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Westminster Hall

Thursday 8 November 2001

[Sir Michael Lord in the Chair]

Higher Education

[Relevant documents: Sixth Special Report from the Education and Employment Committee of 2000-01, HC 384—Government's response to the Fourth Report from the Committee, Session 2000-01, on Higher Education: Access; Seventh Special Report from the Education and Employment Committee of 2000-01, HC 385—Responses from the Government and Higher Education Funding Council for England to the Sixth Report from the Committee, Session 2000-01, on Higher Education: Student Retention; Minutes of Evidence taken before the Education Sub-Committee on 14th March 2001, HC 329.]

Motion made, and Question proposed, That the sitting be now adjourned.—[Mr. Caplin.]

2.30 pm

Mr. Barry Sheerman (Huddersfield): It gives me great pleasure to introduce the debate on the two reports on higher education conducted by the former Education and Employment Committee and the Education Sub-Committee. There had not been a full inquiry into higher education for about 20 years and it seemed appropriate for us to look at it at a time when, some would say, the dust had settled on both the Dearing report and the Government's rapid response to it after the 1997 election— [Interruption.] The hon. Member for Newbury (Mr. Rendel) says that it was too rapid. I shall come to that in a moment.

I will try to keep my remarks reasonably short. In one sense it was an invigorating and pleasurable experience to chair the Committee during those two inquiries. First, we had not looked at higher education before. Secondly, we were trying some new methods of obtaining good evidence for the Committee. We tried a range of seminars. We took the Committee to universities both in the United Kingdom and the United States. We looked at good examples everywhere. We also took a great deal of oral and written evidence. We also had excellent special advisers, and I want to pay tribute to all five of them now because they took such a lead role in making our report as good as it could be.

Committee Chairs do not often say this, but our inquiry was a failure in one sense. The terms of reference were set during the period between the old Chair moving on to pastures new and the new one taking over. I think that members of the Committee will agree that they were set very broadly. When I became Chairman, I realised that we could spend another Parliament pursuing them. We thought through the process and decided to concentrate on two aspects of the report that could make some impact in the run-up to the general election.

I am told by all Select Committee Chairmen on the Liaison Committee that it is slightly different chairing a Select Committee in the year running up to a general election than it is for most of the rest of the time. Some of our interesting discussions on one or two points

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stemmed from that quite understandable, slightly heightened political tension. Select Committees do not wish their recommendations to be ignored and we decided to look at access to higher education and then move on to student retention: how to get them in and keep them in. Looking at those two aspects seemed to be a manageable task.

We started from the base that we all know about. We have now moved to a system not of elite but mass higher education. By 1997, more than 30 per cent. of the relevant population were going off to higher education, and that percentage is steadily rising. The Prime Minister's aspiration is for it to reach 50 per cent. However, moving to a system of mass education, produces interesting problems. Only last week, we were taking evidence on a further education inquiry. It was pointed out that there are now far more people taking higher education in the further education sector than there were students in the whole higher education sector at the time of the Robins report into higher education in the 1960s. That is a measure of the change, and shows how many people are coming into higher education.

The dilemma, which was recognised by the Government and by the previous Conservative Administration, is that whatever the system, it is extremely difficult to get children from lower socio-economic income backgrounds into higher education. That was the case before the changes made by the Labour Government in 1997. It was extremely difficult to encourage children from, to put it bluntly, working class backgrounds to stay in the system and enter higher education. It was an acknowledged problem before students had to pay fees and take loans, and has remained a problem.

That thread ran through our deliberations. When taking evidence, we wanted to find out what Governments of all persuasions had done well and badly, and why they had not succeeded. That was the thrust of our inquiry. Why had we not succeeded? Even when there were full maintenance grants, why did so few young people from working class backgrounds enter higher education? We examined the change in the system after 1997 and asked why it did not work. There were warnings that it might be worse than the one that it replaced. What recommendations could we make to Government to ensure a much broader spread of participation?

Mr. Phil Willis (Harrogate and Knaresborough): Before the hon. Gentleman continues, will he explain the staggering refusal of the Select Committee, on any occasion and particularly in its conclusions, to recognise that debt aversion and student poverty are fundamental causes of the Government's failure to expand the university entrance of students from lower socio-economic groups?

Mr. Sheerman : I have a lot of respect for the hon. Gentleman. He is the Liberal Democrat spokesman and is knowledgeable about many aspects of education. However, on the Committee—the inquiry took place before he joined—examined those aspects and took a great deal of evidence. Indeed, I remember one day at Manchester university when we consulted all the universities in the area. We invited particularly groups of students, members of staff and those associated with

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universities, such as chaplains, who are not paid by the universities but have an independent voice. They gave evidence about whether and to what extent debt aversion was a problem, and we asked the Government to be aware of that.

The hon. Gentleman's question also relates to student retention: why are students not retained in the higher education system? We must remember that we have the world's second best retention rates after Japan. The drop-out rate is only 17 per cent., of which two thirds drop out in the first year of university. We did not refuse to discuss the question. The evidence that came back to us clearly showed that debt and debt aversion were a problem, but we were not sure about the extent of the problem as we did not have the data or the statistics.

We took evidence from Professor Callender, who had written a report. She was not confident that the data that she used were sufficiently relevant to show that debt and debt aversion were a significant problem, and she planned to use new data. Let us remember that we published the report some time ago. Since then, more evidence has been produced that debt is a problem.

I must put that evidence into perspective, however. The Committee found that debt and debt aversion were a problem, but not of the first order. In the report on retention, we found that the overriding reason why students did not complete their courses was that they had been given the wrong advice and were enrolled on the wrong course. A university department that wants to make up its numbers may take a marginal student who is unlikely to complete the course. In addition, after going through clearing, a student may end up on a course that is not their first choice and in a city to which they never expected to go. That was the number one link found by the Committee.

Dr. Evan Harris (Oxford, West and Abingdon): I enjoyed serving on the Select Committee under the chairmanship of the hon. Gentleman. He mentioned DFEE-funded research from South Bank university. In fact, page 16 of the executive summary of that research stated that

We heard that evidence, but the report failed to reflect it in its recommendations.

Mr. Sheerman : That is true. The report on access was a divided report, and today's debate will reflect that. The hon. Gentleman refers to a poll, not facts or hard data, and other polls suggested that students were still spending at the same level as their peers who were not studying but in work. There was a great deal of evidence, and we had to make a judgment. As we went down that road, there were indications that student debt might be a problem and might be getting worse.

The hon. Gentleman may remember that the Committee strongly recommended that the Government keep a close eye on the situation. Callender's new figures were coming in, and the Higher

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Education Funding Council was gathering new evidence. We recommended that the Government should act quickly if there were real evidence that the new system that they introduced after the 1997 general election was not having the right impact.

Let us not detract from the Committee's suggestions. We proposed a range of possibilities and ways in which students from poorer backgrounds could be attracted to and retained in higher education. I am sure that my colleagues on the Committee will remember our being told that vice-chancellors and senior people in universities were good at following the money. We strongly recommended, therefore, that the premium received by universities for taking a student from a poorer social or academic postcode should be increased from 5 per cent. Some evidence suggested that the premium should be increased to 10 per cent.; some suggested quadrupling it from 5 to 20 per cent.—serious money. The Committee examined the problem and how the Government could remedy it.

I reiterate that we looked back at the position pre-1997—before the changes were introduced—and we saw that there were already difficulties getting through to this group of potential students. As the report shows clearly, much of the evidence—both written and oral—revealed that the real problem was not the level of grant or the system of financing one's way through university, but what happened to children early in their careers. We conducted an early-years inquiry, which showed that many children's potential lifetime of learning was stunted between nought and eight, or even before they have entered the education system.

We took evidence from sure start. As Harold Wilson said, a week is a long time in politics and we cannot wait for a 15-year perspective, but we found considerable evidence that young people switch off their aspirations to carry on with education between the ages of 13 and 16. The other evening we debated the 30 per cent. who are difficult to draw into education or who, if drawn in, find it difficult to maintain their interest and progress into further and higher education or lifelong learning.

One of our strongest recommendations was that the roll-out of education maintenance allowance is a highly significant factor. Not all members of the Committee agreed so strongly, but we showed that the 14-to-16 age group was crucial and urged the Government to examine it closely.

We strongly criticised universities with not such a good record on the breadth of the social and economic background of their student intake. Some stand out with a great disparity from the average. HEFC has come up with a range of figures that suggest that there are low and high performers. I acknowledge the strong criticisms—particularly from one university, but from others, too—of the basis of the HEFC statistics. Where some institutions were less good at attracting a broader range of students from diverse backgrounds, we agreed that they should do better. We wanted the Government to police the system, as it were, and to provide incentives—a carrot-and-stick approach to under-performing institutions.

There can be no doubt that some institutions are under-performing—including, I must confess, the London School of Economics, of which I am a governor. My hon. Friend the Minister for Lifelong

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Learning is a former governor of that institution. I said expressly to the court of governors that the school is under-performing. I understand the reason for that—it takes a broader spread of students from diverse social and economic backgrounds.

We clearly encouraged under-performers to examine the position carefully. We did not want to use abusive language. We encouraged a dialogue about problems. We wanted under-performing institutions to recognise problems and find ways of dealing with them. Whenever I met vice-chancellors or other senior people in universities, I encouraged them to use good management, to look down the supply chain and examine linkages with feeder schools.

When we visited the United States, we examined some of the most elite universities in the country—Princeton, Berkeley and Stanford—which had a sophisticated way of saying that they did not receive many students from poorer social backgrounds in their part of the US. They wanted to know what they were doing wrong; they wanted to send out emissaries; they wanted to send out their full-time staff and their alumni to try to build the right relationships. We did some good work and made some good suggestions. We saw good practice that could be emulated in this country without Government interference.

Chris Grayling (Epsom and Ewell): When the hon. Gentleman and his Committee were in the United States, did they find that the universities' endowment foundations, which are independent of the day-to-day or year-to-year inflow of funds for students, gave those universities a greater ability to take a profound look at the base from which they encourage students and at the substance of the institutions?

Mr. Sheerman : We all certainly picked up on that; the hon. Gentleman makes a good point. In fact, some of us have become sick of hearing excuses from higher education institutions in this country, such as "America is a different culture, the alumni give to universities, they have had hundreds of years to establish funds."

I am sure that my colleagues will remember our visit to New York university. Twenty years ago, that university received few alumni donations and had few residences—most students commuted. It recognised the problem, decided to become a residential university, set up a new foundation and bought and rented buildings. We were told that none of the bankers said no when the university approached them and said that it wanted to buy a building, fill it for 52 weeks of the year and set the rent.

That is an example to Leeds, Bristol and so many universities in towns where accommodation is a problem. Many universities should have done something about that a long time ago. We saw many exemplars in the United States: not only did universities start from scratch to build up that kind of base but they did so rapidly.

Dr. Ian Gibson (Norwich, North): Will my hon. Friend comment on the importance of graduate schools in the universities that he is discussing? From my experience of working and teaching in the United States, graduate students do much of the undergraduate

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teaching and are paid for it. Graduate students also do much of the research work. Thus, students are attracted to certain universities because of the increased teaching and support for teaching by people of the same age group.

Mr. Sheerman : That is a good point, too, but I am somewhat embarrassed by it. We skirted around the issue of using postgraduates in teaching, although we visited UMIST and saw some examples there. I will be honest and admit that, under our terms of reference, we did not pursue that; the Select Committee should return to it.

The Select Committee model has been that a report into higher education, early years or whatever was produced, the experience was cathartic and the report was put on a shelf to gather dust. I believe that most hon. Members are aware that, under my chairmanship, we regularly take down such reports and review them. The Government are re-evaluating student finance and want to make an impact, so we are dusting off the higher education reports and taking new evidence. I say clearly to the hon. Member for Harrogate and Knaresborough (Mr. Willis) that we will make different representations this time, because there is now more evidence about student poverty.

Mr. Willis : The hon. Gentleman protests too much about the lack of response in December—in fact, there was significant evidence—and let the cat out of the bag when he said that there was a general election coming up. Clearly, the report is about the general election rather than about the issues.

In the United States, the Select Committee looked at a system of university structuring and funding that has a totally different foundation. The hon. Member for Epsom and Ewell (Chris Grayling) is right to refer to endowments but, clearly, the endowment system in the United States is different from what we have even at Oxbridge. Why would the Chairman of the Select Committee steadfastly refuse to take on board the evidence of the Cubie commission, which had completed a most detailed examination of student aversion to debt in Scotland? Andrew Cubie gave evidence to the Committee—all the evidence was current—yet the report made virtually no reference to it; it is as if it did not exist, as if Scotland were some faraway planet rather than a part of the United Kingdom. What is the explanation?

