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Mr. Rob Wilson (Reading, East) (Con): May I begin by congratulating my hon. Friend the Member for Norwich, North (Chloe Smith) on delivering such an excellent maiden speech? She can be very proud of herself, and I am certain her predecessor would have looked on and nodded in approval. I am sure she will be his equal in every respect in fighting for the interests of her constituents in this House.
In the short time available to me, I would like to focus on three areas: widening participation, the financial pressure on universities, and the student loan book. I know that other Members will more than adequately cover the issues to do with student numbers and the recent student loans payment crisis so I do not intend to cover those topics. Indeed, my hon. Friend the Member for Havant (Mr. Willetts) demolished the Government handling of the loans crisis in such a forensic manner that no more needs to be said on the subject.
All Members probably accept that higher education will play a vital role if we are to emerge from this deep recession more able to compete in what is a highly skilled global economy. Enabling our young people to have the opportunity to gain entry into higher education is both morally right and an economic necessity. By preventing a large number of students from fulfilling their educational potential, the Government risk making the country less competitive. When we look at what has happened over the lifetime of this Government, we see that in higher education as elsewhere it is the disadvantaged groups in our society who have been failed most. While many more middle-class children have been able to go to university, those from lower socio-economic groups have struggled to make progress. Data from the Office for National Statistics confirm that in the most deprived 10 per cent. of neighbourhoods only three in 10 children go on to higher education, compared with six out of 10 school leavers in the least deprived 10 per cent. of areas. Moreover, this year tens of thousands of young people have suffered because the Government put a brick wall where a ladder should be, blocking the path to university for many who have worked so hard to get their A-levels.
It cannot be denied that much of the answer for the underperformance of the lower socio-economic groups lies within our schools. As Ofsted has made clear, a whole swathe of our schools are underperforming and failing children. It is not just Ofsted that is making that clear, because only yesterday our captains of industry made clear their concerns. The chief executive of Tesco, the nation's largest private employer, described standards in schools as "woefully low". He said the private sector is now being left to "pick up the pieces" by having to spend resources on basics such as writing, numeracy and communication skills. The chief executive officer of Asda weighed in behind him, as has the CBI. The Department's response to this critique said it all: according to its spokesman,
"standards have never been higher in our secondary schools."
Improving standards in schools is crucial, but we must also look at other ways to open up higher education to all groups. It is clear that the one-size-fits-all approach is failing. I have been extremely impressed by the US model of community colleges. I have spoken about it before in this Chamber, and I have been banging the drum for it for some time. I was therefore very pleased to see positive mentions of the community college system in the recent Select Committee report. Such colleges constitute the largest part of the higher education system in the US, offering short vocational courses as well as the equivalent to our foundation degrees. They provide access to learning for millions of students who otherwise would be excluded from a traditional university education.
One of the main successes of the community college system is that many people from lower socio-economic and minority groups have thereby had an opportunity to engage in higher learning. Currently, 34 per cent. of students enrolled at community colleges are from minority ethnic groups. Students are also typically older, with 16 per cent. over the age of 40, and they are typically employed, too-77 per cent. are in full or part-time employment. Students typically begin the first part of their associate degree at a community college with the option of using accumulated credit to transfer to a traditional university to complete a bachelor's degree.
By breaking down courses into bite-sized chunks, US colleges also offer the chance to reskill without having to shoehorn busy lives into rigid timetables. Credit is therefore a vital component underlying the structure and system. Americans rightly view the career ladder as a career lattice, where people drop in on education as and when it is needed and it fits in with their lives-in this country, we often see that as "dropping out".
Important lessons can also be learned from how the US community colleges manage their finances; put simply, the model is much more cost-effective than the one in this country. Networks are organised on a sub-regional basis and groups of colleges often pool resources, such as human resources, and other administrative functions. As purely teaching institutions, colleges typically do not host very expensive research facilities, thus keeping financial pressures to a minimum. Although there are growing examples of good practice in the UK, such as the Staffordshire University Regional Federation consortium, which I visited, local articulation agreements should be encouraged. They should be led by a strong university at the core of each grouping. The UK has 172,000 students studying higher education in 269 further education colleges. Such colleges provide 39 per cent. of all entrants to higher education, so we already have a good base on which to build a US-style system.
It is also clear that the student demographic is changing, and it is time that the Government realised that the higher education system can no longer be centred solely on the needs of 18-year-olds undertaking the traditional three-year course. Although spending on widening participation has increased, it has been sprayed around like a water cannon, whereas it should have been precision-guided. If the Government are truly serious about widening participation, they need to ensure a much more strategic focusing of funds.
