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We have no objection to making better use of the Special Public Bill Committee procedure, which we have recently used successfully for the Committee stage of the Third Parties (Rights against Insurers) Bill, which is a Law Commission Bill. It is essentially a very good idea. There are one or two drawbacks; for example, proceedings in Select Committees are less accessible to Members of the House, as only Peers nominated to the committee can participate fully in the proceedings. My noble friend Lord Grenfell spoke powerfully of the need to use Public Bill Committees better to engage with the public, with which I agree. My noble friend Lord Filkin spoke of the time implications of more use of this procedure, which should be taken into consideration.

My noble friend Lord Brooke mentioned petitions and online consultation, which should also be further considered. While I do not say that it is a bad thing, I was interested to read in evidence given to the Wright committee a comment that the public's desire is for influence rather than for participation. I make no judgment; I just reflect that comment.

On public engagement, the Information Committee has produced an excellent report. We briefly debated it ahead of its publication, and I hope that there will be opportunities for a longer debate. I, too, welcome the Lord Speaker's work in outreach.

In the debate on the Loyal Address, my noble friend Lord Rooker said that Bills coming to this House should have an accompanying note stating which amendments had been debated. That is a fabulous idea; I want to take it forward; I have mentioned it to

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the Procedure Committee. However, in looking at the proposal more closely, it has become clear to us that producing this type of document would be far from straightforward. It is not clear how one might impartially determine which provisions of a Bill have received an appropriate level of scrutiny in the other place, and there are some problems of methodology. That is not to say that we should not try to do it-we shall try, but it is not as easy as it might at first look.

Should Committee stages be taken off the Floor of the House? There has been an interesting debate today, and we will look at the idea further. The noble Baroness, Lady Shephard, said that the world is changing and that we must change with it by looking at cross-cutting issues, in relation, for example, to security. I wholeheartedly agree with that. Many would agree that we need less and better legislation, but I have to tell her that badges are still worn with pride, as they would be in any Government. However, I take issue with her views on the Personal Care at Home Bill, because that will have a profound effect on people's lives.

All regulatory policy is open to scrutiny by the Regulatory Policy Committee, an independent body, through published impact assessment. The noble Lord, Lord Alderdice, was right that the new Parliament will be a great opportunity for both Houses together to improve the ways in which we work. I hope that we will all seize on that. There is much that we can learn from colleagues in other legislatures, but there is also much that we can learn from each other in both Houses of Parliament, which we should do more of.

It was agreed in another place on Monday night that the question of sitting in September should be reconsidered in the next Parliament following a recommendation from the Wright Committee-but, of course, we are not bound by the decisions of the Commons on that.

This has been a healthy and timely debate as we come to the end of this Parliament. Over recent months, we have put in place a number of new arrangements designed to enhance the House's ability to scrutinise legislation, air issues of public interest and hold the Government to account. Like my noble friend, I believe that strengthening Parliament is good not only for Parliament but for government as well. It is right and proper that we should continue to look for new ways of adjusting and improving our practices and procedures to ensure that they are fit for purpose.

Today we have evidence of many potential new improvements. We must not be paralysed by either procedures or processes; we seek improvements because we understand the importance of good governance. Today's debate has helped to move us forward. I have said that I hope the process will culminate in the establishment of a Leader's group to conduct a systematic review of some of the issues raised today and on previous occasions by Members of the House.

I conclude by thanking all noble Lords who have participated in the debate today, which I am sure will be a huge catalyst for the process of change.

Lord McNally: Four-and-a-half weeks is a very precise timetable which, on my calculation, takes us to 30 March. Is the noble Baroness content to lead tonight's six o'clock news?



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Baroness Royall of Blaisdon: My Lords, my four-and-a-half weeks of legislative time led me to the Wednesday before Maundy Thursday. I believe the House will wish to break for an Easter Recess irrespective of what happens about the election.

2.21 pm

Lord Norton of Louth: My Lords, this has been a superb debate. The contributions have been notable not only for their number but for their quality. I am grateful to everyone who has taken part, not least the three party Leaders, and I am grateful for the response of the Leader of the House; I know how seriously she takes her responsibility in that capacity. She will be most welcome to enrol at the University of Hull-perhaps following my noble friend Lady Miller of Hendon, who has just graduated from the university with an MA in legislative studies

There has been a clear theme throughout this debate-that we do a very good job but that we can and should build on that, not least to enhance our links with the public. There have been some excellent proposals and, as my noble friend Lord Higgins and the noble Lord, Lord Filkin, said, a consensus appears to be emerging. Like the Leader, I reiterate the words of the noble Lord, Lord Rooker: good government benefits from a strong Parliament; a confident Government should welcome changes designed to strengthen Parliament.

