UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 520-ii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

EDUCATION AND SKILLS COMMITTEE

 

 

Higher Education Issues

 

 

Wednesday 26 October 2005

PROFESSOR DRUMMOND BONE and BARONESS WARWICK OF UNDERCLIFFE

Evidence heard in Public Questions 99 - 171

 

 

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Oral Evidence

Taken before the Education and Skills Committee

on Wednesday 26 October 2005

Members present

Dr Roberta Blackman-Woods

Mr David Chaytor

Mrs Nadine Dorries

Jeff Ennis

Tim Farron

Helen Jones

Mr Gordon Marsden

Stephen Williams

Mr Rob Wilson

 

In the absence of the Chairman, Helen Jones was called to the Chair

________________

Witnesses: Professor Drummond Bone, President, and Baroness Warwick of Undercliffe, a Member of the House of Lords, Chief Executive, Universities UK, examined.

Q99 Helen Jones: Good morning, everyone, welcome to this morning's Committee hearing. My name is Helen Jones, I am chairing today in the absence of our Chairman, Barry Sheerman, who sends his apologies for his unavoidable absence. He is not absent very often, but I am afraid today it was not possible for him to be here. Can I, first of all, welcome our witnesses this morning, Professor Drummond Bone and Lady Warwick? We do have a number of questions for you this morning but I wondered if either of you wanted to make a brief statement about how you see the sector at the moment. Is there anything in particular you want to draw to the Committee's attention before we begin?

Professor Bone: Thank you very much, Chair. As it is my first time here I thought it might be worthwhile summarising just one or two things that we have on our mind, at the moment. Firstly, as I said when I first addressed UUK, we are very concerned that we move through the next few years, after a lot of change, into a period of relative stability, both in terms of policy and in terms of funding, if that is at all possible. When we look, certainly, to the next year, which is obviously important for the sector, we do hope that we will be able to preserve that crucial unit of resource for teaching and, therefore, preserve the additionality that will be brought by fees. There are also, I think, one or two research issues which we are quite keen to follow, particularly in the European context, where the introduction of FEC will change the research environment in the UK quite considerably. We are much in favour of that as a long-term way to provide stability, but there will be certain transient issues in Europe where, obviously, European providers are not functioning on an FEC basis and where we might be at a disadvantage. In financial terms, too, there is also the question of fully funding the recent modernisation of the pay structure, which again will take quite a chunk out of the extra money that we hope to receive from fees. Then, I suppose, last but not least, there is the issue of our international competitiveness in terms of students as well as research. These are just one or two of the issues that are in my mind at the moment, and they are probably in yours as well.

Q100 Helen Jones: I think they might be. Thank you. Lady Warwick?

Baroness Warwick of Undercliffe: I think I am happy to just answer questions.

Helen Jones: Thank you very much. You have highlighted there, Professor, a number of issues which I think the Committee will want to follow up. We want to start by looking at fees and funding.

Q101 Dr Blackman-Woods: As you will both be aware, the justification for top-up fees was that it was going to bring additional funding into the HE sector. Is there a guarantee, do you think, that the fee income is not going to be clawed back, particularly after 2007/08?

Professor Bone: We have been told that there will not be any reneging of the promise to maintain the unit of resource up until then but we have not actually been given any promises beyond then. Certainly, it is one of the things that we will be underlining in our submission to CSI (?). It is very important. It would be, I think, quite ridiculous, in a way, to give money through one route and then take it away with the other, but on the other hand we realise, also, that CSI is going to be very tight.

Baroness Warwick of Undercliffe: I think the important thing, though, is that this will produce additional resources for the sector to improve the student experience as well as the other things that Professor Bone has referred to. Therefore, it is an enormously valuable additional funding stream. Yes, perhaps to reinforce the point, we will certainly be trying to ensure that it is additional money, otherwise there really is not any point in seeking to expand numbers or even to expect more of the sectors; clearly, everybody does expect more of the sector.

Q102 Dr Blackman-Woods: Are you gathering evidence about how important a contribution variable fees are making to the sector and will you continue to do that?

Professor Bone: It is very, very important, I think. This will not be true of all institutions in the sector but of a fair number, but roughly one-third of the income will be going straight back to students in terms of bursaries, one-third of it, broadly, will be taken up again by the modernisation of the pay agenda, and that is probably already spent, which is something we have to underline - that we have taken on that commitment in advance of the fees actually appearing - and one-third of it, again in very round figures, is probably going on infrastructure, and that is not new infrastructure that is delayed maintenance of infrastructure and actually keeping us standing still. So the idea that there is a sort of windfall coming is simply not right.

Baroness Warwick of Undercliffe: I think it would be enormously helpful to have an assurance - if this Committee is minded to look at this - that there will be a continued commitment to ensuring that the unit of funding is maintained. I think that will give the kind of long-term planning perspective that higher education institutions obviously need.

Q103 Dr Blackman-Woods: One additional question: one big difference between universities and universities in America is the amount of money that they raise from endowments. Do you think that we should be going down the American model and trying to get more endowments, and do you think it is possible?

Professor Bone: I do not think we should be going down the American model lock, stock and barrel (I think there are difficulties with the American model) but I do think we should be trying to raise more in terms of endowments. That is a different issue. I think, again, most universities probably are now ramping up their endowment-raising capability, if I can put it that way. We have to realise that is a long-term business and it also depends on the fundraising and philanthropic context in the nation as a whole.

Baroness Warwick of Undercliffe: We have got a very practical project at the moment, with support from the Department for Education and Skills, to try to ensure that we, if you like, raise our game in this area. We are investing new resource in infrastructure to provide the help in fundraising, in alumni development and in managing the process. There is a lot of skill in fundraising; it is not easy and lots of charitable organisations (of course, universities are charitable organisations) put an enormous amount into the underpinning of their fundraising, and I think that is what we have to have. We recognise it as a key area for further expansion; we do not expect - indeed, in the States it is not a huge proportion of their income - but, nonetheless, it could be improved in this country and we need to make ourselves more professional in doing that.

Helen Jones: Thank you for that. We will be expecting letters from you.

Q104 Mr Wilson: I would like to turn to bursaries, if I may. Do you think that competition amongst the universities will be increased by the level of bursaries that they give?

Professor Bone: Yes, I think it probably will. I do not see there being much evidence in advance, if I can put it that way, of discounting of the actual fees. I do not think that is the way it is going to go, but there might be competition in terms of actually offering bursaries. In some ways I think that is helpful.

Q105 Mr Wilson: Do you think there is going to be a temptation for some institutions to cream off the better students to raise their standards and reputation?

Professor Bone: Again, I do not think I would like to use the word "cream off" but every university is very keen to get the best students. What represents the best students, I think, varies from institution to institution, as well. I think it is a question of institutions getting appropriate students for that particular kind of institution. That may mean, in some cases, particularly high academic standards, and in other cases it might mean the universities with a particular commitment to a kind of community - a local community, perhaps, or a regional community or some other community - which feeds the particular subject areas they are interested in. There is bound to be competition but it is a very segmented market.

Q106 Mr Wilson: How would you respond, then, to the KPMG survey which shows that one-in-four institutions would top-up the amount students receive depending on their A level results? The better the A level results the more bursary they get?

Professor Bone: Again, I would have to know more about the detail of the survey. Obviously, lots of universities at the moment offer scholarships for academic excellence. Some of the bursaries that the universities have introduced are academic related, but there is nothing new in that. However, I think the majority, by far, of the bursaries that have been introduced are not academic related, they are genuine bursaries. We have tried to clarify this by talking about scholarships on the one hand and bursaries on the other, but not everybody uses the same terminology.

Q107 Mr Wilson: Do bursaries not change the whole basis on which fees were introduced recently - ie, the more an individual benefits from their education the more they should pay? Do bursaries not fundamentally change all that?

Professor Bone: No, I do not think so. Most of the bursaries that I know about that universities are offering are actually being offered to people who are in receipt of maintenance grants and, therefore, in some sense or another financially managed.

Q108 Helen Jones: Do you think the current situation is far too complicated for students to understand? Maybe Lady Warwick will want to come in on this. We have a whole plethora now of different bursaries and different scholarships. Do you think people out there who are applying to university are really in a position to understand the system and work out what financial support they are going to get and what their prospects will be?

Professor Bone: I think there is a real issue there, and perhaps Lady Warwick will take that up.

