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Earl Russell: My Lords, I thank the noble Baroness for the amendment. Indeed, one must always thank Ministers for small mercies. But I think that this is a very small mercy. If the Minister compares the words of Amendment No. 60 with those of Amendment No. 61, which I do not intend to move at this time of night, she will observe a very considerable discrepancy. I grant that Amendment No. 60 prevents the Government from distinguishing between different academic subjects. As far as I can understand it, it does not prevent the Government from imposing a term or condition such as, for example, the abandonment of the tutorial system on all academic subjects. I do not know why not. I can find nothing in Amendment No. 60 or any of the material in Amendment No. 61 relating to the academic conditions for the selection of staff or the admission of students. Can the Minister tell the House why not?

Baroness Blackstone: My Lords, I have made clear in Committee and in speaking earlier this evening that I fully understand the motives behind the noble Earl's amendment and I sympathise with its aims. I know that university autonomy is a sensitive issue for vice-chancellors; after all, I have been one. I quite understand concerns about academic freedom. I can only assure the noble Earl once again that this Government are committed to upholding the principle of academic freedom. We have no intention of prescribing how universities should carry out their teaching, to refer to one example that the noble Earl has just mentioned. We have no intention--under the 1992 Act I do not think the Government would be able to do so--of prescribing how any university should select its students. I do not think that I can say any more than that. I have tabled what I believe to be a helpful amendment to meet the concerns of your Lordships' House on the issue of academic freedom in relation to the kind of subjects that are taught. Of course that is a matter for the universities, as is the question of how they carry out their teaching. It is quite unnecessary for us to bring forward an amendment that prescribes the powers of the Secretary of State in relation to teaching methodology or indeed the selection of students.

Lord Pilkington of Oxenford: My Lords, with the leave of the House, I have a worry which the Minister will most probably be able to dismiss. It seems to me

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that the Government have taken control of university tuition fees. The financing of universities will now be a matter for the Treasury and the university concerned. Let us suppose the universities want to raise tuition fees. In the old days they negotiated with the HEFC. Now they have to negotiate with the Treasury. The Minister shakes her head, but where will the money come from? The Minister's colleagues look worried. If universities want to raise tuition fees two years from now, how would they do that?

Baroness Lockwood: My Lords, before the Minister replies I wish to ask her a question. As I understand it, there is no difference between the funding of universities and the role of the Higher Education Funding Council as proposed under the Bill, and the position which exists at the present time. Would it be appropriate to prescribe in a Bill what the academic responsibilities should be of either the governing body or a vice-chancellor of a university? Would that not in itself be breaching the principle of academic freedom?

Baroness Blackstone: My Lords, I say to my noble friend Lady Lockwood that I think I have already answered that question. The Government have no intention of interfering in the academic decisions that are made by our universities. I am puzzled by the point raised by the noble Lord, Lord Pilkington, as it does not appear to have anything to do with this amendment. It is perhaps relevant to the subject of later amendments when we shall discuss whether top-up fees should be included on the face of the Bill. All I can say to the noble Lord is that the Government have not taken control of university tuition fees. In this clause they are taking a reserve power to prevent universities charging top-up fees. It is a power that we hope we shall never have to use.

On Question, amendment agreed to.

[Amendments Nos. 61 and 62 not moved.]

Earl Russell moved Amendment No. 63:

Leave out Clause 18.

The noble Earl said: My Lords, I beg to move that Clause 18 do not stand part of the Bill. I must declare one more interest. I am advised on this by the principal of my own college who says among other things, "In my dealings with foreign delegations considering to what country their students should be sent, reassurance is often sought that the government of the day do not have control of the university. It would be difficult to have to say that the law provides power for a Secretary of State to impose conditions on the amount and nature of fees to be charged to students--conditions which may impact on the general quality of education we can provide".

I am in agreement with that view. Clause 18 is not fit for a curate's breakfast. No parts of it are excellent. It is objectionable both in whole and in part. Clause 18(2) is a Henry VIII clause. It was not identified as such by the Delegated Powers and Deregulation Committee.

Clause 18(3) deals with the matter we have just discussed. I am not in the least satisfied by the Minister's answers. Ministers always say that they do

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not intend to interfere with academic freedom. What Ministers intend to do is to save money; and they do that absolutely regardless of the effect on academic freedom. That is an old story and it is independent of party.

Clause 18(4) is a power to impose a cap--the reserve power to which we referred just now. It gives the Government in the end ultimate power to determine costs. Clause 18(6) is in effect a power to exclude from the state system those who do not co-operate with that cap. That is intended, I think, to be a bluff. One day that bluff may be called. The end of a state-funded system of higher education would indeed be a disaster. If the clause reaches the statute book I, for one, cannot be certain that that will not happen.

The clause strikes me as being somewhat like sending someone to sea in a rather rickety submarine which has suffered a certain amount of war damage, and then barring the escape hatch. The power to charge a top-up fee is precisely that; it is an escape hatch. No one wishes to exercise the power any more than he wishes to escape from inside a submarine in deep water. But there may be circumstances when it is not possible to provide a competent academic education for the amount the Government provide. The options may be only to do that or close down. It is in that spirit that I describe the provision as like closing the escape hatch of a submarine.