Like the Leader, I trust today's debate will constitute but one part of a process of ensuring that this House enhances its role as a crucial part of our political system. I look forward to moving ahead on the proposals that have been put forward. We have the political will; we now need to exploit it. I beg leave to withdraw the Motion.

Motion withdrawn.

Higher and Further Education: Funding

Debate

2.23 pm

Moved By Lord Baker of Dorking

Lord Baker of Dorking: My Lords, this is the last occasion in this Parliament on which we will have an opportunity to call the Government to account for their policies in higher education, universities and FE colleges. We have just had a debate on scrutinising legislation and public policy-how the House of Lords can get better. It is a disgrace that the Secretary of State is not replying to this debate. He is the author of the policy and, if you are going to improve the ability of the House of Lords to scrutinise public policy, you should have the Cabinet Minister replying. It is very rare for this House to have a departmental Cabinet Minister in it. In the House of Commons there would be no question at all: the House would have insisted that the Secretary of State replied. In fact, the Secretary of State said earlier today that he had departmental business. I suspect he is trying to settle disputes between the Chancellor and the Prime Minister and other members of the Government. However, he has a duty

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to be here because the cuts he has introduced will have a substantial effect on the whole of the university and FE world.

There are 350 further education colleges in which 3 million people are trained every year. The cut in this sector is 16 per cent but, as it is focused on adult education, 147 colleges have said that they will have to cut their courses by 25 per cent. The head of Walsall College, Amrit Basi, said that this September he will probably have to cut by 25 per cent, which means 8,000 fewer adults in training. On Tuesday I went around an FE college in London and was surprised at the number of people in their twenties and thirties who were going through retraining; it was a very large number. I spoke to one young lady in her late twenties, I thought, who was training to be a mason; she was chiselling out a piece of Portland stone. I asked her what she had done previously and she said that she had been on the trading floor of an investment bank. So she was at least learning a craft that would be useful in her life. All around, there were other people like her doing various courses. These are the courses that are going to be cut.

On Teesside, for example, the House knows that the Corus plant has been closed, as have all the ancillary companies, and that this has devastated the area. There is massive unemployment, with people of all ages-twenties, thirties, forties, fifties-out of work. So what is happening to the colleges in that area? Middlesbrough got a big cut; the principal of Redcar said:

"These cuts will have an impact on adults and those who wish to develop their skills for working life",

and there have been cuts in Stockton and Cleveland. So in the Teesside area you have the extraordinary anomaly of unemployment increasing dramatically and cuts in adult training. Is that joined-up government? No, it is disjointed, disorganised and disastrous government. It is extraordinary that the choice in Teesside is between training or the dole, and for a Labour Government to accept dole as the answer by cutting the training places in Teesside is absolutely disgraceful.

I turn now to universities. The cut this year is £449 million. The Minister will say that that is 5 per cent and the universities can accommodate that. However, it is much more than 5 per cent because it is in addition to the £600 million that has already been announced for the following years. The real cut, in fact, is £1 billion-that is what we are talking about-so beware the honeyed words that you might hear in the Minister's reply.

This is the biggest cut for 30 years. Over the past 30 years we have had a magnificent record in developing higher and further education; it has been a golden period. However, before the Minister takes all the credit for the Labour Government doing this, let me remind him that the big increase in students took place in the Thatcher/Major years, when the figure doubled, from 500,000 to 1 million. In a speech I made in 1989 at Lancaster University I did not set a target but forecast that this would happen because of the natural ambition of young people wanting to go into higher education to improve their lot in life, to improve their education and to move on. It was going to

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happen; the circumstances were in place and there was rapid growth. In the Blair/Brown years there was an increase of 500,000 students-50 per cent, not 100 per cent-to about 1.5 million.

As a result, both Governments provided substantial money to this sector. We managed to retain certain world-leading universities, and we still have a clutch of universities and colleges in the top 20 in the world. The universities make an important contribution to the GDP of our country-nearly 2.5 per cent. In research, we box above our weight; we have 1 per cent of the world population and 12 per cent of the scientific citations. We should be immensely proud of this. Universities of such quality are a great asset to our country. America and Britain stand out in the world as having these quality institutions. However, they are always under threat through a lack of money. That is why the Government, quite correctly, introduced fees.