I wish to move on to discuss the financial challenges faced by universities. They are cutting their budgets at an alarming rate and many are in considerable financial difficulty. As I said at the previous departmental questions in July, seven universities were on the Higher Education Funding Council's warning list of "at higher risk" institutions but soon as many as 30 could be on it, facing significant financial difficulties. Those not in any danger, such as my own university of Reading, are still having to chop huge swathes from their budgets. Financial pressures on the university of Reading have meant that it is cutting £10 million from its budget and has had to make painful decisions about closing departments, such as those of physics and health and social care, and courses in continuing education. The university recently announced that it has had to cancel its £60,000 joint sponsorship with Thames Valley police of four community support officers on its campus. I have had lengthy discussions with the pro-vice-chancellor about this, as both the safety of students and peace and quiet for local residents are priorities for me as the local MP. I am very concerned about that and have made my views clear, and I am continuing discussions with the university and the police about how we can ensure student safety will not be compromised. Many universities up and down the country are having to make even more painful decisions affecting staffing and the services to students than the university of Reading is having to make.
Finally, in light of this week's announcement, I wish to say a few words about the sale of the student loan book. In my previous position as shadow Minister for higher education, I was involved in this legislation, and it appears many of the concerns I raised at the time, along with my hon. Friend the Member for South Holland and The Deepings (Mr. Hayes), are being borne out by events. Throughout its passage, the Sale of Student Loans Bill was always deemed to be enabling legislation, necessary for a rainy day. Indeed, following its Royal Assent, the then higher education Minister withdrew the book from sale because he was worried about securing a fair price and was finding doing so increasingly impossible. Not much has changed since then regarding the value of the loan book in the marketplace, but the Government's need to get their hands on the money clearly has. The rainy day has arrived and it seems to have become a bit of a monsoon. The student loan book is once more up for grabs as part of a fresh sale of state assets that aims to raise an estimated £16 billion.
The Prime Minister announced that the sale would not go ahead if a good deal could not be brokered, but I feel that the panic to plug this massive financial black hole will override the financial caution. I want to repeat what I said during the passage of that Bill-the legislation was supposed to be about the sensible management of an important public asset, which at the time was worth nearly £20 billion, but it has actually become a tawdry attempt to cash in on a valuable asset by a Government running out of resources and of money. The former higher education Minister, the hon. Member for Harlow (Bill Rammell), said on Second Reading:
"Making a sound judgment about the timing and pricing of sales is particularly important given the recent turbulence in world credit and financial markets...Decisions will...always be informed by what provides the best value for money for the taxpayer."-[ Official Report, 22 November 2007; Vol. 467, c. 1393.]
Indeed, if my memory is correct, at our insistence a framework for making the decision was put in place in the Bill, but I do not think that details of that framework were ever published. The Minister for Higher Education and Intellectual Property cannot sidestep that issue, as he tried to earlier when he was pressed by my hon. Friend the Member for South Holland and The Deepings. The details of that framework should be published so that we can all see just what the criteria are to which the Government are working. If they are not published, people will believe what I believed when the Bill was introduced: that the Government are in danger of stripping taxpayers of a valuable public asset in the hope of receiving a quick cash injection. The Minister must surely be aware that flogging assets recklessly will not make the Exchequer solvent.
What about the students? The former higher education Minister repeatedly stated during the progress of the Bill that it would have "no material impact on graduates". That proposition remains entirely dependent on the good will of the Government. Given their incompetence with all things student related-particularly this summer-that is a precarious safeguard. This car boot sale of state assets needs to be managed with caution. The quick sale of the student loan book is no substitute for a long-term plan to get the economy back on track. Any business man-like me-can assure the Government that a short-term sale for a quick fix is definitely not the way forward. The structural budget deficit is what must be targeted.
We are very fortunate that we have a world-class higher education system in this country. However, through their focus on short-termism and their mismanagement of the UK economy, the Government have made many universities vulnerable to financial problems and international competition. As events over the summer have proved, the Government have lost their grip on higher education. I fear that the only way to get it back on track is a general election and a fresh approach from an incoming Conservative Government.
Anne Main (St. Albans) (Con): I want to touch briefly on one or two points raised by my hon. Friend the Member for Reading, East (Mr. Wilson). He said that there is no point trying to widen participation in education when so many of our children are leaving school failed by this Government's system and with poor qualifications. Indeed, other hon. Members have also touched on the fact that many colleges have, like Oaklands college in my constituency, had the learning and skills grant pulled at short notice. That college is attended by many severely disabled pupils because Hertfordshire keeps its disabled pupil teaching within Hertfordshire and the college specialises in such teaching. It was hoping to widen participation for those disadvantaged young people, and what happened? At the eleventh hour and the 59th minute, the funding was pulled, leaving my college in a dilemma about what to do next. It is still struggling with that dilemma and Mark Dawe, whom I meet regularly, has my utmost sympathy. It is no good seeing crocodile tears from the Government.
I want to touch briefly on a topic that has not come up. Many young people have been let down because they wanted to go to university this year but have been caught up in the regrading fiascos that, unfortunately,
left them unable to take up their university places. Dr. Jack Alvarez, my constituent, who teaches at Haberdashers' Aske's school, which is just outside my constituency, wanted me to bring the matter to the attention of the Minister. Many extra pupils have been participating in GCSEs and, importantly, A-levels and AS-levels, and if the grades are challenged, the challenges need to be lodged within a certain time frame to ensure that they meet the clearing house dates.
