Higher Education Bill

HL Deb 17 May 2004 vol 661 cc516-97

3.7 p.m.

The Parliamentary Under-Secretary of State, Department for Education and Skills (Baroness Ashton of Upholland)

My Lords, I beg to move that the I-louse do now again resolve itself into Committee on this Bill.

Moved, That the House do now again resolve itself into Committee.—(Baroness Ashton of Upholland.)

On Question, Motion agreed to.

House in Committee accordingly.

[The CHAIRMAN OF COMMITTEES in the Chair.]

Clause 27 [Sections 22 to 26: supplementary provisions]:

Lord Phillips of Sudbury moved Amendment No. 57A: Page 13, line 32, at end insert— ( ) Student fees paid to relevant institutions pursuant to this Act shall in principle be additional to and not in replacement of state funding provided directly and indirectly for and in respect of students at such institutions which will be at an annual real level per student not less than that provided previously subject to exceptional macro-economic circumstances.

The noble Lord said: Amendment No. 57A, which would amend Clause 27, has been tabled by four university chancellors: the noble Lord, Lord Forsyth of Drumlean, from the Conservative Benches; the noble Lord, Lord Dearing, from the Cross Benches; the noble Lord, Lord Puttnam, from the Government Benches; and myself. The amendment would put into the Bill the principle of additionality.

The passage of the Bill, as I need hardly remind the Committee, has been marked by more intense debate and rebellion in the other place than, perhaps, any other measure since 1997. What has united all parties, including the rebels, is the vital importance of higher education and acceptance that the long-standing underfunding of higher education imperils its future quality, particularly as regards academic recruitment. That general conviction overrides other disagreements—all other disagreements—about student fees.

In opening the Second Reading debate, the noble Baroness, Lady Ashton of Upholland, based her entire speech on the assumption that student fees would be an independent source of funding, additional to state funding. She was echoing the repeated assurances in that regard from the Prime Minister and the Secretary of State for Education and Skills. She said: We must ensure that higher education has the funding and the independence to fulfil its many roles". She referred to what she called, a history of underfunding, with a backlog of about £8 billion". The noble Baroness went on to say: it is essential that that underfunding is addressed. That is why the Bill provides greater support to our higher education system". She finished by saying: We estimate that it will raise about £1 billion a year in additional income".—[Official Report. 19/4/04; cols. 12–15.] Nothing could possibly be clearer, so what could be the grounds for opposing an amendment that does no more than take the Government at their own word? So far as I am aware, the only argument advanced is that it would be a relative novelty. Governments, it is said, cannot or should not bind the future spending of their successors. But this is a very particular Bill with a very particular purpose and may be the exception that proves that convention.

In fact, the taxation provisions in every Finance Bill, for example, bind successor governments unless and until they legislate otherwise. That is precisely what I suggest the vast majority in Parliament want in this case. Surely it would be a deep-dyed farce if, after all the heat and passion, the very foundation of this contentious Bill rested on a mere ministerial assurance. I say "mere" not to traduce the good intentions of Ministers, but because we all know from hard experience that times and Ministers change, as does government determination to stick by assurances given by other Ministers, let alone by other governments. In any event, assurances can be subject to argument and be diluted.

One current example of that is the lottery legislation. In introducing the original lottery Bill, Kenneth Baker, as he then was, assured the House of Commons of additionality, yet a few years later we had a different Minister in a different government justifying lottery revenue being devoted in large sums to sustaining the core funding of the NHS by being used to buy replacement X-ray machines, scanners and heaven knows what.

Lord Baker of Dorking

I thank the noble Lord for allowing me to intervene. It is that experience which has led me strongly to support his amendment.

Lord Phillips of Sudbury

I have never had a more welcome interjection.

We must not have that here. This amendment is the only way which its movers can think of to ensure that. Without the amendment or something like it, one could find in 2006 policy arguments being adduced—after the next election—to justify a reduction in state spending, which in turn could have the effect of converting student fees into an indirect graduate tax by reducing the contribution of the general tax payer.

I should explain one or two aspects of the wording of the amendment. I do not claim that it is perfect, but I believe that its purport is clear and common sense. It puts the principle four-square on the face of the Bill. Reference to "exceptional macro-economic circumstances", while I admit is not a lovely phrase, is a straight lift from Article 9 of the EU Council of Ministers Council Regulation 4253/88, as amended in 1993. I hope that that does not put off some noble Lords. However, that legislates for additionality in relation to EU structural fund support. The exception is designed to protect governments from the effects of economic crisis, allowing them flexibility.

Where the amendment compares real levels of per student funding with those "provided previously" that would, subject to the crisis let-out, require a government to do at least as well in the year concerned as in the previous year. That is exactly what has been promised.

If the amendment is passed, plainly it would need to be monitored, preferably on a consensual basis, by Universities UK and/or HEFCE, the Treasury and the Department for Education and Skills. I wondered about adding a monitoring provision to the amendment, but that really would not be necessary. I think and hope that we can assume good sense in implementing the statutory principle.

Some have asked whether a breach of this provision would be justiciable. The answer to that is a highly qualified "yes", but in practice it would be legally enforceable only in a very clear and exceptional case. Speculative claims would be inhibited by the potentially huge costs involved in mounting a judicial review of this clause. In any event, one has to have leave from the High Court so to do.

The wording is intentionally expansive and so I believe that this formula provides a powerful moral marker as well as a practical, proportionate, long-stop safeguard. I beg to move.

3.15 p.m.

