Select Committee on Education and Skills Minutes of Evidence


Examination of Witness (Questions 100 - 119)

MONDAY 10 DECEMBER 2001

PROFESSOR TERESA REES

  100. So you are moving out of the loan scheme for maintenance?
  (Professor Rees) I think the loan scheme is a useful supplement to the bursary system. The bursary system would be means tested. We have all the calculations of how it would be stepped in the report and it is quite clear that some students would need to apply for subsidised student loans in addition to their bursaries if they are not getting a full bursary, for example, if they are not doing some paid work to supplement, they must have that opportunity. I would anticipate that the amount that the public sector would need to put aside for student loans would be considerably less than it is at the moment. Incidentally, there are difficulties of course in reclaiming the student loans, that is also a problematic solution to the funding of higher education.

  101. Would the element of the loan remain on a minimal interest or would that go back to the average interest rate?
  (Professor Rees) We have suggested there should be two kinds of loan, one would be minimal and one would be near the economic.

  102. So that is where the extra comes from?
  (Professor Rees) That is right.

Chairman

  103. How are you going to divide the two different sorts of loans?
  (Professor Rees) Means testing.

  Chairman: I see.

Mr Chaytor

  104. We heard a little earlier from HEFCE that in England the proportion of students continuing into higher education has continued to increase and there is no differential factor between the different social groups. Is that the same in Wales?
  (Professor Rees) In fact in Wales there is a slightly higher participation, as I understand it. The main difficulty is that if you want to increase the target numbers, as we do, then there are relatively few people in Wales not already in the system who would be eligible for admission to higher education. They would have to have some sort of foundation course, access course, further education, first, and that is why in our report—and of course it was in our terms of reference as well—we put a lot of emphasis on progression from FE to HE, not simply for younger age groups but for mature students as well. If Wales is to become a learning country and participating rates are to increase, then we have to get more adults into further education in order eventually to have them in higher education.

  105. I come back to the first point about participation, the facts are that in Wales the participation rate is higher—
  (Professor Rees) Marginally.

  106. —therefore the existing regime of student support has had no impact on participation, it has not been a deterrent to students continuing to go to universities?
  (Professor Rees) I do not think we can say that because of the demographics and it is very complicated.

  107. You said that virtually everybody who had the appropriate qualifications in Wales is now in the system, therefore the financial support system cannot be a deterrent.
  (Professor Rees) I think it is enormously problematic though when you look at the experiences of people in the system. One of the things we looked at was the reasons for dropping out and very few people actually identified finance as the first reason for dropping out, they identified things like health, but when you investigate these more closely it is interlinked with the problem of finance. My own view is that the current system is unsustainable.

  108. But the current system is not a deterrent. It is quite an important distinction between whether the current arrangements deter people from participating and whether the current system merely gives them difficulty when they are participating.
  (Professor Rees) Yes.

  109. You are saying the more important issue, in fact the only issue of the two, is the latter rather than the former?
  (Professor Rees) I think we are seeing different kinds of people who are deterred. If I can mention two groups, particularly mature age women but also Islamic students for whom usury is against their religion and who therefore feel they are not eligible to apply for student loans, and therefore many Islamic families are having to choose one member of the family to go into higher education to avoid having to access loans. So there are different groups of people for whom it really is a deterrent even if the numbers—

  110. I have to say in my constituency I have a significant Muslim population and no parent of any young Muslim student has come to me and said they are not going to take out a loan to get their son or daughter through university.
  (Professor Rees) We did have evidence from the Islamic community saying that.

  111. On the question of mature students, what is the evidence there? In England, there was in the first two years of the new system a decline in the proportion of mature students. Is there specific evidence in Wales?
  (Professor Rees) The problem is it is very difficult to tell because the new system is very new and I think there is always a follow-on, a gap, between the introduction of a new system and it taking effect in people's minds in terms of their future plans. So although there are some figures available, my own view is it is not wise to pay too much heed to them so early on in a new system.

