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Page 11, line 6, at beginning insert ("On or before 1st April 2000").

The noble Baroness said: My Lords, in moving the amendment, I speak also to Amendment No. 39. It is best that the amendments are argued together. They relate to the provision of a facility for loans for part-time students. We have had some discussion today about part-time students. We know that the Government are keen to promote the principle of life-long learning. I believe, as they do, that the financial support offered to part-time students will play a key role in the development of life-long learning. Many groups are in favour of that, not least students themselves, who have long believed that support for part-time students should be made available. The Dearing Committee was attracted to the principle of levelling up the support for part-time students. However, I realise that the Minister is likely to tell me again that Dearing did not consider this to be the priority.

A recent study undertaken by London Economics uses a model that would make a loan available to part-time students earning less than £10,000 a year, or £16,000 a year. It was supposed that the average loan would be about £500 per year. The study indicates that extending loans to part-time degree and sub-degree level students would cost the Government only an extra 0.5 per cent. per annum in the short term and 1.5 per cent. per annum in the long term. I maintain that that is not a large increase in public spending despite the fact that when we discussed this matter at Committee stage the noble Lord, Lord Whitty, indicated that he thought it was a huge amount of extra money. I maintain that that is not the case.

When we proposed similar provisions at Committee stage, the Government agreed in principle that they would like to offer student loans for part-time students. They also indicated that the Bill as drafted allows them to do so. The problem is that the Bill does not state when the Government will do that. Our amendment deals with that. We want loans,

--that is, in two years' time.

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Perhaps I may explain why we have chosen that date. We have all suffered somewhat since 1st May last year because of the Tory freeze on government spending. That freeze was adopted by the Chancellor, the right honourable Gordon Brown. However, we are trying to guess when the thaw in that freeze will come. The Government have used the phrase "about two years". We are testing whether they mean about two years. That is why we refer to the date 1st April 2000.

The Minister was cautious when she responded at Committee stage. I hope that today the Minister will be able to give us some idea when the freeze on the Government's spending is likely to be lifted. I believe that the provision would not cost as much as the Government say. Not all full-time students take up grant offers. Given the cross-section of part-time students going into higher education, it is likely that fewer would take up loans than those students going into higher education straight from school.

Our views were widely supported at Committee stage. The noble Lord, Lord Peston, and the noble Baroness, Lady Lockwood, backed the principle but spoke of "priorities". We realise that it is a matter of priorities. From the Liberal Democrat Benches our priority is to ensure that we extend help to part-time students by the year 2000. I look forward to the Minister's response. I hope that it will be favourable. If the noble Baroness is not in favour of the year 2000, perhaps she will give some indication about when the Government expect to be able to give some support to part-time students. The Government have agreed that it is important. I hope that the noble Baroness will be able to respond positively.

Lord Whitty: My Lords, as my noble friend made clear earlier, we recognise the vital importance of part-time students. But, as we have also made clear, the Bill as drafted already enables the Secretary of State if he so wishes to make grants or loans available to part-time or full-time students. Clause 16(2)(d) enables him to prescribe in regulations the categories of attendance which will qualify for any purpose of the regulations. So the power to do so already exists. The intention of these two amendments when read together is to require the Secretary of State to make a regulation extending loans to part-time students before 1st April 2000, and the noble Baroness tried to press the Government on that provision.

However, as we have said previously, in terms of priorities the Government do not at this stage intend to introduce regulations extending the loans scheme to the generality of part-time students. I reiterate that we agree with the Dearing Committee on this matter. As the committee pointed out, a high proportion of part-time students are in employment, and are therefore largely supporting themselves.

The noble Baroness referred to the cost of extending loans to part-time students. It is a key issue. If loans were made available to part-time students at the same level as for full-time students, on a pro rata basis, the

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average loan would be at least £1,500. On that basis, the cost per year would amount to some £370 million each year in the short term. I am afraid that I cannot give--

Baroness Maddock: My Lords, I am grateful to the Minister for giving me the opportunity to repeat that there was some research done which indicated (I will not say proved) that the average grant was expected to be £500.

5.30 p.m.