Baroness Warwick of Undercliffe: It is very complicated and I think part of the responsibility must lie with institutions to try to ensure that we explain what is on offer better and as well as we can through prospectuses and through all the outreach work that we are doing. We have said right from the start that this was going to be a very complicated package, and we were very concerned - because for many people this is actually a beneficial package, it is an improvement on what they were going to get before or might have got before - that the Government would, if you like, promote this new package rather more than, at least initially, it did. Now, I think, the Government has put a lot of effort and weight behind it, the Minister for Higher Education has put an enormous amount of energy and enthusiasm into promoting the new bursary scheme, the whole fees structure, and I think there is no doubt (they are doing quite a lot of marketing analysis) that the message is getting across, but it has been a cause for concern because both the fees system itself, or the contribution to fees and the bursaries, the maintenance grants which are available and the bursaries, do produce quite a complicated package. We have now got what we have called a one-stop shop, a website where students or potential students can get access to not only explanations of the current system but, also, they have access through links to every institution's information about its own practices and processes. So, hopefully, we are on the way to providing much better explanations.

Q109 Helen Jones: That is very interesting but I think the Committee would be interested in what evidence there is that that is getting through. Certainly the experience that most of us have in our constituencies is that students do not understand the current system and are not aware of the support that is being offered them. There has been a £1.6 million public information programme. Where has that gone? Who designed it? How do we know that it is getting through to potential students?

Baroness Warwick of Undercliffe: It has been designed and the money has been produced by the Department for Education and Skills, so I think in detail it would be helpful, possibly, to ask them that question. What I think they have sought to do is to target those places, like television programmes, where the age group of young students potentially coming into university are likely to watch those programmes.

Q110 Helen Jones: We are not talking just about young students, the student profile is changing.

Baroness Warwick of Undercliffe: Indeed. In fact, the largest increase has been in the number of those who are mature students applying. I think getting the information out through UCAS has been enormously helpful in that respect, or will be. I think trying to ensure that a complicated package like this is made very much more widely known publicly is quite difficult because there is a whole range of audiences that you are trying to hit. Nonetheless, I think, from the university perspective, we have done an enormous amount to make sure that the information that individual universities put out about their packages and the access that is available through UCAS and through the website should be, I think, much clearer than it was a few months ago.

Professor Bone: I agree there is a problem here - there are no two ways about that. UUK, obviously, now has its website, and we have been pressurising, I think, the Department for sometime to get this media campaign up and running. We are also running workshops with personal finance journalists and we are running workshops with career advisers in schools, and so on and so forth. Most universities now have financial advice booklets which are not just about themselves but give general financial advice. We thought at my university we were being very good for doing that but we then discovered that absolutely everybody is doing it, but I think that is a very good thing. The question of evaluation of how that is going is something, I think, which individual universities will feed into UUK. From our point of view, I understand the Department will have its own evaluation system.

Q111 Helen Jones: Do you think the current situation is fair either to students or to universities? If you are a poor student and you get into Oxford, shall we say, you might get a very good financial package; if you are a poor student going into one of the universities which has a lot more students coming from deprived backgrounds, you will not get the same financial package. Is that fair either to the students or to the universities, where those who are taking in more of the students from non-traditional backgrounds have to pay out more in bursaries? What are the implications of that for the sector as a whole?

Professor Bone: Obviously, the current system is dependent on the financial help of an institution, and that is the case. One of the major targets of the DfES seems to have been to widen access to institutions which were not traditionally open to those from a disadvantaged background or traditionally open to those who are first-time applicants to university. In that sense, giving larger financial incentives to these people from the more traditional institutions is probably a good thing, but it is certainly not equitable. One takes that point.

Baroness Warwick of Undercliffe: I think it is worth saying that the package that is available to the poorer students is now a great improvement on what was available before, but there is no doubt that, as before, those institutions that, for example, have raised more in endowments or have additional resources over and above the money provided through the funding councils and other sources do have more money available to pay higher bursaries. I do not think that is anything new, it is just that it is highlighted now because all institutions are now involved in paying a lot more bursaries, but I think it is right to say they will be able to afford to pay more, yes.

Q112 Tim Farron: You made my point for me, partly, Chairman: the gap between the richest and the poorest universities is significant. Just pulling out of the air Middlesex University, that has a turnover of £120 million with 22,000 students; Cambridge has a turnover of £650 million and 17,000 students. The widening participation profile of Middlesex University would be vastly different to the one at Cambridge, and all points in between on the scale. So, as the Chairman has already mentioned, the bursaries are going to be focused upon those institutions which have the worst widening participation profiles. Sir Howard Newby accepted when he came to this Committee the other week that that would have a damaging impact on the attempts to try and funnel money towards those students. I wonder whether UUK should not be supporting a national bursary system rather than a variable institution-by-institution bursary system.

Professor Bone: Again, it does depend, to some extent, on what the policy is intended to produce. If the policy is intended to produce a swing from non-traditional applicants to Middlesex, let us say (just to take your example), to going to Oxford or Cambridge, then arguably what is in place will do that. It does not provide equitable funding across the whole spectrum of institutions, and the notion of a national bursary scheme is something which it might be worth looking at, but it is simply not on the menu at the moment.

Baroness Warwick of Undercliffe: Also, I think, if one is talking about a national bursary scheme, one is not talking about, for example, the higher bursaries that are available. I think we need to be quite careful about not suggesting that those institutions that can afford and wish to provide higher bursaries for students with poorer backgrounds should be prevented from doing so. I think that would be a poor outcome of a change in policy.

Q113 Tim Farron: I take the point but I think it does fly in the face of the evidence of how you reach students from difficult-to-reach backgrounds. In Cumbria, for example, where I am an MP, the reality is that there are cultural issues about how you get to apply for higher education in the first place; you are not going to get people to apply to universities more than 50 miles away at all, and that is a growing feature. So concentrating bursaries on a handful of wealthy universities with this kind of idea that that is going to somehow open the doors of those universities to the less well-off, I think, is a pipedream. We need to be concentrating on widening participation in reality rather than in theory.

Professor Bone: I have got some sympathy with that. It goes back to my response to Rob Wilson earlier on. I think there are appropriate institutions, not necessarily better institutions, and I understand what you are saying.

Baroness Warwick of Undercliffe: I just think that is not a policy issue really directed at the universities per se, I suspect. Congratulations on the prospect of a university actually in Cumbria, because I think you are absolutely right to highlight the fact that a large number of students - and it is a growing number of students in those who are mature - are, if you like, unable to move out of their localities who require greater opportunities for higher education, and we are certainly delighted that in Cumbria that new opportunity will be available, as indeed in one or two other places as well. I think it is important for us to ensure that we are playing our part as institutions in enabling those who are limited to local access to learning have access to higher education experience of high quality.

Q114 Mrs Dorries: I would like to bring it down to the day-to-day survival level of the actual students. I am not sure if the talk of bursaries and fees and what-have-you actually relates to the fact that we have such a high drop-out rate during, or at the end of, the first year. I would like to talk about Newcastle, which is a city of high unemployment, therefore making it almost impossible for students who arrive there to find work and jobs. The day-to-day cost of their living - for example, their cost of halls of residence which is supposed to include food but actually includes four meals a week (it does not include weekends) and the cost of just doing things like their washing and their ironing and day-to-day existence - some of these students are finding so difficult that they drop out of university because it is impossible financially to carry on. With all the will in the world, talk about bursaries and the wider participation has to apply here because in other universities, such as - as has been mentioned - Oxford and Cambridge, the bursary scheme covers all these costs for students. It brings me back to the question of wider participation but I am not sure enough account is taken of how expensive it is for a student to live and survive with the funding that is available on a day-to-day basis. Is that not the reason why the drop-out rates are as they are?

Professor Bone: I think universities are individually very, very conscious of that fact. It is one of the things which hits us and hits our welfare offices every single day. Obviously, all the universities are trying to maintain as many students in the system as they possibly can for community reasons but, also, for selfish reasons - if I can put it that way. So I think it is something that is very much part of the day-to-day experience of trying to run the university. The catch-all in this is finding the funding to actually give the necessary support. One of the conundrums which the Government faces is the fact that the proportion of education spend on student support in the UK is very, very high, if you actually look at our OECD competitors, and yet still, quite obviously, as you exactly say, students have great difficulty in actually financing their way through university. I think there is a great obligation on universities to provide particular support in that first year because it is often that first year where it is not only financial pressure but financial pressure contributes to the unease of a radically new experience, whether it is somebody moving back in from work into student life or moving from school into student life. I think we have got a responsibility, but there is also a serious funding issue.

