One issue not covered by the report, although I was glad to hear the noble Baroness, Lady Young, and others refer to it, is that of student visas for non-EU undergraduates, postgraduates and teaching staff wishing to come to our universities, perhaps because this is not a matter of policy for the EU as such. However, it could critically affect our ability to play a leadership role in Europe and more widely and have a negative impact on the capacity of this sector to enhance our and the rest of Europe’s invisible exports to, and

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future influence in, the great emerging economies such as those of China, India, Brazil, South Africa, Nigeria and Indonesia.

A recent report from the Business, Innovation and Skills Committee of the House of Commons has highlighted just how misguided and damaging is the Government’s policy of lumping those who come to study here in the wider category of immigrants and imposing their targets for reducing immigration on overseas students, whose numbers it is surely in our national interest to increase, not decrease, since they bring resources to this country and to our universities. In the light of that report and of the many other representations made to the Government by the universities and those of us who have raised the matter in this House, I urge the Government to rethink this aberrant policy.

This is not just a matter of changing the statistical presentation of immigration, which up to now has included students together with other immigrants; that is, everyone who comes here for a year or more. What is being sought—and I emphasise this—is to exclude students from the public policy implications and impact of the Government’s target of reducing net immigration to the “tens of thousands” by 2015. When the Minister for Higher Education spoke to Universities UK early last month, he said that the Government would in future disaggregate the statistics and present the statistics for students separately from those for other immigrants. That could be a step in the right direction, but it was not the step that matters. The step that matters is for the Government to state categorically that they do not include students in the public policy implications of their objective of reducing net migration to tens of thousands by 2015. Until they say that, this sector will get squeezed in the way that it has been squeezed already, and it will go on being squeezed if that statement is not made. I hope that the Minister replying to this debate will be able to say, at the very least, that a review of that policy is now under way.

5.24 pm

Viscount Hanworth: My Lords, the report, The Modernisation of Higher Education in Europe, is an important and timely document. It alerts us to developments within the European Union and suggests that we need to keep a close watch on them if we are fully to exploit the opportunities that have arisen for co-ordination and collaboration.

The report also serves to remind us that, unless we take care, we are in danger of losing some of the advantages that our universities enjoy in the competition to attract overseas students. The report is relatively brief, and it might be helpful to give it a fuller context by recalling some of the recent history of our university system. I suggest that some things have gone amiss in the course of the modernisation of higher education in the UK.

The British university sector has grown remarkably in the past 20 or 30 years. The UK probably has a higher proportion of the relevant age group in higher education than any other European country. The participation rate for the year 2010-11, as calculated

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by the Department for Business, Innovation and Skills, was 47%. When I embarked on my own undergraduate studies some 45 years ago, only a small proportion of the age group attended universities, and the participation rate was probably no more than 12%. There was a favourable ratio of staff to students. We were treated in a manner that was casual but intimate, and if we showed aptitude or enthusiasm attention was lavished on us.

The academics were, in the main, as hardworking as they are today. However, they were free from the unsettling demands of research assessment exercises and national surveys of student satisfaction. They also benefited from the security of their jobs. Nowadays, academics within research-orientated universities who fail to perform sufficiently in their research and in its publication are liable to have their careers terminated, either by the non-renewal of a temporary contract or by early retirement. In the past, if their research faltered they had a ready alibi, which was to undertake administrative duties. The consequence was that there were few professional administrators in universities. The administration was also highly efficient, and a maximum output was achieved from a minimal input.

Nowadays, professional administrators, who used to play a minor role, are more numerous than the academic staff. The balance began to alter in the 1980s, when large numbers of academic staff were retired or dismissed as a consequence of budgetary cuts. Additional administrators were needed to oversee these cuts and dismissals, and the dismissals led to a dearth of academic staff available for administrative duties. At that time, the prospects of early advancement in the academic profession all but vanished and there were severe restrictions on academic salaries. Academic employment became unattractive to British nationals, and the numbers of British students pursuing master’s degrees and PhD qualifications in some subjects declined almost to zero.

Today, there continues to be a dearth of native trainee academics. Very little financial support is provided to native postgraduate students and, given the current burden of undergraduate fees, few people can afford to prolong their studies. Today, British universities recruit the majority of their young academic staff from other countries, and this is likely to be the case for the foreseeable future.

This circumstance, which has barely been recognised by politicians or the public at large, has had some adverse consequences. It has led to an increasing impermanence of academic staff. The turnover in some of the academic departments in which I have served has reached as high as 30% in one year. The impermanence of the staff is one of the factors that have contributed to a loss of ownership on the part of the academics of the processes of student recruitment, teaching and examining. The administrative staff have been exercising increasing control in these areas, with consequences that have often been deleterious. The academic staff, who are a weakened force, have been unable to resist incursions on to their rightful domain.

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The increasing commercialisation and customer orientation of the enterprises of higher education have meant that student satisfaction has become a guiding principle. This has had adverse consequences both in teaching and examining. There has been a remarkable inflation of the grades in the assessment of the exams. When I was pursuing my undergraduate studies, the preponderant honours award for the final exams was a Lower Second. Nowadays, the majority of students are awarded at least an Upper Second. The failure to achieve the higher classes of honours degree can prejudice a person’s employment prospects.

A reputation for stringency can also prejudice a department’s ability to recruit the students it needs, which can have grave financial consequences. In one of the universities of which I have had experience, the management has issued an injunction that at least 70% of the students should be awarded First or Upper Second degrees. The failures of some departments to achieve this target have led to visitations from the quality-control administration, which has been pursuing an agenda that is directly opposed to the purpose that it is ostensibly intended to serve. The system of honour classifications is under attack. In some quarters, it has been declared that it is no longer fit for purpose. The purpose has surely changed over time.

The formative or didactic purpose of exams, which is the role they play in reaffirming knowledge, has given way to their summative purpose, which is their role in generating qualifications. Part of the impetus behind the desire to abolish honours classification is the fact that most of us dislike being subject to judgment. The honours system implies failure as well as success. Those who propose that the honours classification should be superseded have argued in favour of transcripts designed to give an assessment of the overall worth of individual students. It has been argued that those transcripts should reflect multiple criteria and give credit for a variety of social and extra-curricular activities as well as for academic performance.

I baulk at such a presumptuous intention to make such broad judgments on a person’s worth. Nevertheless, in a system based on the accumulation of credit, the majority of students will graduate from universities brimful with credit, and there will be few ostensible failures. Such a system would surely certainly enhance customer satisfaction.

Surveys of student satisfaction nowadays accompany every taught course. In some cases, the objective of customer satisfaction is placing a major constraint on what can be taught to undergraduates. The courses that tend to be the least popular are those that are technically demanding and those that have a major mathematical content. Such courses are often essential to the mastery of an academic discipline. The responses to them within surveys of satisfaction tend to be dichotomised. If they are demanding and well taught, such courses are liable to receive plaudits from the most able students, but they will usually be accompanied by bitter complaints from those whose have struggled.

The averaged indices of satisfaction of courses that are demanding are liable to be low, which will lead inevitably to pressures to curtail or suspend them. When such pressures come directly from the university

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administrators, academics are nowadays rarely able to resist them. The consequences for the quality of undergraduate education can be dire.

I have paid rather little attention to the detailed recommendations of the report. I am pleased that others have discussed them more fully. Instead, I have described what the processes of modernisation have implied for the British system. They have created some significant problems.

The report has alerted us to one significant problem, which is that the natural advantage that Britain has enjoyed in attracting overseas students may not endure. It points to the fact that nowadays many European universities teach their courses in English, which has become the modern global lingua franca as well as the pre-eminent language of academic discourse. To benefit from being taught in English, students no longer need to come to the UK. The extraordinary treatment of overseas students by the UK Border Agency now poses a strong deterrent to them.

At a time when many European universities are purging themselves of the last remnants of medievalism, British universities are becoming increasingly subject to the pathologies of the modern age. The prognosis is not good for them, and they should be fearful of being rapidly overhauled and outdistanced by their competitors in Europe and elsewhere.

5.32 pm

Baroness Coussins: My Lords, I shall focus on what the report says about student mobility in relation to the Erasmus scheme and the teaching and learning of modern foreign languages. I declare an interest as chair of the All-Party Group on Modern Languages and vice-president of the Chartered Institute of Linguists.