Lord Dearing

At Second Reading I expressed three concerns. The first was better support for part-time students; the second was to ensure that OFFA had no role in admissions; and the third was that the Exchequer should not substitute any part of graduate contributions for Exchequer funding. During that debate the noble Lord, Lord Phillips, outlined an amendment he had in mind to secure the third of those purposes. Afterwards I said to him that if he could successfully draft a clause, I would wish to support it.

The noble Lord knows from our subsequent discussions that I have some reservations. However, our objectives are exactly the same. I thank him and congratulate him on his work and the effort he has put in to bringing forward a clause that makes such sense. My objective, however it is achieved, is to ensure that graduate contributions are used for the good of higher education and not for the benefit of the Exchequer. How could it be otherwise when we are expecting young people, standing on the threshold of their lives, to do so with debts to which we are party?

Turning to how that is best achieved, the legislative route has the clear attraction that it serves as a roadblock confronting any future government, not just the present one. That is a real attraction because the tenancy of the seat of government is no more than a tenancy, the freehold being owned by the electorate. I expect that the seat will be up for rent well before the graduate contribution part of the Bill ever begins to bite.

The difficulty lies in drafting something that on the one hand is Treasury-proof—I confess that I was once a practitioner of that dark art whose darkness is its only mystery; it is a troublesome art—while on the other hand is acceptable to a government and does not have unintended consequences.

I suspect that we all want a safeguard against the possibility that the increased funding will be snitched—I repeat the word I used at Second Reading—by the Chancellor, but the problem is that the Chancellor, whoever he, or she, may be, may feel that having complied with the letter of the clause, he has done his bit. I listened carefully to the words of the noble Lord, Lord Phillips, as is his due, and they confirmed my reading of the wording of this clause. This is a chain index-linking, not one linking the unit of funding to what it was in a base year. That gives me cause for concern that the Chancellor, in thinking about an increase, might feel committed indefinitely to the higher figure, which may not be affordable indefinitely. Therefore, he would back off from something we would all want.

I turn to wheezes and dodges. Although I shall not waste the time of the Committee by outlining them, there are aspects that would mean that the Chancellor would be able to do things that we would very much not want him to do. He could bring things into the reckoning, because the clause refers to direct and indirect funding, embracing matters like funding for the teaching infrastructure and the estate. We are then talking about billions, which could wobble the whole intention.

When thinking of future governments, I note that the noble Lord, Lord Forsyth, who sits on the Opposition Front Bench, has added his name to the amendment. I take that to mean that he has every honourable intent, however much he may dislike the Bill in principle, of ensuring that if it goes through, his party will do the decent thing. When the noble Baroness, Lady Sharp, spoke to her very principled and well thought-out amendment substituting tax for student contributions, if it were the case that a Liberal government came into office, we would be assured that if there were any student contributions, they would soon go. The noble Baroness nods in assent. Therefore I turn to the Government Front Bench and look forward eagerly to what the Minister has to say.

Lord Forsyth of Drumlean

I am encouraged by the thought that the noble Lord, Lord Dearing, thinks that a future Conservative government would do the decent thing. The decent thing to do with this Bill would be to put it through the shredder because it does not bring in more income than it costs the taxpayer, and it lays open the possibility of the Chancellor—in that marvellous phrase which the noble Lord used—"snitching" the proceeds. I have no experience of the present Chancellor, but when I was in government the previous Chancellor was a twitcher, if not a snitcher. Everything that I have seen of the Treasury over the years under both administrations shows that it does not change its habits.

I congratulate the noble Lord, Lord Phillips, on moving this amendment. I was fishing in Scotland about lunchtime on a Friday, and a ghillie came running down the opposite riverbank and said, "There's an urgent message from Lord Phillips. He has an amendment which you must look at immediately". The text of this amendment was brought across the water to me and of course I dropped everything to read it. It is an important issue and I very happily added my name to it, although I am not a university vice-chancellor or chancellor, as the noble Lord suggested. Everything that I have learnt in the course of acting on this Bench in respect of this Bill has encouraged me to do everything possible to avoid any invitations of that kind, for the problems are enormous.

I have one question for the noble Lord, Lord Phillips: does he think that this amendment would have prevented the Government doing what they did in 1998 when they introduced tuition fees? That brought in additional income, but the Government then reduced the funding so that the funding per student remained broadly the same. There was therefore no additional benefit of the fee income. In short, this Government have form; this Chancellor has form on snitching the resources from fees. The noble Lord described in his speech the opportunities for challenge in the courts: does he think that this clause would have provided a guarantee in that circumstance?

Lord Phillips of Sudbury

I do.

Lord Forsyth of Drumlean

Then it was well worth the ghillie bringing the amendment down to the river! If that is the case, it provides something of merit. The noble Lord, Lord Dearing, suggested that it would commit us to the principle of the Bill. I think not. But if universities are to be encouraged to go down the route of having fees, we should at least ensure that what Ministers say will be the position is the position.

Therefore I see no reason at all for the amendment to be rejected, short of the Minister having had an earful from the Treasury on the merits of the proposal. The Treasury never likes anything that smacks of hypothecation or limits its room for manoeuvre. Furthermore, my noble friend Lord Baker fought long and hard for the principle of additionality on the lottery, and once again this Government, not the previous government, have breached that principle. We have seen it, too, in respect of structural funds from the EU.

I congratulate the noble Lord, Lord Phillips, on this amendment. I would have thought that, given the rhetoric which we have had from Ministers about this Bill, the Minister should have no trouble at all in accepting it.

