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Baroness Blackstone: My Lords, I can confirm that my noble friend's figures are quite correct. It is estimated that about £300 million comes to universities direct from the fees paid by students from these countries. They probably inject approximately another £300 million indirectly into the UK economy. They constitute about 11 per cent. of the total number of overseas students. The Government are closely monitoring this matter and are working with the British Council to establish exactly what the extent of the problem may be next year and what can be done about it. Meanwhile the Government very much applaud the efforts of higher education institutions in helping existing overseas students from this region to deal with any hardship.

Lord Quirk: My Lords, does not the Minister agree that the 50,000 students from the region, the greatest number of whom are from Malaysia and Hong Kong, who come to this country annually are an important resource not only to higher education which benefits, as the Minister said, by £300 million a year--Imperial College receives £9 million a year out of that--but also

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to British industry as a whole, largely because of the networking that students get involved in during their years here? Would it not be a good idea and in their interests for British firms which have major involvement in the region to set up bursaries for as long as the emergency continues so that we can maintain this flow of students to this country?

Baroness Blackstone: My Lords, the Government regard overseas students in our universities as an important asset and one that we want to maintain. It is, of course, up to companies of the kind that the noble Lord, Lord Quirk, describes to decide whether they want to develop sponsorships or scholarships of this kind. I believe that some already do. The Government would very much welcome more of them establishing programmes of this kind. Meanwhile the Government, through the Chevening scholarship scheme, the Commonwealth scholarship scheme, and scholarships run by the British Council, offer awards to a substantial number of overseas students, including large numbers from this region.

Lord Beloff: My Lords, does the Minister agree that there is a particular problem, not so much with the Far East as a whole, but with regard to Malaysia? I have information that the number of Malaysian students coming to this country is falling rapidly. Does not this suggest that we made a mistake when we classed Commonwealth students as general overseas students while European students pay lesser fees? Would not the simplest thing be to treat Malaysians as honorary Europeans from the point of view of fees?

Baroness Blackstone: My Lords, the decision to change the fees paid by overseas students was made by the previous government some years ago. The noble Lord, Lord Beloff, is absolutely right that the fall in the number of students from this region is especially pronounced in Malaysia where there has been a drop in applications this year of about 25 per cent. I am, however, glad to say that for most of the other countries the number of applications is holding up, although, of course, applications may not necessarily result in entrants to our universities later this year. As regards treating Malaysian students as Europeans, I am not sure that Malaysian students would welcome that.

Lord Monkswell: My Lords, a figure of £300 million of revenue that universities may lose has been mentioned. Can my noble friend advise the House what proportion that is of total university revenue income?

Baroness Blackstone: My Lords, there is no suggestion that all of the £300 million that students from this region are paying in fees will be lost. That is the total sum they are currently paying. The Government and the universities hope that applications will continue to be submitted and that the eventual fall will be relatively small. As I just said, I am glad to say that the

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number of applications from most of the countries in the region is holding up. The £300 million is a tiny percentage of the total income of our universities.

Baroness Blatch: My Lords, does not the noble Baroness agree that the problem of losing students from the South-East Asian countries is compounded by the overall decline in applications of home students? Therefore the problems for universities are much greater. Will the noble Baroness confirm, or deny, that the £165 million extra that will be allocated to higher education in 1998-99 is permanent year on year funding that is additional to the base funding for higher education?

Baroness Blackstone: My Lords, the second part of the noble Baroness's question does not seem to bear much relation to what is on the Order Paper. The £165 million extra funding that has been found by the Government for next year arises directly from the changes in the funding of students that the Government are introducing. I cannot say what will happen in years after that because of the comprehensive spending review.

Lord Thomson of Monifieth: My Lords, will the Minister take some comfort from the fact that I seem to recall that over 30 years there have been recurrent occasions when everyone has prophesied woe as regards students coming from the Far East to this country--sometimes that was the result of the policies of the government of the day and now the fall in numbers is the result of financial circumstances in the Far East--but in each case there has been an extraordinary resilience on the part of the students, the political fears have proved unfounded and the attractions of British higher education have remained supreme?

Baroness Blackstone: My Lords, I entirely agree with everything that the noble Lord, Lord Thomson of Monifieth, has just said.

Asylum Seekers: Welfare

2.56 p.m.

Lord Evans of Parkside asked Her Majesty's Government:

Whether the proposal of Westminster City Council to move asylum seekers from London to Merseyside accords with their policy.

The Minister of State, Department of Health (Baroness Jay of Paddington): My Lords, social services authorities in London, as indeed elsewhere, are seeking to discharge their duties towards asylum seekers as they are currently defined in the most cost-effective and appropriate way. How this is done is, of course, a matter for individual authorities. We would, however, expect those seeking to move asylum seekers to consider very carefully the consequences of doing this, including the impact on the asylum seekers themselves and on the existing communities in the receiving area, and to seek

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the views of the local authority concerned. As I said in answer to another Starred Question on asylum seekers in your Lordships' House last week, we do not believe that the present system is working well. That is why the Government are reassessing the whole process, including the way that welfare support is delivered to asylum seekers.

Lord Evans of Parkside: My Lords, I thank my noble friend for that reply. Does she accept that a number of issues are raised by the proposal of Westminster City Council to relocate asylum seekers on Merseyside, as reported in the Evening Standard? Is my noble friend aware that Merseyside has probably the highest male unemployment in Great Britain and that if there is imported competition for the limited number of jobs available it may cause some friction with local jobseekers? Will the refugees' applications for asylum be speeded up or retarded by living in Merseyside rather than in London? More importantly, will my noble friend give a categorical assurance that no Merseyside local authority will be called upon to make any contribution towards the cost of the imported asylum seekers, no matter how long those asylum seekers remain on Merseyside?

Baroness Jay of Paddington: My Lords, all of the points that my noble friend has raised reflect precisely the considerable concern that is felt about this problem by the asylum seekers themselves and by the relevant local authorities. I assure my noble friend that we are aware of the potential for difficulties on Merseyside in terms of employment. That is why Westminster Council consulted carefully with the local authorities on Merseyside before deciding to take this step. As I am sure my noble friend is aware, the step was taken because of the large numbers involved. Suitable accommodation in London is now scarce. I assure my noble friend that the costs will continue to be borne by the London local authority. He will be as aware as I that a large number of asylum requests are pending. The Government are seeking to speed up that process.

The Lord Bishop of Lichfield: My Lords, is the Minister aware that local authorities near Gatwick airport estimate that expenditure on unaccompanied children seeking asylum is approximately £1.2 million a year? If so, is it not time for the Government to decide that the National Assistance Act will not be used in the long term for providing support to asylum seekers but that a return to a realistic benefit system is both cheaper and easier to administer?

Baroness Jay of Paddington: My Lords, we are very much aware of the problem of unaccompanied children. As the right reverend Prelate says, it is a problem in areas around airports and seaports in this country, and is growing. It is very much a focus of the review being undertaken. The review is comprehensive and will deal with the subject of unaccompanied children among the other relevant issues.

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