I warmly welcome the committee’s conclusions on the importance of the Erasmus scheme: in particular, that the fee waiver should be retained to encourage participation and not deter students who may already be finding university fees a bit of a stretch. There is already early evidence that recruitment to modern language degree courses, which of course are four-year courses, has been adversely affected by fee increases. It seems that by no means all Russell Group university language departments have succeeded in recruiting to target this year and that at least three of them have recruited so badly that degree programmes are likely to close. In that light, the recent settlement agreed with the Government for study and work abroad was most welcome, minimising disincentives to outgoing UK student mobility for both students and their home universities.

The UK benefit from the Erasmus scheme is still very much one way. We benefit from the enrichment to students and university life provided by incoming students but, sadly, three times as many students from Germany, France and Spain take the opportunity to study abroad as their British peers. In 2009-10, we had 406,000 foreign students here, but only 33,000 UK students were abroad. I agree with the noble Baroness, Lady Sharp, who said that universities themselves should be doing much more about this. They should encourage all students, not just the linguists, to know about and take advantage of the Erasmus scheme.

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The committee suggests—and it is right—that the language deficit among our students is a major factor in the UK’s inability to benefit fully from Erasmus. The significant increase in funding from 2014 to 2020 will remain untapped by the UK unless we can produce greater numbers of linguistically confident and competent students in HE, whether they are studying modern languages or not. I wish that more universities would follow the example of UCL and insist that all applicants, irrespective of subject, should have a GCSE or equivalent in a foreign language—or that if they do not, should undertake to study one during their first year. This is surely the right approach for a modern university with an international perspective and awareness. No graduate should be a monoglot, even if their one language is English. Most continental universities ensure that all their graduates have two or three languages to a decent level.

I take slight issue with the committee for saying that the evidence for the benefits of student mobility on employability is still anecdotal. The British Academy’s report, Valuing the Year Abroad, which was also published in March this year, set out some robust evidence for the link between mobility and employability and is just the latest evidence that one might quote. Various employer and business surveys have shown for years how much employers value languages. Over 70% of UK employers say that they are not happy with the language skills of UK graduates and are being forced increasingly to recruit from overseas to meet their needs. This applies to business in all sectors. We are damaging both the economic competitiveness of the UK and the employment chances of young people in a global labour market if we allow this language deficit to continue.

The committee also asserts that English is the dominant language in the academic world and in EU institutions. However, I believe that that is a great oversimplification and that where it is the case it will not necessarily remain so. It is short-sighted to believe that English is enough. One interesting indicator is the language of the internet. The fact is that content on the internet in English is declining rapidly, from over 50% in 2000 to only 29% in 2009. In the same period, content in Mandarin or Cantonese quadrupled and continues to rise rapidly, particularly in the field of scientific research.

As far as EU institutions are concerned, there is an interesting paradox. The truth is that as multilingualism within the EU has grown following the expansion of member states, the need for English has also grown. This is because English is what the directorate of interpreting services calls a bridge language. You would be very hard pushed to find many people who could do simultaneous interpretation between, say, Finnish and Maltese, or between Latvian and Greek. What happens is that they go from language A to English, then English to language B. The trouble is that the UK is not producing enough language graduates to meet the need, either in the EU or in the United Nations and other institutions. Meetings in all of them often have to be cancelled because there simply are not enough people in the language services who are English native speakers and able to work in other languages. This is not doing a lot for our reputation as a nation in these institutions, and is why the committee whose

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report we are debating was so imaginatively right to recommend that languages should be compulsory in both primary and secondary schools. Without this, the HE sector will not have the raw material to maintain and develop its language teaching and learning.

We desperately need not just more specialist linguists but more economists, geographers, scientists and others who can also handle themselves in at least one other language—as graduates from the US, China, India and most of the rest of the EU already can. As the committee’s report says, this goes back to the need for better language teaching in schools. I am delighted that the Government have made such a strong case recently for the introduction of compulsory languages in primary schools from 2014. This will be an important step in addressing our national languages deficit, but only one small step, insufficient alone to secure the higher standards of achievement that we need to see. The arguments that the Government themselves have made in relation to primary education, in terms of European and global comparability, apply equally to key stage 4. International research shows that an early start to language learning is not a panacea; it needs continuity through to secondary school. In my view, compulsory languages up to key stage 4 should also be a part of the Government’s curriculum review. Just making them compulsory is not enough in itself, of course; we also need radical improvements to the syllabus and to teaching methods, especially the emphasis on spoken language, which, as both Ofsted and the noble Baroness, Lady Blackstone, have pointed out, is not nearly good enough.

The EBacc has had a positive effect, which is very welcome, but on only 54% of state schools. The other 46% have said that they will not be changing or improving a thing about their language offer as a result of the EBacc. We must stop the current trend of languages becoming an elitist subject and university language departments being dominated by students from the independent schools because fewer and fewer state school-leavers are actually qualified to apply for those courses. Without compulsory languages at key stage 4, we are unlikely to be successful in exploiting the opportunities provided by the Erasmus scheme to enable young British people to achieve their potential.

It is important to point out that languages for all up to key stage 4 does not necessarily mean forcing every child to do a GCSE. There are several other ways of accrediting language learning, not least the language NVQ, which is highly favoured by business. Will the Minister assure me that the question of languages for all at key stage 4 is still under active consideration, and does she agree that there is a strong case to be argued?

Given the cross-departmental relevance of all the aspects of modern foreign languages that I have touched on, not just for BIS but for the DfE and the Treasury, not to mention for the Foreign and Commonwealth Office, does the Minister agree that it would make sense to designate a Minister with cross-cutting responsibility for languages policy so that the interconnectedness between these sectors, from primary schools through to a competitive economy, could be properly made and monitored and better served by coherent policy?

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5.42 pm

Lord Hunt of Chesterton: My Lords, I welcome this report and debate on modernising higher education in Europe. It is a great pleasure to follow the noble Baroness, Lady Coussins, who is emphasising modern-language teaching. I have friends in France who have a company that is developing software to enable French companies to work with British ones. It is important that the translation of English is regional; if you are in a Birmingham factory, you jolly well want the French people to speak Brummie, not some other language. Of course, English is a broad and complex subject, and sometimes when we say “English” we should think about what we are saying.

Those of us of a certain age have hugely benefited from this extraordinary period over the past 30 to 40 years of the renewed Europeanisation of academic life. Around 130 years ago my great-grandfather, after doing medicine and chemistry at Oxford and having been introduced to his wife by none other than Oscar Wilde on The High, then went to Germany to study medicine. Then there was a long period when there was a breakdown in relations across Europe during the first half of the previous century, and it is very gratifying now that that has all been restored. It is also interesting to remind noble Lords that we should remember that the PhD degree, which came from Germany, was still regarded in Cambridge in the 1960s as an interesting experiment.

The report emphasises the growing masters’ courses in English. One of the features that it does not emphasise is that the ones that I know about in the Netherlands are not just courses in one university; they are collaborative across universities, and that is a very important feature. Almost every master’s course in the UK is given by a university, but there is no subject in which you would not benefit from spending a week here, a week there and so on. I have participated in that.

The other important point is that these advanced masters’ courses are all highly specialised, even the ones I have just referred to. Surely we should be moving to masters’ courses in English or well understood languages to enable students in Europe to understand and study broader issues, perhaps involving social science questions, environment, health or business. Business schools are one of the areas that enable people across Europe to study processes and ideas in a very broad way.

Perhaps the greatest critique, which is not mentioned in this report, of European higher education is that China, in thinking about its higher education, is moving away from the European model. It is moving to the American model because it realises that it is important that people have a broad education when they start higher education. They should learn about languages, philosophy, politics and science, as you do in the United States, where you have to know the name of the planets, for example, even if you are studying English literature.

Is Europe going to follow this idea? Fifty years ago, Lord Snow spoke of the need to combine science and humanities teaching. He visited the school I was at and talked about Russian physicists having to write essays about the character of Natasha in War and Peace,

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which is an inconceivable concept in the way we educate people now. We are now changing in the UK. There is a new course at University College London on humanities and science. Interestingly, it is partly funded by the movement of science funds into humanities as the result of the Government reducing the humanities budget. It is an ill wind, et cetera. It is also interesting that some of the Netherlands universities are also developing science/arts universities, so all is not lost.