Baroness Warwick of Undercliffe: I do not think we should fall into the trap of thinking that where there is a high drop-out rate the main cause is financial, because the evidence suggests that is not the case; it is a contributor, certainly, but the main reason for most students to drop out is course-related; it is to do with the way in which they have related to that particular course. It is not that finance is not important but I do not think it is the main cause, because that is what studies have shown. That is not to suggest, however, that students would not like to have more money - of course they would - but I think the new grant system means that they have now got a maintenance grant which they can access up front and which enables to at least plan for their expenditure. I guess it does not mean that students are not going to borrow, but nonetheless I think it is very advantageous - both maintenance grant and loan arrangements - at a considerable cost to the Treasury. We have got the lowest drop-out rate (and I think Sir Howard Newby made this point as well) of OECD countries, so it is relative.

Mrs Dorries: It may be the lowest rate but it is still high. I think you slightly trivialise how absolutely difficult it is to students to live on a day-to-day basis. Of course, they would like more money - we would all like more money - but the issue for students is that they have their loan offers and they borrow to the nth degree to live on a day-to-day basis. Nine months into the year, what are you going to cite as your reason for having to drop out? That you cannot manage financially? That your family cannot support you financially? No, you are going to say you have chosen the wrong course. That may be the reason why they drop out but I think financial pressure is by far the main reason.

Helen Jones: We are going to move on to part-time students now. Can I remind Committee we are supposed to ask questions and not make statements.

Q115 Jeff Ennis: The Government recently announced an enhanced package of support for part-time students. Have these measures gone far enough or could we have been a little bit bolder, shall we say?

Professor Bone: They could have been a little bit bolder, but I am going to ask Lady Warwick to elaborate.

Baroness Warwick of Undercliffe: There is no doubt that this is a step in the right direction. I think it is providing the greater equity of treatment as between part-time and full-time students that we have been pressing for, although we were not pressing necessarily for equal treatment. Once you start unpacking the issue of part-time students it becomes quite complicated. We do not really know what the background of our part-time students is; we know a lot more about our full-time students than we do about our part-time students. For that reason we decided in UUK to undertake a study looking (of course we know the numbers of part-time students) at the numbers who are supported by their employers, their background, the financial arrangements that they make and so on. They are different kinds of students. The initial outcomes of our survey has suggested that they are rather different in terms of cohort, in terms of gender, in terms of ethnicity, in terms of whether they are home-based or willing to study away from home. I think it is quite a complicated area, but the new package is a step in the right direction, although clearly it would be enormously helpful if it could be improved. I know that the funding council is looking at ways of seeking to provide additional support to that provided by the Government.

Q116 Jeff Ennis: I take your point that they are a different cohort, as it were. Last week, Sir Howard Newby argued that we will not achieve flexible learning and a widening of access to HE until the distinction between part-time and full-time students has ended. So, what is the difference between his philosophy and your philosophy?

Baroness Warwick of Undercliffe: I think the problem is that what one does not want to do is use public money to subsidise employers. At the moment, a substantial proportion - not a majority - of part-time students are funded by their employers, and we certainly do not want to stop that. Finding ways of ensuring that you can target the support provided for part-time students, I think, is the problem. The way in which the Government is proposing to do it, I think, is a very practical one, in that the Access to Learning fund is already administered by universities, so already they know what their local - and it tends to be local or relatively local - part-time market is. So I think it is a scheme that can be very efficiently run.

Professor Bone: If I may be so bold as to try and interpret what Sir Howard may have said, I think the key thing is that we have to learn (and this applies to universities and to government alike, I think) to see part-time students as on the same playing field of importance, if I can put it that way, as full-time students. I think there is an awful tendency, perhaps for everybody, to still think of the traditional full-time student rather than (a) the lifelong learning student and (b), in particular, the part-time student. We have no argument with that at all; I think it is important for everybody to get that plea in. Then, however, as Lady Warwick has said, you have to deal with market-specific problems.

Q117 Jeff Ennis: One of the main measures that were not taken last week by Bill Rammell was to actually defer the fees of part-time students. Should that have been in the package?

Professor Bone: My view is that it was important to get some improvement in place quickly. There is this major study which UUK is actually undertaking at the moment and which will be ready by the end of the year, and what I hope we will do is return to this issue once the results of that study are out and we can produce proper, evidence-based policy. I do think it was important to do something quickly.

Q118 Jeff Ennis: I accept what you say about what Sir Howard said last week and the interpretation that you put on it, Professor Bone, but does it not still send out a message that part-time students are second-class citizens, to some extent, having a different deferral system?

Professor Bone: I think anything which sends out that message is the wrong thing but I do think we should base what we are going to do on real evidence rather than on licking our fingers. On the other hand, having got into the position we were in something had to happen, I think, quickly.

Baroness Warwick of Undercliffe: In answer to your specific question about deferred fees, deferred fees have obviously been a great advantage in terms of full-time students. One suspects that they could give the same advantage to part-time students. We have to take into account the complications that we have already mentioned, but I suspect that the main problem that has prevented that policy choice was cost. However, that is not to say that it might not be the best policy outcome.

Q119 Mr Marsden: I wonder if I can take you both to some of the practical consequences that flow from the announcement over the improved package, which as you have already said you welcome? I suppose people might think that there is a danger, with the perception of all this extra money flowing in, although the sums are relatively modest, that universities might feel, particularly those that have felt financially pressed: "Oh well, we can ratchet up some of our fees to part-time students". Do you think that is a danger, and if it is how can it be avoided?

Professor Bone: I think it is a danger but it is not likely. I think one of the arguments that we have heard a lot in UUK from those universities most affected by the part-time situation is simply that they could not raise their fees; that if they raise their fees that would discourage people from coming, and that was one of the reasons why they were pressing so urgently for the change. Obviously, in a sense, it is a danger, but I do not think it is likely, Lady Warwick, do you?

Baroness Warwick of Undercliffe: I doubt that fees will be raised dramatically, although I think the intention is that by providing the support there will be scope for institutions to raise fees in those areas where in terms of the market they believe that they can afford to raise those fees. I think it is important to remember that part-time fees have always been unregulated, so it has been a matter for institutions to judge their marketplace and determine how they will recruit and into what subjects, and so on. I think what this might do is provide institutions where they know they have demand ----

Professor Bone: It could be company-sponsored courses.

Baroness Warwick of Undercliffe: It could be company-sponsored courses where they can make a judgment. Universities have got quite good at judging their marketplace where there is a marketplace, and in this area there is a marketplace. I would not expect at all to see a major hike across the board.

Q120 Mr Marsden: That is helpful. You mentioned, professor Bone, those universities with large numbers of part-time students and, of course, that includes not just the Open University and Birkbeck but, obviously, a large number of the post-1992 universities. Are you concerned (because we have talked about the Government not moving on deferral of part-time fees) that universities in those categories are still going to face financial difficulties because of the difference in the fee regimes between part-time and full-time students?

Professor Bone: Yes, I am concerned but I am not in a state of panic, if I can put it that way. Clearly, there will be some universities which this affects significantly, and obviously, as I have already said in answer to Jeff Ennis, it would be better if we had a more fully-thought-out support package, both for students and for the institutions. I think the institutional support here is very, very important; it is not just the support for the students too. If you are asking me is this going to plunge some institutions into serious financial difficulties, then not that I know of but perhaps that question would be better directed at Sir Howard.

Q121 Mr Marsden: I was going to say that a lot will depend - we heard about it last week - on the way in which HFCE decides some of these institutional arrangements in the next couple of weeks.

Professor Bone: Yes, the consultation on financing will be interesting.

Baroness Warwick of Undercliffe: There are something like 19 institutions, I think, that have more than 50 per cent part-time students. Most of them are adept at managing both the income that comes in through the part-time route and the income that comes through the full-time route, so I do not expect a major perturbation. Part of the problem, of course, is their concern that they are not able to raise as much additional money as those institutions where they have the fee income coming from almost 100 per cent of full-time students. I think that is possibly the area of concern, but I do not expect that to lead to greater financial difficulty in managing their institutions.