Mr. Sheerman : The explanation is that we took an enormous amount of evidence. It was at my instigation that Cubie and his colleagues were invited to give evidence at the outset. We set a precedent: the Minister for Education in the Scottish Parliament came to give evidence to the Select Committee too.

We listened to the evidence. It is the Select Committee's job to sift and evaluate the evidence and then to strike a balance, which some people will not like. However, we believe that we got the balance right. We published one report, on access, on 30 January 2001 and the other on 13 March 2001; it is early days in terms of hard statistics.

Mr. Stephen O'Brien (Eddisbury): I am grateful to the hon. Gentleman for giving way. I recall that there was a

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long discussion in the Committee about the relevance of Scotland to the outcome of the report. In considering Cubie and the Scottish experience, we viewed Scotland as a helpful comparator; it represented an experience learning curve for the Committee, as did our trip to the United States. However, the focus was on England and Wales as a function of the Government's devolution responsibilities. The Committee was constrained in considering how much it could and should look to the Scottish experience as directly applicable rather than comparative. I do not know whether the Chairman of the Committee recollects that.

Mr. Sheerman : I recollect that but I also recollect the fact—[Interruption.] The hon. Member for Harrogate and Knaresborough is murmuring and whingeing and carrying on. The evidence that he has cannot have come from the majority of members of the Committee. If the hon. Gentleman had been on the Committee he would know what happened. We had dinner with Andrew Cubie, and talked to him formally and informally; he was an unhappy man because his recommendations had not been accepted by the Scottish Executive—the Liberal Democrats and the Labour party—and he was unhappy about the compromise. I understand that people in Scotland were as unhappy about it as many had been about the Government's reaction to the Dearing report.

We should not think that Cubie came from on high and made recommendations that were accepted and implemented in Scotland. When we took evidence it was very close to the event. A Select Committee should not be swept along by fashion and instantaneous evidence. It must consider things over time, as we did. The Scottish changes had just occurred; there was no evidence of what would happen. However, we now have evidence of how many children are going to Scotland to study; the figures are worrying because there is an increase in the number of students going to Scottish universities this year compared with other British universities. That marked diversity was shown in material published two weeks ago in the Scottish and the UK press.

Dr. Evan Harris : Further to the intervention by the hon. Member for Eddisbury (Mr. O'Brien), I want to say that even if one does not accept that the Cubie recommendations are relevant to this country, his evidence should inform our discussions. There is nothing in the water in Scotland that makes people there more debt-averse than poor students here. Indeed, the Cubie report clearly stated that he proposed the introduction of non–repayable bursaries for some full-time higher education students to counter loan aversion and facilitate greater access, as

Whether from Cubie-full or the Scottish Executive, the message rings out from the evidence.

Mr. Sheerman : At certain times, when the hon. Gentleman was passionate about it, his voice rang out about certain aspects of the matter, but I do not remember his being so passionate about Cubie. He is

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both a member of the Select Committee and the Front Bench spokesman on higher education. In the run-up to the election, his party ran a successful campaign on student debt up and down the country, on university campuses and so on. That is not a criticism. I know where the hon. Gentleman is coming from and I applaud his political energy.

As I have taken many interventions, I shall continue for a couple of minutes over my time. The first report was very controversial and caused a lot of division and unhappiness. So far, no one has mentioned a particular piece of evidence in it—[Interruption.] I did not hear that name and I am not about to mention it. The first report was fair enough but the second one was agreed and had a very different tone. It would be wrong not to ask for those reports to be read and re-read. They were an honest evaluation of what we thought were the problems at the time.

A clear message that came to me as Chairman of the Select Cttee, as is written into the evidence, was that universities are the key to our future. Everyone knows that I share that view strongly, because I express it strongly whenever I talk about higher education. Most people in the House and the country do not understand just how vital universities will be in regenerating our economy. I know the criticism that people sometimes level at us, that some of us who believe in economic regeneration do not believe in individual fulfilment. Of course we all believe in individual fulfilment—but we also believe that a fulfilled individual can help us to create a successful, creative, imaginative and innovative economy. That is what we desperately need. I always challenge people to imagine taking universities out of any town or city. If we took them out of Leeds, Manchester, London and Huddersfield there would be devastation—[Interruption.] My hon. Friends want a commercial. The same would be true of Edinburgh, Bristol or anywhere. The importance of universities to the future of our regions, cities and towns cannot be underestimated.

What should we do? The evidence in the two reports highlighted several issues that the Government—and future Governments—must address to fulfil the potential of higher education. First, we must pay university teachers decent pay that attracts and retains talent. We are pretty close to the margin in keeping the talented people we need in higher education. I am still a vestigial member of the Association of University Teachers; I do not have much connection with it now but I passionately believe that university teachers must be paid decent wages. Many of those employed in universities do not earn what teachers earn. Last night I was talking to an Oxford professor; his son is also a professor, and earns less than a nursery head. People might say, "So what?", but the Government must consider the issue of salaries for research and teaching in universities.

Mr. Willis : Where is the money coming from?

Mr. Sheerman : We will come to that. It is a very good question, like all the hon. Gentleman's questions.

Secondly, we cannot just splurge on research for three years and then let it lapse. Money must constantly be poured into research if universities are to be taken

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seriously as world-class research institutions. The Government have put significant amounts of money into research over the past three or four years, but they have to realise that the funding must continue. Higher salaries, research and the regeneration role must be maintained with real resources. The evidence given to the Select Committee showed that we were spending about the same percentage of gross domestic product per capita on higher education as most of our major competitors. It was not as much as the highest spend, but somewhere in the middle band.

Let us examine more closely our higher education spend. About 40 to 45 per cent. of it was allocated to student support, which was double the spend of our competitors. The hon. Member for Harrogate and Knaresborough was right to ask where the money would come from. If we returned to the old system of maintenance grants for all students that we had until three years ago, where would the money come from? Let us consider our priorities. The majority of members of the Select Committee agreed that we must help poorer students who are finding it difficult to stay at university. However, for the average student, the principles of Dearing were right. Students should pay something towards the cost of their education because they are receiving a great benefit that will repay them throughout their lifetime. If they can afford to, parents should pay something towards their children's higher education. The present sum of £1,000 a year is a small proportion of the cost.

Mr. Willis : Will the hon. Gentleman give way?

Mr. Sheerman : Not at the moment. I shall be finishing in a couple of minutes. If we want such expansion, where will the money come from? We should never return to the time when we spent an enormous amount of money on student support, but it is important to get the balance right at the margins. There is now a much stronger case for protecting marginal and poorer students and introducing a new form of financial support for them. We may have to go beyond that, but we cannot afford to move much further the balance of HE spend on student support. Perhaps the money will come from parents. Many hon. Members have benefited from a higher education, so why should we not pay something extra towards it?

Mr. Willis : How about the penny on income tax?

Mr. Sheerman : I knew that the hon. Gentleman would say that and he makes a fair point. A balance should be struck so that those who benefit from higher education make a contribution to it.

There have been many interventions in my speech so at times I have been slightly off track. We had an interesting time compiling the two reports. I am sure that most members of the Select Committee enjoyed that process. We learned a lot and that is shown in the reports. That there was some slight disagreement was shown in the first report, but the second report was agreed unanimously and it sets out some helpful conclusions.

I hope that my hon. Friend the Minister does not think that I am not in agreement with the Government, but they must take higher education more seriously. I

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accept that my hon. Friend is new in the job. She will be scrutinised by the Select Committee soon, as will all the members of the education team, and she will face some tough questions. I know that she is committed to higher education, but it is no good people being committed if they let others kick them around. I have known my hon. Friend for a long time and I know that people do not usually kick her around and get away with it. Surprise, surprise, perhaps the Prime Minister became worried about what was happening in the election campaign and said that student finance and higher education had to be revalued. If such a message came from No. 10, so be it. I hope that the Department is resolute to ensure that the inquiry produces a proposal that works positively for higher education and gets the balance right. It would be criminal to get the balance wrong.

The hon. Member for Harrogate and Knaresborough will not like this, but senior people in the university system—some speaking over dinner or a cup of tea rather than in front of the Select Committee—said that the change in the basis of student finance was one of the toughest but bravest measures that the Labour Government introduced. Hon. Members may not like it, but, that is the opinion of many people in higher education. If priorities for higher education are to be changed, tough decisions must be made. Decisions may be tough, but they must be right in order for the correct developments in higher education to happen over the next 20 to 30 years and that is important.

I crave your indulgence, Mr. Pike, for a longer speech than I intended. However, many hon. Members shared the time .

Several hon. Members rose—

Mr. Peter Pike (in the Chair): Before I call the hon. Member for Eddisbury (Mr. O'Brien), it will be noticed that many hon. Members wish to speak in this important debate. I can call everybody only if hon. Members co-operate. I urge that to be taken into account. I do not have the power to curtail speeches, but courtesy should be shown to others who wish to speak.

3.11 pm

Mr. Stephen O'Brien (Eddisbury): Thank you, Mr. Pike. I will do my best to comply with your encouragement to be brief by highlighting a few of the aspects that arise from the reports and the Government's subsequent responses, rather than rehearsing the Committee's experience during the prolonged and thorough inquiry on higher education.

It was a privilege to serve on the Select Committee on Education and Employment, although I am no longer a member of an Education Select Committee. All hon. Members agree that nothing is more important than our responsibility, as a generation of politicians, to influence the chances in life that are given to the generation of people who are coming through the education system. The Committee seriously considered that and, above all, how to give the correct context and encouragement to professionals who provide the service. The Committee was hard working. I echo the Chairman of the Select Committee on Education and Skills—as it is now called—in congratulating and praising the raft of expert advisers who helped the Committee and who were committed and frequently available. They were exceptionally helpful.

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I pay tribute to the hard work and leadership given to the Committee by my colleague Mr. Nicholas St. Aubyn, the former hon. Member for Guildford, who, with a clear set of views and an open mind to the advice that was received, always engaged in the debate on higher education with deep passion and commitment, which continues during his temporary sabbatical outside this place. I am pleased that the Chairman acknowledges that.

The Chairman was correct to show that there was a balance between the positive and the less attractive side of the way in which the Committee interpreted the evidence. While there were differences of emphasis and, at times, vigorous arguments about student retention, the report was unanimous because although compromises were made during discussions, the thrust was correct. The Chairman fairly identified the matters on which we look to the Government to show commitment and practical application equal to that demonstrated across all parties during the report's production.

I wish to pick up on a point that was made by the hon. Member for Oxford, West and Abingdon (Dr. Harris). It is important to state that debt aversion was accorded a lower priority in the report than would now be considered appropriate. However, at the time, the evidence was embryonic. Evidence was offered by Southampton university, but it was not corroborated, and there was not a large enough body of experience to show that it was conclusive, or the primary issue.

As we lacked conclusive evidence, it was difficult to reflect in the report the instinct that was shared by Conservative and Liberal Democrat Members that debt aversion is a high-priority issue. However, I wish to place it on record that there was a discussion about that, although the report is less explicit on the issue than it should have been.

Mr. David Rendel (Newbury): Why did the hon. Gentleman take that evidence if he was then going to ignore it on the grounds that it was too new?

Mr. O'Brien : The hon. Gentleman's question answers itself. A judgment needed to be made, and a Select Committee's function, in terms of the way the House as a whole conducts its business, is to make collective judgments. With regard to the access report, the collective principle was not applied because there was a serious diversion of views—as well as of motivation concerning what was going on. However, with regard to the reports under discussion, judgments were reached in a more collective manner, and some compromises were made to try to maintain unanimity and to create an impact—I hope that the hon. Gentleman appreciates that, at times, the process of the House is intended to provide a context that will carry impact. This debate is being extended so that the point that he and I are making is on the record. That will help to show where we stood at the time that the report went to print. I hope that that will be of assistance to him.

With regard to the overall context, Governments of every political persuasion take seriously their obligations in respect of education—and higher

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education in particular, because higher education qualifications are the most obvious and demonstrable measure of a successful education system. They also make the biggest impact on the nation's economy and social life.

In 1979, when I left university, one in eight of our young people were entering higher education. In 1997—and I have, of course, chosen that date at random—that statistic had fallen to just under one in three. That step change in terms of student access—and all hon. Members hope that there has also been a step change in terms of quality of education—was achieved under the previous Conservative Governments. I am glad to note, however, that the present Government are determined to deliver on their aspiration that up to one in two people will have the opportunity of a higher education by the time they reach the age of 30.