Another important feature touched on in this report and, indeed, responded to by the Government in paragraph 120, is that collaborative research is vital in EU higher education to enable us to be in this leading position. I do not quite take the gloomy view of my noble friend Lord Giddens. As a result of the EU, we have extraordinary and marvellous research programmes involving people across Europe. The attraction of EU research is that it is totally unexpected. You have no idea what your colleagues in Latvia, Greece or some other place are going to do. It is not like, if I may say so, a grant from Swindon when you more or less have to say what you are going to do and you do it. If you have a European project, you have no idea what is going to happen, and really new things happen. This is, of course, a very minority view about European science. Most of my colleagues prefer a grant from Swindon, which is very regular and predictable. I believe that this EC practice of insisting upon collaborative projects is bringing Europe together, and we are getting many important ideas. I believe this should be welcomed. The Government in their welcome response to the report referred to the importance of small companies benefiting from these developments and their connection to the Technology Strategy Board.

Another important development in European higher education and science in the past 20 or 30 years has been the formation of networks of activities across universities. I was involved in the formation of something with the indigestible title of ERCOFTAC—European research community for flow turbulence and combustion. It involved major European companies and many of the major universities and technical institutions. Forming that kind of bottom-up network was considerably resisted by officials in national research communities and by the European Commission. They said, “It’s our job to tell you what networks you have. We’re going to control them”. We said, “No. We’re going to have our own”. Periodically European-funded networks participated in this bottom-up network, which has lasted longer than every finite-time initiative from the councils. In the 1990s, we had a meeting at the Royal Society that looked at these large numbers of groups from beekeepers and watchmakers to physicists and engineers. This is a great feature of European development, and you do not see it on any other major continent. Industry has been highly supportive of this. As a result of such networks, databases and scientific developments have been formed.

One of the interesting developments in Europe is that Airbus, for example, shares its future plans. It is going to produce some sort of “Dan Dare” paper-dart-like aeroplanes in future. We all know about this in Europe, and the way in which the wings are going to wobble around and hopefully be controlled. It is an extraordinary

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participation of universities and industry, the like of which you do not find in any other country. Boeing keeps its future plans very secret.

In the enlightened world I see around us in Europe, if you wear these rose-tinted glasses, the United Kingdom research councils should be much keener on this. They should be in much closer contact with the other EU research councils. If they get a research grant, they should be able to ring up their friend in Germany, Paris or Italy to find out whether some proposal is similar to what they are doing. Not a lot of that happens.

It is interesting that, still as a result of the lack of languages, a lot of EU science is not credited in the UK because it is not in English. A really important point was mentioned in a meeting that I had a couple of weeks ago in Bergen in Norway: one of the most important findings about climate change—the fact that we have very long periods of great heat or cold—was published in French. It is nowhere published in the English language. Therefore, at the moment, it may not appear in the next IPCC report on climate change. I had to rush to my French friend and say, “For goodness’s sake, quickly write this in English. Then it will probably be credited”. The consequences of this lack of understanding of other languages have many practical applications.

The movement of students, as other noble Lords have commented, has great merits. Those of us in British universities have seen excellent students arriving and bringing with them new ideas. Some of them have then also joined small British companies. The French universities’ “stage”, as they put it, can be held not just in another university, but in companies. Many of them make this transition, and bring with them their ideas, their language skills and employability.

The British Government could do much more— I welcome that this is highlighted in the report—in showing UK students the merits of doing some of their advanced work in universities in other European countries. How should this be done? It is interesting. I was talking to colleagues in Delft this week. Even in Delft, they find that their academics do not understand what happens in Brussels, which is not far away. They want their academics to understand the EC programmes, so they put them all in a bus and took them to Brussels in order to do so, with great benefits. Surely we should have familiarisation courses for students who are very unaware of what happens on the continent. That may be the first way of overcoming this problem.

One of the reasons why British companies and even certain government agencies now employ many continental rather than British graduates is simply because the continental graduates arrive with great familiarity of several languages and an understanding of wider European institutions, industry and so on. The Met Office now employs a considerable number of scientists and experts from these countries, which they did not use to. I am glad to say that our government agencies are broader than other European agencies in being able to employ people from other countries. However, the reason is that it is because our graduates do not have this broader savoir faire, as one might call it. That will continue until UK universities are taught

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in their entry standards and insist that they know at least one other language. Special courses could be laid on by universities, as they are at UCL and many other universities I know. For example, professional bodies like engineers, bankers and lawyers should also insist upon this.

Finally, since this is a report to government, I can see no reason why the Civil Service entry examinations should not include a foreign language qualification, which would show some seriousness. In this debate, we have tended to talk about foreign languages as something European. Of course, many tens of thousands of our Civil Servants speak several Asian languages. We should not forget that they are also modern languages. It is extremely important that we have people speaking Asian languages and we have that benefit because of Britain’s enlightened immigration policy. Long may it last.

5.55 pm

Lord Bilimoria: My Lords, in June 2011 my company, Cobra Beer, signed a joint venture with Molsen Coors, one of the world’s largest brewers in India, to build on the global joint venture that we had already formed in 2009. Molsen Coors and Cobra Beers in India bought the only brewery in the state of Bihar. In the past year, I have got to know more about Bihar’s history. It is the state where Buddha started Buddhism. It is where one of the most powerful ancient empires under the emperor Ashoka, the Mauryan empire, was based. It is where one of the world’s most famous ancient universities, Nalanda, was founded around the fifth century AD and was closed in 1197AD. Nalanda was closing down when Oxford and Cambridge were starting. We in Europe are fortunate to have a host of ancient universities, including Bologna, Salamanca, Oxford and Cambridge, and I could go on. I thank the noble Baroness, Lady Young, for leading this debate.

Where Europe in concerned, Britain is a proud member of the EU. Yet there is always the debate about “Are we in Britain contributing more to Europe than we are getting out of it? Is European governance, regulation and red tape stifling or hampering Britain or is it helping to improve Britain? Is our trade too dependent on Europe, when the world’s centre of gravity is moving east and south?”.

Fortunately, we made the right decision to stay out of the euro. To me, the eurozone crisis shows that pushing towards a united states of Europe is a bridge too far. The euro has proven itself to be an abject failure where one size cannot fit all and a group of countries in Europe can never be in sync at the same time, and thus should never be straitjacketed by a single exchange rate and a single currency. That can work only if you have a true political, fiscal, financial and economic union with a central defence and a central foreign service such as the federal systems in the United States of America or a country like India. I believe that that will never happen in Europe. It is a utopian dream to anyone who thinks that it will. Given this, in Europe, where higher education is concerned, on the face of it there appears to be the right balance in encouraging interaction between European universities,

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movement of students between countries and funding of research around the EU. Some of these things are handled by the EU directly, but others, most notably the Bologna process, operate outside the EU, and involve both EU and non-EU countries.

As the noble Lord, Lord Hannay, said, Britain has some of the best higher education in the world and it is one of our greatest sources of soft power. As many noble Lords have said, we are fortunate to have the best higher education in the world alongside the United States. I do not think that we need another ranking system, which has been mooted. We have got enough rankings of universities but whichever ranking you look at we in Britain are right up there at the top. Yet that is in spite of our higher education funding being a fraction as a proportion of GDP compared to our competitors in the United States and on the continent.

My figures are slightly different from those given by the noble Viscount, Lord Bridgeman. We spend 1.3% of GDP on higher education compared to 3.1% in America and an EU median of 2.6%. We spend exactly half a percentage of GDP on higher education as the median European figure and far less than the United States of America. Given this, the Government were short-sighted and irresponsible in cutting higher education funding and teaching funding by up to 80%, thus forcing universities to almost treble their students’ tuition fees in one go.

We are shooting ourselves in the foot and this is deterring students, both domestic and from the EU. Our domestic students will be burdened with loans for up to 30 years. Will the Minister confirm the financial arrangements—this issue has been raised—that are available to EU students attending British universities? Will she give us the number of EU students who applied to British universities for the 2012-13 academic year versus the number who applied for 2011-12? Will she also confirm the actual number of EU students who enrolled in this academic year compared with the previous year?

We have a huge advantage with the English language being the world’s global language. Not only do we have the reputation for having the best universities in the world but we also know that EU students want to come here to enhance their English skills at UK universities—something that they know is essential around the world. In the state of Bihar, the chief Minister told me something that I would never have heard in India some years ago—that children in his state wanted to learn English, and that the teachers needed to be able to learn it to teach it to the students because it was the international language. The internet has only enhanced this.

On the other hand—and on this I completely agree with the noble Baroness, Lady Coussins—we must continue to encourage our students to learn foreign languages, and in particular European languages such as Spanish and French that are spoken so widely around the world. The Erasmus scheme must be encouraged among UK students, but we languish at the bottom of the list among the large EU countries in terms of outgoing Erasmus students. What are the Government doing to try to get us higher up this list? What are they doing to encourage the Erasmus scheme

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to be more flexible? The average time spent is about six months. Could students not be encouraged to spend a term, or just a few months?