There is one other point which I would like to make, if your Lordships will bear with me. It relates to Universities UK briefing, which seems to parallel Labour research department briefing, which also finds its way into my interest from time to time. In the briefing, Universities UK comments: We accept that it is very difficult to commit future governments to levels of expenditure and we understand that Lord Phillips does not intend to press this amendment to a vote". I am very surprised that Universities UK should not wish to see this on the face of the Bill, for the reasons which the noble Lord, Lord Phillips, has explained. I await with interest the Minister's response and perhaps a contribution from the noble Baroness.

Lord Dearing

My understanding from the noble Lord, Lord Phillips, was that at this stage he did not wish to press the amendment to a vote and I mentioned that to Universities UK.

Lord Forsyth of Drumlean

It would be interesting to follow the audit trail of where these things come from. Certainly my support for this amendment was on the basis that it was not a probing debate to discuss the merits or otherwise of additionality and what the Government might say to reassure those people who are concerned about it. It was because it would put on the face of the Bill a specific legal commitment in line with the rhetoric which we have heard from the Chancellor and other Ministers.

Lord Phillips of Sudbury

If I might just intervene to respond to the noble Lords, Lord Dearing and Lord Forsyth, I have never said—and never would say—that that matter will not be put to the vote. It would be rather fruitless to have gone to all this trouble to say that. What I have said and what I expect to continue to say is that we will wait and see what the Government have to say on this amendment at this stage. I look forward to that right now.

Lord Hannay of Chiswick

I add my voice to those who have supported this amendment. It is an intensely serious subject and a very topical one because the universities had experience—in 1997 and 1998, as the noble Lord, Lord Forsyth, mentioned—of having the fees that were introduced snitched. Therefore the memory is sharp in their minds. They do not want to see it happen again, for perfectly legitimate reasons, because, frankly, the Bill has no purpose at all if it is merely a transfer of responsibility from the Exchequer to the student. The Bill has purpose at all only if it provides a degree of income and autonomy to the universities. So it is very important what the Minister says in reply, and what her colleagues in another place say if the Bill returns there.

It is also quite important what the colleagues of the noble Lord, Lord Forsyth, in another place say if the Bill returns there, because there was not much sound of that coming from the right honourable gentleman the Shadow Chancellor of the Exchequer when he was setting out the spending plans for a future Conservative government. He failed to mention higher education at all as a priority. So I am not quite sure where this money is coming from.

Lord Forsyth of Drumlean

It would be very odd indeed for the Shadow Chancellor to spell out the outcomes arising from implementing an opposition policy to which we are opposed.

Lord Hannay of Chiswick

That is as may be. Nevertheless, his support for this amendment would be deprived of much substance if it were just a verbal pirouette; if it did not in fact bespeak an intention to provide—if there were a Conservative government—greater resources for the universities, perhaps by a different route but nevertheless greater resources. It is important that the Government Benches reply to this amendment, it is hoped by accepting it, or if not, by statements that are a little bit better than simply saying they cannot bind the hands of a future government.

I have many years of dealing with the Treasury over a matter which the noble Lord, Lord Forsyth, mentioned, which was the structural funds of the European Union and additionality there. Anyone who has dealt with the Treasury on this matter is perfectly well aware that the reason the Treasury does not tie its hands is not because it cannot, but because it does not wish to. It is a matter of will; it is not a matter of law. The day it wishes to, it can come to this House with an amendment which will be absolutely copper-bottomed, and which cannot be got around. It might be a better one than the noble Lord, Lord Phillips, has produced. The Treasury could do it any day it liked, but that day has not yet come.

So it is extremely important that statements are made if, at the end of the day, the Government refuse to accept amendments of a really clear kind. After all, we are having a comprehensive spending review this summer, which will overlap the period when this scheme enters into effect. Are we going to see in that spending review, before this measure enters into law, an absolute commitment not to snitch? I hope so because, if not, many people will feel that they have been led up the garden path.

3.30 p.m.

Baroness Warwick of Undercliffe

The amendment does indeed bring us to the heart of the Bill. As the noble Lord, Lord Phillips, said, during the debates in this House and in the other place it was widely accepted that higher education is underfunded; the disagreement has been about how that funding gap is to be filled.

In my view, variable fees are a vital step towards filling that gap. Predictions about how much they may raise have varied but, none the less, it is a fair estimate to say that about half the annual recurrent funding gap for teaching of about £2 billion would be met. Continued increases from the public purse will therefore be essential, as all other speakers have pointed out. If the additional funding from fees is offset by reductions in public funding, then universities will be no better off. Fees must be truly additional.

As the Committee is aware, the debate on whether the fees introduced in 1998 were truly additional still rages. We have raised the issue again today, as we did in previous discussions. However, I am sure that the fees mitigated the effects of the deep cuts that came in the mid-1990s. Indeed, public funding is now on the increase. The Government have committed themselves to increasing public funding. Let me remind the Committee of the Chancellor's words in a Budget speech.

Lord Forsyth of Drumlean

I hope the noble Baroness will forgive me for interrupting but she said something which I am sure she did not mean to say. She suggested that funding had been falling under the previous administration. That, of course, is not the position. The funding per student provided by the Government since 1997 has fallen by about 10 per cent; and funding per student under the present administration has been less than in any of the 18 years under the Conservative government. I am sure the noble Baroness would not want to mislead the Committee.

Baroness Warwick of Undercliffe

I have no intention of misleading the Committee. I was making the point that when the present Government came to power the threats of cuts for higher education were very substantial indeed. The Government managed to reduce those cuts. I said that the additional resource provided by student support was part of that attempt.

The Chancellor said that, university and student finance reforms will be matched by rising real- terms funding, to progress towards the 50 per cent target … The settlement will maintain the levels of real-terms student funding per head, and ensure the universities receive in full the benefit of additional revenue from the Government's higher education reforms".—[Official Report, Commons, 17/3/04; col. 335.] That was very welcome, although I would appreciate it if the Minister could confirm that what the Chancellor meant when he said "student funding per head" was funding for institutions and did not include funding for student support.