Priority requests for regrading are usually handled within 18 days. Awarding bodies have until 7 September to deal with them, but the universities close their books by 28 September, and the bulge in the numbers of pupils applying to go to university this year has led to the matter being especially badly handled.
This year, 80 per cent. of all clearing places were taken by 25 August, even though exam results were released only on 20 August. Although the good news was that many high-flying pupils did get their results upgraded, I am sad to relate that the short time frame meant that a lot of them missed the opportunity to go to university or to the university of their choice, or they lost their university place.
The Minister must look at the problem. It is pointless to encourage young people to go to university if regrading is shoehorned into a time scale that is, frankly, undeliverable. The result is that high-flying, well educated and qualified pupils from all walks of life end up being unable to access a college place of their choice. Some of them have looked at the loans fiasco, realised that it would cause them to struggle financially and said, "I'm walking away."
If the Government want to deter young people from participating in higher education, all they have to do is to put them in a system where there is very little chance of fair play. As happened with the loans fiasco, people who tried to communicate the problems that they were encountering found that the phone lines were impossible to access.
I shall rest on that point. We should think about what young people face: it is hard enough to start out in life but, when more than one obstacle is put in our way, many of us would say, "Forget it." Given the stresses and strains that hon. Members have suffered over the summer in our relationship with bureaucracy, surely we must recognise that many people will walk away when faced with the sort of obstacle that I have described.
If we want to encourage young people into higher education, we must ensure that they leave secondary school with the qualifications that they need, and then that their places and loans are managed properly.
Mr. John Hayes (South Holland and The Deepings) (Con): We have had a rigorous and well informed debate, in which we heard an excellent maiden speech from my new hon. Friend the Member for Norwich, North (Chloe Smith). She is a bright star with a bright future.
This Government promised to extend opportunity and to ensure that 50 per cent. of young people attended university. That promise was made by the former Prime Minister Mr. Blair in a speech 10 years ago, and it was repeated in the 2001 Labour party manifesto, yet today's debate has been all about broken promises and false claims. The scar of disappointment cuts deep-in some cases to despair.
Even though the figures have been recalibrated and recalculated, by last year the Government had achieved just 43 per cent. participation in higher education. Success for women masked failure for men, for whom the rate stood at 38 per cent.-just one percentage point higher than a decade ago. Under a consistent measure, the proportion of university entrants from both sexes increased hardly at all over the whole decade.
Both my hon. Friends the Members for St. Albans (Anne Main) and for Reading, East (Mr. Wilson) made good contributions to the debate. The latter has championed the cause of community colleges for some time. I acknowledge and praise him for that. His remarks were interesting and stimulating, on a matter that we certainly take seriously even if Ministers do not. However, I am sorry to tell my hon. Friends that, even though the Government are spending £2 billion a year on widening participation, the participation rate for working-class students has hardly improved since 1995.
If that were not bad enough, the improvement rate has actually declined. In the previous decade, participation by working-class students grew at a faster rate. Although I acknowledge the genuine determination across the House to try to widen participation, the truth is that the Government have failed by any measure. It is clear that there are Labour Members, such as the hon. Member for North-East Derbyshire (Natascha Engel), who care about these matters. It was especially distressing to hear how her ambitions, and the ambitions of the whole country, have been frustrated down by Ministers-not through lack of concern, but through their inability to deliver results.
Even though applications increased by a predictable measure this year, the result, as my hon. Friend the Member for Havant (Mr. Willetts) noted in his excellent opening remarks, has been chaos. While the Government blew up expectations, parents and students have been let down, the dream of a generation has been exploded, with universities left to pick up the pieces. There are 140,000 potential students who cannot find a place in higher education, as my hon. Friend pointed out and only 22,000 places were available through clearing; that is down by 50 per cent. from the year before.
That so many young people should lose their chance to learn can hardly come as a surprise to Ministers. Universities received roughly 60,000 additional applications this year. The Minister for Higher Education and Intellectual Property broadly confirmed that, yet the Government simply did not allocate sufficient places to meet that extra demand. Every previous recession has brought an increase in the number of applications for university places, so the Government must have known that that would happen. The issue should have been anticipated and dealt with, and a solution should have been found.
The Government are still nowhere near their target, and yet the system of student finance that they established has not been able to cope with the pressure, as was generously acknowledged by the hon. Member for Stockton, South (Ms Taylor). She said that the situation was not good enough, and challenged those in her own party,
on the Treasury Bench, to recognise the problem. I must be fair to the Minister of State: he did acknowledge it. His words were damning of his own record and that of his hon. Friends. He said that the situation was not good enough; that it was not effective; that it had not been sensibly anticipated; that the technology had failed; and that systems had let students down. But who is to blame? I am afraid that the buck stops on the Government Front Bench. The Minister knows that, and should have acknowledged that, too. After all, it is the Government who shifted responsibility for processing loans from local authorities to Student Finance England.
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