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Lord Morgan: My Lords, I know nothing of Northern Ireland and we have had an authoritative statement from the noble Lord, Lord Smith of Clifton, about the circumstances there. My only reason for intervening is that we are veering into the general issue of whether top-up fees are helpful or disastrous for universities. In the rest of the United Kingdom, Scotland is still considering them, but Wales is switching to the system.

The view of those in charge of our universities and of the organisation that represents them is that there is a desperate problem of underfunding. We cannot keep up the standard of universities—I am sure that this applies in Northern Ireland—without a complete change of policy. The alternatives are a major increase in direct taxation, which the Liberal Democrat Party proposes—but its arithmetic has been questioned—or some kind of share that gives a substantial increase in funding and makes provision for the means of students. The noble Lord, Lord Maginnis, did not show a full awareness of the schemes for bursaries and remissions that mean that the increase in fees for poorer students will be negligible.

Universities in England have already accepted and welcomed this proposal. University institutions in Wales have also accepted it. I think, to coin a phrase, that there is no alternative. I accept the view of the noble Lord, Lord Smith of Clifton, that there are special social and economic circumstances in Northern Ireland that change the context of the argument. But it seems to me to be beyond dispute that the general principle of top-up fees is essential for maintaining the international quality and competitiveness of British universities—and I speak as a former vice-chancellor.

Lord Dearing: My Lords, I cannot speak with any knowledge of Northern Ireland but, as one who has
 
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had some part in proposing income-contingent contributions by graduates to the funding of higher education, I would like to offer a word or two.

I agree that there is a great need to increase the level of funding for universities for the benefit of the students who attend them and for the quality of the educational experience from which they benefit. I have always thought that to seek a contribution from graduates on an income-contingent basis is equitable because, unlike the health service, which is available to us as of right, higher education is only available to those who can qualify for entry.

It is not available to all, but it conveys real advantages to those who go. First, it increases their ability to engage fully in life and to contribute to life. Secondly, it gives them the opportunity of more interesting jobs. Thirdly, it makes them less vulnerable to unemployment. Fourthly, for the majority, it gives them the expectation of a higher income. When I chaired an independent committee of inquiry into this some years ago, we found that there was a positive return. I am not specifically arguing on the Northern Ireland issue, but on the general issue of whether this policy is fair. There is a case in equity for asking for graduates to contribute on an income-contingent basis.

While it is right to ask graduates to contribute, the student has no money, especially those who come from poor homes. It is right that those who come from poor homes should receive a grant towards their living costs. For those from the poorest homes in England, that grant, as a result of debates in both Houses of Parliament, is to be £2,700 per year. In addition, there are to be loans at highly subsidised rates of interest. Indeed, the loans for tuition fees are, as has been said, at a zero real rate of interest. I was in Germany last week, debating these issues with members of the German university sector, students and government. Professor Nicholas Barr of the LSE was arguing strongly that the terms of these loans were very generous.

I am not arguing about Northern Ireland, but about whether these arrangements are equitable. I say that they are equitable. I hope that the House will be aware of that dimension of the issue in relation to other members of our community who do not have the opportunity to go to university.

Lord Forsyth of Drumlean: My Lords, I apologise for being a few minutes late for the consideration of this order. I have a specific question to ask the Leader of the House which relates to Northern Ireland.

I have no wish to rehearse the arguments we heard when we considered the Higher Education Bill and the provisions as they affected England. However, at that time a number of contributions were made on all sides of the House on behalf of part-time students and those who were studying through the Open University. The Government gave a commitment that they would look at the issue. They have not.
 
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I have had correspondence from the Open University and others. I remember the noble Baroness, Lady Boothroyd, making an impassioned plea in her role as Chancellor of the Open University. There were many speeches about the position of institutions which had part-time students. Therefore, those students in Northern Ireland who wish to study with the Open University, or at institutions which are providing part-time courses, will be interested to hear what the Government will do about the problem which they have created by introducing this scheme. The universities will benefit from the additional income from the top-up fees. There is no such provision for the Open University.

I realise that we are entering a sensitive political period but when I listened to the news on the radio this morning I heard the Government saying how committed they are to vocational training, education, and creating a country which is able to compete with China. It was a major theme of the Chancellor's Budget so I am sure the Leader of the House will not have come to the House to discuss the matter without being able to tell us exactly what will be done for those students who are at the Open University and in part-time courses.

When the assurance was given from the Front Bench, I took it in good faith that something would be done about the problem. The days of this Government are numbered and, therefore, they should get on with it.

