Clause
4
Loan
regulations
Question
proposed, That the clause stand part of the
Bill.
Sarah
Teather:
Just for clarification—I think that the
Minister will be able to answer my question easily—clause 4(3)
refers to
“the
reimbursement of costs or expenses incurred by a loan
purchaser”.
Does that
relate to fees for sorting out the purchasing of the loans in the first
place or to costs that are incurred if somebody defaults on the
loan?
Bill
Rammell:
It is the latter. I think that that was clarified
this
morning.
Rob
Marris:
May I suggest that my hon. Friend considers
tabling amendments to clause 4(3) on Report to make it clear that that
is the case, because it is not clear in the
wording?
Bill
Rammell:
My apologies. I discussed this issue with my hon.
Friend and I think that I am right in saying that he has tabled an
amendment on it. I am sympathetic to the framing of that amendment, but
I need to look at it in detail. If I can be reassured that it would not
have an unintended consequence, I will be happy to accept it on
Report.
Question
put and agreed
to.
Clause 4
ordered to stand part of the
Bill.
Clause
5
Repayment
Question
proposed, That the clause stand part of the
Bill.
Mr.
Hayes:
There are issues about who might act as a
collector on behalf of the loan purchaser. Clause 5(2)(a)
stipulates
“collection by
a person acting on behalf of a loan
purchaser”.
We
have some doubt about that. Some reassurances were offered during our
earlier considerations, but it would be useful to put those on the
record again here. The anxiety is that the collection agent should be
the Student Loans Company, or someone directly accountable to it; that
the line of accountability should not be stretched to a point where
graduates are disadvantaged.
Clause 5(2)(b) concerns the
issue of Her Majesty’s Commissioners for Revenue and Customs.
Regarding the repayment of loans by people who are not resident in the
United Kingdom, I wonder whether we should firm up the fact that the
power to collect student loans lies with HMRC and the Student Loans
Company, and not another agent. That was discussed at some length
during our deliberations this morning, but these are important matters
for popular reassurance. I hope that the Minister will clarify and
amplify some of the points that he made during that earlier
scrutiny.
Sarah
Teather:
We discussed this issue this morning, but I was
not clear about the answer. I asked the Minister what would happen in
the case of a default. He said that there is no need to pass data
between the Student Loans Company and the SPV, but what I was asking
was whether there is a legal prohibition, either in the Bill or in the
data protection legislation, to ensure that that does not
happen.
Bill
Rammell:
The latter would come by means
of a contract and I hope that that provides a reassurance. In respect
of the hon. Gentleman’s questions, we have made it clear that we
intend to ensure, by use of contractual obligations, that the private
purchasers, through the SPV, use the Student Loans Company to
administer the loan repayments on its behalf. We intend the Student
Loans Company to carry through its review of the administration of
student finance, which is called “Customer First”. That
is very much our intention. However, if we were to stipulate in statute
today that the Student Loans Company would carry out that task for ever
and a day, that would bind our hands unnecessarily and we would have to
come back to legislate on that issue when there are already other
protections in place.
Mr.
Hayes:
That was a weak argument when it
was used this morning and it is a weak argument now. Many such bodies
are specified in legislation. The nature of legislation is that
sometimes one has to specify those agents and bodies—those
organs of government. The Government would be much more likely to
satisfy the doubts and assuage the fears of those who have reservations
about this matter if it were to put what the Minister said at the
beginning of his remarks in the Bill. That would be something of the
order that collection should be by the Student Loans
Company.
I understand
that the Minister is concerned about fixing that measure in stone, but
my goodness, if that view prevailed in respect of legislation, we would
pass virtually nothing here. So I am not so sure that that is a very
convincing reason not to put this measure in the Bill. At the very
least, it would deal with any doubts that exist about people collecting
debts who ought not to
be.
Bill
Rammell:
I am genuinely not convinced
that making that change is necessary. I know that we are in something
of a limbo because amendments have not been tabled, but if the hon.
Gentleman feels strongly about this matter then, without giving any
commitment, he should table an amendment on Report that we could debate
and consider, although I do not believe that that is
necessary.
The
hon. Gentleman’s other point was in respect of those people who
are repaying outside of the pay-as-you-earn system. They must undertake
those repayments, at the moment, directly to the Student Loans Company.
That will continue to be the case whether or not—again, I state
this for the record—the debt is owned by the Government or by
the private sector.
Question put and agreed
to.
Clause 5
ordered to stand part of the
Bill.
Clauses 6
to 7 ordered to stand part of the
Bill.
Clause
8
Wales
Question
proposed, That the clause stand part of the
Bill.
Mr.
Hayes:
This clause would, in effect, extend the power of
the Welsh Assembly to administer these matters. That may be a slightly
clumsy way of putting it, but I think that is its gist. For the
purposes of the record, can we have an assurance of what that would
mean in practice? Presumably, it means that the Welsh Assembly might
take a different view about when to sell, what to sell and how to sell
the loan book. Also, what estimate have the Government made of the
incompatibilities that that situation could
produce?
Sarah
Teather:
I asked a question this morning during the
pre-legislative scrutiny and the Minister said that the proceeds from
any sales would come straight back into the Treasury. It is not clear
to me what benefit—if any—there is to the Welsh Assembly
in enacting any of these powers.
Mr.