Then there is the area of R and D, which the noble Baroness, Lady Sharp, spoke about. We are so underfunded as a country. We need European Union funding; in Britain we spend 1.7% of our GDP on research and development, compared with an EU median of 2%—let alone countries like Germany, which spends 2.8% and the United States, which spends 2.7%. Are the Government doing enough to ensure that the Horizon 2020 figure of €80 billion will be maintained, even if other parts of the Commission budget must fall?

I wrote a foreword for a book called Big Ideas for the Future, produced by Universities UK and Research Councils UK. In spite of our underfunding in research and development, we have 200 examples in that publication of innovations coming out of British universities that are world-beating and world-changing. We are doing this, and the Chancellor is asking for the EU budget to be cut—although that is understandable. But can the Minister confirm that the EU R and D budget is not to be cut and that we will stick to the Horizon 2020 plan of €80 billion, if not the €100 billion suggested by the European Parliament committee?

On the business interaction with universities that is talked about, are we using Cambridge as an example of a cluster? There are three great university clusters in the world. One is Silicon Valley, which is head and shoulders above the rest. Then we have the Cambridge, Boston cluster, with MIT, and the cluster with Cambridge University here, which is one of the best in the world. What are we doing to encourage this around Europe? The report does not really talk about this.

Furthermore, what are the Government doing to encourage the European Union to have a strategy to attract students from around the world, working in a co-ordinated manner to market European universities to developing countries and the emerging markets? Could we have flexible degrees, where a student from India could come for a degree to the UK but spend a year of that degree at one or more European universities as part of their course? We are competing, as Europe, with Australia, Canada and the United States of America.

As the noble Baroness, Lady Young, and the noble Lord, Lord Hannay, said, this Government continue to insist on including student figures within immigration figures. I have challenged the Home Secretary on this and I am told that we are using internationally recognised figures. That is not the case. Could the Minister confirm that countries such as Australia, Canada and the United States of America all include student figures as a separate category from immigration figures? The signal that we are sending out is awful. I am on the board of three business schools and I know that our applicants from countries such as India have plummeted. Students in India are asking, “Does Britain want us?”.

Then we had the situation at London Metropolitan University. That was a shocking incident, with the UK Border Agency having the gall to take the licence away from a university. I could challenge the UK Border Agency and say, “Tell me the number of illegal immigrants in this country”, and it would not be able to give me a

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figure. Even when it finds them, they cannot deport them. Yes, we need to address bogus universities and colleges and yes, we need to address bogus students—but what about the innocent students among the 2,500 at LMU who had done nothing wrong and were told that they had 60 days to find another course? Are we a police state? Is this the way to behave? The signal that we have sent out around the world once again is that Britain does not want foreign students—the students who bring in £8 billion of revenue to this country and build generational links around the world. Three generations of my family have been educated in this country. I want that to go on and on. Will the Government address this situation and redress this gross unfairness and injustice?

We are now competing with the rising powers of China and India. Britain and the European Union will compete and stay ahead only by ensuring that our higher education, research and development and innovation always lead the way. We cannot cut back on this funding now. The Government have not only cut back on HE funding but have cut back on R and D in real terms by freezing the funding of science and research. Will the Government confirm that they have frozen science and research funding? Will they admit that they are cutting it back in real terms? If we do not put higher education and research and development at the top of the agenda in Europe, we will not get ahead and we will be left behind. Britain is head and shoulders above our European counterparts in higher education. We should be leading the way for Europe to be able to compete in the decades ahead with the emerging countries, particularly the giants of China and India.

6.06 pm

Lord Parekh: My Lords, I thank the noble Baroness, Lady Young of Hornsey, for introducing this report. I welcome the report of the EU Committee on higher education with two minor reservations. First, it talks about modernisation of higher education. Whenever I have come across the word “modernisation” as a social scientist, I have found it to be loaded and rather disturbing. It is disturbing because it seems to imply that if you do not go along with it you are reactionary, archaic—a backwoodsman. It is also unacceptable because it seems to imply that no argument is needed on behalf of it. Simply to say that something is modern is ipso facto to suggest that you should go along with it. I am pretty sure that we can find a less loaded, more satisfactory way of describing the content of the report.

My second reservation has to do with the fact that when the report talks about modernisation of higher education it does so in the language of economic growth. The noble Baroness, Lady Young, talked about higher education being in the interests of economic growth. While I can understand why this is so important in general as well as in the context of today, we need to bear in mind that every time we talk about economic growth we instinctively think of science and technology and have a tendency to underemphasise the role of the arts, the social sciences and the humanities. When we talk about co-ordination across various European countries we are not simply thinking in terms of economic growth. We are also thinking—imaginatively,

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boldly—in terms of a common elite, an elite which shares a common intellectual, educational and cultural background. Unless that kind of elite is created by moving between different universities, we simply will not be able to make a success of the European project.

Having got that out of the way—in a rather boring, academic way—I turn to the more positive task of endorsing the report, especially its three major imaginative proposals. The report rightly addresses the question of the lack of mobility among British students. This is being addressed but not as effectively and extensively as one would like. UK mobility under the Erasmus programme in 2000 and 2001 was 9,000 students. Today it is 12,873, so things have moved on, but that is as nothing compared with other European countries. I shall not talk about our rivals and competitors because one should not use that language in the context of the European Union. In Germany, however, 28,000 students are taking advantage of the Erasmus programme, and in France the figure is 32,000.

It is also striking that mobility is considerably limited, not only compared to other European countries, but in terms of its depth as regards social class, race and gender. White students, for example, represent 75% of those who move across European countries. For Afro-Caribbeans, however, the figure is 0.4% out of a total student population of 1.27%. Pakistani students’ mobility is only 0.3%, although they represent 2.42% of the student population. As regards class background, it is striking that the mobility of students from higher managerial and professional backgrounds is 22.4%, but for those from lower managerial and technocratic occupational backgrounds, the figure is only 2.4%. It is striking that mobility is limited in terms of the groups of people who travel.

The advantages of mobility do not need to be emphasised here. We know that people who travel across cultures and different regions gain in experience, maturity, communication skills, greater cultural awareness and greater employment prospects. The obvious question to ask is: why are British students not taking advantage of mobility? Are they dumb? Do they not realise the way that the world is moving? Rather than blame them or language provision, I want to look a little deeper.

Why does one learn a language? How do you do so with confidence such that you are able to follow courses in that language at undergraduate level in a foreign country? When the Dutch and the Germans learn English—although the French are slightly weaker at it—they do so for at least five-and-a-half to six years and for about six periods a fortnight. If we want our students to learn French with an equivalent degree of competence, language will have to be taught in that manner. It is also worth bearing in mind that a lot of English is picked up by the French, Germans and others through television programmes and films. That kind of facility is not easily available for our students who might wish to learn French or German. What TV programmes are they going to watch in order to pick up those languages informally?

We need to pay far more attention to why people seem to be resistant to learning languages when we know that they calculate their own long-term interests

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and know that it would be to their advantage. Obviously we need a national strategy. We need to make sure that languages are available at primary and secondary schools, although they cannot be enforced or imposed. We also need to bear in mind that a large number of people do not move across linguistic barriers, largely for financial and other reasons. We therefore need to consider the various schemes to which the report rightly draws our attention. Grants and loans should be portable. There should be fee-waiver schemes, and those we have should be extended. It is difficult for people to go abroad to spend a semester there. We could therefore think in terms of substitutes, work placements or internships for shorter periods. We could also think in terms of vacation courses on which one could earn and learn, as lots of students do when they go to the United States. Better advice could be offered to students on the UCCA form when they apply for university, as well as by the universities themselves.

It is amazing how certain impressions are created. It is important to bear in mind that the international league tables create an impression to which the report unwittingly adds its weight. Of the top 50 universities in the world, many are in the United States but only three from Europe. All three happen to be in Britain and the implication is that the universities in France and Germany are not as good as ours. That is simply not true because you are not comparing like with like. In Germany, universities are not the centres of much of the research; much of it takes place in the Max Planck Institutes, and these are not taken into account in the world rankings. Similarly, there are great research institutes in France.

Therefore, it is important to bear in mind that our students may get the wrong impression. From my experience as a university professor, I know that many do, thinking that the Sorbonne, Heidelberg, Bonn or Berlin are not as good as, say, Hull or Exeter. That is ridiculous, yet that impression is created by suggesting that none of the European universities emerges among the top 50. It also partly explains why students do not readily move across linguistic barriers.