Having said that, I very much welcome the spirit of the amendment of the noble Lord, Lord Phillips. as an opportunity for the Government to reiterate their commitment and as an attempt to hold future governments in principle to that commitment. We have spent many months wrestling with ideas about the way in which additionality could be ensured. The noble Lord, Lord Phillips, is to be congratulated on the ingenuity of his amendment and I await the Minister's response with interest.

I invite the Minister to consider three proposals. First, the Government should agree to work with Universities UK and the English funding council to arrive at an agreed definition of "unit of public funding per student". It seems that every year, as the Committee may be aware, we get involved in a public dispute about what the unit of funding means. I should like to see, for example, income from private fees clearly identified as a separate and additional element; neither do I think that funding tied to specific projects should be counted in the calculation of unit funding. The Government think differently.

The second proposal is that the Government should undertake to publish an annual report to Parliament on the funding of the sector. Such a report should include three measures: the total public funding for higher education per student, including student support; the total public funding for higher education institutions per student; and the public expenditure on higher education institutions as a percentage of GDP. These measures should be agreed in advance between the Government, Universities UK and other key stakeholders. I accept that Universities UK could do this itself, but the whole purpose is to find a way to strengthen Parliament's position in holding the Government to account.

Thirdly, as the Government pointed out in last year's White Paper,The Future of Higher Education, France, Germany, the Netherlands and the USA all contribute 1 per cent of their GDP in public funding to tertiary education institutions. In the UK this is only 0.7 per cent. The conclusion drawn by the White Paper is that, Our competitors see—as we should—that the developing knowledge economy means the need for more, better trained people in the workforce". I interpret the phrase "as we should" to mean that the Government recognise the importance of the UK moving towards the OECD average public expenditure on tertiary education. I hope the Minister will be able to confirm this.

For these reasons, I support the amendment of the noble Lord, Lord Phillips. Unless fees are truly additional to public funding, the whole purpose of the Higher Education Bill, which has been debated with such passion, will be entirely undermined.

Lord Baker of Dorking

The principle of the amendment is very simple. The whole purpose of the Bill is to provide extra money for the universities, otherwise it would not have been introduced or gone through all the trouble it has gone through already. But it has to involve extra money. I congratulate the noble Lord, Lord Phillips, on devising a formula to achieve this. The amendment provides a very sensible solution. If it comes to a vote, possibly at Report stage, I hope it will even be supported by his own Front Bench. I am sure that noble Lords on the Liberal Democrat Front Bench will not want to pass the whole of the Committee and Report stages without supporting one sensible idea.

It will be quite difficult to get the simple principle on to the face of the Bill, but perhaps I may offer a suggestion. I am sure that, in reply, the Minister will repeat the words of the Chancellor—that he will undertake to increase the funding of universities in real terms—but, from my own experience, such pledges are written in sand. I said exactly the same in relation to the lottery—that the money from the lottery would be preserved for the original direct beneficiaries—but that was changed, first by a Conservative government and then changed in spades by the present Government. So pledges are not sufficient.

If the Chancellor's words are to be implemented, one way of doing so—apart from through the amendment of the noble Lord, Lord Phillips—would be simply to say that the teaching grants to universities for art, science and medical students should be increased automatically, in real terms, by the rate of inflation. Such an undertaking could be placed on the face of the Bill. We need something more than a ministerial pledge based on what the Chancellor said.

Baroness O'Neill of Bengarve

I congratulate the noble Lord, Lord Phillips, on trying to find a way to address the issue at the heart of the Bill. As the noble Baroness, Lady Warwick, said, this is the heart of the Bill.

In the universities we have dark days where we believe that we will go through the process of obtaining additional funding streams through variable fees but that we will gain no benefit and our students will gain no benefit. In fact, we will gain a net detriment; namely, the transfer of odium from the Treasury and HEFCE to ourselves. That is our fear.

Nevertheless, we all recognise that the amendment has been very difficult to draft. I do not know how the Minister will respond to it—I am not, I am afraid, going to help her on that matter—but I have a suggestion for a failsafe approach which will avoid the problems of additionality and hypothecation having to be, in effect, defined on the face of the Bill. It is not an amendment that the Government will like but it will provide a safeguard to universities and students and I would be grateful if the Minister will speak to it when she replies. I suggest that we should consider a system whereby any decline in levels of HEFCE funding per student is compensated for by a reduction in the total student numbers. This would restore the real value of the HEFCE contribution per student.

Any reduction would undermine the ambition to move towards a 50 per cent target, but it is only sensible to have a failsafe provision in the Bill. We cannot make bricks without straw; we cannot go on with a continually reducing unit of resource. If the resource cannot be increased, I believe that we should reduce the numbers so that the resource per student is not reduced.

Indeed, my suggestion might accompany the amendment of the noble Lord, Lord Phillips, rather than replace it if it is not accepted. For understandable reasons, he has had to consider the serious macroeconomic conditions. My proposal would recognise that situation and would be an obstacle to the serving-up of ever thinner degrees in the name of expanding totals.

Baroness Sharp of Guildford

Several noble Lords have referred to the position of the Liberal Democrat Front Bench, so it is appropriate that I should make some statement. There is a law in economics known as the general law of the second best. The Liberal Democrat Front Bench adheres to that law. Our first best solution would be to have no fees at all and for the money to be put into the universities' pot from the Exchequer. We have made it quite clear that that is our first best position. However, if we are confronted by a position in which fees are being levied—and we do not form the Government and are therefore not in a position to get rid of those fees—we would support this amendment on the grounds that it would be a second best position.