Mr. Gordon Marsden (Blackpool, South): I endorse the point that the hon. Gentleman has made about that broadening process. Does he agree that much, if not all, of that increase was due to the conversion of polytechnics into universities, and that, because of that, all political parties, regardless of whether or not they are in government, have a responsibility to show concern for the resources of those new universities, and the investment in them?

Mr. O'Brien : The hon. Gentleman has made a broader point, which I accept. Redefining polytechnics as universities inevitably made a huge measurable change. The right interpretation is that, during that period, there was a welcome recognition that all those engaging in higher education, whether of a very academic nature or of a more vocational nature, were being placed on a more equal footing. That must be the right approach. The issue that he raises, into which I shall not stray, as it goes down another path, is that of the Government's aspiration of one in two people receiving higher education. If that is achieved, employers and society may question the value of those academic and vocational qualifications, in their various guises and subjects, and whether they allow people to make the huge step forward to which the hon. Member for Huddersfield (Mr. Sheerman), who is Chairman of the Select Committee, referred. That balance needs to be struck, but it is a debate for another time, and one that I would welcome.

Mr. David Chaytor (Bury, North): Thank you, Mr. Deputy Speaker. To pursue the point about the extension of participation in the 1980s, does the hon. Gentleman not accept that the main reason for that was the increased supply of young people with the necessary qualifications to go to university, which was entirely as a result of the extension of comprehensive education by Labour Governments in the 1960s and 1970s?

Mr. Peter Pike (in the Chair): Before I call the hon. Member for Eddisbury, I want to make it clear that I am not Mr. Deputy Speaker but Mr. Pike.

Mr. O'Brien : Thank you, Mr. Pike. I hope that I shall remember that.

I do not agree with the hon. Gentleman's point. A combination of factors was responsible. The broadening of educational opportunity was no doubt a contributory

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factor, but that should not diminish, for instance, the role played by those systems of education that retained grammar schools, those that chose to become grant-maintained and assisted places scheme—much lamented by me and my party—and the independent sector. It is therefore wrong to identify one source of advantage.

In terms of trying to ensure that students are retained once they have had the opportunity to go into higher education, some of the points in the student retention report should be highlighted, especially in relation to the question of non-completion. Although the report should be read in terms of statistics, issues of portability, time spent and the accreditation given to students whose circumstances can be exceptionally varied individually and geographically can impact on the funding of those students. The issue of portability needs to be addressed, and I hope that the Government will tell us their thinking on that.

A point that did not appear in the main body of the report, partly because, sadly, it was in the excised version of the powerful minority report, and which was a passion of my former colleague Nicholas St. Aubyn, was that we should give much more attention to the year out, which fosters greater maturity and acceptance of the obligations and opportunities that are provided by higher education. Sometimes, it is best to take that year out in the middle of a course, so the arguments about portability also apply in that regard.

Dr. Evan Harris : For the record, I urge the hon. Gentleman to remember, in the course of his fascinating and enjoyable speech, that there were two minority reports. The report to which he refers was the one that he and his colleague produced.

Mr. O'Brien : That is almost strictly true. However, the hon. Gentleman will recall that on one extraordinarily exciting occasion we managed to agree with him on part of his minority report, and he managed to agree with us on part of our minority report. It is a shame that we were not able to develop that wonderful marriage of thought further.

Moving onwards very swiftly from what is becoming extremely dangerous ground, it is important to emphasise, as the report says and as is accepted by the Government, that social class is not completely straightforward in terms of defining many of the issues that surfaced during our inquiry. Although the Government have given relatively comprehensive and helpful responses on the student retention report, their response to the access report has been poor by comparison. That is partly a matter of presentation, because in the case of the student retention report they helpfully responded recommendation by recommendation. They responded to the access report, however, with a broad-brush letter. I am ashamed to have to expose the Government deliberately trying to avoid answering certain of the recommendations in the access report because the issues that it dealt with were more awkward.

We cannot have this debate without having an honest and robust discussion about funding not only of students, but of staff and research. That point was made earlier. Often, in science and technology subjects,

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teachers are able to secure some external supplement to their income. Perhaps that should be encouraged as part of the marriage of the scientific community with the real world. However, it is much more difficult for those teaching in the arts and the less-developed subjects to secure such a supplement. Although best practice should be followed, such as the Cambridge science park, there is a lot more work to be done. We need to consider the true nature of the marketplace.

On student funding, it was welcome that the Government signed up to the strong argument put forward by my former colleague Nicholas St. Aubyn for the raising of the threshold to £20,000. That is important, not least for when students come to repay the money that they must contribute to their education de post facto. However, it is important mainly because the £10,000 threshold was catching those who wished to work in the charity sector and in public service, for example. Their salaries were just a little bit north of £10,000 but they were not really in a position to pay much until they were earning £20,000.

It is important, for the record, to talk about the access report. It will be recalled that while the terms of reference unquestionably were broad to start with, we expanded them to include access. That resulted in paragraph 11 of the majority report dealing with what the Chancellor of the Exchequer said at a conference on 25 May 2000, when he referred by name—he introduced her into the public domain—to Laura Spence, whose case has been much publicised since. It is said that she is now having a very successful time at Harvard university and I am delighted by that. The Committee was seriously divided on that issue. One has only to examine the series of reports on the divisions within the Committee and the particular wording that was tabled by Mr. St. Aubyn and by me. It was felt that the Chancellor should not have made those remarks, but we ended up with an exceptionally unfortunate phrase in the majority report, which states:

That left out, after the phrase "the Chancellor's remarks", the following phrase:

The majority report goes on to state:

That is where the Committee was exceptionally unhelpful in its majority report. I will defer to the hon. Member for Oxford, West and Abingdon (Dr. Harris), whose seat includes Oxford university and who will have the latest information, but I understand that the opposite is the case and that things have been difficult as a result of publicity that the Chancellor inadvisedly gave.

That episode caused much unhappiness on the Committee, not least because it threw into question the motivations of some members, who we felt had more of an eye on the general election than on making the process helpful to the House, and to students and teachers. I wish to place that on the record because it is important to ensure that those points are drawn out.

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3.29 pm

Ms Joan Walley (Stoke-on-Trent, North): I shall try to keep my remarks brief because I know that many hon. Members, including those on the Select Committee, want to contribute.

I want to try to put the Select Committee's work into the context of my constituency experience, and to urge the Minister to study the Committee's recommendations and act on them to make a real difference to levels of participation in higher education. All too often, Select Committee reports gather dust. It is critical that recommendations are closely examined and that the Minister makes detailed proposals for implementing them.

I want to deal with several aspects of higher education, but of particular importance are the way in which students pay for their education, the Government contribution to maintenance and to grants or loans, and the funding of higher education establishments. It is important that the Government get those things right and do not enter into hasty arrangements that might make matters worse. I hope that the Minister will attend to what the report says about getting the balance right. My constituency badly needs more people to go into higher education, and for many people from families in which no one has done so before the prospect of debt is not an encouragement. We need a cultural change, so that people feel better about higher education.

It is important that we should use joined-up thinking in considering what is to happen next and the process by which the report will be absorbed and configured within Government policy. Sure start and the excellence in cities initiative have been mentioned, and I am happy to report, first-hand, a huge difference in my constituency as a result of such work. Education maintenance awards are relevant in this context. In Stoke-on-Trent there has been a great increase in the number of people continuing into the sixth form and taking A-levels, and, as a result, being able to consider higher education.

I do not know whether other hon. Members do as I do, but whenever I attend a school awards evening I ask a very pertinent question of the parents who are gathered proudly in the hall to see their children accept their awards: how many of those parents were in higher education? The report makes an important recommendation about the need for us to establish an infrastructure that allows for family history and encourages first-generation students into higher education. We must make it possible for the culture to change. Education maintenance awards can achieve that.

Stoke-on-Trent, like other pilot areas, has now been told that there will be a one-year extension for current year 11 students. We greatly welcome that, but the education maintenance awards were for a three-year pilot process, and it is critical that the analysis is completed as soon as possible. I want to be able to tell my constituents that the extension will not be just for a year. Instead, I want the programme to be rolled out in Stoke-on-Trent and, before too long, nationally. This is exactly the time of the parliamentary year when the Chancellor is considering future spending plans. Whatever long-term decisions are to be made about education maintenance awards, they must be an integral part of the agenda of not only the Department for

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Education and Skills, but the Treasury. I want a decision as quickly as possible, because I want to be able to tell people that the awards will continue in Stoke-on-Trent and be extended to other parts of Staffordshire, where people are often in college side by side with students from Stoke-on-Trent. They cannot understand why someone who lives virtually across the road from them has an education maintenance award, but they do not.

In case the Minister is in any doubt on the subject, I can tell her that GCSE results are improving significantly in Stoke-on-Trent. The number of people staying on in school has increased from about 54 per cent. to 64 per cent., which I attribute to the difference made by education maintenance awards. I have been to every high school in my constituency and encouraged people to take up the awards. I have helped to make information available to parents, and I hope that the Government will make the awards a standard part of educational policy and closely consider the evidence and discussion about that in the Select Committee report.

The education debate is relevant to the agenda of the regional development agencies, which are to improve our local economy. I was pleased to see the report flag up the role of learning and skills councils and the way in which it is envisaged that they will work locally with the ConneXions agency and regional development agencies. We could give them greater impetus to bring about more of a cultural change in access to higher education, not only for students in school, but for mature students.

It is unfortunate that north Staffordshire has had a huge number of job losses in manufacturing, some of them in your constituency, Mr. Pike. Many men, often in their early or late 50s, who are highly skilled in engineering, have lost their jobs at the Michelin company. Some who are my constituents have told me that they would like access to higher education, and perhaps to go on to train as teachers and make their expertise of a lifetime in industry available to young people. However, they feel that the finance system means that they cannot contemplate higher education at that stage in their lives. Will the Minister consider ways in which learning and skills councils, with their new responsibilities, could do more to promote the entrance into higher education of more mature students as well? That could launch people who had unfortunately lost their jobs due to the problems in manufacturing into a new career, even at a late stage in their lives.

I must flag up another issue, although I know that time is short. We are pleased that Stoke-on-Trent is an excellence in cities area. The award is working well and its results have been transforming. It has encouraged our young people to think seriously about higher education. However, I must tell the Minister that the opportunity bursaries are something of a discrepancy in the higher education work undertaken through the excellence in cities awards.

I should give hon. Members a little geography lesson. Stoke-on-Trent and the borough of Newcastle-under-Lyme, which is not in my constituency, lie side by side. Someone who did not know the area would probably not know where the boundaries were. My constituents who go to college to do A-levels in their sixth form mainly attend the college of further education in Newcastle-under-Lyme. Like the colleges in Stoke-on-

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Trent, it is an excellent educational establishment. About 415 of my constituents attend it, all of whom live in the excellence in cities area. When they are ready for higher education and want to attend Staffordshire university—where much work has been done to widen participation in education—or to Manchester Metropolitan university, they are told that, because of the way in which the regulations are applied, they are ineligible for opportunity bursaries.

I know, for example, of a young girl who lived in Tunstall and went to a local school. She attended the college at Newcastle and wanted to go on to Manchester Metropolitan university to study sport. However, she was not eligible for a bursary, not because of where she lived, but because of the college that she had attended. Newcastle college is not yet in an excellence in cities area—I hope that it soon will be, although that is not up to me—and it is only an observer college in Stoke-on-Trent's excellence in cities partnership. Its 415 students from my constituency are, therefore, ineligible for bursaries unless the universities that they choose are prepared to consider them for hardship awards.

Staffordshire university has made huge strides. It now allocates the joint fifth highest number of bursaries in the higher education sector; reflecting its successful record of allowing access to and widening participation by under-represented groups. It has had far too much demand for bursaries and simply cannot offer any more. If we are serious about getting more people into higher education, we must look at such obstacles in more detail and find ways of overcoming them.

Finally, I welcome the Select Committee's recommendation that something similar to the excellence in cities partnerships should be available to higher education establishments, allowing them the opportunity to access extra funding. I can envisage a new pilot area, linked to north Staffordshire, which would take on board the new medical university that is to be at Keele university. It could, perhaps, include Staffordshire, Keele and Manchester Metropolitan universities, and could attract people from the wider urban area, where there have been so many manufacturing job losses and where north Staffordshire partnership is so keen to promote access for all to higher education.