Professor Bone: What it does play back into is the affordability of bursaries issue. It exacerbates that problem.

Q122 Mr Marsden: When Sir Howard Newby came before us last week he admitted that possibly HFCE - leaving aside the issue of part-time students - had not paid enough attention to the issue of the growing numbers of HE students who actually have their courses done by further education institutions. Is this something that Universities UK would want to put their hand up on, or have you begun to address that issue as well?

Baroness Warwick of Undercliffe: It is something that we have encouraged. Do you mean he expressed concern that the funding was not right? What was the issue of concern?

Q123 Mr Marsden: He said, in general terms, in terms of their planning and funding and in terms of everything else, that perhaps they had not taken into account in the past the number of HE students having their coursework done via FE. My question to you, on the back of that, is whether Universities UK have taken sufficient account (in the policy which the university is offering) of the need for co-operation with the FE sector, given that there is a larger number than ever of students who are doing their HE courses via it?

Baroness Warwick of Undercliffe: I think we have got very positive co-operation with the further education sector. We work, as Universities UK work, closely with the Association of Colleges; individual universities, which is where I think it is most important, have either franchise arrangements or partnership arrangements with their FE colleges. I cannot put my hand on my heart and say everything in relation to those partnerships is absolutely rosy, but certainly, I think, the links between those HE institutions and FE institutions with those kinds of partnerships seem to be working very well. The foundation degree programme, which has grown very substantially, is largely being delivered in FE colleges with the support of HE, and there is clearly (I do not want to sound at all complacent) a lot more to do, but for those institutions who have good links with FE colleges they often exist in a symbiotic relationship because they rely through transfer for many of their entrants from the FE college. So it is very much in their interests to work closely with them.

Q124 Mr Marsden: Have you commissioned any research or are you looking at projections for the future as to how many more students are going to have HE delivered by FE? Is that going to affect what you have just said?

Professor Bone: It is under discussion at UUK, I can reassure you, but I do not think we have any research specifically commissioned. If I could perhaps make a personal comment on this: as you can obviously hear from my voice I come from north of the border, and I must say, coming down to England, there is a time-lag in England; HE in England does not work so well with FE as happens north of the border. So I think there is still quite a lot of work to do. However, it is very much on UUK's agenda. In fact, at the executive committee last week this subject was under discussion. We have not thought of doing a formal study, but that is maybe something we should do.

Q125 Mr Marsden: Can I ask you a final question, again, touching on something that Sir Howard Newby raised last week? We asked him about flexible learning and, again, he said that perhaps we needed to do more in that direction. I am particularly concerned - and I know we will come on to this later when we are discussing Bologna - about how easy it is for students, particularly older students, particularly women, to be flexible in terms of their coursework if they want or need to move in and out of university. Are you happy that you have done enough in the organisation to promote that?

Professor Bone: No, I am not. I think there is a lot of work still to do on that. That does not mean that because universities do not, again, have it on their agenda that they are not aware of the problem; I think we are aware of the problem and we are aware that it is not just a problem for universities it is an opportunity for universities, again, to get more people in and to offer a more flexible service to, as you say, comers and goers throughout their career. I think the new lifelong learning network programme, which started last year, is something which we are very excited about and a lot of universities are working hard on, but if you are asking me has enough been done, I think we would all have to say no, not yet.

Baroness Warwick of Undercliffe: I think the structure is in place in terms of links and collaboration between FE and HE. I think that is a route whereby those, particularly women and particularly older women, who are not able necessarily (I say "older" women but women with families anyway) to move out of their locality are going to be entirely reliant on the quality of the programmes that are offered through their FE colleges at local level, and that is going to very much depend on improved links between the FE colleges and their linked higher education institution. I do not want to be complacent about that; I am sure there is an enormous amount more to do, but I think the links are there to be built on.

Professor Bone: It is worth saying, as well, that driving this kind of link from the HE point of view, and making sure it actually works and making sure it is not just there in principle but actually happens, does cost quite a bit of management time. It is not costless, and we have to bear that in mind. If this begins to develop, and I think it should develop, there is a cost to the institutions.

Q126 Helen Jones: Thank you for that. Before we move on I want to ask about this survey that UUK is undertaking on part-time students. Why has it taken so long for you as an organisation to start looking closely at the needs of part-time students, given that the sector has been changing rapidly for sometime? Why has it not been done before?

Baroness Warwick of Undercliffe: I do not think it is a question of whether it should have been done; it has been done in response to the changes in the fee and bursary structure. It has been, in one sense, entirely a matter for institutions in terms of responding to the market in relation to the courses that they have put on, what they offer part-time and so on. I think it has been very much seen as something to be determined through supply and demand. Now, I think, we are facing a situation where additional support is being provided for full-time students and what we do not want to do is change the terms of the playing field, so to speak; that institutions, because of the additional resource either they get or they can offer to full-time students, could well see that it is more in their interests for full-time students to be recruited rather than part-time students, and we think that would be a very bad idea. However, I do not think it is an issue that has come up, if you like, to hit us before.

Q127 Helen Jones: Is it just about markets? What research are you doing into those who would like to study part-time and still encounter barriers to doing so? Having suffered the vagaries, some years ago, of being a part-time student and finding childcare very difficult - lecturers changing the time of their lectures, throwing the childcare arrangements into chaos - what research are you doing into that? Is it not true that you may find - we do not know - that many people do not even get to first base because universities are not adjusting to their needs?

Professor Bone: Certainly a lot of individual universities have, for quite a long while now, done exactly that kind of research and tried as best they can - again, within the financial envelope in which they are - to accommodate their part-time students. I do not know the answer to why UUK has taken till now to get round to this. I think the fact is that there is now a great deal of demand from our members to do this research, so that research is now under way. Individual institutions have been doing exactly the kind of research that your experiences suggest is necessary for quite a while.

Baroness Warwick of Undercliffe: Your question was about whether there should be national work done to investigate this. Perhaps there should and we need to reflect on that, but I suspect that it is very much a matter for determining the market at a local level and with other institutions locally, because this is not something that I think can ever be only answered by individual universities; they are not often in the locations where they could provide the kind of part-time courses and so on, or where it would be sensible to provide them because the people who want those courses are elsewhere. So I think it is quite important that the market is determined at a local level, or even perhaps at a quasi regional level, that the market is looked at and the needs of part-time students, in relation to courses, is determined. You are looking at something else; you are looking at the circumstances in an individual institution ---

Q128 Helen Jones: I am looking at the whole thing.

Baroness Warwick of Undercliffe: ---- where universities are providing childcare and so on.

Q129 Helen Jones: I did not actually say that. I am sorry, I must correct you there; I said there are problems with doing that and universities do not research their market. Whether your childcare is in the university or somewhere else, universities have to tailor their courses to take account of the needs of their students, and that includes students who have childcare arrangements in place.

Professor Bone: I am sure universities have been researching that, Chairman.

Q130 Helen Jones: What puzzles me here is that you were talking about the market in terms of employers and demand, but do you, as UUK, research the potential market, not simply the obvious market with people actually coming through your doors on course but the potential market that might be out there if the arrangements were different?

Professor Bone: Again, this is being done at an individual institution level, and has been for quite sometime. I cannot speak for every institution but certainly for a very great number that I do know about. It has not been done nationally, and maybe it should be done nationally, but one of the things, again, is the difference from institution to institution is so considerable that it might perhaps be most appropriate for it, actually, to be done at individual institutional level. We could then, of course, do a survey of the individual institutions, I suppose, and compile something which might help develop policy, that is true.

Baroness Warwick of Undercliffe: Although it is from a slightly different direction, what we have done, since 1999 through our From Elitism to Inclusion project, is report each year - we have had four reports now - and look at the way in which universities have developed projects to encourage a greater degree of both widening participation and, also, attracting what used to be, of course, non-traditional students and now becoming much more traditional students. So we have got examples of what is happening on the ground in relation to part-time and mature students and, indeed, other groups who are part of our widening participation agenda, and we have also produced something called the Patterns Report since 2001, which identifies the patterns of what is happening in higher education. What it does not do is look at whether or not those patterns might be changed, which is what I think you are suggesting - that we do rather more commercial marketing, or more thorough marketing, or market analysis. That might be a question of cost, but it is certainly worth looking at and seeing whether, if we cannot do it, others might do it.