I turn to the second proposal in the report, which I endorse—the European research area. It is absolutely right that we should think of promoting the EU as a very desirable study and research destination. It is also striking that grand research projects and challenges are best undertaken through cross-border partnerships, and our Government need to be fully engaged. It is certainly worth bearing in mind, as some of my colleagues said earlier, that EU universities can easily sell themselves outside the EU—for example, in the United States, as well as in other parts of the world—by offering unique combinations of degrees and courses. The London School of Economics and Imperial College do not have to sell themselves in any way but, for example, Manchester or Hull, jointly with Heidelberg or the Sorbonne, could offer a degree in social sciences, economics or whatever. Students abroad, including those in the United States, would be enormously attracted by the prospect of spending two or two and a half years in Britain and half a year or a year in France or Germany. I think that we should take full advantage of the EU proposal for a European research area.

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The third proposal concerns a common master’s degree. That is obviously not easy. In this country it takes one year; in Europe it tends to take two years. It is not generally a good idea to insist on uniformity but it is important that postgraduate education is encouraged. It is striking that in Britain we have seen only a 14% rise in postgraduate education in the past five years compared with 69% in the rest of Europe and 155% in non-European countries. While encouraging postgraduate education, we should also think of postgraduate research degrees, including master’s degrees, being undertaken collaboratively between various universities in Europe. For that to be possible, financial support will have to be available, especially in the arts, humanities and social sciences, where scholarships are not readily available. National support schemes should be portable and not limited merely to the countries that provide them, and there should be greater facilities to secure loans for postgraduate students.

Once we begin to think along those lines, we will begin to find a flow of students at undergraduate and postgraduate level, and when that begins to happen not only will our universities become more attractive but we will contribute towards creating a common intellectual and political elite that is capable of carrying forward the great European project.

6.18 pm

Baroness O'Neill of Bengarve: My Lords, there is a great deal of interest, and I think importance, in the European Union Committee report, The Modernisation of Higher Education in Europe. We are indebted to my noble friend Lady Young for the report and for the many themes that it covers in some detail.

I am going to be, I hope, quite boring and concentrate on a single theme. It is discussed in paragraphs 50 to 57 and summarised in paragraphs 121 and 122. I shall put some questions to the Minister about the proposed new EU university ranking instrument, which goes by the uncharming name of U-Multirank and is, it is supposed, being developed by the European Commission. The topic is, I acknowledge, something of an outlier in the report and in the Government’s response, so it is probably pretty appropriate to reach it at the end of the debate. However, it is not unimportant; it is potentially expensive, it is unlikely to improve the quality of universities in the EU, and it is unlikely to contribute to their excellence in any way.

University ranking tables have, of course, become a well known currency and very often headline material during the past decade since the emergence of Shanghai Jiao Tong University’s academic ranking of world universities and the Times Higher Education world university rankings. As is well known—sometimes we preen ourselves on this—some leading UK universities have consistently ranked very highly on these measures, but initially few other European universities ranked highly. In the Times Higher Education rankings for 2012-13, which recently emerged, Oxford, Cambridge and Imperial were all in the top 10 and a further seven UK institutions were in the top 100. No non-UK European institutions are ranked in the top 10, but 16 are now ranked in the top 100. That is a change. I agree with the noble Baroness, Lady Sharp, that it is remarkable that five of those 16 are in the Netherlands.

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Among other things, I think that shows that these rankings have, in the decade in which they have existed, great influence on university and national higher education policy and practice. Institutions strive to rise in these rankings. That is why, as the noble Lord, Lord Parekh, pointed out, the Max Planck institutes used to be outwith the university system in Germany and therefore did not count in the ranking, but the Germans have seen the writing on the wall and have now incorporated them into universities. It is one reason why German universities are coming up the rankings quite fast.

One might wonder why, given that the problem has to some extent been cracked, and European universities are now doing reasonably well using the existing metrics, the EU is still bent on devising a further ranking system. I think the answer is that one has to go back to when these rankings first emerged, less than a decade ago—it does not go back into history—and people were horrified that almost no European universities outside the UK were even in the top 100. The UK had some in the top 10 and a good number in the top 100. It was galling for institutions of high reputation and long history to find themselves with such low rankings. In particular, I think French and German universities were appalled.

That sense of injustice, whether the rankings were merited or unmerited, is a separate point that lies behind the hope that a new measuring rod will provide the answer and that it will somehow reveal the true qualities of European universities in a more compelling and fair light. It is hoped that U-Multirank will show the diversity of institutions and their merits by ranking different aspects of performance separately. It will supposedly give us a fairer picture. I suspect that if it comes to pass, people will quickly put the various rankings together and find a single ranking for all European universities.

Some French and German universities may now achieve higher scores and they may be less inclined to want to shoot the messenger, but for many of them, and also for many UK universities, the rankings still bring unwanted and what are felt to be unfair comparisons. They are still resented. That sense of grievance is spreading and it is bound to spread further as more institutions find themselves with lower rankings than they feel they deserve. Non-EU institutions of considerable distinction in other parts of Europe are also now experiencing that disappointment and resentment.

Recently, I had the good fortune to speak to the rector of St Petersburg who told me how startling and upsetting it had been to find Russia’s leading universities—St Petersburg and Moscow State—given lowly rankings. Naturally, they are taking what they see as appropriate measures to raise their scores—note I did not say to raise their standards, which is a somewhat separate matter. It is understandable that some institutions and Governments still think that U-Multirank is a useful project in Europe, but it is quite hard to find out either whether it is still on track or who is supporting it. At a meeting in Aarhus this spring on excellence in universities, under the Danish presidency, I heard great enthusiasm for U-Multirank. A prototype is supposedly now out to tender. It is said that the first version should be available at the end of

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2013, and further versions at the end of 2014 and 2015—and that the European Commission wants at least 500 participating universities at the end of the first phase, covering at least the disciplines of business and engineering.

However, no one seems particularly enthusiastic about U-Multirank. The League of European Research Universities—a dozen or so highly selective universities not in capital cities—voiced its opposition publicly as early as 2010. The rectors of the Coimbra universities—another very selective group, although not quite as selective—are apparently not happy, as I heard at a meeting in May, but they have not to my knowledge gone public about being unhappy with it or opposing it. The European Union Committee was not enthusiastic, nor was the Government’s response, but the juggernaut appears to be rolling. Are Her Majesty’s Government going to take steps to disengage, or will they remain tepidly engaged? Are they content that matters should roll—or perhaps lurch or inch—forward, and if so, why?

I will ask the Minister a few simple questions about Her Majesty’s Government’s views and plans. Is the development of U-Multirank proceeding, or is it sputtering to a halt? How much is its development expected to cost in the current year? What costs are foreseen for future years? What estimate have they made of the costs to UK universities of collecting the additional data that will have to be submitted if U-Multirank goes ahead? Do the Government believe there is a reasonable likelihood that other European university systems will be able to compile the data needed for U-Multirank, or do they believe that the data likely to be submitted will be of low quality and perhaps even bogus? Do the Government think that the U-Multirank project represents value for money?

Above all, do the Government think that U-Multirank, even if it has integrity and goes ahead, will be useful? League tables give us just a ranking. What is needed for quality control is not a ranking or league table but a judgment, and sometimes metrics, of quality or excellence—that is, of the excellence of matters that are educationally important and that matter for research. Both the committee’s and the Government’s response suggest that a ranking might be helpful for applicants to universities, who would be able more accurately to compare institutions. That is just an illusion. Students need to know far more about a course before they apply for it and commit years of their life and considerable amounts of tuition money. I am sure that they will continue to rely on institutional websites, university prospectuses, the advice of current and recent students and teachers, and site visits. Open days are a way of gaining seriously relevant information.

Ratings or rankings are not substantive enough or sound enough to be useful for these decisions. Students need ways of judging quality, not comparative success. Excellence is not a positional good. There can be many excellent universities, or perhaps few. That is what we need to know. That is why there is no reason to think that UK universities are worse just because fewer of them are in the top 100; it is simply that others are taking steps to do better in the rankings. Relative success is a merely positional good. Someone

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will come top even if the standards are uniformly low, just as someone will come last even if the standards are uniformly high. Should we not aim for excellence and spend less time and money on ranking? In the end, one is tempted to ask whose benefit the U-Multirank is being compiled. Cui bono?

Will the Government take an active stance? If, as I suspect, they think U-Multirank is not needed or valuable, why not say so? We could save some money and put it into research.

