Examination of Witness (Questions 100
MONDAY 10 DECEMBER 2001
100. So you are moving out of the loan scheme
(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
(Professor Rees) We have suggested there should be
two kinds of loan, one would be minimal and one would be near
102. So that is where the extra comes from?
(Professor Rees) That is right.
103. How are you going to divide the two different
sorts of loans?
(Professor Rees) Means testing.
Chairman: I see.
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 reportand
of course it was in our terms of reference as wellwe 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
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
(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
(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 examplevery 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.
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