Mr. Stephen O'Brien : On the point made by the hon. Lady before she turned to bursaries, would she agree that it would be helpful if the Government were to initiate and to report on an audit of the number of university teachers and other teaching professionals who are now members of either regional governmental bodies or learning and skills councils? The Government talk of partnership, but those bodies do not make many appointments that would help to advance the hon. Lady's arguments. That would be a good area in which to make progress.

Ms Walley : I said at the outset that I wanted a joined-up agenda and links between the Department and the wider economy. The membership of bodies such as those mentioned by the hon. Gentleman is critical if they are to have the necessary vision and to deliver the policies that will give people improved access to higher education so that they can then contribute to the area's

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economic success. I believe that I have taken up more time than was allocated to me. I am grateful to have had the opportunity to contribute to the debate.

Mr. Peter Pike (in the Chair): Order. Before I call the hon. Member for Chesterfield (Paul Holmes), may I say that Front-Bench Members are co-operating well and have indicated that they will catch my eye at 5 pm? That will assist hon. Members in working out—we are talking about higher education, after all—how much time is available.

3.44 pm

Paul Holmes (Chesterfield): Since my hon. Friend the Member for Oxford, West and Abingdon (Dr. Harris) issued his minority report, and since the general election, the Government have accepted that they have got it wrong on student debt, access and retention. In a different area, they have admitted that they botched the rushed introduction of AS-levels, which will also have adverse effects on access to higher education, although those effects may only be short term.

With the funding of students and further and higher education back in the melting pot, it is vital that the Government go back to the two reports. The evidence in them clearly shows that student debt and fear of debt are preventing full access by all social groups to higher education at undergraduate and postgraduate level and causing retention problems. That evidence has been further reinforced by the Cubie report in Scotland, and its implementation, and by the publishing of the Rees report on student finance in Wales. [Interruption.]

Mr. Peter Pike (in the Chair): I shall suspend the sitting for 15 minutes. We will be back at four o'clock, which means that the timetable that I announced moves back by 15 minutes. I was tempting fate.

3.45 pm

Sitting suspended for a Division in the House.

4 pm

On resuming—

Mr. Peter Pike (in the Chair): For everyone's guidance, I should make it clear that the vote in the House will add 15 minutes to our sitting.

Paul Holmes : Labour Back Benchers may well tell us that the problems of student debt, access and retention are exaggerated, that only 50 per cent. of students pay fees because of means-testing and that loans are cheap and easy to repay. That would be pre-emptive spin from Treasury Ministers which, like the Prime Minister, must have been told by plenty of voters during the recent election campaign that debt and fear of debt are major problems. I was certainly told that on the council estates of Chesterfield.

Let me give some personal examples. In 1975, I was the first member of my family to go to university. When I was offered a place, my father was unemployed and my mother was a part-time home help. I doubt that I would have gone to university if I had thought that I would leave with a debt of between £10,000 and £14,000, which is the average range of debt now.

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Twenty years later, I became a secondary school teacher and, for my last 12 years in teaching, I was a head of sixth form, or years 12 and 13. That involved guiding sixth form students through their higher education and job choices. The school at which I worked for the last 10 years took quite a number of children who were the first generation of their families to enter post-16 education, let alone higher education. It was difficult to persuade some to take that step. Some said that they had to go to work to contribute to the family budget. Some children of single parents said that they had to work to help with younger brothers and sisters. Other children and young adults had experienced family breakdown and could not rely on parental contributions, even if Government means-testing showed that their parents should contribute. For many reasons, people were put off higher education, and there was a noticeable increase in their numbers after the introduction of the 1997 regulations on paying fees and abolishing maintenance grants.

The Government must review the overwhelming body of evidence on the issue. If students are to be asked to pay for the benefits of higher education, they must pay post-graduation, while they are earning, and not up front, while they are studying. The Government could consider a system of taxation that has been tried and tested, for which the bureaucracy already exists and which is fair and related to ability to pay. A graduate who became a low-paid nurse, social worker or teacher would not then be required to pay back the same amount as a graduate who became a highly paid lawyer, accountant or company director. I have heard it rumoured that such a system exists—it is called income tax.

Chris Grayling : Will the hon. Gentleman clarify a point of policy for me? The Liberal Democrats have made great play of proposing a small increase in income tax to deal with those problems. Are the penny on income tax and the financial structure that was put together during the general election designed to cater only for the current level of students, which is approximately 33 per cent. of the population? Would it also provide the financial capability to cater for a figure of 50 per cent., which is the Government target? If it is the former, do the Liberal Democrats share the Government's ambition, and how would they pay for it?

Paul Holmes : The costings that we set out in the election manifesto were given a clean bill of health by the Institute for Fiscal Studies, unlike those of the other two main parties. The figures made it crystal clear that the penny on income tax and the increase in income tax on high earners who earned more than £100,000 a year would pay for the proposals in our manifesto. If the Government undertake a review of the system—as they say they will—and there is a further increase, the way forward would have to be considered. However, it would have to be a genuine review.

Chris Grayling : What about the 50 per cent. target?

Paul Holmes : The 50 per cent. target is long-established, but I question how it will be funded. I also wonder how other aspects of the expansion of universities, such as teaching resources, will be funded.

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As well as considering undergraduate education, and why people want to go to university or are put off from going, the Government must also consider postgraduate education. Universities are suffering shortages and crises. They are having difficulty recruiting university teachers because there are not enough postgraduate students, particularly in the sciences, and they are having problems with postgraduate access.

Earlier this week, I talked to students from the university of London. They told me that student friends of theirs had been denied further funding or loans because they were so much in debt with their previous student loans and tuition fees. Many people said that the problem would begin to bite in the next few years as the level of student debt rose from the average figure of between £10,000 and £14,000. Indeed, one or two such cases have been highlighted by the press during the past few months. If universities are suffering major problems in the recruitment and retention of postgraduate students as well as of undergraduates, the Government need to take action.

The Government need also to consider other aspects of higher education expansion. It must be funded properly if the present 33 per cent. level is to be maintained, let alone increased to 50 per cent. It cannot be done by robbing one side to pay the other. One cannot rob the students to fund higher education, and one cannot rob higher education to pay the students; if one tries, neither will be done satisfactorily. The past few years have seen a 36 per cent. drop in the funding per student. There are more students in the system, and less is being spent on their education.

The Taylor report showed that £900 million a year more is needed to provide adequate teaching resources. A crisis in staffing for universities and further education is imminent; unless the Government take action in advance rather than waiting until the crisis hits them, it will match the crisis that already exists in schools.

I shall now comment on some aspects of university education for disabled students. The last school where I taught was very good on social inclusion, and over the past 10 or 12 years I have taught a wide range of children with various disabilities in mainstream classes. The youngest of those children is now a second-year student at university. She is registered blind as a result of three astigmatisms. When she came to look for a university place, she found that many seemed to offer good facilities for disabled students. However, on visiting them she found that the facilities often fell short, although not, I hasten to add, at the university where she now studies. I know that organisations involved with various disabilities are very concerned about some aspects of that problem. Amendments to the Disability Discrimination Act 1995 which come into force next September will tackle quite a few of those problems, but still leave some pockets untouched which need to be tackled by appropriate legislation.

Finance for disabled students also needs to be considered. They face the same rules on finance as other students, but they face extra difficulties. For example, the present system assumes that, these days, students will work their way through university. Disabled students find that much harder, although it depends on their disability. Some will not be able to get part-time work as easily as able-bodied students. Other disabilities, such as ME or multiple sclerosis, cause

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problems with fatigue; such students cannot work many hours, and if they are working on their degree and supposedly working to pay their way through university, they will face a double bind.

Some of the rules on benefits and disability student allowances may cause problems for disabled students on part-time courses. Compared with able-bodied students, they may have difficulty moving in and out of the benefits system as they move between work and full-time education. It takes too long for the system to catch up with their movements. Many who receive the disabled student allowance find that the money paid to provide for extra facilities and transport requirements comes on stream only several months after their course has started, which creates major problems. A number of problems that specifically affect disabled students need separate attention, even though many of them are closely linked to the general issue of student finance.

4.9 pm

Mr. David Chaytor (Bury, North): I am glad to be able to contribute to the debate. I think that the report produced by the Committee, at a time when I was not a member of it, is excellent, dealing with almost all the issues that need consideration.

Access to university, especially for young people and mature students from working-class backgrounds, is one of the issues about which, of all my other preoccupations as a Member of Parliament, I feel most strongly. I worked on it for the best part of 15 years before entering the House. My concern about the limitations of the United Kingdom's higher education system arose from my experience working in the United States in the late 1970s and observing how it had moved to mass participation in the university system, which in those days was unthinkable in the United Kingdom.

I welcome today's debate. It is interesting that it is the third debate in eight days on higher education. There is a temptation to repeat arguments that were well rehearsed last week, but I will avoid it and concentrate on one or two specifics. I do, however, want to return to the big issue of student finance before I finish.

I welcome the Government's achievements through the reform of student finance in their first term, and the prospect of further improvements to that. I welcome also the significant improvements in student achievement at GCSE and the prospect of greater achievement at A-level, as the years go by, with the reform introduced by curriculum 2000. I welcome too the prospect of the wider curriculum reform for 14 to 19-year-olds flagged up in the recent White Paper on schools and its consultative document. The direction of Government policy is absolutely right, forming the essential foundation to enhance participation and achieve the target of getting 50 per cent. of young people into university or higher education by 2010.

The expansion of higher education between 1979 and 1997 was possible only because of the increased supply of young people with the necessary qualifications, brought about by the extension of comprehensive education in the 1960s and 1970s. That is an indisputable fact, and the Conservative party is in a state of denial if it continues to pretend that that was not a factor.

I turn to some specific points. I think that the hon. Member for Eddisbury (Mr. O'Brien) pointed out the distinction between the Government's responses to the

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two reports. That concerns me, too. The Government's response to the report on access is far sketchier than their response to the report on student retention, a fact that must be registered. The response to the report on retention was extremely detailed and helpful, but there was a tendency in both reports to exploit the division of responsibility for higher education between the Department, the Higher Education Funding Council for England and individual institutions, and perhaps to abdicate some responsibility from time to time. In the Government's response to the report on retention, there were numerous places—I counted six—where a particular recommendation was dismissed as a matter for individual institutions or for the HEFC.

I shall dwell on one point, although it is a tiny detail. In the report on retention, the Government responded to the issue of outreach activities and pastoral care to support participation by recommending that HEFC and individual institutions look carefully at the matter. HEFC's response in the same report says that that is a matter largely for individual institutions. In the response to the report on access, however, the Government accept that they are taking an initiative. The difficulty of having two reports to respond to has led to a slightly contradictory response by the Government. In general, the temptation must be resisted to say that something is not a matter for Government but the responsibility of the individual institutions or the HEFC. I would like to see a stronger and more interventionist role by the Government in setting firmer parameters and a clearer direction for the HEFC.

Having distinguished between the two reports, I should like briefly to dwell on some specifics. I welcome the introduction of both the new curriculum 2000 and the new Universities and Colleges Admissions Service tariff. I am concerned that some universities have dismissed curriculum 2000 and do not seem to have adjusted their admissions procedures. The report refers to officials in the Department working closely with individual institutions, but it would be helpful if the Minister, either today or in due course, were to make a brief statement. It is unacceptable that universities can ignore a major curriculum reform with its associated implications for the UCAS tariff system. The universities that are most dismissive of the new curriculum and tariff system are precisely those that are least concerned about widening their participation and social base.

Paul Holmes : I agree with much of what the hon. Gentleman has said. Universities are slow to accept new qualification systems such as the general national vocational qualification. However, does he accept that during the past 18 months it has been difficult for universities to accept qualifications such as AS-levels? Universities, like the teachers—among whom I include myself—who had to introduce those qualifications, did not know the system until the course had been taught for six months.

Mr. Chaytor : I do not accept that. I speak as the parent of a child who is at university and of another who is currently applying. My observation of their

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experience of the AS-level system does not conform to the sense of crisis and chaos that the hon. Gentleman wants to create. However, I take the point that with such a major innovation in the curriculum there will be teething problems, which is something that the Government recognised earlier this year. The report on AS-levels issued in June was sensible, and there will be a further report in December to make more substantial recommendations to ease the implementation of curriculum 2000.