Indeed, we exposed the travesty of the situation that took place in relation to the 1998 fees. The fact that the Government were withdrawing money with one hand while taking fees with the other was exposed by a series of Questions put down in the other place by my honourable friend David Rendel, the Member of Parliament for Newbury. Therefore, we have played a considerable part in exposing what has happened and raising awareness of the fact that it is necessary to maintain the real value of the funding per student.

I point out, both in relation to the amendment proposed by the noble Baroness, Lady O'Neill, and what was said by the noble Baroness, Lady Warwick, that there has been an ambiguity in the unit funding per student, which frequently tends to take the HEFCE funding per student per institution. That includes HEFCE research funding as well as HEFCE funding for teaching. There is an ambiguity in that. It is vitally important that we use the HEFCE funding per student for teaching and that that is not linked up with HEFCE research funding. The funding going into institutions from the research councils must also be kept totally distinct. There have been occasions when the Government, considerably to their benefit, put all three together, and the figures looked very good. The latest briefing from Universities UK provided us with figures for the funding per student just before we began the process of debating in this Chamber. I am grateful that at long last we have those useful figures.

Lord Winston

I rise briefly to support this amendment. I understand very well the concerns that my noble friend the Minister may have, but as an employee of an excellent university, I know the desperate straits in which the higher education sector increasingly finds itself. Unless something like this amendment is supported by the Government or a provision is introduced to reduce student numbers, such as was suggested by the noble Baroness, Lady O'Neill, if this amendment cannot be supported, I will find it difficult to support the Government.

Lord Wilson of Tillyorn

I add my voice to those who support this amendment. It is clear that the Bill sets out in the right direction. It is equally clear that, if our universities are to flourish—or to survive in anything like their present form—what is proposed does not go far enough. It would be even worse if what is proposed were then taken away. In one way or another—whether in the form of the wording of this amendment, or the alternatives such as the subtle version proposed by my noble friend Lady O'Neill or with the additions suggested by the noble Baroness, Lady Sharp—it is essential that a "no snitch" clause is included in the Bill.

3.45 p.m.

Baroness Ashton of Upholland

I am grateful to the noble Lord, Lord Phillips, for ensuring that we have had this interesting debate, which has now become the "no snitch" clause debate. I am sure that the Chancellor of the Exchequer will be thrilled when he hears about it. Listening to noble Lords, I am very conscious of the strength of feeling, which is either born from experience within the university sector or, in relation to the noble Lords, Lord Baker of Dorking and Lord Forsyth of Drumlean, from their experiences as Secretaries of State. I am sorry that they had those experiences in government. I pay tribute to the eloquence with which the noble Lord, Lord Phillips of Sudbury, introduced his amendment.

I had planned to begin by repeating the words of the Chancellor, but as I repeated them on Thursday and they were also used by my noble friend, Lady Warwick, I will assume that noble Lords heard them on Thursday and today and that there is no need for me say them again. Of course, it is important to recognise within those words—and I was interested to think of this Chancellor as a "mere" Chancellor, which is not a word that I associate with my right honourable friend—that the money raised through variable tuition fees will be in addition to the grant paid by the Higher Education Funding Council for England. We hope that our assurances will make noble Lords feel comfortable about the Government's ambitions for the sector.

It will be no surprise to hear that I question whether it is right to agree this amendment to the Bill. Much as we endorse the principle and understand the rationale behind what the noble Lord, Lord Phillips, argues, we do not believe that it is right to tie the hands of governments present and future for an unspecified time, which would be the impact of this amendment. Furthermore, as the noble Lord would recognise. there are two technical difficulties with the amendment. I understood what he said about Article 9, in terms of exceptional macro-economic circumstances, but there are still issues about what that phraseology would mean in particular circumstances and whether we would be able to gauge whether those circumstances had been reached or breached. It is also unclear whether the amendment would apply at the level of the whole sector or to individual institutions. If it were the latter, that could cause difficulties where the pattern of provision at an institution changes. Noble Lords well versed in education matters, especially at universities, know that HEFCE provides different amounts of funding for different courses, reflecting the different costs of lecture-based and science courses, for example, which is only sensible. However, it also reflects the ebb and flow of students across courses at different institutions. It would be important to allow for the funding adjustments to take account of the changes in course mix and numbers.

The noble Lord, Lord Forsyth, returned to the issue of underfunding by governments. I have been very clear: I have put the figures in your Lordships' House on more than one occasion. I accept that there has been underfunding of the sector. However, I reiterate what my noble friend Lady Blackstone said last week when she indicated the position that faced us when we came to power. The previous administration planned a cut of more than 6 per cent. We were able to reduce that cut to 2 per cent. It was still a cut and I am sorry that that was the case, but it was better than what would have happened. The noble Lord can shake his head. I can quote figures and so can he, but we both agree that governments have underfunded the sector. I would like to stop the argument at that point because it is important that we move forward.

Lord Forsyth of Drumlean

The last thing that I want to do is have a debate about figures with the Minister, but this is an important principle. The Government were elected on a slogan of "Education, Education, Education", but proceeded to cut university funding on a per-student basis while, at the same time, raising the money in fees—what has been described as "snitching" in this debate. The Minister talks about tying the hands of the Treasury. That is precisely what we want to do. We want to prevent the Treasury taking this money and using it to reduce the amount of money that it would otherwise provide. The Minister must see that that is central to the whole theory and justification for the introduction of fees and for the Bill itself. It is a central issue.