6.30 pm

Lord Judd: My Lords, it is a challenge to follow the noble Baroness, Lady O’Neill of Bengarve. Throughout our deliberations she has made wise, incisive and penetrating contributions, and that is characteristic of her whole approach to public life. I am therefore certain that I do not speak for myself alone in saying how much we admire her for agreeing recently to take on a huge new challenge on behalf of society, one that is not unrelated to the issues we are discussing today; in fact it is very close to them. We all wish her well as she shoulders those responsibilities. I also thank the noble Baroness, Lady Young of Hornsey, and her colleagues for a helpful and useful report. It will be of value to the many people who get hold of it and study it.

Earlier today in another debate about constitutional matters, I ventured to suggest that the first reality of political life is that, whether we like it or not, from the day we are born we are locked into a totally interdependent international reality. The world is totally interdependent internationally. I feel strongly that we fail our young, and we certainly undermine the United Kingdom’s future, if we do not recognise that and then grapple with the challenge in order to meet it effectively. As I said in the earlier debate, I am quite certain that history will judge our generation of politicians by the contribution we make to finding effective answers to the challenge of international interdependence and the success, or indeed the mess, we make of it.

Universities are central to all this. Unless we enable the young of the world to prepare to participate in and contribute to an international community, what are we doing with our educational system? This is not simply a matter for those reading international relations formally. That is a daft approach. Of course we need the discipline of international relations as a subject of study, but it would be daft just to leave it at that. All the dimensions of higher education, and indeed of education at all levels, are related to what needs to be done. In that context, if we adhere at all to the concept of a real university being a community of scholars, it totally lacks relevance unless it is a vibrant international community in which all parts of the world are represented. We desperately need access socially, ethnically and internationally in order to ensure that our universities provide a climate of learning that is essentially part of the international reality.

Too often the debate is dominated by what overseas students represent to universities in terms of the income they provide and how universities are going to be in dire economic straits if the overseas students do not come. While that is part of managing universities, it is completely to miss the point, which is that the quality of the education and the educational experience in

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our universities is related to the degree to which they are real international and socially representative communities.

These days we have a very utilitarian approach to education, which of course cannot be dismissed; it is an important part of enabling society to function. But sometimes I wonder about where we draw the frontiers in our evaluation of what is relevant in utilitarian terms and what is not. I declare an interest as an emeritus governor of the London School of Economics, and I find it extraordinary that the Government should give the emphasis they do to science and technology but deliberately underrate the significance of the social sciences. If we are to make a success of society, if we are to meet the radical new challenges that are presenting themselves, the social sciences are absolutely essential. Even if you take a utilitarian management approach, the social sciences are every bit as important as the physical and other sciences in enabling us to make a success of what we are trying to do.

There is another point in all this. Understandably, we are desperately preoccupied with our economic plight. Our leaders have nightmare situations to deal with. But why do we want our economy to be successful? Is a successful economy just an end in itself or is it a means to having a society worth having? If we are going to have a society worth having, what about revisiting the principle of education for its own sake, and the principle that part of living as distinct from existing is discovering your potential and realising it, or discovering your creative potential and realising that? If we really care about the future of our society, we neglect at our peril an emphasis on the arts, including the creative arts.

As was powerfully argued by the noble Baroness, Lady Coussins, languages are crucial. There is a great importance in studying language as part of education for its own sake, and the richness of studying language, of course, but languages are also essential to the functioning of international society. We need to reinvent a passionate concern for people being able to live the fullest possible lives, and that means being able to enjoy music, art and all the rest; and we are hell-bent on creating a hell on earth if we let our commitment to these dimensions of higher education slip. The interplay in European education is crucial to all this.

To conclude, it has been a very high-minded debate today, which has avoided the immediate controversy of party conferences and the rest, but I was very depressed last night when I heard the Prime Minister’s jibe about intellectualism. Where are we taking our society if we try to score cheap political points by talking about intellectuals in politics? For God’s sake, why are we in the mess we are in? We are in the mess we are in because we have not been doing enough thinking, because we have not being doing enough evaluation of where we are and why. If I were to pick one urgent priority in education and our national life, it would be a revival of intellectualism and the ability to think about our predicament, and to think about where we could be as distinct from where we are, and what we should be doing. From that standpoint, I make no apology for introducing a hard political point at the end of this debate.

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6.39 pm

Lord Stevenson of Balmacara: My Lords, I thank the noble Baroness, Lady Young of Hornsey, for introducing the last report of the committee which she chaired, The Modernisation of Higher Education in Europe, and all noble Lords for their contribution to what has been a very informative and sometimes spirited debate.

There is not time to reflect on every contribution made today, though there was something of interest and value in each one. I think that we are all in debt to my noble friend Lord Giddens, whose sadly truncated speech dealt with the context for our debate, of a Europe in crisis, and drew attention to the impact that this may have. I shall pick up three main points which I hope will be noted by the Minister when she comes to respond in what I think is her first appearance as a spokesperson for BIS. We welcome her to her new role and I am sure that we are all grateful to the noble Baroness, Lady Verma, for her contributions to our education debates over the year.

We have too few opportunities to debate higher education in your Lordships’ House—the wide range of comments that we have received in this debate prove that—and I, too, will raise issues both from the report and on general HE policy. Much of the report implies at least a partnership between the UK Government and our HE institutions across the Bologna process, Horizon 2002 strategy, EIT, ERA, KICs and, of course, the Erasmus programme. Several noble Lords referred to the benefits that can flow if these multilateral programmes are delivered, but it was not clear from the government response how, if funds are tight, they will be supported. With HEFCE being refocused and no direct teaching grants being provided, how will the UK Government deliver on their commitments?

Several noble Lords mentioned the poor level of participation of UK students in the Erasmus programme but also drew attention to the work of the Riordan group. Student mobility clearly suffers from poor language skills acquisition at school and at university and may also be impacted by debt aversion to the new student finance system. It also needs more direct funding. Will this be available? Can we be assured that extra support will continue to be available for disabled and disadvantaged students?

My noble friend Lady Blackstone and others raised the question of how postgraduate education is to be supported more generally. A loan system will surely not be attractive to those undergraduates who leave university with accrued loans of perhaps £50,000. What are the Government going to do in this area? We are still not very clear about this.

Listening to the debate today and reflecting on how the EU intends to modernise higher education leads us to call into question what this Government are doing to our higher education system, which, until recently at least, was regarded as one of the best in the world. Can current plans really be called modernisation? According to UCAS, there are 54,200 fewer students starting this term than there were this time last year. The evidence is clear: the trebling of tuition fees is hitting the life chances of thousands of potential students across the country, holding back their access

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to opportunities and at the same time damaging the UK’s economic potential, which must surely be seen to rely on a supply of highly qualified graduates to enable us to compete with new competition from emerging markets.

Other countries see the importance of higher education and are investing in it. This Government are out of touch and doing the opposite. Cutting 25,000 student places at universities this year is hardly investing in our young people or contributing to growth. Times Higher Education has estimated that the fall in student numbers will mean a loss of income to universities of around £1.3 billion over the next three years. That is the equivalent of shutting down a huge university such as the University of Manchester, together with a smaller one such as the University of Keele, or shutting two mid-sized institutions like Cambridge and Hertfordshire. It is not just that this piles yet more financial pressure on universities, already under significant strain as a result of the Government’s 80% cut to the teaching grant; complex student number control mechanisms are compounding these problems, creating further uncertainty where places at popular universities which could have easily taken them have been taken out and auctioned off to those who bid for them on price not quality.

The impact is being felt in regional economies, already suffering from a recession made in Downing Street, with fewer students studying, eating, shopping and renting in towns and cities across the UK. The University of Southampton estimates that the changes that it has experienced have generated a £16.5 million loss in income to the city. What is going to happen to our current,

“enviable track record of attracting bright overseas students to come and study in the UK”,

who, according to the chairman of the Business, Innovation and Skills Select Committee whose recent report has already been mentioned today,

“contribute significantly to our economy as well as to our reputation as a world-class place to do business”?

We seem to have yet another omnishambles, with what seems to be open warfare between BIS and the Home Office. Can the Minister shed light on who is winning the argument? The Immigration Minister, Mark Harper, said recently that:

“The government does not consider it appropriate to deviate from the internationally agreed definition of a migrant”.

However, in what was widely described as a damage limitation exercise, David Willetts said that the Government want,

“to publicise disaggregated figures”—

on net migration—

“so that the debate can be better informed”.