I was speaking yesterday to the noble Lord, Lord Rees, the Astronomer Royal and Master of Trinity College, Cambridge, another great gem in higher education. He said that some years ago we were able to attract some of the greatest scholars, researchers and teachers, but now it is much more difficult. This is because other countries-not America-are trying to catch up and are offering high salaries and attractive terms. All the time money has to be found for the university sector, not cuts. No Government, of any party, will ever provide universities with the sort of money that they need or deserve, so the damage to universities will be quite considerable.

The quality of speakers in this debate, including chancellors, vice-chancellors and heads of colleges, tells its own tale. Every university is going to be hit in one way or another-some very severely indeed. The sector has estimated that some 15,000 jobs are likely to be at risk. I do not think that it is shouting "Fire!" unnecessarily; it is already beginning to happen. King's College has already announced a redundancy programme of 205 staff; Leeds is expected to make 700 redundant, Sheffield 340 and Hull 300. I was saddened to read in the evidence sent us by the British Medical Association that in the medical faculty at Imperial College, one of the spectacular great colleges of the world, 26 people have already been made redundant and there is a threat that another 50 may go. This, after 12 years of a Labour Government, is really a great sadness and a national disaster. It is reflected through the whole of our estates of our universities.

Teesside University has come together very well and won a prize last year for being one of the most successful universities. It had devised a plan this year for a scheme of £2 million to help poor students with bursaries and scholarships, but the university has had to scrap it. One perverse consequence of this programme of cuts is that the poorer students are the ones who are going to be hit. That is an extraordinary thing for a Labour Government to do. If you restrict universities on the numbers that they can take, they will raise their entrance standards; that is already happening across the board. Some universities are saying that they will require three A-levels of AAB rather than of ABB. Who benefits from that? It will be the beloved sectors that the Government want to promote-private education

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and grammar schools, along with some of the better comprehensives. So their policy is having the most extraordinary perverse effect on social inclusion. It is extraordinary that the Labour Government, who have made such a thing about social inclusion in higher education, are creating and implementing a policy that will make it less, not more.

As for the numbers of students likely to suffer as a result of this policy, there are various estimates by various vice-chancellors and the head of the Russell Group. Between 200,000 and 300,000 youngsters will not be able to get to university or college this year. That is denying a generation; it is a generation abandoned. I am sure that those who voted for new Labour in 1997 did not think that after 12 years they would abandon a generation of youngsters, who will not go to college this year. The numbers have been cut; the 10,000 that the noble Lord, Lord Mandelson, increased last year have been removed totally and all universities are beginning to say that they will recruit less. This is a tremendous sadness; it is not a policy that can be defended in common sense. What will we do with those 300,000 who cannot get into college? Some of them will go on to the dole queue. Again, it is the Teesside conundrum. It is very regrettable that this policy has actually occurred. Of course, if universities dare to increase their recruitment over the figures set by HEFCE, they will be fined £4,000, which is again an extraordinary policy to follow.

The last cut from which universities will suffer is capital, which will be cut by 15 per cent. I seem to remember hearing a speech by the Prime Minister about 18 months ago in which he said that one way in which to get out of this recession was through public investment in building projects of one sort and another-the Roosevelt pattern, the Keynesian solution. Well, that will not happen in the universities, where 15 per cent will be cut.

I had a letter from the noble Baroness, Lady Andrews, who was recently a member of the Government but is now head of English Heritage. If she was still a member of the Government, she would be making a speech similar to the one that the Minister will make today. She is very concerned, at English Heritage, that the £40 million that was given last year to the universities right across the board to restore their historic buildings is all going to be cancelled. They will not get a penny. This is capital building in a recession! These are a Government of adjectives, when they talk of policies. This is not a constructive policy at all, and the losses are enormous.

Oxford, whose chancellor is here, will lose £5 million, while Cambridge will lose £4.25 million. The vice-chancellor of Durham has 65 listed buildings in his estate, some dating from the 11th century; he will lose £700,000, which he says that he will have to spend on the buildings as they are actually crumbling. So it has to come out of the teaching grant.

The Government are following a crazy policy on all this. They are not giving enough money to increase training for the unemployed and they are cutting the capital costs which was supposed to help in employing the unemployed. I hope that the Minister is taking a little of this on board and will be able to answer some of it.