Helen Jones: I think the Committee would be interested at some point if you started looking at those people who do not get past first base who might be potential students. If you ever have that information we would be grateful if you would share it with us.

Q131 Mr Chaytor: Why is Universities UK so opposed to a post-qualification application system?

Baroness Warwick of Undercliffe: We are not opposed to a post-qualification application system. In fact, all other things being equal, if it provides a fairer system for students and a clearer system for students and institutions then it makes sense. It is when you look at how to do it that one gets into difficulty, I think. For us, the problem has been that under the various proposals that have been under discussion to make the selection between different students - and, particularly, for those areas where interview is the norm, in medicine, for example - there just is not the time to go through that process under the proposals that were under consideration. The alternative, then, was to start the academic year later, so that one started the academic year, say, in January. The problem there, I think, is that we were concerned (a) what would happen to our international student market, because if international students are expecting to start a course in September/October, which is the norm internationally, I think we would certainly lose out in that area, but, also, we were anxious that the very students who might be perceived to be disadvantaged by the current system, ie, those who might be part of the widening participation agenda, might be the very ones who, if there was a six-month gap between qualifications and starting their course, might well choose to do something else. So I think we were just anxious about the detail. We have been working very closely with the Department (we are part of a group looking at this), with the further education sector, the schools sector and the local authorities to try to see whether there is a way through this, but it might end up being a halfway house. It might be a step on the way to full PQA but, I think, at the moment, it is the detail of the scheme that is a problem for us.

Q132 Mr Chaytor: Do you think PQA, in principle, is a good idea? Is it preferable to the status quo and it is only the issue of detail and timing that concerns you?

Baroness Warwick of Undercliffe: Yes. We have supported the idea of a post-qualification application system and we have tried to see whether there are ways in which it can be made to work.

Q133 Mr Chaytor: If timing is the problem, how much time is needed? If it is only the issue of interviews by medical schools, should medical schools be ----

Professor Bone: It is not, unfortunately, just medical schools. There is clearly quite a difference here between the recruiting institutions (institutions which, largely, recruit students) and those which, largely, select students. Of course there are differences inside institutions too, but you can broadly categorise them in this way. It would be true to say that the selecting institutions are much more nervous about PQA than those institutions which recruit. Nevertheless, I think we would all agree that the more certain information that is available in the recruiting process the better the recruiting process is likely to be. So, in principle, PQA has got to be better than where we are at the moment. If I can just lean on that word "only the detail" that you used, the "only" is quite a big "only". We have not yet seen or been able to really talk in concrete terms about a scheme which answers both the practical problems, on the one hand, and the difficulties of a substantial delay in the start of the university term, on the other. That route would mean quite a big social change, if we moved it even a couple of months back; there are all the problems about international students that Lady Warwick suggested as well and there are the problems that it would particularly damage, we think, people who come from less supported backgrounds, if we can put it like that, who have to hang around for a bit before they come into the university system. It is not impossible but it is quite a big step. What we are very anxious to say is: "Look, we have got fees coming in in 2006, there is the proposal on the table for a kind of halfway-house modification of the current system, if you like to put it that way; let us get that out of the way first." We think we can handle that, as it were, without causing too much disruption, not just to the institutions but to the students as well, because this is going to be a big change for them and for their understanding of the system. Let us get that out of the way first and then we will go back to the PQA.

Q134 Mr Chaytor: You are happy to revisit it after the introduction of the new system?

Professor Bone: Yes, absolutely.

Q135 Mr Chaytor: You referred to the period of two months, so you are saying, really, that if it is going to change ----

Professor Bone: If it is going to change it is going to have to be a substantial period. We have heard about shifting it back two weeks. If you go to a pure PQA model it is going to be a lot longer than that.

Q136 Mr Chaytor: It is somewhere between two weeks and eight weeks?

Professor Bone: I said eight weeks and that was me doing what I said we should not do - licking my finger! It is going to be at least eight weeks.

Q137 Mr Chaytor: Can I press you on some of the arguments that were put in favour of PQA, particularly the accuracy of predicted grades on certain groups of students. This seems to be quite confusing because the DfES were arguing that this was a way of discriminating against non-traditional students. The author of the report on which they base their judgment said he did not say that at all; it is all about the fact that it is just easier to predict A grades. What is your understanding of the limitations of the current system in terms of the accuracy of predictions?

Baroness Warwick of Undercliffe: I do not think I can second-guess the researcher but what I do know is that there have been a lot of statistics bandied around about the differences between predicted and actual grades. Again, it is the fine rain (?) of this. Something like nine per cent of students are predicted to achieve grades that are lower than their actual grades. Of those whose predicted grades are different to their actual grades, the vast majority of those are inaccurate within plus or minus one grade. I think it is important to understand the way universities use these predictions. They find them a helpful tool, but they are one tool in a range of qualities and qualifications that are looked at. So I think any outcome, from our perspective, I guess, ought to be seen to be proportional to that, but that is not to say that I think it is believed that it would be fairer if students knew when they applied exactly what they had got. There are studies that suggest that, in fact, that is not necessarily the case, and that students might actually work harder if they have had a predicted grade that is less than they thought they might deserve. As I say, I cannot really second-guess the researcher. The numbers of students who are actually directly affected by this appear to be - again, it is not terribly accurate - a lot smaller than I think the 45 per cent figure that was originally postulated.

Professor Bone: Some suggest about 800 students. The issue, again, is the granularity of this, if I may underscore that. A difference of one grade is unlikely to make the difference between acceptance and rejection from the university point of view. The difference is going to be very much wider than that because the university would set a target for a student to achieve rather than refusing a student on the basis of a predicted grade.

Q138 Mr Chaytor: It is not the only argument for a change to a PQA system, surely. Are there not huge savings in the general efficiency of the administration, in that we do not have all these multiple applications which are then rejected, with people going into clearing? Are there not administrative savings?

Professor Bone: I suspect you would still have multiple applications, but, yes, there probably are administrative savings. The main argument, I think, for PQA is just the logic of having the maximum amount of information available when you make a decision. There is not really much argument against that. That would clearly be a better situation.

Q139 Mr Chaytor: Accepting the importance of having maximum information available, is there a risk that the A-level grade might become a more important indicator or might tend to be the sole indicator used by some admissions tutors, and would that lead to a slightly narrower approach to recruitment of students?

Professor Bone: That is certainly an argument that I have heard. Again, I doubt in practice whether that would be the case, but it is certainly a danger. I think anything that makes the process more automatic works against precisely the kind of widening participation, multi-factorial entrance requirements which we are actually trying to encourage. I hope it would not become something automatic.

Baroness Warwick of Undercliffe: Here we are trying to make this process more student focused and I do not know that we really know enough about both why students make their choices and what they do when they are going through the applications process and the clearings process. Maybe that is something we need to look at, possibly with the Department, to see whether or not we could learn more about how students' behaviour affects their choices.

Q140 Mr Chaytor: What is your general view of the reliability of the A-level grade itself as a predictor of student performance as an undergraduate and the final class of degree? Is there a close relationship there or are there any variable factors or uncertainties?

Baroness Warwick of Undercliffe: I believe there are statistics on that. I do not have them to hand, I am afraid. I could certainly look them out for you. Of course A levels are now only one indicator that is taken into account. There is a large number of students who come in with other qualifications that are accepted. I think that is really all I can say in answer to that. There is data on this, and I think we should find it for you.

Q141 Mr Chaytor: It would be useful if we could have a note about what research tells us about the relationship between A-level performance and final degree performance.

Professor Bone: We will provide that. It is often said that A levels are the best possible predictor, but the question is: What is in the set of predictors that you are using?

Q142 Mr Chaytor: What does UUK think about the whole issue of the educational context from which the student is coming? I recall a few years ago when the vice-chancellor of Bristol got into a lot of difficulty with the Daily Telegraph because he suggested that Bristol was operating a differential admissions policy. He said, for example, that a grade A student from Eton was not necessarily absolutely the same as a grade A student from an inner city non-selective school. What do you think about weighing up the school from which the student comes in terms of the offer which should be made to that student?

Professor Bone: I agree with the Schwartz report here: one should weigh up the student. That is the key thing. If one gets led down - again, it is the point you were making a minute ago - some kind of mechanical scoring mechanism which actually suggests school X gets so many points for being school X, and school Y gets so many less points for being school Y, I think one is on very, very dangerous ground here. One has to look at each individual case and consider the evidence in the round.