Turning to the question of the school year, it is a ludicrous anomaly that we have a university admissions system based on predicted, rather than achieved, grades. That is unsustainable, and I welcome the debate on that matter. There is a weight of evidence in favour of switching to a different structure for the school year that would allow students to get their grades and then apply, rather than applying in anticipation. That would be better for students and it would be more efficient in terms of administrative processes and costs. It would also be less time-consuming for individual universities to consider applications only from students with grades broadly in line with those required. The report refers to the Local Government Association consulting on changes to the school year to facilitate a new admissions system based on actual results, but the report does not say how long that will take. It would be helpful if the Minister were to comment on that matter.

I endorse the comments made by my hon. Friend the Member for Stoke-on-Trent, North (Ms Walley) on education maintenance allowances. It grieves my constituents that they are not eligible for EMAs. There is a significant increase in participation in EMA pilot areas, and I add my voice to those calling for an early decision on their extension. I hope that there will be an indication of that later this month in the pre-Budget report. I am not sure that any Government could afford or would be wise to make EMAs universal without dealing with the associated issue of child benefit. Until recently I was able to go to the post office every Monday and claim £27.75 on behalf of my two children who are over-18 and in full-time education. The woman in the queue next to me, whose children left school at 16, was unable to claim child benefit, which is a disgraceful anomaly. The question of the taxation of child benefit must be part of the equation in extending the principle of student support to all over-16 students.

The report refers to the postcode premium. I know that the chairman and members of the University Grants Committee felt strongly that that should be enhanced. The HEFC is evaluating the postcode premium's impact. However, it has not said how long the evaluation will take, and it would be helpful if the Minister could say something about that. It appears to be an effective way to widen participation, but as yet no firm conclusion has been drawn.

Reference is made to the importance of higher education institutions linking with further education colleges and working more closely with the newly formed local learning and skills councils and RDAs. Where that happens, it would be useful if the Government could publicise best practice. In my experience, the gaps between universities and local colleges and sixth forms are sometimes immense. In

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contrast with their American counterparts, British universities have been very slow in building links with the potential suppliers of their students. Such links can be established at a much faster rate only if we have well-documented examples of the clustering of universities, colleges and schools.

On staffing, I endorse completely the comments of the Select Committee Chairman, my hon. Friend the Member for Huddersfield (Mr. Sheerman), on the crucial importance of doing something about the salaries of university teachers. It is true that some university teachers are able to supplement their basic salary with significant earnings from various forms of consultancy work, but many are not. We need a major investigation into that, and it is not good enough for the Government to abdicate responsibility by saying that salary levels are a matter for individual institutions. We must have some commonality in the salary structure of those teaching in primary and secondary schools, in further education colleges and in universities, along with agreed differentials to reflect the nature of the work.

The access report touches rather briefly on the Oxbridge admissions systems. I do not want to rehearse the story of Laura Spence. On the way to vote in the House, I discussed the matter briefly with the hon. Member for Newbury (Mr. Rendel), and it seems that our views differ slightly. I think that the Chancellor was absolutely right to put the matter at the top of the public agenda, and I welcome the report's conclusion that it is not sufficient for the Oxbridge universities merely to publicise the proportion of applicants from the state and independent sectors who are offered places. What we need is a breakdown of those figures college by college, and a clear statement on what the Oxbridge universities are going to do to improve those ratios.

Chris Grayling : Is the hon. Gentleman aware that the Chancellor's unfortunate intervention in the Laura Spence affair resulted in a 2 per cent. fall in applications to Oxford from state schools? In light of that, does he think that it was a constructive intervention?

Mr. Chaytor : I am sorry, but that does not relate to figures on entries to Oxford and Cambridge between 1999 and 2000 which I was given in response to a parliamentary question of 5 March 2001. I urge the hon. Gentleman to check the latest statistics if he wishes to justify his prejudices further.

There has been huge progress in opening up the Oxbridge admissions system to students from state schools, and many people at Oxford and Cambridge are working very hard on this issue. The record of some colleges is hugely impressive.

However, in places offered to state school students, there is a 100 per cent. differential between the best and worst performing Cambridge university colleges, which have figures of 84 per cent. and 42 per cent. respectively. That is unacceptable. I shall resist the temptation to name and shame the worst performing college, but I endorse the following point from the access report:

The admissions tutor of every Oxford and Cambridge college ought to consider that comment extremely carefully.

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The Government need to take a more interventionist role. The information that Oxford and Cambridge now produce, which was put in the public domain for the first time in response to my parliamentary question of 3 April, is not in a standardised format and there is no requirement on Oxford and Cambridge to produce it. I hope that the Government will have further discussions with those two excellent universities to ensure that the information appears in a standardised format every year so that parents, students and Parliament can judge the progress that they are making.

Dr. Evan Harris : I hope to say more about the over-performance of comprehensive school students if I am lucky enough to catch your eye, Mr. Pike.

Does the hon. Gentleman think that the number of offers made by various colleges at Cambridge has anything to do with the number of applications received by each college? If fewer people apply to certain colleges, it is hard for them to award places.

Mr. Chaytor : That has always been the standard excuse of people in the Oxbridge establishment who wish to deny the reality of the situation. I completely agree that students from state schools must be given greater encouragement to apply, but I do not accept the hon. Gentleman's argument as a justification for the appalling differentials that exist and the continuing inertia of many Oxbridge colleges in that regard.

I want to turn to a matter that is not covered in the report on access, and I would be interested to hear the Minister's comments on it. In his excellent introduction, my hon. Friend the Member for Huddersfield said that many young people between the ages of 13 and 16 lose interest in education, which was cited as one of the key problems in enhancing access. That applies in the eight excellent comprehensive schools in my constituency of Bury, North, which have some of the best results to be found in any equivalent catchment area anywhere in the country. If it applies there, must it not apply to a far greater degree in those parts of the country that still do not have comprehensive education? What happens to youngsters in secondary modern schools in Kent, Buckinghamshire, Lincolnshire and the other 12 local authority areas that still remain fully selective? What possible chance is there for the 11-year-olds who fail this arbitrary test on a wet Wednesday some time in December to aspire to a university place when the system has deemed that they are to be rejected?

Chris Grayling : I offer the hon. Gentleman the example of the comparison between the secondary schools in the London borough of Merton, where I was shadow education spokesman, and the London boroughs of Kingston upon Thames and Sutton, which both have a grammar school education system. When one compares the non-grammar schools in Kingston and Sutton and the comprehensive high schools in the London borough of Merton, Merton comes off rather worse than the non-grammar schools in the selective areas.

Mr. Chaytor : I cannot comment in detail on Merton and Kingston. However, I refer the hon. Gentleman to the research that was published last week by the National Foundation for Educational Research, which

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compares the performance of selective and comprehensive systems, and to the research published this June by Professor Jesson from the university of York, which compares the overall performance of the two systems. I think that he will find there the evidence to challenge his traditional prejudices.

I turn to funding. It is the third time in eight days that we have had the opportunity to discuss this. To those who want an end to tuition fees—I can see how it could be hugely attractive to simply end them and roll them into the overall package of student support—we must say that if they are abolished for full-time undergraduates, why should all other post-18 students still have to pay those fees?

An earlier reference to research from South Bank university suggested that there were complaints about debt from students from working-class backgrounds. The argument must be that they are the very students who do not pay tuition fees, so such fees cannot be a contributory factor to their perception of debt.

It is extremely important that we maintain a balanced and objective view of the role of tuition fees. It is fact, not spin, that almost 50 per cent. of people do not pay tuition fees. The means test that exists is crude, rough and ready, and tripartite in nature. A criticism of it might be that it stops at £33,000; we have no means test that is sensitive to higher earnings. However, for those who have been happy paying for their child's education from five to 18, at £15,000 a year for the most prestigious private schools or £5,000 for a bog standard one, paying £1,075 to continue that education is a bargain. That is an important point, and any proposals for reform of the student finance system, which the Government might produce in the next few weeks, should consider a more sensitive and extensive means test. Rather like the argument about council tax bands, the problem is not the bands, but the fact that the banding system stops at too low an income. A parent on £35,000 is paying the same fee for their 18-year-old as a parent on £350,000, and that is not necessarily right.

The question of loans has also arisen. The Liberal Democrats are slightly confused about that because they want to create the impression of crisis and chaos, and suggest that massive student debt is deterring students from going to university, but they are not really opposed to students paying a proportion of the cost of higher education through the loan. Questions must be asked. For most of the half century following the second world war, a system provided 100 per cent. grants—non-repayable bursaries—and the proportion of young people from working-class backgrounds going to university hardly increased. That must be explained to the Liberal Democrats in particular: consider the relationship between cause and effect. The key issue about extending participation in higher education, increasing access and improving retention is not financial.

I draw the attention of hon. Members to the excellent article written by my hon. Friend the Minister—I think that it was in Tuesday's Guardian—where she not only provided an effective criticism of the absurd comments by the vice-chancellor of London university, but quoted figures on the estimated enhanced earnings of graduates during a lifetime. As I recall, the figure was £400,000. It will vary from person to person, but if graduates earn £400,000 extra during their lifetime, most people would

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not think that a contribution of £12,000 to £15,000 to the cost of the university education that gave them the opportunity for enhanced earnings was unrealistic. Many hon. Members would agree if they thought about that seriously.

To extend participation, it is essential to increase the supply of young people with the necessary qualifications. That is the direction in which the Government are going, and I am delighted that the Select Committee report makes an important contribution to the debate on that policy.

Several hon. Members rose—

Mr. Peter Pike (in the Chair): Order. Five hon. Members are standing, so they have about eight minutes each if everyone is to be called.

4.34 pm

Chris Grayling (Epsom and Ewell): I start by commending the Select Committee for the amount of work that has gone into this report. Whatever the divisions that manifest themselves, a huge amount of time, effort and commitment goes into the creation of such detailed reports. The Committee has pointed out some important facts. It makes the point that retention in this country is good, but it offers some valuable thoughts about improving both access and retention within our universities. It also makes the important point that the income threshold for the repayment of student loans in England and Wales is too low and needs to be increased, particularly as so many of our public services lack the recruits that they need to perform in the future.

On reading the conclusions of the report, I feel that two issues are a little short changed. They are the funding infrastructure that surrounds higher education and the nature of higher education itself, as the Government look to push participation up from one third to around half of our young people. Some stresses are already apparent at the level of 33 per cent., as we widen participation. Those universities that exceed the Higher Education Funding Council targets for participation measures are at or near the bottom of university league tables. Where we manage to broaden participation we must ensure that it feeds up through the range of institutions.

The hon. Member for Bury, North (Mr. Chaytor) referred to the amount of money earned by graduates during their lifetimes. However, as we open up access to higher education, that differential is becoming smaller and smaller. It is far from clear that the undoubtedly significant salary premiums for those of 40, 50 and beyond, who are in the later stages of their careers, will be on offer for the much larger generation of graduates to follow.

It is important to recognise that the reasons for students pulling out of universities are not solely financial. Listening to the Liberal Democrats there is a tendency to believe that retention is just about money. I merely quote from Bernard Longden of Liverpool Hope university who said recently:

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The financial infrastructure that surrounds our higher education is a crucial factor that needs to be at the heart of the debate about how we continue to expand access to higher education. My colleagues on the Select Committee rightly highlighted their belief that the Government are trying to play down the impact of their student finance policy on access and retention, and one of the reasons for their decision to produce a minority report was that they thought that the Committee had not got close enough to the heart of that problem.

I reiterate a point that I have made before. It cannot be right to saddle today's students with the extremely high levels of debt that they carry through into their professional lives, particularly given the challenges that many of them face in the early years of their careers as more and more graduates enter the job market. Those who have suffered from the new student funding regime are often not in the core group of 18 to 21-year-old students who leave school and go straight to university. Dennis Smith of the university of Ulster pointed out that higher education institutions in Northern Ireland have traditionally had a much higher proportion of applicants who are either mature or from previously under-represented groups. He added:

There is no doubt that the current structure has been a disincentive to many students. It must be addressed as part of the Government's forthcoming review of the whole structure of student financing. It is enormously important that the threshold issue is addressed as part of that structure. I hope that the Minister can reassure us that that will be the case.

The Select Committee report highlights the fact that the consequence of students' funding difficulties—not with student tuition fees, but with the enormously high maintenance costs incurred during a three-year course—is that many work in part-time jobs to make ends meet. Two fifths of full-time undergraduates have term-time jobs for an average of 13 hours per week. The report wanted that figure to drop, so that the number of students who had to work to make ends meet and the number of hours that they had to work were reduced. However, how can that be done within the existing funding framework?

