it was trying to achieve, whatever resource went in. I think the period after Labour was elected in 1997 led to an increase in morale, but also an increase in concern. We were making many changes which gave rise to concerns in some people, and I think we have now moved to a situation of steady progress and stabilisation which I think is delivering the kind of results you are describing.

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