Lord Pilkington of Oxenford: My Lords, like many of my colleagues, I know little about education in Northern Ireland. However, the Government are committed to devolved government and to take such an autocratic act—as they are taking over grammar schools in Northern Ireland—is wrong. Therefore, I support the noble Lord, Lord Maginnis. It is an autocratic act. Considering that they are negotiating, they should listen to the parties in Northern Ireland. Since a devolved assembly is proposed, it is—dare I say this in a quite emotional way?—quite disgraceful to impose the abolition of grammar schools and this measure. Therefore my vote is decided.

Lord Shutt of Greetland: My Lords, those of us who spent some time last week in the Northern Ireland Grand Committee are well aware of the size of the public sector in Northern Ireland. The other side of that coin relates to the size of the private sector. From where does the Minister believe that bursary funds are likely to come in Northern Ireland? The noble Baroness, Lady Blood, is in her place. I appreciate her work and concern for the Community Foundation for Northern Ireland. That body has now been in existence for 25 years. It has been trying to build up a crock of gold in order to use the income for the support of community causes across Northern Ireland. An interesting factor is that much of that crock of gold has come from the public sector because of the difficulties of raising money from the private sector.

The question I stress is this. From where will bursary funds come for two universities in a place where it is very difficult to raise money?
 
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3.45 p.m.

Baroness Amos: My Lords, I know that this a highly emotive issue, as was made clear when we discussed the Higher Education Act in this House. Perhaps I may also say to the noble Lord, Lord Glentoran, that I welcome his opening remarks. Despite the differences that there have been across the House on Northern Ireland business, our debates have always been conducted in a constructive way. I entirely appreciate that the noble Lord's disagreements with the policy are not disagreements with me personally although, of course, I speak on behalf of the Government.

I recognise that it would have been preferable for this legislation to be taken forward by the Northern Ireland Assembly. The noble Lord, Lord Maginnis, was also concerned about that issue. However, I emphasise that the policy proposals and the draft legislation have been fully consulted on in Northern Ireland although, again, I recognise that the outcome of the consultation was negative and the reaction critical. But I also have to say that no viable alternatives were proposed.

The noble Lord, Lord Glentoran, raised a concern about a possible rise in the level of student debt. I recognise that student debt is a matter of concern to those who believe that the proposal will be a deterrent to higher education, particularly for those from lower income backgrounds. The proposals will make higher education free at the point of access and fair at the point of repayment. No student or parent will have to pay any fees before or while studying at university. Graduates will have to repay only once they start earning over £15,000 and then at a very reasonable rate linked to their income.

Perhaps I may also say this to the noble Lords, Lord Glentoran and Lord Molyneaux. The key point is that there is no "do nothing" option for Northern Ireland. The Higher Education Act will fundamentally change the way in which higher education is funded in England. In the absence of this order no fee deferral arrangements exist which would enable the Department for Employment and Learning to provide funding to the institutions in the first instance to the extent that students choose to defer their fees. That means that almost 7,000 Northern Ireland students who go to English universities would have to pay the new fees, up to £3,000 up front, each year, from 2006.

The noble Lord, Lord Smith of Clifton, was concerned about applying English solutions to a Northern Ireland issue. We have taken the opportunity to tailor this legislation to reflect the specific needs of Northern Ireland. For example, we have not replicated the provisions in relation to the Office for Fair Access and the establishment of an office of the independent adjudicator to hear student complaints. The noble Lord was also concerned about comparisons with Scotland and Wales. Indeed, my noble friend Lord Morgan picked up on these points and sought to clarify them.

The Scottish Executive has announced that new students studying at a Scottish university will have to pay higher tuition fees from 2006–07. The level of tuition fee has not yet been set but is expected to be between £1,700 and £1,900 each year. This would mean
 
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that a four-year degree course in Scotland would cost approximately the same as a three-year course in England. Of course, there may also be a separate, higher tuition fee level set for medical students.

As regards Wales, a review is currently being undertaken under Professor Rees of fees and student support. That review will report in due course. Decisions will then be taken with respect to the ongoing fee level in Wales.

The noble Lord, Lord Smith, raised the importance of looking at socio-economic differences. The noble Lord, Lord Maginnis, spoke of spiralling costs for students. I am of course aware of the socio-economic differences between Northern Ireland and England and that there is a higher participation rate in Northern Ireland. The proposals will help across the range, but will seek to ensure that access to higher education is protected for students from disadvantaged backgrounds. There will be no financial barrier to students choosing a particular course or university as they do not have to pay before they study or while studying.


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