Lord Whitty: My Lords, I believe the noble Baroness refers to the study commissioned by the Open University. That suggested an average loan of £500. If that figure is compared with the average take-up and the average loan for full-time students, I do not see why there should be any dramatic difference between that and the figure for part-time students. On a pro rata basis, which is surely the more legitimate way to consider it, the average loan would be £1,500. That would amount to £370 million per year. It is not, I fear, a figure that I could guarantee to the House; nor can I give any comfort that my right honourable friend the Chancellor of the Exchequer would immediately allow me to commit the Government in that direction.

That is not to say that we do not recognise the vital importance of part-time students, or rule out the possibility that loans could be made at some stage in the future. However, we are not at this point prepared to accept the date set down by the noble Baroness, or indeed to give a date for that to be done.

However, one of the features of the Bill is that it is suitably flexible to ensure that support could be extended to categories of students who are not currently eligible without recourse to further legislation. I am afraid, however, that I cannot commit the Government to making such provisions by 1st April 2000. Recognising the public expenditure involved in making such a commitment, I hope that, given the general assurance of the Government's good will and the fact that the Bill is flexible enough to allow us to make those orders at a later stage, the noble Baroness will agree to withdraw the amendment.

Baroness Maddock: My Lords, I thank the Minister for that reply. I regret that it veers not one inch away from the reply that I received in Committee. I am extremely disappointed. However, in view of the circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 39 to 42 not moved.]

Lord Addington moved Amendment No. 43:

Page 11, line 35, at end insert--
("( ) Regulations under this section shall make provision for the disregard of disability benefits in the calculation of income for repayment purposes.").

The noble Lord said: My Lords, this amendment is comparatively straightforward and simple. It deals with an issue that has been very much in the public eye and in the eye of the ministerial Bench; namely, ensuring

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that those with disabilities are allowed access to all areas of life. In reality, that is done primarily through some form of pump-priming. This amendment seeks to ensure that the extra support given to those students with a disability is not taken into account when repayment terms are being calculated.

The reason is simply that the extra payments are given to meet specific needs, and therefore specific costs. For instance, if you are given extra payments to help with mobility costs, they are an essential part of the way in which you function. Thus, they are not disposable income and should not be counted.

We have heard a great deal recently about how the Government do not want to alienate those in our society who are disabled. I suggest that this would be a small measure towards that, in keeping with what has gone before. The Government could show their commitment in this field and in others by backing this amendment or a similar one. I beg to move.

Lord Tope: My Lords, I rise to support my noble friend and to speak particularly to Amendment No. 44, grouped with this one, standing in my name and those of my noble friends.

Amendment No. 44 returns to the important principle that at the age of 18 people are adults and should be regarded and treated as responsible adults. In almost every other walk of life, when people reach the age of majority they are treated as adults. If they wish to marry or enter into any other form of contract, fight for their country, and so on, they are regarded as adults. The only significant area of life where that is not the case is where they are students--they are dependent upon their parents, and their income is dependent on their parents' income. We feel that, as a point of principle, that is wrong. Therefore this amendment proposes that a student over the age of 18 should be assessed as an adult on the basis of his or her own income.

The Minister objected in Committee that our proposals were making available support for fees and loans for living costs without regard to the income of the households from which the students come, and that that would be both regressive and extraordinarily expensive. That is to misrepresent the proposal. Of course the calculation should take into account all the income of an intending student. That might typically include any allowances or gifts received from parents, spouse or friends; any earnings; any investment income from capital and savings, and so on. The important point is that it is the income of that student, not the income of his or her parents, that needs to be taken into account.

Students from wealthy homes whose parents wish to subsidise them generously should not be receiving the same help as those who have no such additional income. It may well be true that for families who are not very well off this new arrangement will make them decide that it is unnecessary to offer financial help. Perhaps for such families it is time that the burden of supporting their adult children was lifted from them. To that extent, the provision would increase government expenditure. However, noble Lords will recall that it was proposed earlier in debate that the Treasury should stop regarding

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student loans as government expenditure. This is an important amendment. It is intended to recognise that, at age 18, students are adults, must be treated as such, and that their right to loans and grants should be assessed on the basis of their income, not that of their parents or spouse.

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