As the number of students expands towards the Government's goal of 50 per cent., we must address also how the institutions will deal financially with those growing numbers. Hon. Members have mentioned that pay for higher education teachers and lecturers is less than it should be, which makes it harder to attract the right calibre of teachers into our universities. That has an inevitable knock-on effect on the quality of education. The hon. Member for Huddersfield (Mr. Sheerman) mentioned the endowments that are available in universities in the United States. If we can create an environment in which our universities have their own financial strength, it will be easier to attract high quality research and, by definition, high quality teaching. If we want to expand our institutions, we must give them the financial strength that takes them beyond the simple year-in, year-out begging bowl to the HEFC and, ultimately, the public purse.

We must examine also the nature of the skills that we provide to young people in our universities. Year by year, we push more people into the jobs market with

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conventional, degree-based educational skills. The consequence is that, in too many areas, we see graduate unemployment, while some graduates are employed in professional areas that are not ideally suited to their degree-level achievement. For example, media studies has seen the biggest increase in student applicants—up 21 per cent. However, unemployment rates for media studies graduates are second only to those of would-be designers.

There is a danger that if we push the number of students in higher education up to 50 per cent. without thinking through the nature of that education, we will end up with too many students doing particular courses. It is not that we do not want them in universities, but if we expand the numbers to that degree, we must consider carefully the nature of the education. What skills are we trying to deliver to our students, and how do we best ensure that our graduates have a wide enough range of skills to appeal to the employers of the future? If we do not answer those questions, the arguments about graduate tax and repayment of debt after university will become academic. Unless graduates can command a salary structure in professional life that reflects their skills, they will not be able to make the repayments or deal with their debt burden.

As we move towards that 50 per cent. target, we must be clear about the financial implications. We must be clear also about the higher education that our students will receive. We all share the aspiration of giving students from all walks of life the opportunity to benefit from higher education. There is no doubt about that. As we heard, the Governments led by the Conservatives for 18 years presided over a significant increase in student numbers. This Government are committed to increasing that number still further, so there has been cross-party consensus over a long period.

After reading its report, my message to the Select Committee, and to the Minister, is that we cannot just dive into this without understanding what having 50 per cent. of our young people in higher education will mean. What kind of skills will we deliver? What are the needs of the job market and the financial implications? I hope that the Select Committee will, in future reports, examine those aspects as well. Good work was undoubtedly done, but I still found myself searching the report for more evidence that those key issues had been taken into account. I look forward to hearing what the Select Committee has to say in future and what the Minister has to say about these issues today.

4.45 pm

Valerie Davey (Bristol, West): I will be brief.

I congratulate the Government on taking up the report's recommendation to review student funding. Students in Bristol are certainly looking for something simpler and more focused on low-income families. They are not asking for a return to a full grants system. Let me tell the Liberal Democrats that they are not too impressed with the graduate levy in Scotland, the burden of which has not yet been experienced.

The Government are not examining funding alone. I congratulate them on the expansion, on removing the cap imposed by the former Tory Government and on recognising—as the hon. Member for Epsom and Ewell (Chris Grayling) did not—that the anticipated need for

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higher education skills over the next decade is for 1.7 million people. This country has an enormous need to make economic progress, which benefits everyone. So higher education is not just about the fulfilment of individuals or meeting the Government's target, but works for the economic benefit of the whole country.

I also congratulate the Government on their announcement last Tuesday of the excellence fellowship awards—a different way of helping young people. These will be awards for teachers in schools and further education operating within the excellence in cities and education action zones to allow them to take time out so that they will better understand the links to help their students into higher education. These awards are innovative, different and not focused solely on funding. Funding is important, but I echo other hon. Members in acknowledging that, under the full grant system, the percentage of students going into higher education from low-income backgrounds was extremely low. As the total numbers entering higher education—under whatever system of funding—increased, the percentage of students from low-income families remained well below 20 per cent.

I want to focus on the university of Bristol, whose intake of students from low-income backgrounds is low. Not having made the headway that it anticipated, the university is responding to the challenge and now has a strategy for widening participation. The university's new vice-chancellor, Eric Thomas, wants to ensure greater involvement with the educational life of the city and its surrounding areas. The university wants to bring in more young people from the state sector. It has a whole tranche of ideas and experience.

I particularly congratulate the students union for sending students into local secondary schools to act as mentors and establish groups to involve pupils in sport, art, music and so forth. The pupils are brought on to the campus at a much earlier age than years 11 and 12. Even 12 and 13-year-olds are gaining an understanding of how their city's university forms part of the total educational experience in which they and their families can take part.

Summer schools have proved remarkably popular in the last few years. In fact, they were oversubscribed last year by 10:1. The Government and the Sutton trust have rightly encouraged them, and we shall continue working together. There are also summer work programmes for students before they start their first year. There is provision for disabled students. Taking up an earlier theme, we need to make special provision for those with a disability. In Bristol, there is particular provision for those with a hearing impairment.

Perhaps most important, the university is considering much more carefully students' backgrounds. Admissions tutors now consider schools and their average A-level results. Then they look for students who have achieved more than that. If two A passes and a B is the standard result, tutors might look for the student who not only achieves three A passes but does more extra-curricular activities.

It is important that Bristol, too, reflects the experience described by my hon. Friend the Member for Bury, North (Mr. Chaytor). Those who come from state sector schools with lower than average attainment on entry do equally well if not better than those with higher academic achievements.

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As we have heard, the Select Committee went to America. One university that we visited was Northeastern university in Boston. Indeed, I was able to link its admissions tutors with those of Bristol, which they then visited. The university in Boston is interesting. It could be described as the workers education university, because it started when people had to work and study; there was no way that students could be full-time. That has been turned into a virtuous circle: the links with working in the city of Boston have proved so beneficial that, even though there is more financial backing for students now, that tradition has been maintained.

Perhaps the Select Committee should have considered South Africa—I am not putting in a bid for it to go there now, but I may do so later. Earlier this week, The Guardian drew my attention to the university of the Witwatersrand—hon. Members must forgive my pronunciation—in Johannesburg. I think that it is generally known as Wits university. Let us consider the change that has taken place there. The university tried to break down barriers. In the 1990s, only 14 per cent. of its students were black; now, 65 per cent. are black. That change is thanks largely to the former vice-chancellor, Colin Bundy. Indeed, I recommend that the Department contacts him. He is only down the road now, as the new head of the London university School of Oriental and African Studies. Had the Select Committee known about Mr. Bundy, we would certainly have asked him to give evidence. I trust that the Government will make use of his undoubted experience. Among other things, the university admitted students whose attainment was too low in the first instance for them to go to university in the normal way. They followed a two-year foundation course and then moved to year two of their degree.

There is experience and examples of best practice throughout the world that we should consider. I shall finish, because I know that other students want to speak—[Interruption.] I apologise, Mr. Pike. I was back in teacher or university mode.

Brenda Gourley, the vice-chancellor designate of the Open university, has challenged us all to think about the purpose of university. In a recent article, she quoted the UNESCO declaration for higher education, which is particularly relevant. She said that higher education is

I trust that in all our development of higher education we shall seek to ensure that that is writ large in the hearts and minds not only of vice-chancellors but of all students who go to our universities.

4.54 pm

Mr. Jonathan Djanogly (Huntingdon): I agree that retention was well covered in the report, which makes useful suggestions. The problem of students dropping out because of debt is a real one, but the report does not adequately cover the issue of standards.

The number of people entering higher education has increased dramatically over the past 20 years. I recognise the Government's intention to increase the

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number of students, but having more people in higher education will not in itself support Britain's manufacturing and service industries. If students are ill suited to their courses, more students doing courses will not necessarily benefit students. In some other countries, only highly qualified school leavers are accepted as students and they are heavily tested at the end of their first year—in effect, a reverse retention policy. We, on the other hand, push ahead with trying to get more students who, once they are enrolled, remain where they are, whether or not the course is suited to their needs. The college will want them to stay for funding reasons and may have offered them a second-choice place on the basis of what it, rather than the student, wants. How do the Government propose to deal with those concerns?

The reports also have good ideas on encouraging access outreach schemes. A review of professional management practices is important. It is easy to blame a lack of access on demographic divisions and so on, but it is important that that is done only after the Government are confident that access for poorer and ethnic minority students is properly managed from the university's point of view. I was pleased by the acknowledgement of quotas as inappropriate because they all too often encourage discrimination.

The view that access is often just as much a problem in rural areas as in inner cities is correct. In cities, universities are probably more closely situated to potential students, and if they have crèche facilities, access for mothers is greatly enhanced. However, in rural areas—particularly those such as my constituency, which has no university and where significant distances must be covered to reach higher education institutions—access can be a real problem. In my constituency, many mature students, particularly mothers, tend to do the first year of their degree at the Huntingdon regional college and then go on to university. I would like our FE colleges to be increasingly recognised, particularly in terms of funding, which normally falls well behind that of schools.

A further concern is about the needs of businesses. Many feel that our education system does not cater adequately for them. Many bright but non-academic young people would be better served by a decent apprenticeship system. Many manufacturing companies in my constituency have said that they are unable to recruit 16-year-olds for high-level apprenticeships and, importantly, that they are blocked from getting into local schools to talk about these opportunities. The vocational A-level is generally seen as not much use and is poorly recognised by businesses. How will the Government improve access in a way that helps our business sector rather than hinders it further?

There should always be a role for academic excellence, but we need to break down the barriers for young people who want to go into vocational higher education. I speak from experience because I undertook a modular degree at a polytechnic and was impressed by how it could be moulded to individual time and career requirements. Will the Government get our business and higher education working together in a better way?

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4.59 pm

Mr. Gordon Marsden (Blackpool, South): I am grateful for the opportunity to contribute to the debate. I was proud to be a member of the Select Committee that produced the two reports. As the Chairman indicated, we presented ourselves with an enormous task: to get not a quart but two gallons into a pint pot. Thus, it was right that we should focus in the way that we did.

I came to the Select Committee with views from both ends of the telescope, one might say, having spent 12 years as the editor of a magazine—when I had close contacts with a range of academics—and nearly 20 years as a part-time tutor with the Open university. I will not hide the fact that those experiences colour my contribution to the Select Committee and what I want to say today.

In the context of part-time students, another strong influence has been my experience in further education, which is an increasingly important means of delivering higher education. In my constituency, which does not have a university—a sad decision was made in the 1960s not to take that up—the Blackpool and Fylde college, which is a beacon further education college of excellence, has close links with Lancaster university and the university of Central Lancashire, which is key to developing a higher education strategy.

I shall be brief and concentrate on some of the key issues that have been mentioned: student finance and access. A great deal of ink—and a certain amount of blood—has been used in writing about Oxbridge interviews and some of the other issues that have been well ventilated today. I have an increasing sense of frustration, which I know is shared by former students of mine who have contacted me and by Members of the House, that the debate is not and should not be about Oxbridge only. Hundreds of thousands of students are not having their education delivered by the Oxbridge system, and it is to them that I want to address what I say today.

The Government response to the report's recommendations about access was encouraging. I was particularly pleased that the Government took up our point about higher education action zones. What my hon. Friend the Member for Bristol, West (Valerie Davey) said about the latest initiative is true. Access is not just about interviews or even about getting grades. What was said about the UCAS tariffs was absolutely right. There are universities that take an ostrich-like attitude towards the tariff regime. They must be encouraged to be more positive about it, and we could all learn from the debate on A and AS-levels about the value of other qualifications, such as the international baccalaureate.

I am convinced that we must have an integrated strategy. We heard today about the value of educational maintenance allowances, but we must think about how we carry that through into opportunity bursaries. We need an integrated approach, so that a 16 or 17-year-old from a single-parent family or a Blackpool council estate who has an education maintenance allowance and is encouraged by that to go into higher education will have the opportunity to do so by way of a bursary or further funding. I will discuss later some ways in which we might be able to do that.

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There has been much discussion about portability, which is an essential aspect of higher education. There is a need for lifelong learning: part-time and mature students, because of their work or the conditions in which they find themselves, want and need to be able to drop in and out of education. The Select Committee was concerned that universities should take that point on board. I wish to give a plug for my previous employer, the Open university. It has shown the way by incorporating previous qualifications—from further education, for example—as part of the credit for a university course and by demonstrating flexibility. That is particularly important for part-timers.

I entirely agree with what was said about access for disabled students. It is not just a matter of wheelchair access; there is a range of related issues. The hon. Member for Oxford, West and Abingdon (Dr. Harris) and I attended the European access network conference in Santiago de Compostela 18 months ago. We heard a fascinating presentation from the universities of Plymouth and of Central Lancashire, which is on my doorstep, about how awareness is being raised in those universities and access is an issue for all staff, not just for disability officers.