Baroness Warwick of Undercliffe: The information we have agreed to provide for you in terms of whether A levels predict final success outcomes at graduation may well offer some clarity on that, because I recall some years ago now studies suggesting that those students who were force-fed into doing well at A levels were not given the more rounded skills that enabled them to do well in a more independent environment in a university, so that was reflected in the outcomes. Whether that is still the case, I do not know. As I say, we would need to check on the outcomes. But I do think it is quite important that admissions officers at universities take into account the potential of the student to benefit from the university course. That is one of the things they are required to do. I think it is quite important that they are able to do that without being necessarily forced into accepting only one particular criterion, the A level, to determine whether or not a potential student is going to benefit from the course.

Q143 Mr Chaytor: What happens in other countries? Does any other country operate the system we have, or do they all have PQA?

Professor Bone: No other country operates exactly the system we have, is the short answer, but there is a whole multitude of sins covered by the phrase "PAQ" it has to be said.

Baroness Warwick of Undercliffe: One relatively common feature in European countries, for example, is automatic entry on a basic graduation from school. The corollary of that, of course, is a very, very, very high drop-out rate at the end of the first year.

Helen Jones: Thank you. I am going to bring in Stephen Williams now, who has a question to ask on this theme and then he can lead us onto the international issues.

Q144 Stephen Williams: Would you say that universities still have full confidence in A levels as the best way of assessing whether a student should be able to go to university? We hear that lots of universities for particular courses are now introducing their own entrance exams. How widespread is that practice?

Baroness Warwick of Undercliffe: I am not sure I have the information that would tell you that. I do not know precisely how many institutions operate their own separate test. Certainly many medical schools - and I do not know how many -----

Professor Bone: Almost half. Some departments in some institutions always have as well. There is a lot of press speculation I have read about institutions introducing new examinations. I do not know of any that have been recently introduced. That is not to say that it might happen. If I could put a slightly different slant on the question, I do think it is very unfortunate that we get the annual A-level beanfeast in the press. It is no help to students, who have worked very hard for their A levels and are looking forward to committing themselves to a university career. We have to be careful in all this talk about denigrating the gold standard, etc, etc, which I think is very inappropriate; on the other hand, I think a number of our members, not all of them but a number, do feel that Tomlinson was a missed opportunity.

Helen Jones: Stephen, would you like to lead us onto issues about international students.

Q145 Stephen Williams: Professor Bone said in his introductory remarks that international competitiveness is one that concerns you. Perhaps I may start off with EU students. Our previous Education Minister Alan Johnson said in evidence to a previous committee, in the last parliament, that he did not anticipate there would be a big growth in the number of students from EU countries. When Sir Howard Newby was here last week he said that the UK currently funds the equivalent of two universities from EU students. How do you see this market? Do you see it growing in the future?

Professor Bone: That is an interesting statistic. I think it probably will grow, but I do not know that it will grow hugely. There has been quite a bit of growth over the last, let us say, 10 years in EU students. Obviously we have an enlarged EU and that might lead to increased growth, however, there is one thing going against that, and that is that, under the Bologna process, the majority of education systems across the EU are what I would call modernising: fundamentally moving to the UK model or something which looks very like the UK model. That will actually make them more attractive to their own students, because it means that they will get through their undergraduate course in four years on average, which makes it look much more like the UK. I think that is a pressure against the expansion of EU numbers into the UK.

Q146 Stephen Williams: Could we look at the new funding arrangements that will come into place, the deferred fees to which EU students will be entitled. What sort of issues do you think arise there in terms of collecting those fees post-graduation, particularly if a student actually goes back to Warsaw or Prague or wherever.

Professor Bone: I think there is a major issue there. I do not know that I have an answer to that issue. Again, that is perhaps one for the Department. I do think there is a major issue there.

Q147 Stephen Williams: A similar question on maintenance. Originally Alan Johnson was saying that the reason you did not expect a take-off in EU applications was because the Government thought when it brought in the new funding arrangement that EU students would not be entitled to grants, whereas now it turns out, as a result of a court judgment, that if they have lived here for three years they may well be.

Professor Bone: That judgment was a judgment on a very specific case. If I understand the details of that case correctly, it is not necessarily going to be a ruling which sets a precedent. If it did, then the difficulty you have just described of course multiplies considerably.

Baroness Warwick of Undercliffe: The great strength that we have is that we teach courses in English. That is an attraction, and it has proved to be a very considerable attraction, for example, for the new accession states, so we have seen a very considerable increase. But this also applies to international students as well. Many of our European counterparts are now establishing not only three-year degrees and masters that are very like ours, but also teaching many courses, the most popular courses, in English. That may mean, not just in terms of attracting international students but also those students for whom English and studying in English is a very attractive proposition, that can now be provided in their home country. That has been a very considerable attraction and I suspect it will continue to be a great strength of the British sector.

Q148 Stephen Williams: Could I move on to non-EU international students, which is something I have taken a lot of interest in recently. Your own figures and other institutions' figures show that universities are very largely dependent now on increasing growth in international fee income. I had a look at Bristol University and the University of the West of England's accounts. In the last figures that are available, they have £28 million in additional fee income from international students, which is clearly very important to them. Do you think the Government is doing enough to encourage further growth in international students coming to this country?

Baroness Warwick of Undercliffe: The Prime Minister's initiative was an enormous help in focusing attention on the conditions and resources that needed to be available in order to encourage international students. We did see a very considerable growth. It was a direct correlation between the amount of emphasis placed on those conditions and the increase in the number of international students. Are they doing enough? We have been very concerned about what has been happening to the Home Office on the visa front and the way in which changes have been introduced without consultation and without any preparation, either on the part of institutions or those recruiting international students, to be able to alert them to these changes, so that, although I think everybody would accept the additional amounts of money that are being charged are not huge, nonetheless the impression has very quickly been created that Britain is no longer a welcoming country. We are in a highly competitive market here. Our Australian and New Zealand counterparts are putting a huge amount of money into marketing to attract international students. America, which, after 9/11, introduced quite draconian entry arrangements, has now relaxed them, and they are already seeing a benefit in that through an increase in the number of international students. I suspect that, whilst on the one hand the Foreign Office and the Department for Education and Skills recognised through the Prime Minister's initiative the huge value to this country and to institutions of international students, the Home Office has been, if I may put it this way, slow to recognise that advantage.

Q149 Stephen Williams: The Immigration Nationality and Asylum Bill is currently going through Parliament, which is introducing some of the changes to which you have just referred, not just the visa review right, which they can do anyway, but also taking the right of appeal against an entry clearance officer's decision in a British embassy abroad. I spoke in the second reading of that debate back in the summer. It was on the same day that about 100 of your colleagues signed a joint letter saying that this was going to have a detrimental effect on students coming to this country, and the reaction of the Minister Tony McNulty, when I quoted this, was "Rubbish and even more rubbish." Do you have an elegant response to that? Because the Bill is just about to come out of committee and to come back to the floor of the House for a third reading.

Baroness Warwick of Undercliffe: I think he is wrong. I do not know how elegant that is.

Q150 Helen Jones: We will settle for the truth.

Professor Bone: I think there are a number of statistics which suggest this. The number of applications, for example, from China to the UK is down about 20 per cent; the number of successful visa applications is down 30 per cent. The number of successful visa applications to the United States is up 15 per cent. If you look at the statistics supplied by one university - you will pardon me if I keep it anonymous at the moment, but we could later, I am sure, reveal it in writing - 90 per cent of the students who are refused visas the first time through get these visas on reapplication. If the threat of formal appeal is withdrawn, there will be nothing like that same incentive. We have quite a lot of evidence which shows the sometimes seemingly arbitrary nature of initial decisions, which are of course checked on review, but if there is not the incentive for that review then we feel we will suffer really very badly.

Helen Jones: Could I bring in Roberta Blackman-Woods on that.

Q151 Dr Blackman-Woods: Could I just follow up on that last point you made. Are you making that information available to the Home Office in order to argue the case?

Professor Bone: Yes, indeed.

Q152 Dr Blackman-Woods: The UK is hosting the next meeting to progress the Bologna process. I wonder if you could tell us what level of enthusiasm you think there is in the HE sector in the UK for this process.