Baroness Ashton of Upholland

I understand that that is the issue, but I take exception to the fact that the noble Lord implies that the Conservative Party currently has a policy of support for the universities and that everything was rosy in the garden until we took over in 1997. The noble Lord implies that what I described as the position that we inherited was not the case. There would have been substantial cuts. There were cuts, but they were not of the order that the noble Lord's party would have imposed on universities. We are now in the position of redressing the balance, which is in an important way forward.

I also say to the noble Lord that, as far as I am concerned, what I say on these Benches ties the hands of my colleagues in another place. I therefore expect his support for this amendment ties the hands of his right honourable friend the shadow Chancellor in exactly the same way, as the noble Lord, Lord Hannay, indicated. I look forward to having some recognition of that in another place as we take this amendment forward and as the noble Lord, Lord Phillips, determines whether he wishes to push that or not.

I would like to ask the noble Lord a further question. I do not know what a ghillie is and I hope that at some point he will be able to enlighten me. That shows that I am neither a fisherwoman nor spend enough time in Scotland for those purposes.

I turn to the points raised by my noble friend Lady Warwick on behalf of Universities UK. I accept the issue about a new measure of unit funding which is something that the universities have wanted for some considerable time. We are going to ask officials in the department to work with Universities UK to look at options to do that; to find the appropriate measure which will go some way towards the kind of transparency that noble Lords have indicated that they would like; and, if we are able to find such a measure, we would be willing to publish that in the annual report. We should put that before Parliament. That is what my noble friend was particularly interested in. We are moving to increase the proportion of GDP that is spent on education.

The noble Baroness, Lady O'Neill, made an impassioned plea about the reduction in unit funding and the implications of that. I have listened with great care to what the noble Baroness said, but what is important is the blend within this. I would not want to commit such a straightforward link between one thing and another because of the nature of higher education and the different kinds of students that we have within education, for the unit funding is different in itself. The noble Baroness made an important point on which I would like to reflect further, as did other noble Lords.

I recognise the strength of feeling in the Chamber. Noble Lords know very well that it is not for me today to commit the Government in this way. It is extremely difficult to put things on the face of the Bill that commit this Government and future governments for all time. There are many issues to discuss. I suggest to noble Lords that I am perfectly happy to consider further what we might do on this issue, and, in particular, to talk to the noble Lord, Lord Phillips of Sudbury, about his amendment. On that basis I trust that he will withdraw his amendment.

Lord Lucas

Perhaps I may briefly enlighten the noble Baroness. The relationship between a ghillie and a fisherman is very like the relationship between the Secretary of State for Education and the Chancellor of the Exchequer. The Secretary of State for Education shows the Chancellor where the money is and the Chancellor then catches it.

What I have drawn out of the last 45 minutes is a profound sense of sadness at the state that universities have got themselves into—stuck on their knees, begging for every last penny from the Chancellor. I spend a substantial amount of my life at the other end of independent schools asking for my money—not for my children but for other people's children. A lot of these problems could be solved if sufficient numbers of universities were to assert their independence and stand proud. They have many strong and intelligent people leading them. I find it a great pity that they have come to this pass.

Lord Phillips of Sudbury

I am grateful to the noble Baroness for the way in which she summed up what can be described as a debate. I am most grateful to the 10 noble Lords who took part in it.

I fear, however, that things are left no forrader than when we started in terms of what the Government are willing to concede. If the matter is taken at its root, they are conceding nothing except further discussions and the assurance that, when this Chancellor above all Chancellors says that black is black and white is white, that is how it will be for ever and a day. It will be thus so long as he is Chancellor.

The intervention of the noble Lord, Lord Baker, was the clearest possible first-hand, soul-seared experience of one Minister who said with great certainty and conviction that lottery funds would be used in a certain way, only to see that assurance undermined, first by his own party and then by successive governments. I suggest that we all take stock of the debate and readHansard. There should be a meeting of all those who have spoken in this debate to decide how we should carry this matter forward—it seems to us to be at the very heart of this measure.

The Bill is a farce if we are in the position in which a future Minister or future government could undermine additionality. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 27 agreed to.

Clause 28 [Meaning of -the relevant authority"]:

Baroness Sharp of Guildford moved Amendment No. 58: Page 13, line 36, leave out from "the" to end and insert "funding body as defined in section 22(2)

The noble Baroness said: In moving this amendment, I shall speak also to all the other amendments grouped with it.

This group of amendments provides the first opportunity to discuss the director of fair access and the office of fair access. The main purpose of this group of amendments is to question the need for a separate office and a separate director and to ask why the functions proposed could not be subsumed within the existing functions of HEFCE and its Welsh opposite number.

Since this is the first opportunity to discuss OFFA, it is worth spending a little time setting the scene. In this Chamber we have already debated Clauses 22 and 23, which empower the Secretary of State to require the appropriate funding body—either HEFCE of the Teacher Training Agency—to impose conditions on their grants or loans to higher education institutions should the institution either breach the fee regulations or fail to submit an agreed access plan. As we have also discussed, the situation in Wales is somewhat different; at the moment I do not want to go into the complications of the Welsh situation.

In this group of amendments we come to the mechanism by which the Secretary of State seeks to enforce these conditions. As the Bill currently stands, Clause 28 establishes a new authority with a director. Clause 29 establishes that the director shall be called the, Director of Fair Access to Higher Education". Clause 30 sets up the duties of the director. Clause 31 specifies that the Secretary of State can lay down regulations setting out the content of access plans. Clause 32 requires that higher education institutions have to submit their plans to the director of fair access. Clause 33 states that the duration of plans shall be specified by the Secretary of State. Clause 34 states that any variations after plans have been agreed have to be agreed with the director of fair access. Clause 35 empowers the director of fair access to instruct HEFCE to withhold grants and loans in accordance with procedures laid down in Clause 23.

