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Lord Dearing: My Lords, I know of no matter that, during debates on the Bill, has attracted more solid consensus than the need to do something for part-timers. We are a nation committed to the principle of lifelong learning, and we want all people to be able to benefit. I had better declare an interest: I was chairman of the University for Industry and am now its patron. That institution is dedicated to the cause of lifelong learning for everyone.

The noble Lord, Lord Phillips of Sudbury, referred to his wife's having done a part-time degree and having done very well. However, many other women, possibly of a similar age, do not live in such a well heeled environment. They need financial support to encourage them to persist with their courageous decision to go back into the world of learning after 10 or 20 years out of learning or work. They have high aspirations, and we must support them. I join all those who have spoken in asking the Government to take action.

There is a hole in the White Paper of January last year. We were all so transfixed by the issue of variable fees and what it involved—it was breaking new ground—that we forgot that, in concentrating on the full-time, we were creating a problem, a disparity of funding that would affect the OU, Birkbeck and other higher education institutions that have a high proportion of part-timers. There will not be the money to compete for staff, for example. There must be action.

The noble Lord, Lord Forsyth of Drumlean, teased me about the malleability of civil servants. I assure him that someone who has worked for Mr Benn and then switched to working for Sir Keith Joseph has a fairly malleable mind. Malleable or not, I would, if I were writing the Minister's brief, say, "You have got to do something, but, for goodness' sake, be careful, if you do not know what it will cost or where the money will come from". Perhaps, the noble Lord, Lord Burns, would give similar advice.

Lord Forsyth of Drumlean: My Lords, does the noble Lord think that it is conceivably possible that officials in the Department for Education and Skills could have forgotten about part-time students in such large numbers? Was it just that the Government did not want to face up to the financial consequences of dealing with the problem?

Lord Dearing: My Lords, as the noble Lord has perceived, I am a man of limited imagination. As one of limited imagination, I must confess that, when I gave a rather lengthy public commentary on the White Paper, I did not focus on the part-time issue.

There is a hole, and we need two things. We cannot wait long; we need some first aid. Before we get a long-term solution, the matter must be properly researched. We must know how much it will cost and how the
 
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money can best be spent. The Minister has already assured us that we do not need legislation to do something, so I hope that she will enlighten us about what the Government have in mind.

Baroness Ashton of Upholland: My Lords, it has been a long and interesting debate. Mindful, as ever, of your Lordships' desire to hear the detail from the Government and to finish Report stage this evening, I shall be as brief as I can. It is a delight to see my noble friend Lord Sheldon taking part in the debate. I am grateful to him. I shall resist the temptation to go through many of the things that I said in Committee.

This Government have done more than any other to support part-time students. To my noble friend Lady Blackstone, I say that we have introduced a grant from the autumn. To the noble Baroness, Lady Greengross, I say that there are no age limits on those grants. We have increased the funding to help part-time students from £18 million in 2003 to £37 million in 2004–05. We hope to more than double the number of students whom we can help. The Government have shown commitment to the matter.

I am conscious that my noble friend Lord Graham of Edmonton has told me to be statesmanlike; that my noble friend Lady Blackstone has invoked heaven in the debate; and that the noble Lord, Lord Phillips of Sudbury, is going to take to the streets. I recognise the pressure on me from different parts of your Lordships' House. Knowing Lady Phillips, I know that she would have got a first-class degree, whatever she did. She is an extremely able woman.

There are four amendments in three distinct categories. The first two—Amendments Nos. 28 and 36—are similar and relate to the role of the director and access plans in relation to part-time students. Amendment No. 54, tabled by my noble friend Lady Lockwood, is concerned with regulating part-time fees. Amendment No. 55 is about support for part-time students, and I shall start with it.

The question that I want to raise is about the rationale behind the amendment. We know that part-time higher education is a vibrant and growing market and that part-time numbers are rising faster than full-time numbers and have done so for several years. As the noble Lord, Lord Dearing, just said, it is critical that, whatever we do, we do it on the basis of evidence. There would have to be a substantial increase in public investment to achieve what Amendment No. 55 would require. That is not to say that we are ruling out changes. Noble Lords have made eloquent statements of the need to consider part-time students, but we need evidence in order to make the changes.

In the amendment is the assumption that part-time students want loans. We had a loan scheme for part-time students, and take-up was extremely low. That is why we have introduced grants from this autumn. We must think carefully about what we would be doing, if we made the amendment. We did some costings, and we found that it would cost about £0.75 billion. The amendment covers students on 50 per cent-plus courses. If the scheme were to be extended to students
 
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on any kind of part-time course, the costs would rise to about £1 billion. Those are big amounts of money. Before we take big, costly decisions, we must be sure that we do so on the basis of the correct evidence. So it is not that I do not think that those matters are important or that a case could not be made, but we do not have the evidence to assess the case.