Professor Bone: I think this has changed really quite a lot over the last three or four years. If you had asked me that question a few years ago, I would have been in despair, quite frankly, but now I am happy to say there is really a quite considerable level of enthusiasm and certainly a considerable level of understanding that there was not a few years ago. I am happy to say that is the same too of Government. If you had asked me that question three years ago, I would have been despairing on the Government's behalf as well. Now we have ministerial attendance at the Bologna meetings, and we are very grateful for that. The word through the Europe Unit, at which of course the UK participates as a key partner, has been very, very helpful in spreading the word about Bologna. The word is mainly positive. There are obviously one or two issues for UK higher education, but by and large we support a strong European higher education system.

Baroness Warwick of Undercliffe: We have put an enormous amount of work into it as an organisation. We play a part now in all the many conferences that take place on the different strands of activity that are working towards producing a European higher education area. Increasingly, it is seen by most institutions as a very important area for our sector. I think people are looking to the opportunities that might be offered by a European higher education area - and, indeed, a European research council, which is also on the stocks. I think there has been a very considerable change in approach and attitude and engagement.

Q153 Dr Blackman-Woods: How close are we to being able to implement a system for European credit transfer?

Baroness Warwick of Undercliffe: There is a lot of work being done on this, a lot of discussion about the best way forward. Not everybody shares the UK view, which is that the credit system ought to be based on outcomes rather than on length of service or length of study. That is quite a major area of disagreement, I think, within different European countries, but I certainly perceive a change in some countries and an acceptance that an outcomes-based process should be the one that we go for. We already have in the UK the Scottish system - and perhaps Drummond can say something about that. It is patchy though. In terms of what is happening on the ground, institutions of course determine their own entry, so the question then is whether there is effective trust between the feeder institutions and the accepting institutions. That, I think, will take time to build and there will have to be a better understanding of the way in which the credits are built up and the courses are developed in order to ensure that an institution can feel confident that the potential student will be able to benefit from the course that they are offering. I think it is a process. It is certainly being positively developed, but we are not there yet in overall terms.

Professor Bone: I would add that we are winning the battle on an outcomes-based system. That is quite clear. The ground has shifted. Another thing I should say is that we are very grateful for the Government's line on the European research council, which I think is very, very important for the sector.

Q154 Jeff Ennis: Do you think we will ever get one specific European credit transfer system, or do you think there will be a transition period whereby you get a number of countries? You kept referring Professor Bone to the fact that a lot of the new accession countries are adopting our model. Do you think we will go to a situation of two or three different types of model before we get to where we want to be?

Professor Bone: I suspect we will. There is quite a large differentiation, it has to be said - and of course one is talking here about the European higher education area, which is 45 countries, not just the members of the EU - and there is no doubt that some are very much more advised than others. There are some countries and some institutions with which institutions in the UK would be perfectly happy to move to some kind of credit transfer arrangement - and, indeed, they have got it already - and there are some areas where that will be very much more difficult. I suspect there will be a two- or three-speed system, yes, before we move to something solid. That does not mean we should not travel in that direction.

Helen Jones: Could we move on, before we finish, to have a look at the student experience.

Q155 Tim Farron: The satisfaction rate amongst students in response to a national student survey produced some fairly surprising results, if you take the approach of looking at traditional hierarchies. Do you think that indicates a level of complacency on the part of some of the universities when it comes to teaching and perhaps student support? Or do you have other explanations as to why the table looks different from what one might have expected?

Professor Bone: I do not know that I was quite as surprised by the results as people affected to be - and my own institution is one of the Russell Group institutions. Institutions do have students who are liable to respond in different ways depending on the kind of course they are taking, for a start, and I think that is one of the factors. It is rather interesting that certain courses, if you look across the board, had higher ratings than certain other kinds of courses. If you have an institution which has a preponderance of a certain kind of course, your chance of getting a higher rating is considerably higher than if you are an institution which has a preponderance of courses which do not. There are various reasons for that, and some of them, I think, are quite complicated. Students sometimes find themselves in subjects because they have been pressured to go into that subject, perhaps for family reasons, rather than out of choice. They perhaps discover themselves studying a subject which they did at school but which they discover at university is very, very different. If a university got a particularly low rating, the thing it should be doing is looking very seriously at why that is the case. Is it real? Is it not real? I am sure most of our members would do that.

Q156 Tim Farron: What do you think your numbers are, taken out of their individual rankings?

Professor Bone: Speaking of those people I have spoken to recently - and obviously this survey is relatively recent on our agenda - it is quite simply that individual universities are looking at those areas in which they have scored lower than they would have expected and are taking very concrete actions to remedy that - first, of all to find out why it is the case, and, secondly, to try to remedy it. I think there will be a whole slew of people looking very seriously and practically at this, because it does not do us any good - to state the crashingly obvious - to have these results out there. The difficulty we have had - and it will not surprise you that I say this - is the construction of league tables by the newspapers of these results. I think that is unfortunate but inevitable.

Q157 Tim Farron: I guess I might say that there are other league tables constructed which tend to be in favour of universities such as your own.

Professor Bone: Indeed.

Q158 Tim Farron: It is perhaps good to see one which is looking at a different angle: what the consumer thinks.

Baroness Warwick of Undercliffe: We always said: The more league tables, the better, in the end.

Q159 Tim Farron: Well, it confuses the whole picture then and nobody takes them seriously!

Professor Bone: I did say I was not surprised at the results. Self defence!

Q160 Tim Farron: Interestingly enough, you will have noted that Oxford and Cambridge do not feature here and it would appear that their students were actively encouraged not to respond. What do you feel about that?

Professor Bone: I have no comment to make on whether they were actively discouraged or not. I simply do not know the answer to that.

Baroness Warwick of Undercliffe: I do not know the answer to that either. Anybody subject to a survey has criticisms of the methodology, but where a survey is well constructed, where it offers students clearer, more accessible information, I think it is helpful. I am sure Drummond is absolutely right, everybody will be looking at the outcome of the survey and seeing how they can improve, because they want to be as attractive as possible for students. I think they will be looking at the outcome of the judgments on teaching and seeking to do something about it.

Tim Farron: I am sure that is so. There is a strong proportion - I would say we are looking at the majority of HEIs here - that are listed. I have never thought Oxford and Cambridge students were particularly reticent and bad at participating, so one can only think there is something under the surface here, and it just is a shame that people are not prepared to be assessed on things that they might not be so confidently strong on. But you are not going to respond on that and I understand why.

Helen Jones: We have noted your spirited defence of Oxford and Cambridge.

Q161 Tim Farron: Indeed. I have a final point, if I may, Chairman, which relates to one of the issues of concern that came out of the student survey and certainly a concern facing many students and also the communities in which universities have their sites; that is, of course, campus closures. We recognise that institutions have autonomy and should have autonomy and need to respond to market pressures, and that sometimes you will need to expand an institution, sometimes there will be a retraction, and sometimes a new course will be developed and sometimes a course will be phased out. I understand, that but I wonder if you recognise that there could be a severe impact - obviously on the students who are involved, but also the staff, and sometimes, when it is a campus closure, on a whole community that that institution serves. Will Universities UK be looking to try to set up protocols that institutions which belong to UUK will be able to follow when it comes to going through the process of course closures and campus closures?

Baroness Warwick of Undercliffe: I think certainly UUK is a repository of good practice. I do not know that we had imagined setting up a protocol for autonomous institutions but good practice is certainly something which we do see it our job to disseminate. We were very pleased with the way FC reported on the subjects that were in danger, if I may put it that way. We now have a voluntary code, as you know, whereby we will be giving early warning to the Funding Council if there are difficulties. I take very, very seriously the question of regional consultation, I have to say. I think that is a very fair and very strong point that I think should be a part of university good practice, that, where they are thinking of closing something or indeed closing a whole campus, it has to be the subject of regional consultation - and not just with other HE institutions in the area either, which is sometimes what that means, but with the local councils, with the development agencies, with the Learning and Skills Council. I take that point.

Baroness Warwick of Undercliffe: Looking back on what I recall of closures of campuses, they are often very prolonged. They are decisions which take a very long time and it is often the length of time rather than the lack of notice that can be a problem. I am sure that from an organisational point of view we are anxious to provide a means for members to alert those who might be affected. That could be the Funding Council but it certainly could be the local community. The links between institutions and local communities, Regional Development Agencies, Learning and Skills Councils and so on, all these links mean that what is going on in an institution is very much more likely to be shared than used to be the case.