As we know, higher fees can be charged only if access plans are in place. These plans have to be drawn up by the higher education institutions themselves and submitted to the director of fair access, who will vet and agree them—and presumably negotiate over them—with the institution concerned. He will then monitor their implementation and, should an institution fail to implement its plans as specified, the director has the power to ask HEFCE or the Teacher Training Agency to fine the institution. As became apparent in proceedings in another place, fines of up to £500,000 are possible. Under Clause 23, HEFCE itself has powers to fine any institution which charges fees higher than the basic amount without having an agreed plan in place.

These amendments would eliminate the role of the director and the whole set-up of the office of fair access. They would, however, leave in place the whole business of access plans, but require these to be monitored by HEFCE or the TTA, which are the funding bodies defined in Clause 22(2).

Specifically, the amendments would modify Clause 28 to eliminate references to the director, substituting instead "funding bodies"; eliminate Clause 29, establishing the post of director; modify Clause 30 so that references to the director are changed to "the relevant authority"; leave intact Clauses 31, 32, 33 and 34 in terms of content, procedures and duration of plans; modify Clause 35 to eliminate references to the director but endow HEFCE and the TTA with his powers; and modify Clause 38 to eliminate references to the director. Perhaps I should also refer to dropping Schedule 5, which relates to the director of fair access, although it is not in this group of amendments.

4 p.m.

Why do we argue that the director's functions should be subsumed into HEFCE? The case was well made by the Minister for Higher Education in discussion of these amendments in Committee in the other place. He pointed out, first, that OFFA and HEFCE would have to work very closely together, and for that reason would be collocated in Bristol. Indeed, I understand that OFFA will work out of the HEFCE office and in the first instance use HEFCE staff. But he then went on to say—and I believe this to be the most significant statement— The Secretary of State made it clear, in his guidance letter, that we do not expect universities to do anything differently from what they do now. They have an agenda of widening participation: that will be subsumed into OFFA, and they will produce the same pieces of paper that they currently produce—no extra paper will be going to Bristol. OFFA and HEFCE will have an obligation to exchange information, so if the access agreement is breached, that would be a matter for the director and OFFA—not HEFCE—although HEFCE punishments, including fines, will be imposed".—[Official Report, Commons Standing Committee H, 2/3/04; co1.379.]

Our argument, in brief, is that HEFCE is already doing the job and that OFFA is an unnecessary piece of extra bureaucracy. It may cost only £500,000, which is what the Explanatory Notes tell us, but quite frankly that £500,000 could more usefully go directly to the higher education institutions themselves. These institutions already have to have access plans, which have to be agreed with HEFCE. HEFCE monitors those plans, and the universities know very well that it is in their interests to modify and amend the plans in line with requirements laid down by HEFCE. Indeed, HEFCE already has powers to impose tines on universities in breach of the fee regulations laid down under the 1998 Act. However, as the Minister admitted, no institution has actually breached the regulations, and no fines have ever been imposed. He said: I do not expect any plans to be breached. Nor do I expect the fee limits to be breached".—[Official Report, Commons Standing Committee H, 2/3/04; co1.380.]

Vice-chancellors are a law-fearing and law-abiding set of people, and will not knowingly breach their obligations. The Minister may argue that we need to preserve the distinction between funder and regulator, and that HEFCE is the funder and OFFA the regulator. I would be prepared to accept that distinction if we were back in the 1970s. In those days, the University Grants Committee was a genuinely independent organisation, set at arm's length from government and acting as a buffer between the higher education institutions and Ministers. But those days are long gone. Some of us would like there to be an element of the autonomy of the UGC restored but, for the present, HEFCE is very firmly in the Government's control, with a direct line of accountability through a director-general of higher education, located in the Department for Education and Skills. Moreover, it is clear from the functions that it has been performing—for example, in policing the charging of fees under the 1998 Act, not to mention the participation agenda—that any suggestion that it has not been acting as a regulator is absurd, to say the least.

My argument, therefore, is that the functions to be performed by OFFA have already been carried out by HEFCE, which has managed the process perfectly well. There is no need to set up an extra office. The expense and potential bureaucratic complications involved are unnecessary. We should remove any mention of OFFA or its director from the Bill. I beg to move.

Lord Forsyth of Drumlean

The more I listened to the noble Baroness, Lady Sharp, the more I wondered whether I should support her amendment. However, I fear that I cannot support her, although I agree with several of the points that she made.

For me, this part of the Bill, which sets up OFFA, is the most offensive and dangerous. OFFA as it is set out in the Bill, with the powers that it has, is an attack on academic freedom. It would be tempting to see the subsuming of OFFA into HEFCE as a way of reducing the unpleasant aspects of its powers, but I fear that there would be a number of disadvantages. First, it would be much more difficult to abolish if there were a change of government. Secondly, it would be extremely difficult to identify the costs of the exercise. I do not know who was responsible for deciding that OFFA would cost £500,000, but if the behaviour of this Government in setting up the many quangos that they have established, along with boards, tsars and all the rest is anything to go by, that £500,000 will not get much beyond paying for the salary of the chief executive and his staff, never mind the fulsome duties being placed on OFFA.

There is an argument for keeping a separate, standalone body, if for no other reason than scrutiny of what it is up to. In addition, however—and uncharacteristically—the noble Baroness, Lady Sharp, is not really being politically streetwise. What we have to recognise, which is so evident from the briefings that we have had from Universities UK and others, is that a deal has been done here between the Government and their Back-Benchers in the other place. Those Back-Benchers, because they are principled socialists, do not like the idea of fees. The Government have persuaded them to go along with this by setting up OFFA, which they see as a body that will interfere with the admissions procedures in our universities and discriminate against youngsters who come from what they regard as more privileged backgrounds. That is the nature of the deal.