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What should we do? First, I would recommend-and I hope that the next Conservative Government will do it-removing responsibility for universities and further education from the Department for Business, Innovation and Skills. In the old days, it was always called the Department of Trade and Industry, but again adjectives have won. The department run by the noble Lord, Lord Mandelson, should not be responsible for universities and FE; they should be returned to the education department. It is the natural continuum. If the education department had been responsible for universities and FE this year, I can assure the House that the cuts would not have been as severe. Having been responsible for the budget of that big department for more than four years, I know that it is always possible to find a little bit to cushion the blow. It would have been quite possible for the education department to have found some of that £449 million and given it to universities and FE colleges. That is one advantage.

I am glad to see that the Tory Party has said that it will increase the number of places this year by 10,000. David Willetts has made that commitment, and we must hold him to it after the election and ensure that it is somewhere in the manifesto. That will be paid for by an earlier payment of student loans to the student loan scheme-so it is costed.

Furthermore, there must be a fundamental look at the funding of universities. This is a spatchcock set of proposals, desperate because the Government are in a desperate position. Of course, the university world will have to make some cuts in this situation, and I am not saying that they should not have to take some. But these cuts are too savage and far too high, at 10 per cent for universities and 16 per cent for FE colleges. That means that we must put a lot of hope and expectation in the Browne committee, reporting later this year, which is looking at fees and bursaries. That must be the way forward.

We spend 0.9 per cent of our national wealth on universities, while the OECD spends 1.1 per cent, although those countries get worse value than we do because our universities are rather better than most universities in the OECD. We are quite good at getting value for money, but, frankly, we will have to spend more. In this knowledge-based economy into which we are moving, we must ensure that higher and further education are really pillars of growth and great attraction, which will make our economy and people much stronger and happier.

Lord Faulkner of Worcester: Before we hear from my noble friend Lord Parekh, I observe that we have no spare time whatever in this debate. If every speaker sticks to a limit of five minutes, we will finish exactly on time, but if speakers run over five minutes we will not. When five minutes show on the clock, it means that your time is up.

2.39 pm

Lord Parekh: My Lords, I begin by thanking the noble Lord, Lord Baker of Dorking, for securing this debate and for introducing it with the eloquence and insight that we have come to expect from him.

The Government have announced cuts amounting to about £900 million out of a total budget of £12 billion

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over three years, which comes to something like 8 or 9 per cent of the universities' state-funded budget. I realise that we are all passing through difficult times and that universities cannot be exempted from their share of painful cuts. At the same time, the Government need to realise that universities can go only so far and that once their international standing and their commitment to teaching and research are weakened, it will take years to rebuild them. What is therefore needed is a spirit of partnership between the Government on one hand and the universities on the other. I first want to emphasise that the universities need to do a little more than they have done and then I will concentrate on what the Government need to do in response.

Universities have already done much to diversify their sources of income. Their reliance on state funding is far less than it was about 15 years ago. They can go further, however. There could be greater involvement of the alumni, greater collaboration with our EU partners and the universities in EU member countries, and greater collaboration with universities in the United States and developing countries. The universities can also do much to rationalise their academic offerings and the way in which courses are delivered. Again, they have done much over the past 15 to 20 years, but there is still room for improvement. They can play to their strengths and specialise in certain areas rather than duplicate what neighbouring universities do. They can also put on flexible courses and offer work-based learning so that students do not have to travel to the campus. They can work closely with industry and business and share the costs of education with these institutions. In some cases, technology can be more widely used and we can save on academic labour power. Therefore, I think that there is room for improvement on the part of universities and it would be wrong for us academics to deny that universities, too, must accept their share of the burden.

The Government need to bear in mind three important principles. They must realise that, while it is right to encourage universities to find research money elsewhere, that is not possible in many areas, such as the arts, the humanities and some social sciences. There is therefore a danger that the universities might neglect these areas because money is not available and concentrate entirely on sciences and technology. I think that the Government are, wittingly or unwittingly, in danger of giving a technocratic bias to our university education, which would be disastrous. A university is not simply a place for science and technology; it is the custodian of our civilisation and the values that the country stands for and it cannot ignore its role in those areas. If we are not careful, we might end up in a funny kind of way reversing what Margaret Thatcher did. She turned polytechnics into universities and, if we are not careful, we might end up turning all or most of our universities into polytechnics, which would be just as great a mistake.


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