Perhaps a more appropriate parallel is the air force in World War I. It appeared to those in command that it would diminish the courage of those who were flying if they were allowed parachutes. So it was decided that they should not be allowed parachutes for fear they might desert their planes and avoid battle. It is not my intention, nor I believe the intention of anyone else, that any university should charge top-up fees. But it appears to me to be necessary that in the process of adjusting what shall be paid for the support of universities there should be a process of negotiation.

It is entirely proper that the Government have the final say in how much public money should be spent. Where the Government cannot have the final say is in deciding how much that money will buy. For that is to enter an area where government's competence is limited. It also breaks the basic principle of the market: the Adam Smith principle that a deal must be in the interests of both sides. For if the Government have the power to determine both how much they will spend and what that money will buy, we then get into what is best described as the Aeroflot system of funding. I have not forgotten the noble Lord, Lord Boyd-Carpenter, asking in this House that the Government should deny landing rights at Heathrow to Aeroflot for reasons for air safety.

There is here an issue of academic freedom. At Second Reading the noble Lord, Lord Whitty, said that if that was so, he did not understand what the words "academic freedom" meant. The content of courses inevitably has implications as to costs. If the cost of a course cannot be decided, its content cannot be decided; library or laboratory provision cannot be decided upon. So in the end you are told, as the Treasury always does, that you have to cut your coat according to your cloth.

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If that principle gains control, there will be no way in which we can decide upon the content of courses according to their academic merit. When that happens, I do not know whether it will be worth preserving a state-funded system of higher education any longer. I should regret its disappearance desperately.

The one serious argument from the other side during our discussions was put at Second Reading by the noble Baroness, Lady Kennedy of The Shaws. I gave her notice that I intended to refer to it. She raised the point of access. I care about that as deeply, I believe, as she does. I have not forgotten one of my school contemporaries who was in the first year with me at Oxford referring to somebody who was 10 times the scholar he would ever be as, "You know, the sort of person who ought not to be here", simply because he had a Lancashire accent. I have no truck with that sort of attitude.

But I also remember the noble Baroness, Lady Symons of Vernham Dean, a few weeks ago answering a Question from my noble friend Lord Carlisle about why there were not more ethnic minority ambassadors. She had some suggestions as to things that might be done, as indeed do I. But in the end her answer was that the problem was lower down. It was perfectly obvious both that that answer was true and that she was having great difficulty putting it over to the House. If people ask about the proportion of people from state schools in universities, that is very often the answer. The place where we need to look is not university admission procedures, but school libraries.

The other response is: what is the point of providing more access if that to which we are providing access no longer deserves the name of higher education? To say that more and more people should receive higher education--which is a good proposition--is no excuse for ensuring that what they receive does not deserve the name of higher education at all. If this clause remains in the Bill, that is what will happen. I beg to move.

9.30 p.m.

Lord Beloff: My Lords, I support the amendment proposed by the noble Earl, Lord Russell, although from a rather different perspective. Unlike the noble Earl, I hope that there will be top-up fees in many universities. I believe it is the only way in which we can meet the type of model which the noble Lord, Lord Desai, outlined for us in a debate on the Bill earlier today; that is to say, to depart from the obviously catastrophic attempt to finance on equal terms out of the public purse 150 institutions of higher education in order to proceed to something closer to the American model where a range of different institutions are funded in different ways, partly from the public purse, partly from private purses and partly from students, making it possible, as the noble Lord, Lord Desai, pointed out, for entry not to be governed by the ability to pay. That is the key to a proper system of higher education.

The cause of our present problems is a notorious failure on the part of the Department for Education over a period of years to foresee that it was creating an

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insoluble problem. It postulated a growth in the number of institutions and students without reference to whether it would be able to pay for those students to receive the kind of instruction to which they felt they were entitled. In addition, to take up a point made by the noble Lord, Lord Glenamara, the assumption was that there would be places for everyone with suitable ability; but, in order to maintain the pace of expansion, the ability threshold--perhaps not in terms of individual talent, but in terms of preparation for university work--was allowed to fall.

I believe that the noble Earl, Lord Russell, is right. If this provision remains in the Bill, we shall eventually see a collapse of the higher education system funded primarily by the state without making it possible for the lacunae in that system to be filled by enterprise, different forms of financing and endowment and different levels of fees.

I know that this is wholly different from the view of the Government as it was expounded. They have not been able to convince people with direct experience of universities today that what they propose is workable and that they can somehow produce a system which will be generally acceptable and admired internationally, as the British system has been in the past, without some departure from their rigidity on the matter of fees.

The noble Lord, Lord Whitty, mentioned that the Bill would be further amended in another place. I hope that the Bill will never reach another place. After all, the Government have been defeated twice today on amendments of importance, although not as important as the one we are discussing now. They know perfectly well that they are riding for a fall, even if the amendment of the noble Earl, Lord Russell, is not accepted. The general university world will not accept their outlook. It would be far better for them to let things ride for a year or two, to look at what should be done about the financing of higher education and to come back with a Bill which is not only better prepared but also better drafted so that much time will not have to be spent in your Lordships' House in trying to penetrate the intention of the Government on this or that issue.

This is a very sad matter. It is sad to have to speak in these terms in your Lordships' House, but I find it impossible to do otherwise.

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