  112. So it is accurate to say that for both mature students and for students as a whole, there is no evidence which suggests the current financial arrangements act as a deterrent to participation?
  (Professor Rees) No, it is not fair to say that at all. Claire Callender's work, her survey of students, has shown—

  113. She said exactly that, she said the evidence was inconclusive because she could not provide the evidence.
  (Professor Rees) If you want to have conclusive evidence that people who would have applied are not applying because of debt aversion, you would have to do a very, very big study indeed. To my knowledge no such study has been done. You would have to ask a hypothetical question which in research terms is actually quite difficult in terms of how you interpret that data. All we can look at is surrogate indicators in terms of who is applying, who is not, drop-our rates, these kinds of things, and also some qualitative data on what sorts of questions are asked at open days at universities, for example—very often, it is parents very worried about the cost implications.

  114. If I could come back to the potential effect of deterring young people particularly who do not currently have the appropriate qualifications for a degree, has that not always been the case? In any positive drive to increase participation in higher education, whether under the Wilson Government in the 1960s or under the Thatcher Government in the late 1980s, by definition it is always the case that the pool of potential new recruits do not have the necessary qualifications. Or do you think it is somehow different now from ten years ago or 30 years ago?
  (Professor Rees) I think it is quite a complicated question that you are asking. What is important is that people have the idea if they went on to higher education it would be free, they would be supported through it, and that affected the kind of decisions they made about investing in their own human capital, qualifications and so on from 14 onwards but also later on in life. Now, with the idea that this might cost a lot of money, it is going into the unknown and so on, so it is less likely to encourage people to pursue those further education routes to put themselves in a state of eligibility.

  115. We have just agreed there is no evidence which suggests that is how it has worked.
  (Professor Rees) What we have done is create an incentive—

  116. These all seem to be assumptions. Yes, if the charge is largely loaded on the student during the course and not picked up by general taxation over two generations, one would assume that it acts as a deterrent, but we keep coming back to the point there is no hard evidence it is, and such evidence as there is indicates that participation rates are increasing year on year, even since certainly the early part of the 1980s and even since 1998.
  (Professor Rees) Participation has been constant for the last four or five years and I think we would have to look at the demographic trends in all of that as well. I think it would be very dangerous on the basis of a lack of a specific research study, and it would be enormous to ask people the hypothetical question "would you have gone to university if there had been a different system", to wait to see the whole system collapse as a consequence. We came across some extremely stark evidence of deterrents, particularly in the FE sector where existing individuals' experiences of the poverty of learning was affecting how they encouraged or discouraged other people in the same class, in the same position, in the same community as them whether or not to take the plunge and return to education. To my mind that is the damage that is being done at the moment. We also have a situation in higher education where if students owe the university money their Finals are not marked, their exams are not marked, until they have settled their bill. Lots of people may remember their Oxford College doing something similar years ago but I have to say this is a major problem for those universities that are particularly good at recruiting and retaining access students. It is chaotic.

Mr Turner

  117. You heard me ask Sir Howard, could you perhaps give your view on what information a student needs before they decide to forego income and incur expenditure or debt, whatever you call it, to discriminate between institutions and courses?
  (Professor Rees) I think if you are talking about mature age and disadvantaged students, one of the trends that we are seeing is the decision to go local because that enables a better control over finances. If students can live at home they feel they have more control over their income and expenditure. That means that the student is not necessarily pursuing the best course in their particular area or the most appropriate course for their particular career trajectory and it is restricting choice, but it is restricting choice for those students who are not well off. Better off students can go where they like. That was one of the inequalities we found in the current system which we think is very detrimental.

  118. Thank you. I think that is very helpful but it does not actually answer the question.
  (Professor Rees) I realise that.

  119. What information does the student need so they can make the right judgment?
  (Professor Rees) I think a student needs to know what their income will be irrespective of where they are going to pursue their course. They need to know whether it is guaranteed or whether it is in a lottery, as applying to Access and Hardship Funds. The pressure on Access and Hardship Funds are very variable by institution depending on the socio-economic make-up of the student body in that particular institution. It is this issue of risk and uncertainty. The student needs to be reassured that whatever course they study, wherever they study it, they need to know what their income will be and whether that can match their anticipated expenditure.


 
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