In other words, the ONS will now publish two series of net migration figures, one including students and one excluding them. Whatever happens, this has been a very sorry episode that will do lasting damage to our HE system and our economy as well as impact on the sort of soft-power issues raised by the noble Lord, Lord Hannay. Mr Willetts is on record as saying that:

“There are few sectors of our economy with the capacity to grow and generate export earnings as great as higher education”,

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and that,

“education exports are already worth around £14 billion, and could rise to around £20 billion in 2020 and nearly £27 billion in 2025, representing an annual growth rate of approximately 5 per cent”.

They will certainly not if the Government do not sort out this unseemly mess in very short order.

The Government in their White Paper—and we are still waiting for the promised Bill—said that they wanted a revolution in higher education and to place,

“students at the heart of the system”.

However, in reality a combination of high fees and broken and discredited number-control policies have hampered universities’ best efforts to fill their books with students ready for the transformational effects of a higher education system that was once the envy of the world.

Our universities are hurting as a result of the Government’s policies, and students will be personally paying for generations to come. They will be paying more and for longer than ever before. In fact most students will be paying back the higher fees most of their working lives. What a way to modernise higher education.

6.47 pm

Baroness Garden of Frognal: My Lords, on behalf of the Government, I thank the noble Baroness, Lady Young of Hornsey, for introducing this debate and express appreciation to her and the European Union Select Committee for all their work. The Government very much welcome its thorough report. It is pleasing that such disagreement as there is between the committee and the Government is essentially of detail and emphasis.

We are agreed that the Bologna process has had very positive effects since the declaration was adopted in 1999. My right honourable friend the Minister for Universities and Science, at the latest Bologna ministerial meeting in April, agreed to focus on three main goals in the face of the economic crisis: to provide quality higher education to more students, better equip students with employable skills and increase student mobility. The national mobility strategy required is currently being worked on by the sector, under the capable chairmanship of Professor Riordan, and the Government look forward to seeing it. We have had a number of references to that report from noble Lords.

The committee was concerned about recognition of our one-year master’s degrees, and the noble Baroness, Lady Blackstone, brought this up. The Government continue to press, bilaterally where necessary, to ensure that the recognition that should be accorded under the Bologna process is given. Recent figures suggest that this problem is diminishing and the number of institutions offering one-year master’s courses is increasing, suggesting confidence in these degrees.

The committee noted that use of the European credit transfer system and the diploma supplement is mandatory in Scotland and considered it would be of benefit throughout the UK. We rightly prize the autonomy of our universities and this would be a decision for them. The Bologna process implementation report prepared for the ministerial conference shows that the

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rest of the UK has one of the best performances in Europe for implementing the Bologna tools. UUK figures show that use of the ECTS and the diploma supplement have increased significantly since 2009. As my noble friend Lady Sharp set out, there are difficulties for HEIs in this country accepting credits from other institutions, especially, but not only, within the Russell group.

The committee noted that the HE sector is global in character and saw value in the production of a strategy in this area. The European Commission will issue a communication on internationalisation of HE in 2013. The Government will examine it carefully, and agree with the committee that it must justify any new EU actions as adding value, and avoid duplicating what member states, and universities themselves, are already doing.

In this context the committee notes that there is increased competition from continental universities, and although it is too early to say what the effect of the new fee regime in England will be, the Government will continue actively to promote the strength of our HE sector to students. Several noble Lords have referred to the fact that continental universities are now offering degrees through the medium of English, so the language component has been taken away from those non-foreign-language-speaking students who want to study there. I assure the House that we encourage and prize the world-class reputation that our universities enjoy. Our reforms to higher education funding in England are progressive, with no eligible student paying upfront, with more affordable repayments and more financial support for students from lower income households. I refute the comments made by the noble Baroness, Lady Young, and the noble Lord, Lord Stevenson, that fees will impact on cash-strapped students and parents. As we all know, repayments do not start until students become graduates and are earning at least £21,000 a year.

The committee rightly stresses the need to foster collaboration between universities and businesses to contribute to our future prosperity and the added value that various EU initiatives can give. In particular, the European Institute for Innovation and Technology and its knowledge and innovation communities have the potential to foster such collaboration. The Government will look closely at how existing KICs are doing that during the remainder of the present programme. For the new European innovation partnerships, it is very early to judge, but we will follow developments closely to optimise future performance. I note the comments made by the noble Lord, Lord Hunt, about innovation and technology.

The committee welcomes the Commission’s proposal for a new integrated education programme, Erasmus for All. The Government agree, and my right honourable friend Mr David Willetts was pleased to support the partial general approach to the programme at the Education Council last May. We will do all we can to ensure that, as the proposal proceeds through the legislative process, the gains agreed are maintained.

Of course, as we are all aware, our aspirations in this field, as in many others, run up against the very difficult financial climate. The report wisely notes that

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any increases will be possible only in an EU budget in which reductions are made in other areas and overall restraint is achieved. The proposed Erasmus for All programme, integrating as it does the existing education and youth programmes with the new sport programme, is a good example of the sort of simplification and streamlining needed.

We agree with the committee on the importance of encouraging student mobility. To do so, the key questions are the language ability of our students, as the noble Baroness, Lady Coussins, set out, and financial provision for mobility. On the latter, since the report was written, my right honourable friend Mr David Willetts has announced new arrangements to replace the Erasmus fee waiver in England. They allow English HE institutions to charge students who take year-abroad placements a tuition fee up to 15% of their maximum fee cap; give students access to a tuition fee loan to cover those costs; and provide a HEFCE grant to support institutions participating in overseas student programmes. For the first time, that support will extend to students from English institutions taking year-abroad placements outside the Erasmus scheme.

On languages, the report criticises our monoglot culture and the risk of complacency due to the increasing spread of English. The Government agree. That is why my right honourable friend the Secretary of State for Education has included languages in the English baccalaureate; the new national curriculum will for the first time make a foreign language compulsory at key stage 2; and his department is funding the CfBT Education Trust to raise standards of language teaching. Several noble Lords have raised concerns about the requisite number of qualified language teachers to meet those new demands. Work is under way to identify teachers to recruit and to encourage more people to come back into the profession to encourage language teaching.

Research published in March this year showed that 51% of state secondary schools have more than half their pupils taking a language in year 10, up from 36% when the previous Government left office—an increase probably helped by the language component in the English baccalaureate. Proposals for the English baccalaureate certificate include making a modern language compulsory at key stage 4. We would certainly hope that that would also become part of the national curriculum. The Department for Business, Innovation and Skills classifies languages as strategically important and vulnerable subjects, which it has asked HEFCE to support; more than £14 million will be allocated to maintain capacity in SIVS this academic year. We are pleased to note the committee’s endorsement of the proposed revision of the professional qualifications directive. The proposed directive includes references to ECTS credits as evidence for minimum training requirements for seven professions. The Government support this approach and are seeking to ensure flexibility for both professionals and their regulators. The noble Baroness, Lady Blackstone, said more on this and I will say a little more in a moment.

I will come on to some of the comments made in this debate, which has been wide-ranging. I apologise if I am not able to cover all of the points raised but I

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will of course write to noble Lords on those which I am not able to cover this evening. Further to mobility, the British Council, which delivers the Erasmus programme in the UK under contract to the Government, introduced a supplementary grant of €500 in 2011-12 for Erasmus students who are eligible for HE widening participation assistance in the UK. It is too early at the moment to tell how that has affected the take-up from these groups but we hope it will certainly help to widen both the diverse range of students and participation. Both the noble Baroness, Lady Young, and the noble Lord, Lord Stevenson, mentioned widening participation and reaching out to those groups.

The noble Baroness, Lady Young, referred to the multiannual financial framework. It is vital that the next MFF is geared to fostering growth and competitiveness. Since those are underpinned by research and innovation, the Government agree that this area should account for a larger proportion of an EU budget that will increase by, at most, inflation in 2014 to 2020. The importance of R and D has been brought out again in a number of speeches this evening.

My noble friend Lord Bridgeman and the noble Lord, Lord Giddens, also mentioned outward mobility. BIS has tasked the higher education sector to consider outward HE student mobility generally, including the measures necessary to support the growth of UK participation in the Erasmus programme, and ensure that students from all backgrounds have the opportunity to take part. Again, it was raised in this debate how the numbers coming into this country are far greater than the number of our own students wishing to study overseas. Raising awareness of international experience in schools, as my noble friend Lord Bridgeman said, is an important aspect of this. I will get back to him on whether this is needed on the UCAS application form. I would certainly have thought that any personal statement would benefit from having a comment about international experience, because we know that is valued by employers and universities.