I want to say something about the poor bloody infantry: the teachers and lecturers in universities. All the time in the world can be spent getting the access process right, but if students go into educational institutions where staff are de-motivated, the emphasis on teaching is not strong enough, there is no proper salary progression and there are demographic problems, we will do them no service whatever. I am glad that things are moving in the right direction, by means of the Government initiatives that have been mentioned. However, it is important that we do more.

We must reassess the balance between teaching and research and the research assessment exercise. The witnesses who gave evidence to the Select Committee had some harsh things to say about the way that the RAE works. The HEFC should seriously consider incorporating a teaching quality assessment exercise in the RAE exercise. If HEFC cannot or is not prepared to do that, I hope that the Minister will not be shy about taking up the challenge herself, because it is a crucial part of the process. The self-righteous and self-regarding views of those in the research institutions of some of the Russell group universities are deeply unhelpful and discouraging.

As to funding, I agree with Opposition Members who said that the issue concerns not just student funding but university funding. We need to ensure that direct Govt settlements for the academic sector are augmented by other means. The Select Committee found some good examples in the United States, such as a system of corporate and individual tax breaks and a form of bond structure for universities. As the Chairman of the Select Committee, my hon. Friend the Member for Huddersfield (Mr. Sheerman) rightly said, universities in this country need to be more entrepreneurial in building up their alumni funding.

I come inevitably to the issue of student finance. The Government are carrying out a student review. What is almost more important than having a wide system of maintenance grants or loans is that the level at which either payment of full grant or the repayment of loans is set must not deter people from non-traditional

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backgrounds from applying. It may come as a surprise to some hon. Members, but I do not think that the graduate tax will solve everything and be a universal panacea. With the greater labour market mobility, graduate income levels falling and people increasingly becoming self-employed, we need to be careful that the Government do not get into the same mess as the Child Support Agency when trying to collect money from self-employed people.

If we are to go for the expansion of funding in higher and further education, we need to consider other sources of funding. We do not necessarily need to follow the Liberal Democrats' loaves-and-fishes policy, with a penny on income tax providing for all eventual circumstances, but core funding needs to be examined. We should also consider other ways of funding. If the Minister would care to cast her eye over The Times Educational Supplement for last Friday, she would see that I have returned to a proposal to which I referred on a couple of other occasions, for a leisure technology levy, which I estimate would raise up to £200 million. If that money were applied tomorrow to the opportunity bursaries system, it would increase the number of opportunity bursaries by, I estimate, about 500 per cent.

Before the Minister endorses the scheme, she needs to discuss with my right hon. Friend the Chancellor of the Exchequer the principles of hypothecation and keeping money in the system. A more general point is involved whether we opt for that or anything else. Whatever its source, we do not want funding raised for higher education in the 21st century to suffer the same fate as road tax suffered in the 20th century. If we believe in lifelong learning and being a friend to access from non-traditional areas, which as a Government we should, we must accept the principles behind that. If we will the ends, we must also will the means.

I am proud to have been part of the team that produced the two reports. I believe that they will bear revisiting and are entirely relevant. We should consider higher education in terms not only of the economic importance that we all know that it possesses for our future as a nation, but of the sense of awareness, connection and cultivation of the humane and liberal civilised values that we all share, to which E. M. Forster referred. The events of 11 September have shown us the value of higher education and access to it, which I believe everyone in the Chamber shares as an objective.

5.12 pm

Dr. Evan Harris (Oxford, West and Abingdon): I certainly enjoyed my time on the Committee producing the report and, as I was often in a minority of one, I thank fellow Committee members for their patience. It was enjoyable partly because I enjoy an argument, and we heard some interesting thoughts. In the event of disagreements and strong arguments, a huge load falls on the Clerks to the Committee, as is evident from the extensive amount of Roman numerals in the report, which is a good way to judge how many divisions were involved. I pay tribute to them, and, like the Chairman, to the specialist advisers, who had to steer a careful course.

I issued a minority report to the access report, parts of which were, I accept, supported by the hon. Member for Eddisbury (Mr. O'Brien) and Mr. Nick St. Aubyn. I did

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so not because I disagreed with the contents of the report, apart from paragraph 109. I agreed with everything that was in the report and, indeed, worked hard to make it what it was. However, a significant omission on the question of student funding was the problem. We were greatly aided in the matter by many expert witnesses, but I mention one in particular, Professor Maggie Woodrow, who, sadly, recently died. She was a leading expert, perhaps the leading expert, on access to universities, as head of the European Access Network. Both she as a personality and her expertise will be greatly missed, and I pay tribute to her.

Because of the time, I cannot go through the details of my minority report, but I commend to hon. Members page l of the report, which deals with the maintenance grant aspect. I have already drawn attention to the South Bank university research, which showed the significant problem caused by the abolition of maintenance grants, and I cited evidence that the Cubie committee collected on the matter.

Dr. John Brennan, director of further education development at the Association of Colleges, told the Sub-Committee:

He argued in favour of a change from the current smaller system of opportunity bursaries. The conclusion that I put to the Committee was that the report should state:

The Government have effectively endorsed that. Indeed, the hon. Member for Blackpool, South (Mr. Marsden) might have supported it if he believed that the success of education maintenance allowances could be reproduced by maintenance grants. It was an achievement of a Select Committee to be less critical of the Government than the Government were of themselves.

I should like to turn briefly to the Oxbridge issue, as I represent Oxford, West and Abingdon. I can report that there is still enduring bitterness about the unfair way in which people felt they were attacked. People such as Dr Ajit Lalvani, a fellow of Magdalen college and one of the world experts on tuberculosis, still cannot believe that he was accused of "old school tie" practices. Professor John Bell, the Nuffield professor of medicine, and Dr. John Stein, who is an expert in finding new techniques to treat autistic children, were appalled at the suggestion of an old boys network. A huge amount of

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evidence shows that the attack by the Chancellor of the Exchequer was misplaced, and it can be found in the minutes of the deliberations. We heard no evidence whatever, except assertions by the Minister, that there was any substance in the attack by the Chancellor of the Exchequer. Indeed, the report states:

It would have been reasonable for the Committee to have accepted that the Chancellor's remarks may have been true in previous years, when the success rate—offer compared with application—was lower for comprehensive students than other students. While that may have been true then, there is no evidence to suggest, as success rates are now higher for comprehensive students than independent school students, that that is the case now.

There is a huge amount in the reports that one can support. It was a pity that the Government did not feel able to give a detailed response to the recommendations of the access report. Indeed, in terms of post-qualification application and the increased use of post code premiums as a way of drawing people into higher education and encouraging universities to do so to a greater extent, the Government merely note such activity. It is time for the Government to lead in policy terms on those issues. I hope that the Minister will shortly give us cause for comfort in that regard.

5.18 pm

Mr. David Rendel (Newbury): This has been an interesting debate, and it is good to follow my hon. Friend the Member for Oxford, West and Abingdon (Dr. Harris) as most of us can see that his minority report got it right from the start. In his opening remarks, the Select Committee Chairman had the good grace to make it clear that much of the evidence that has appeared since the minority report was produced has backed up what my hon. Friend said at the time, and has told more firmly in favour of the policy of abolishing tuition fees and restoring grants.

Sadly, I was able to attend only part of the Conservative Opposition day debate on Tuesday because of a hearing of the Select Committee on Procedure, in which I was involved at the same time. However, my hon. Friends have drawn my attention to a rather intriguing comment made by the Chairman of the Select Committee on Education during that debate, while discussing the evidence that the Committee had heard. He said:

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That is precisely the point that the Liberal Democrats made since changes following the Teaching and Higher Education Act 1998. It is precisely the point that we made and won in the Scottish Parliament. It is precisely the point that was made by my hon. Friend the Member for Oxford, West and Abingdon when he served on the Committee. It is precisely the point made in the Rees report, which was commissioned by the Welsh Assembly, and it is precisely the point that I made during our Opposition Day debate on student finance two weeks ago. I said:

That answers the earlier point made by the hon. Member for Bury, North (Mr. Chaytor).

It is interesting that when the Committee took evidence from a group—only one group gave evidence on this matter—who had decided not to go to university and from their parents, rather than dons or existing students, the group said that the fear of debt was the greatest factor that put them off university. It is no surprise that the Chairman of the Committee admits that most of the evidence heard by the Committee shows that debt aversion—whether valid or not—is a real problem. Fear of debt is most likely to deter the people who need the greatest encouragement. Why on earth did the two reports, particularly the access report, not reflect that adequately? Why did my hon. Friend the Member for Oxford, West and Abingdon have to produce his own minority report that raised the problem of fear of debt?

When the Committee should have acted like a lion and savaged the Government's policies, it acted like a lamb. As it produced the reports just before a general election, one must wonder whether that was the significant factor. The job of Select Committees—I differ from the Chairman on this point—even in the year before an election is to hold the Government to account, not to wimp out in the face of the voters.

The Government can also be criticised. Why did we have to wait until the Government

before they took any action on the matter? In case any hon. Members think that it is only the Liberal Democrats that claim credit for the Government's change of mind, that quote comes directly from the speech of the Chairman of the Select Committee last Tuesday. He admitted that the Government had the collywobbles. The Liberal Democrats' campaign caused that, and forced the change of mind.

The Liberal Democrats welcome the Government's review. It is better late than never. However, the review is secretive and internal, and it would be more democratic and more likely to lead to the correct changes if it were more open, transparent and inclusive. I ask the Minister to give us further details of the review.

Further matters have arisen since the publication of the report. There has been a change of Secretary of State. Initially, that looked to be a way of introducing top-up fees. After all, the previous Secretary of State famously said, "There will be no top-up fees while I am Secretary of State, but I will not be Secretary of State for

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ever." He was right about that. His parting shot was to ensure that his Ministers publicly ruled out any changes during the next Parliament, and I welcome that. However, instead of a pledge on just top-up fees, I ask the Minister to go further and confirm that whatever comes out of the review, all tuition fees will be abolished. That is, after all, the benchmark by which the review will be judged. If tuition fees are left in place following the review, people throughout the country will think that the review has failed.

The second occurrence since the publication of the Select Committee reports is the release of the Rees report on student finance, which was commissioned by the Welsh Assembly. I congratulate my colleagues in the Assembly on ensuring that the review occurred, and I welcome many of the recommendations. Not the least of its recommendations is that tuition fees should be abolished throughout the United Kingdom, and that simplified maintenance grants should be reinstated. It is notable that the Rees report approaches student support in further and higher education as a single issue, rather than as two mutually exclusive matters. Can the Committee investigate ways in which student support in further and higher education might be more effectively integrated?

Finally, I wish briefly to return to the most important change that has taken place since the publication of the two reports, which is the announcement of the Government's review. That is good news, but there will be disillusionment with the Government among a large and influential section of the population if the review fails to lead to substantial changes to the present system.

The Select Committee should take the earliest opportunity to fill the glaring gap in the reports by recommending that the Government make the changes that are so clearly supported by the evidence that it has heard. I hope that, on this occasion, the Government will listen to those recommendations.

5.25 pm

Alistair Burt (North-East Bedfordshire): I, too, enjoyed reading the deliberations of the Committee. I thank everyone who has played a role, including the people who guide the Committee and the witnesses who appear before it. Its deliberations were thorough and detailed, and 10 minutes is not long enough to pay proper justice to them.

I share the disappointment that has been expressed that, although the Government's response with regard to the issue of retention was straightforward, their response with regard to the matter of access was not. When those responses are compared, a great contrast is apparent. I hope that the Government will take steps not to make that mistake again.

I also hope that the hon. Member for Huddersfield (Mr. Sheerman) has taken on board the criticism that the Committee, which he chaired, was not sufficiently robust in hounding the Government. However, in the debate, he did bite the ankles of the Minister when he reminded her that she should conduct her own review of student finance, rather than accept the Treasury review. That point was made by several hon. Members of my party, and perhaps more will be said about it.