The noble Baroness, Lady O'Neill, who is not in her place, said that we need to think about that group of students as not being all the same. There are many different categories of students who are studying part-time, which make it a rich and vibrant group. But we need to make sure that we have the evidence.

So what are we doing? Currently, we are running a survey of part-time students and their financial backgrounds. The contract for that has been awarded to the Open University and we are grateful for its work on the survey. Next year, we will get more information when part-time students are included in the income and expenditure survey, which will also assess their needs in the light of the new grant that they will be receiving by then. Again, we shall have a much greater evidence base.

We must then decide what we wish to do, which we would be doing on the basis—

Earl Russell: My Lords, I have every sympathy with the noble Baroness in her search for evidence. Perhaps I may ask her to include two things within it; namely, the possibility that for older people an interesting education may result in improvements and therefore saving in health and, for people of child-caring age, excess expansion reduces the space available for child care.

Baroness Ashton of Upholland: My Lords, I am not sure that I quite understand the noble Earl's second point. But—

Earl Russell: My Lords, the same room cannot be used for child care and lecturing at the same time. So if the college is jam-packed, there is nowhere to look after the children.

Baroness Ashton of Upholland: My Lords, the National Childcare Strategy is working precisely to support children and child care in lots of different locations. Of course, we supply support for people who have children, to enable them to take part in education. As I have already said, the question of age and grants available does not apply: the grants are available regardless of age.

It is critical that we get the information that we need and make the decisions based on that information. On that basis, I would ask that Amendment No. 55 be withdrawn.

As regards Amendment No. 54, institutions have always been free to determine the level at which to charge for part-time courses. That unregulated market is working well. We have no desire to interfere with it. If we were to regulate part-time fees, we would be imposing new restrictions on institutions where there
 
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have never been restrictions before. A cap might be imposed on fees that are less than some institutions currently charge and employers or students currently pay. That would have a dramatic effect on the income of those institutions: some might stop running the courses. Equally, if we set the cap higher, there might be an upward drift in fees charged. We do not believe that that is the right way to go or that we should regulate. I hope that my noble friend will not press her amendment.

I turn now to institutional funding and the review. Noble Lords have mostly talked about the Open University and Birkbeck, but I think that they are also interested in this issue in more general terms. We are very aware of the concerns that some institutions have expressed—particularly those with a high number of part-time students—about the funding for part-time students in the light of our proposals.

Last autumn, the Higher Education Funding Council for England consulted the sector about proposed changes to its teaching funding methodology. That consultation, and the responses to it, led to some changes to the way that the funding for part-time students will be calculated for the 2004–05 academic year. I understand that allocations have been announced. For the longer term, HEFCE has commenced a comprehensive review.

Following debates in your Lordships' House at Second Reading and in Committee, we have had further discussions with HEFCE regarding the scope of its review of the funding methodology. In particular, we have pressed it to ensure that the review is conducted and that proposals are developed as quickly as possible with full consultation with the sector. That consultation needs to take account of the position of those institutions with a strong interest in part-time issues. That does not refer simply to the Open University and Birkbeck, although, of course, they are very important players. We have also asked for an assurance that changes flowing from the review will be implemented at the earliest opportunity.

I am pleased to say that HEFCE has responded very positively and has confirmed that part-time issues, far from being an add-on to the review, will form an important and integral part of it. Its starting point will be to consider whether in the future it makes sense to continue the full-time/part-time distinction at all and how to develop a better approach that is consistent with more flexible learning.

HEFCE has also confirmed that its fundamental review, which is now under way, will involve extensive consultation with the sector on the issues that are to be addressed. Its expectation is that in summer 2005, it will be in a position to consult on the principles of the new system with a view to finalising proposals for a new model in early 2006, which would be before the introduction of variable fees. Those recommendations can then be implemented in a phased way as soon as the associated financial information systems can be developed.

Therefore, before variable fees are introduced, universities will know the funding regime and the broad implications for the sector. Of course, that does not
 
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address the very specific issue of the implications of variable fees for those institutions with predominantly part-time students. Here again, HEFCE proposes further consultation with the sector on the detail of what will be the transitional arrangements pending the introduction of the new funding method. It has explained that using its current funding formulas, if it did so happen that full-time tuition fees increased at a greater rate than part-time fees, there would be a natural rebalancing of government funds in favour of part-time courses. It has also agreed to consider the special cases that both institutions—the Open University and Birkbeck—have made regarding their funding, with a view to the HEFCE board coming to a decision in the autumn.


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