The noble Baroness, Lady Blackstone, asked a number of questions. I will do my best to tackle some of them. She asked what was going to happen about EU students defaulting on student loans. The reply is that we are working closely with other member states and the European Commission to establish a means of strengthening ways of pursuing repayment. However, there has not been a major problem with other forms of loans to EU students. We are hoping that it will not present a great problem. It is a matter, of course, of working with other countries.

On the review of the directive and the recognition of professional qualifications, which the noble Baroness mentioned particularly in the medical field, we hope that that directive will help young graduates not to have to start again or to study for more years than is necessary to prove their professional competence. We shall obviously have to work with that directive as it develops to make sure that that is happening. I think that I have already mentioned the one-year master’s degrees, but on the professional directive we would like to ensure that the levels of education outlined are aligned with Bologna cycles, so that the training courses towards regulated professions do not aim for two

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differing benchmark levels. I would not underestimate the difficulties of trying to ensure that, throughout different countries, we have benchmarks measuring the same things across this range of professions.

On the master’s-level student loan guarantee facility, which my noble friend Lady Sharp mentioned, we agree with the committee that the loan guarantee proposal needs to be explored further and could potentially help UK graduate students, but once again we will need to monitor how this goes along to make sure that it is entirely effective.

A number of noble Lords mentioned universities doing as much as they can to enforce the teaching of modern languages. My noble friend Lady Sharp mentioned the University of Sussex, where languages were encouraged. The noble Baroness, Lady Coussins, mentioned UCL, which has insisted on a modern language module for all incoming students and, if they do not have a GCSE, UCL is providing courses to enable them to gain one. There are examples of other universities doing similar things. Aston, for instance, has a programme where all first-year students will be studying a modern language. There are a number of very innovative programmes within universities to try to ensure that languages are encouraged across the range of subject areas. I think that the noble Lords, Lord Judd and Lord Parekh, mentioned the importance of linkages across subject areas, not just for linguists but in science, engineering, technology, the arts, law, medicine and so on.

The noble Lord, Lord Giddens, also mentioned the barriers to research and academic careers for UK citizens, and the European Commission recognises that there are barriers for researchers and academics and is working with member states to tackle those barriers to develop the European research area to ensure that there is more openness and exchange within those areas.

The noble Lord, Lord Hannay, raised the matter of visas, as did the noble Lords, Lord Bilimoria, Lord Judd and Lord Stevenson. This has been a vexed question. I am destined to disappoint the noble Lord, Lord Hannay; I am sure that I will not fill the lacuna to his satisfaction regarding the areas that he raised. There are hopeful signs regarding the Government’s interest in fostering internationalism; for instance, just recently the Government announced that the Foreign and Commonwealth Office language facility would be funded with £1 million following the closure of the college in 2007, so there is an upturn on that front.

I assure noble Lords that the UK is most definitely open for business to international students. Genuine students who have the greatest contribution to make to the UK will continue to be welcomed. The aim as always is to get the balance right between providing a user-friendly route for bona fide students and education providers and deterring those who would seek to abuse the system. I share noble Lords’ concerns that we certainly seem to have got publicity rather skewed against that in recent times. We are working very hard to try to redress that position and to encourage overseas students to come. Conversations continue with the Home Office and UKBA and the student visa people to try to ensure that we encourage students to come

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here. As the noble Lord, Lord Judd, pointed out, it is not just a matter of economic benefit to the UK from students; it is also the matter of international relations, the fostering of friendships across different cultures and countries, which is of such vital importance today.

The noble Viscount, Lord Hanworth, commented that he was not impressed by the trend of universities to issue statements of all-round achievement alongside the academic record and guides. We understand from employers that they are interested in other characteristics of graduates as well as their academic grades, and many UK universities have adopted the higher education achievement report, which provides a much deeper record than the standard academic report. The Government encourage that development.

The noble Baroness, Lady Coussins, commented on the importance of linguists generally and concerns about the shortage of interpreters and the impact that that has. I commend the work in this respect of the Chartered Institute of Linguists, to which I spoke last week, which performs a vital role in trying to ensure that standards are maintained in all branches of linguistics.

I have given the assurance on key stage 4. That is going to continue. The noble Baroness’s idea that there should be a cross-cutting Minister covering languages in all departments is an interesting one. I will need to get back to her on that; it might not be wise for me to make a policy decision at the Dispatch Box this evening.

The noble Lord, Lord Hunt, commented on the benefits of EU research collaboration and research mobility, and we would certainly agree that that is of enormous benefit. We are working with the European Commission and other EU partners to increase such collaboration where appropriate through the European research area initiative. The noble Lord, Lord Parekh, talked about joint and double degrees, as did the noble Lord, Lord Hunt, with a mixture of different universities delivering together. These already exist, with the development of joint programmes supported through the EU education programmes, and are strongly encouraged in the Bologna process, but it is indicative of the fact that they are worthy of more support than they have at the moment.

The noble Lord, Lord Bilimoria, reminded us that India was closing down its universities long before Oxford and Cambridge were even thinking of opening. I also mention that there are BIS-funded projects for sending students to India and China to find out more about those cultures. They are very popular. Applications are way in excess of the number who can go. On the financial arrangements available to EU students, they are eligible for loans but not for maintenance grants.

I will have to write to the noble Baroness, Lady O’Neill, on the detail of the U-Multirank. The Government concur with the report’s finding and with the concerns that she raised. It is important that there is clear information and guidance for students on higher education institutions, but there are concerns about the usefulness of university league tables and rankings systems. The noble Baroness pointed out some of the difficulties of rankings systems for universities. There are also possible concerns about the cost. The Commission is running a trial scheme with a limited number of countries on this, and we will possibly wait

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until that trial is reported. I shall try to find out about the costs for the noble Baroness. I do not know them at the moment.

The noble Lord, Lord Judd, mentioned the multinationalism of universities and that social science is as important as physical sciences. I think we all agree that the revival of intellectualism and the ability to think our way out of problems are of key importance in the times in which we live.

I am conscious that I have not covered all the points that have been raised in the depth that I would like. I will read Hansard and try to come back to noble Lords on the points that have not been covered today. I commend the influential reports of the EU Committee, which are very welcome. Once again, I thank the noble Baroness, Lady Young of Hornsey, the members of the committee and all noble Lords who have taken part in this debate. We have had productive and incisive contributions that will help to shape government policy in a field that is not only crucial to our economic future but helps to promote good international relations and opens opportunities for students of all ages.

7.06 pm

Baroness Young of Hornsey: My Lords, I thank all noble Lords who took part in today’s debate. I, too, am conscious of the time and that everybody has been very diligent in listening to all the analysis and critiques that we have heard this afternoon. It makes me sad that I no longer have any responsibility for this subject directly within the EU Select Committee structure but I will, no doubt, be working with my noble friend Lord Hannay, who I wish well in his work, in following up on this debate and on the report, as is customary.

I shall make a couple of very quick points in shorthand. We recognise, but were not able to put fully into the report, how complex student mobility is. It is not just about finance; it is about economics and social and cultural factors and the rich interplay of all those different factors in presenting barriers to many of our students going to study in Europe.

I shall say no more on U-Multirank, except that in a sense I understand that the impulse to develop something less oriented towards particular kinds of institutions was not necessarily a bad idea, but how that is to play out is to be seen.

Our remit and title were determined by the communication from the European Commission, so although there might be problems around the use of the term “modernisation”, it is not necessarily of our doing and I distance us slightly from that.

On language competence, I shall say only that it is not merely about the language and linguistics; it is also about culture. Even if everybody in the world were able to speak English as well as other languages, we would be impoverished if we could not communicate in languages other than our own native tongue.

I thank the Minister for her thoughtful reply. I shall not address those areas where we might still be in disagreement. Like her, I shall be looking at Hansard and thinking through what some of those responses mean.

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To conclude, I thank hugely the members of Sub-Committee G who I worked with. In particular, for today, I thank the noble Viscount, Lord Bridgeman, who was so supportive on that committee. I am really glad that he is able to follow that through on the committee of my noble friend Lord Hannay. I, too, give due credit to Michael Torrance, Alistair Dillon and Mandeep Lally, who were admirable support for Sub-Committee G.

The debate has been stimulating and wide-ranging. The one thing we all agree on is that higher education

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has a huge role to play, one way or another, in trying to get us out of this ongoing crisis in which we find ourselves, which is not only to do with the financial crisis—although that is obviously at the forefront—but also our environmental crisis, and social and cultural issues, too.

I thank everybody for their participation.

Motion agreed.

House adjourned at 7.10 pm.