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I join my hon. Friend the Member for Eddisbury (Mr. O'Brien) in praising the contribution that was made to the Committee by Mr. Nick St. Aubyn, the former Member for Guildford. I hope that he will be able to read the Committee's deliberations, so that he can learn that his brave report and its proposals were welcomed. I wish to highlight two of his achievements: first, he brought to the Committee's attention the importance of the gap year and emphasised how it can be of benefit to a young person who is planning to enter higher education; and secondly, he took up the Laura Spence issue in a laudable manner. With regard to that issue, I agree with the hon. Member for Oxford, West and Abingdon (Dr. Harris) that serious and unfair damage was done to people who were trying hard to broaden access. It is an issue that readily leads to old prejudices and chips on the shoulder coming to the fore. If education is to make progress in the British political system in the current century, some of those prejudices must be rejected—and hon. Members should set an example by rejecting them immediately. However, the hon. Gentleman was too generous to the Chancellor of the Exchequer: he knew what he was doing when he raised the issue.

A number of important subjects have been raised, and I agree with the sentiments expressed in the deliberations of the Committee in hoping that they will be taken forward, and that the Government will focus on them. Portability is one such subject: it should be examined because it is important to assist students who wish to transfer to a different course.

Further education is another important subject, and I am pleased that attention has been paid to it by several hon. Members during the deliberations of the Committee, and in this debate. It is essential that, by focussing on the important subject of higher education, further education does not get squeezed. My hon. Friend the Member for Huntingdon (Mr. Djanogly) made that point, as did my hon. Friend the Member for Epsom and Ewell (Chris Grayling), who emphasised how important it is that students choose the right course. I will refer to that matter when I address the subject of access.

I also agree with the remarks of the hon. Member for Stoke-on-Trent, North (Ms Walley), and I am eager to find out how the introduction of education maintenance awards proceeds. That is an exciting development. The majority of hon. Members understand that the key issue in British education is not access at the top. The key project is to help the youngsters who currently have few inspirations, little aspiration and not enough hope. Although tremendous work is being done in that area, more needs to be done, and anything that can be done to ensure that such youngsters have higher aspirations is good news. I am pleased that efforts are being made to encourage teachers to retain that connection with their own higher education institution, because teachers may be the only people in a community with experience of higher education who are able to communicate that to their pupils.

I share the concerns of the hon. Member for Blackpool, South (Mr. Marsden) and others in terms of staffing. We must be careful that higher education institutions that are student-rich but research-poor do not suffer because of that. A number of hon. Members have made reference to that. It is a difficult balance to

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achieve, but we must ensure that we value staff and that they have the resources to do the job—particularly in pastoral and outreach care, if they are to look after those who may be most vulnerable to the changes that higher education brings to them.

On access, the Government have announced their target, which is that 50 per cent. of those aged 18 to 30 should enter higher education by the end of this decade. Our aim is more ambitious and widely drawn. We expanded higher education markedly when we were last in office, from a system designed for an elite of one in eight of the population to a more open system where one in three could expect to benefit both for themselves and for the country. As I said recently on the Floor of the House—no quota, no fuss, just progress.

Higher education should be open and accessible to all so that everybody can benefit from it. Quality need not drop with expansion, but it is essential that quality remains high because access to higher education is not the only issue facing universities in the UK. Higher education is not the only option for those with talent and ability. At present, too many of them are being failed long before they even have the chance to consider what they should do with their lives. The target for higher education should not act as a smokescreen to disguise the real scandal of our education system, which is the ultimate denial of access to many of our children almost from the first day they walk into a classroom.

On leaving school, a child should have full knowledge of what courses are available in both HE and FE and an understanding of what is likely to be best for them in terms of their career choice. They should know where each qualification might lead, the path from one level of qualification to the next and where the workplace fits in if part-time study is a sensible option. They should know what financial options are available and how they intend to cope with the new demands that will be made upon them. They should know how future employers honestly regard each qualification, because they do not regard them all in the same light. If they have not made up their mind what they want to do, they should know that education purely for its own sake has value, as they consider what they want to do with the years that lie ahead.

Based on that, school-leavers will choose what is best for them, not what somebody else may want them to do in order either to fulfil a quota or to ensure that an institution gets funds simply because a place is filled. Further education will not risk being downgraded, as that sector may be the right one for those with talents and abilities. We must not let our aspirations for higher education risk blunting the developing edge of vibrant further education courses. We must make it clear that people can move from sector to sector and that age is no barrier to subsequent movement. We must recognise that the nature of students has changed during the past 20 years. Above all, we must make it clear that there is true parity of esteem between the vocational and the academic and that student finance will be, as far as possible, a help and not a hindrance.

As the Minister might expect, I shall end on student finance. As someone who has read the reports rather than was part of the Committee, it is clear that there was already evidence emerging that the financial arrangements for students have a key part to play in both access and retention. Evidence that has emerged

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since the publication of the reports makes that even more stark. I mentioned some of that evidence in the recent debate. The Government cannot possibly deny the importance of student finance in relation to debt and students' working hours outside their studies.

The complexity of the system makes a difference to whether people apply in the first place.The system is complex. To illustrate the Minister's difficulties, there are widely differing opinions of it to be considered. Is it complex, but not too difficult to understand once people get on top of it, as Baroness Blackstone described it, or is it a nightmare, which is how Baroness Ashton described it recently in the House of Lords? Which is it? There is plenty of evidence, quoted several times, of the difficulties that the financial arrangements have caused and for that reason I, too, challenge the Minister to open up the internal review that she has already started.

Will the Minister publicly seek the comments of at least Universities UK, the Association of Colleges, the National Union of Students, the National Association of Teachers in Further and Higher Education, the Association of University Teachers, the Standing Conference of Principals, the Student Loans Company and Skill, the National Bureau for Students with Disabilities, before the results of her review are published, so that they can comment before proposals come forward? Will she place their submissions in the Library? Will she put in the Library the submissions that she has already received from her colleagues in Government as part of the internal review so that we, and the public, can see the standards by which the review is being judged? Will she publish the terms of the inquiry towards which she is working? Finally, will she take the chance to clear up a mystery, namely, what is her Department's definition of higher education? I hope that she will be able to do so. Yesterday, Baroness Ashton gave us some hope when she said that she would consult. I hope that the hon. Lady will take the opportunity to tell us the same thing now.

5.35 pm

The Minister of State for Lifelong Learning (Margaret Hodge ): First, I congratulate the Chairman and all members of the Committee. The two reports and the debate that we have had today demonstrate the best of Select Committee processes. It has been an informed debate if, perhaps, a little vigorous. Nevertheless, it has given us an opportunity to debate something that is of key importance to the Government and to all of us who represent the members of our community.

I agree with what the Chairman said about the importance of university in our lives, not only for economic reasons, but also for the purposes of social inclusion. That is at the heart of the Government's commitment to widening participation. We wish to widen participation and we shall maintain quality. I am incredibly fed up with the constant attacks on the grounds that widening participation will reduce quality. It will not, and we shall ensure, through all our quality assurance mechanisms, that quality is maintained. It is crucial, for economic and social reasons, to widen opportunity. Part of the productivity problem in this country is due to the skills gap. America has a much higher participation rate in university than we do in the United Kingdom—although it does also have a much higher drop-out rate. Of the new jobs that will be created

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in the next decade, 1.7 million, as my hon. Friend the Member for Bristol, West (Valerie Davey) said, will require the sort of skills that can be acquired only through higher education.

I should like to respond to some of the issues that have been raised, rather than make a statement of Government policy. A number of people have spoken about prior attainment levels. Those have been mentioned in every debate in recent weeks as being crucial to extending participation in higher education. My hon. Friends the Members for Bury, North (Mr. Chaytor), for Huddersfield (Mr. Sheerman) and for Stoke-on-Trent, North (Ms Walley) talked about educational maintenance allowances. They are successful and are increasing participation by 5 per cent. We must now consider, in the context of the comprehensive spending review, whether they are the best-targeted way of achieving that 5 per cent. increase. They are the most effective instrument that we have found to increase participation.

Equally important is our agenda for those aged 14 to 19. That includes our approach to vocational qualifications, which a number of speakers mentioned, the Connexions service, which was alluded to, and the excellence challenge programme.

The hon. Members for Eddisbury (Mr. O'Brien), and for Epsom and Ewell (Chris Grayling) and my hon. Friends the Members for Bury, North, for Huddersfield, and for Blackpool, South (Mr. Marsden)—with apologies if I have left anyone out—talked about the importance of funding the universities. I agree with them. We have to discuss the balance between our investment in the university infrastructure and that in student funding.

We have not done badly with an 18 per cent., £1.7 billion increase in spending and investment in higher education. I would say to the hon. Member for Chesterfield (Paul Holmes) that this year, for the first time in a decade, we have increased the unit of resourcing, and therefore reversed the year by year decline that happened under the previous Government.

We have also put an additional £300 million into teaching over the three-year period. That is very important in order to address a number of the issues that have been mentioned. I agree with the hon. Member for Epsom and Ewell that it is underfunded, but I hope that he will accept that that is due to the underfunding by the previous Government. We got expansion at the expense of funding, but that was no way to go forward.

I am delighted that so many hon. Members have welcomed the excellence fellowship awards that were announced yesterday. They represent a mechanism through which we can build links between schools and universities. There are sufficient jobs; we should not worry, as the hon. Member for Epsom and Ewell has suggested, that the increased number of people who go through higher education will not have opportunities to work.

I can reassure the hon. Member for Huntingdon (Mr. Djanogly) that we are ensuring that the qualifications offered in our higher education sector are relevant to the world of work. The foundation degrees, which we launched this year, have been extremely well received,

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with 85 per cent. take-up of places in the first cohort that we have examined. They were designed by business in collaboration with the higher education institutions to meet the needs of the business community. Much of what we offer may not be at degree level, but at sub-degree level, and take the form of HNDs and HNCs. I hope that all hon. Members will welcome that.

Several hon. Members expressed concerns about retention, with which we shall need to deal more as we go along. As we extend participation, the cohort of students will change. It will become all-important to deal with retention and to ensure that people do the right courses, are properly supported and have the skills to develop. However, we have the best record on graduation and the second-best record on retention among OECD countries.

Mr. Gordon Marsden : Will my hon. Friend give way?

Margaret Hodge : No, I shall carry on because I have only five minutes left.

I want to talk a little about social class and access. We acknowledge that higher education expanded under the previous Conservative Government, but I hope that the Opposition will acknowledge that they did not manage to break the inability of people from lower socio-economic groups to access higher education. That is the much tougher challenge that we face and want to takeup.

On Oxbridge, I hope that all hon. Members will accept that there is an issue. Some 52 per cent. of Oxbridge entrants have three A passes at A-level, but the figure for entrants with three A passes at A-level across the university sector is 65 per cent. There is a disparity, and the Chancellor of the Exchequer properly raised the issue. We want to ensure that more people from state schools have access to universities. The issue is perhaps partly about whether they apply. The aspiration funding that we have put in place will tackle that, but we need to deal with a range of issues to ensure equality of access to some of our best institutions, and the hon. Member for Oxford, West and Abingdon (Dr. Harris) is naive if he thinks otherwise.

My hon. Friend the Member for Bury, North talked about the UCAS tariff scheme. We are doing a lot of work on that, and I shall write to him and to my hon. Friend the Member for Blackpool, South about what we are doing to ensure that universities consider the issue seriously.

The hon. Member for Chesterfield and my hon. Friends the Members for Bristol, West and for Blackpool, South mentioned disability. Some hon. Members will know that I was previously Minister for Disabled People, and I like to think that the Government moved the agenda forward with allowances for part-time disabled students and postgraduates and through legislation. I will be happy for the hon. Member for Chesterfield to write to me about where he thinks the gap in the legislation is.

Higher and further education is vital, and there are 150,000 HE students in FE. It is crucial that we create strategic partnerships between the FE and HE sectors and tackle the funding of the FE sector.

The hon. Member for Eddisbury mentioned the portability issue, and I have a lot of sympathy in that

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regard. We are currently considering the matter. He also mentioned the year out, about which Nick St Aubyn, with whom I worked on the issue, was concerned when he was a Member of Parliament. Again, I like to think that we have made progress. Students have spent time outside the UK under the Erasmus and Socrates programmes, and that has made an important contribution to their higher education.

My hon. Friend the Member for Bury, North mentioned the postcode premium, which is important. We are considering it again to see whether we can focus it better to ensure that young people from under-represented groups come into higher education.

I have not mentioned student funding because we talked about it last time. [Interruption.] Time does not permit. We are undertaking a review about balancing

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the contributions of students, parents and the state. The Liberal Democrats have nothing to bring to the debate and are incredibly naive. The review is about phasing the payment. We will consult all the groups that the hon. Member for North-East Bedfordshire (Alistair Burt) mentioned, and we will put an animal on the table. Any sensible consultation must take place in that way. We are responding to evidence as it emerges.

Congratulations to the Select Committee—

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