Professor Bone: I can certainly provide the Committee reassurance that this subject has been a matter of considerable debate and concern in UUK over the last year or so.

Q162 Mr Marsden: Student satisfaction, of course, is quite closely related to staff satisfaction in universities at all levels, and I would like to draw you on a little bit in that area. Professor Drummond Bone, right at the beginning, when we were talking about where the fees income was going to go, you talked about modernisation of the pay structure. Do you still have concerns, notwithstanding that, about structural shortages within the teaching profession at university? Perhaps you would like to illustrate where you think those lie.

Professor Bone: There is no question about that, we do, and they lie I suspect in the regions where one would expect. Economists, for example, are extremely difficult to come by; lawyers can be extremely difficult to come by; some categories of engineers increasingly can be difficult to come by; people in computing science in certain areas - not across the board, but in certain areas of computing science - can be difficult to come by; and I suspect there are other areas which I just cannot think of off the top of my head. Mathematicians are quite difficult in the UK as well. So there is a real shortage. There is also a demographic problem looming, and there is increasing competition, because of a demographic problem in the States, from the United States as well. Again, one of the problems that we have is not just the base level of salary but the fact that, in trying to attract people from other countries, the UK is an expensive place to live.

Q163 Mr Marsden: What is the answer to that? The one obvious answer all the way round is more money. I am well aware of that, and no doubt you would like to get your begging bowl out to HEFCE now. The other issue is how universities themselves are able to use their existing funding more effectively to tackle some of these issues. I know the maximum line has been removed in terms of staff recruitment at professorial level and so on, but are there more things you could be doing as institutions or UUK could be doing to tackle and focus on the shortage areas?

Baroness Warwick of Undercliffe: I am thinking of the new framework agreement, which has been negotiated through the Universities and Colleges Employers Association with the university unions, which introduces a greater degree of flexibility. I think that is going to be very important in ensuring that we can respond to changes in the marketplace. That does not necessarily mean that in 10 years time or six years time economists will be the group that it is most difficult to recruit. I think introducing a degree of flexibility into the process will be helpful. We are in competition, particularly for our scientists and engineers, with organisations or companies that pay a great deal. But it is not only pay: it is the ability of the institution to be able to provide particularly in the research area, the research environment and the teamwork and the support that good researchers, excellent researchers, require when they want to teach in a university or want to work at a university. So I think there is more to it than pay.

Q164 Mr Marsden: Sure, I would accept that, but do you not also have an issue, particularly in the sciences, of the fact that in the universities you still pay pretty low rates for many of the crucial support staff, not least the technicians, who need to keep the show on the road?

Professor Bone: Yes, that is a real problem. I think there are a number of issues. At the top end of the professorial market, if I could put it that way, salary really is not the issue, it is resources. There is no question about that. The difficulty is somewhere in the middle, if I can put it that way, where retention is a real problem. You get city companies and so on and big multinationals approaching our staff and it is very, very difficult to get them back. The flexibility that Diana has spoken about will help there. But, let us not kid ourselves either: it will introduce problems into the system as well. There are some institutions, it is quite clear, who will be able to pay more now that we are effectively in a local bargaining situation than other institutions and that is going to create an issue as well.

Q165 Mr Marsden: Even where you have a situation of teaching staff and academics where there is not a particular problem in terms of recruitment into the profession, there are concerns, are there not - particularly going back to student satisfaction, in terms of teaching - that the incentive balance is skewed in universities towards research and against teaching by the nature of the RAE and the nature of many of the other funding regimes? I know many younger academics in particular feel frustrated that some of the things they would like to do, in terms of social inclusion, in terms of relating to schools and other institutions - some of the outreach work, for want of a better word - does not get an automatic recognition. It certainly does not get an automatic recognition in terms of the pay cheque or the time they are allowed to do that sort of thing. Are there more things - and I am not talking about opening up the RAE question, because we know the situation there - that UUK could do to send out to its members some more welcoming suggestions in that area, or more things that universities themselves could do to balance things more in favour of teaching perhaps and less absolute focus on research?

Baroness Warwick of Undercliffe: Perhaps I could address that in a slightly different way by saying that in our submission to both the last Comprehensive Spending Review and certainly the next one, our highest priority is support for teaching infrastructure - and, indeed, for pay, but support for teaching infrastructure - in the sense that the additional resource that has been provided for universities through the last funding round has been heavily weighted towards research. It has been enormously welcome but it has meant that the support that can be provided for teaching has lagged behind and certainly we see that as a key priority in our representations to government.

Q166 Mr Marsden: It is about academic recognition as well, is it not? What incentive is there for a young science lecturer at a university to go out and do an open day in, say, a socially disadvantaged area of schools or to promote science, or for a young historian, for example, to do a similar sort of thing? There is not anything formal in the progression process or the promotion process in university that assists those people, is there?

Professor Bone: Yes, I think there is. I cannot speak for all universities but most universities employ a balanced scorecard approach to promotion. Typically, it is divided into three - and in some cases there are other things taken into consideration as well: certainly teaching; the administrative load undertaken in university; and research. In most universities it is an equal number of points for each and that is roughly how it works. But, nevertheless, I understand the remarks you are making. In university HR departments now, particularly because of the discussions we have been having about the new framework which involves equal pay for equal work, there is a lot of awareness of the necessity to value people's work in different ways. I think the situation is improving, but that is not to say there is more to be done. I think you will find that most universities are employing some kind of scorecard approach which does involve teaching and promotion.

Q167 Mr Marsden: Obviously you can do things at the margins, but, to some extent, inevitably these things are going to be dictated in the amount of funding which is distributed via the RAE as opposed to via other processes. Are you happy or content that the changes have taken place and will take place over the next RAE assignment in 2008 are sufficient and adequate to reflect many of the concerns that have been previously expressed about getting the balance right between teaching and research?

Professor Bone: As a question near the end of the session, that is a very big question. I think I would, at the moment, quite frankly, like to leave the RAE stone unturned. It has taken an enormous amount of trouble and discussion to get us where we are. We are now only three years or two years away from the submission date of the RAE - October 2007 the census date. I think there will be room for a great deal of discussion following the RAE. If you mean has the new format of the RAE rebalanced things towards teaching, then I cannot say that it has.

Baroness Warwick of Undercliffe: That was the point I was going to make. I do not know that the RAE has specifically addressed that issue. It seems to me that is an issue that can only be addressed by looking at the outcomes of the way in which universities determine their promotions. I am not even sure whether it would be possible to judge that by outcomes. I do not know what statistics are kept. Because it is a balanced scorecard approach, I do not think one normally in those circumstances draws out particular elements to determine whether one was given more weight than another. It might be quite difficult to get at, but certainly there is a perception. I accept that there is a perception.

Q168 Mr Marsden: There is a problem of universities allegedly buying in bright young professors or for that matter bright older professors and simply having them there because of their publications to ratchet up the RAE scorecard and not actually contributing to the teaching in the university. That is going to still be an open question, is it not?

Baroness Warwick of Undercliffe: As a result of the RAE.

Q169 Mr Marsden: Yes.

Baroness Warwick of Undercliffe: I suspect that must be the case. Yes, I suspect is the answer, but there is not a huge amount of evidence that there has been a major shift in terms of poaching from one institution to another.

Professor Bone: The trouble about that -----

Q170 Mr Marsden: Perhaps we should leave this stone unturned.

Professor Bone: No, Diana is absolutely right, but one of the issues is how much universities are actually paying people who do not move because there is an approach. I think there is a real issue there. However, I do not think many of these chairs who may be brought in because they are good researchers are given carte blanche to do research. Often good researchers are good teachers as well and want to teach.

Q171 Helen Jones: Thank you very much indeed. We are going to wrap it up there. Professor Drummond Bone, Baroness Diana Warwick, thank you very much for coming before the Committee today. You have given us some very interesting evidence and it is very nice to have had an English literature specialist in front of us for once, Professor. That is my abuse of the Chair! We do not get many of them. We are extremely grateful to you for the evidence you have given to us today, some very interesting things which we will mull over in the future.

Professor Bone: Thank you very much, and, through you, the Fund.

Baroness Warwick of Undercliffe: I wonder if I might also say that I think I made a mistake, in that I said the inquiry we are doing on part-time is due next year and in fact it is next year. It will be towards the end of the academic year.

Helen Jones: Thank you very much for that correction.