Hayes:
That invites another question, about the proceeds
from the sales generally, but it is a very good point. We are not for a
moment suggesting that the proceeds of the sale should be hypothecated,
because that would be a spending commitment and if I were to make that
I would be on the carpet, even though the Opposition Whip has briefly
left the room. However, the hon. Lady is right that there is an issue
about the receipts of the sale. That raises the question why the Welsh
Assembly was included. More especially, there is an issue about the
compatibility of any policy that might be enacted in Wales that was at
odds with what was done here. Given that an immense number of students
from Wales study in England and students from England study in Wales,
it would seem to be in all our interests to ensure that policy is
consistent and coherent. Has the Minister made any assessment of that?
In offering that assessment to the Committee, will he address the
pertinent point raised by the hon. Lady?
5.45
pm
Bill
Rammell:
Let me set out the general
framework, and then I shall respond to those two points. As
responsibility for student loans in Wales was devolved to Welsh
Ministers back in 2006, it is important that the provisions apply
equally to Wales. Any decision on the future sale of the Welsh loan
book needs to be made in Wales by Welsh Ministers. Clause 8 gives Welsh
Ministers the power to do that in the way that they have requested.
Welsh Ministers are keen to ensure that maximum value for money is
achieved for Welsh student loans and the powers are in place so that we
can ensure that they do so. The Bill will enable them to decide when
they deem it appropriate to use the powers, bearing in mind the
relevant economic and value-for-money considerations—exactly the
same value-for-money considerations that govern our decisions in
England.
In
accordance with the new devolution settlement agreed in 2006, the Bill
will confer executive powers on Welsh Ministers to sell loans for which
they are already responsible, mirroring the powers that it gives the
Secretary of State for loans for which he is responsible. Those mirror
powers are appropriate in these circumstances, as it is clear that that
is what Welsh Ministers require. The clause confers on Welsh Ministers
functions of an executive nature; it does not give them the power to
make that legislation.
Let me pick
up on the points that have been made. The first was about the
difference of treatment that we may end up with between Wales and
England. The responsibility is devolved. Part of the settlement of
devolution is that the Welsh Assembly is allowed and empowered, in
areas for which it has responsibility, to make decisions that may be
different from those in England. In terms of the scale of things, the
sums of money are relatively small, as Wales
represents £1.1 billion of the £18.1 billion
total student loan book. On whether there is an incentive for Welsh
Ministers to undertake the step because money comes back to the
Consolidated Fund and not the Welsh block, the money coming back to
Government will give the Government as a whole greater flexibility in
determining its spending priorities. Welsh Ministers cannot have the
money directly attributed to their block but, as a DIUS Minister, I
cannot have that money directly attributed to DIUS. Nevertheless, I am
delighted and delirious to be taking the Bill
forward.
Sarah
Teather:
It is, however, rather odd. The Minister is a
Minister in the Westminster Government. It is odd for Welsh Ministers
to make a decision that will have an effect only on the books here and
that will have no obvious direct impact on their budgets. Is he aware
of any discussions between the Treasury and Welsh Ministers about
whether that will have any impact on that
budget?
Bill
Rammell:
Just as I do not comment on discussions that I
and the Secretary of State have with Treasury Ministers, it is not
appropriate and would not be right for me to comment on any discussions
that may or may not take place between members of the Welsh Assembly
Government and the Treasury.
The fundamental principle
governing sales in both England and Wales is that they will enable the
transfer of risk and an income stream that enables us to make choices
about where that money should be spent. That was the principle on which
we had cross-party support for the Bill on Second Reading. I hope that
we can maintain that support in Committee.
Question put and agreed
to.
Clause 8
ordered to stand part of the
Bill.
Clauses 9
to 13 ordered to stand part of the Bill.
Question proposed, That
the Chairman do report the Bill, as amended, to the
House.
Bill
Rammell:
Thank you, Miss Begg, for
presiding over the Committee smoothly, efficiently and effectively. I
congratulate all Committee members on the good-humoured nature of the
discussion. A number of hon. Members commented on the fact that this
might be a Finance Bill rather than an education Bill. I do not believe
that that is the case. It is appropriate that education spokespersons
lead this discussion. Important points of principle have been at stake
that will bring real benefits to the Government. Through the mechanisms
that we put in place, we can protect the graduate
interest.
Mr.
Hayes:
I endorse and amplify the thanks to you, Miss Begg.
You have shown remarkable indulgence to
Committee members, which has allowed us to debate these issues, even
though our consideration has been concertinaed.
I have a
couple of points to make, however. First, we learned a great deal this
morning, but I wonder whether it would be better in the future—I
make no criticism of today’s proceedings—to have a gap
between the evidence-taking sessions and subsequent consideration of
Bills. My second point is that we look forward to further consideration
of the legislation and perhaps to tabling one or two amendments on
Report, as we were encouraged to do by the Minister, when we can
explore matters in even greater
detail.
It
is always a pleasure to serve in Committees opposite the Minister and
with such an immensely sagacious group of colleagues. I thank all hon.
Members.
Sarah
Teather:
I, too, thank you, Miss Begg, for the way in
which you have chaired this Committee. I found it a very useful debate,
particularly this morning’s session. I hope that this innovation
in Public Bill Committees will be taken up by all Members.
I would like
to add to the point made by the hon. Member for South Holland and The
Deepings. It would be useful to have a gap between sessions, because
this morning’s opportunity to question witnesses changed the way
in which I thought about the Bill. It was a good example of the way in
which Members on both sides can contribute and ask pertinent questions.
The Committee was able to move forward considerably from the point at
which we started this
morning.
The
Chairman:
I add my thanks to Committee members. This was
the first Public Bill Committee that I have chaired. I thought that
this morning’s session was extremely useful—I think that
all Members
did.
Question put
and agreed
to.
Bill, as
amended, to be
reported.
Committee
rose at seven minutes to Six
o’clock.
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