The noble Baroness may see this as a Trojan horse, but were we to send the Bill back to the other place without OFFA in place, that deal would collapse and the whole Bill would collapse. Perhaps the noble Baroness is more streetwise than I imagined and that is the tactic that she has in mind. But it is perfectly apparent that the universities, certainly with regard to Universities UK, have entered into a Faustian bargain. That bargain is that the Government will deliver the fees—although we noted in the last debate that that might not amount to very much by the time the Chancellor has finished—and, in return, OFFA will be created, which will have an unprecedented role in interfering in the independence of our universities.

I have much sympathy with the noble Baroness, but I prefer the amendments tabled by my noble friend Lady Perry, which we shall discuss later and which would leave OFFA in place while seeking to limit the degree to which OFFA can interfere and to secure more independence of OFFA. On that basis, I regret being unable to offer support to the noble Baroness, Lady Sharp.

Baroness Warwick of Undercliffe

Like many noble Lords, I have had grave concerns about some aspects of the proposals for the Office for Fair Access, and I know that many or most vice-chancellors share my concern. I should also confess that, whenThe Future of Higher Education was first published, I, too, thought that OFFA should be part of the funding council. I did not see why it was necessary to create an extra body when the funding council already monitors institutions' widening participation strategies. It seemed to me that it would be administratively tidy, which might help in respect of the possible mushrooming of OFFA's remit. However, I believe that I was wrong.

On reflection, I am not convinced that it would be helpful to extend the remit of the funding council in this way. The funding council already exercises considerable power within the sector, particularly in the way in which funding is distributed. OFFA will have the power not only to instruct the funding council to fine institutions if they breach their access plans but also to prevent them charging fees above the basic level in the first place. It would seem excessive and could possibly be to the detriment of all parties involved were these additional powers to be concentrated with those that HEFCE already has. So I am not convinced that this set of amendments produces a solution to the problems which I foresee arising from the proposals.

However, I would urge your Lordships to focus attention on some of the more pressing matters. First, OFFA should have no remit with regard to admissions. As noble Lords will know, that is the subject of two amendments tabled in my name.

Secondly, the regulations under Clauses 31, 32, 33, 34 and 35 should be subject to proper parliamentary scrutiny. The powers to make regulations under those clauses are very wide and should be subject to affirmative resolution procedure. Again, I have tabled amendments on that point.

Thirdly, OFFA should not seek to micro-manage institutions' widening participation strategies, or to require institutions to frame their plans by reference to particular courses of study. My Amendment No. 85A deals with that point.

Fourthly, there should be an appeals mechanism. The noble Lord, Lord Sutherland, has tabled an amendment on that, which I shall certainly support.

There are other issues, too, but those are my four main concerns. They are covered in detail in briefings distributed by Universities UK. But the problem here is that locating OFFA within the funding council would not address any of the problems with OFFA that I have just mentioned. In fact, there are distinct advantages in locating OFFA outside HEFCE. Not least, as the noble Lord, Lord Forsyth, mentioned, it will allow us to keep an eye on the running costs. That is an important point. But I urge noble Lords who have supported this amendment to reconsider.

Lord Sutherland of Houndwood

I, too, regret that I cannot support the amendment. I see its point and merit. I want to stress a point made by the noble Lord, Lord Forsyth, and the noble Baroness, Lady Warwick—the issue of scrutiny.

HEFCE does not hold its meetings in public. I declare that I was a member of HEFCE and I have the highest regard for the rigour with which discussions take place. But to put OFFA under the umbrella of HEFCE would to some extent obscure what was going on. That is why I prefer to support later amendments which stress the importance of public access to what is going on and public discussion of how this body is funded and carries out its business.

Baroness Lockwood

There are a number of amendments on the subject of OFFA. It is difficult to know where to speak on the different aspects. I seek greater clarification of the respective roles of OFFA and HEFCE. Subsuming the widening of participation responsibility into OFFA from HEFCE will make it difficult for OFFA to be a distance organisation. In other words, if it enters the whole question of widening participation, it must use its powers in relation to that matter, which HEFCE does already.

There are two aspects on widening participation. First, there are those highly qualified A-level students who may or may not receive a fair deal in getting into the so-called top universities. That question was raised in the press today in anticipation of the report which I understand will be published in a month's time, indicating that the state system is not getting its fair share of places in top universities.

OFFA could carry out that role because it would not involve interference with the policies and programmes of universities.

On the second aspect of widening access, we are talking about a different group of young people. They are young people from lower social backgrounds who are not motivated to go into higher education. Some of HEFCE's work has been to support and fund strategies which universities are adopting in order to widen that access and to try and motivate those students at a younger age to have higher expectations of themselves and to work to get qualifications that would enable them to enter universities.

4.15 p.m.

HEFCE has considerable powers in relation to funding. It funds strategies which relate not only to what universities do as single institutions, but also to the way they work with other educational organisations, with the LSC and even with employers, who are providing possibilities for study in places of employment. That is a much more detailed approach than surely OFFA could undertake if it were to accept the responsibility of widening participation.

I should like the Minister in her reply—and perhaps this would be done better in response to later amendments—to tell us where the responsibilities of OFFA will begin and the responsibilities of HEFCE will end. Otherwise, I feel that we are not going to have a straightforward arm's length position from OFFA and the funding provided by HEFCE will become somewhat blurred as to its purposes.

Baroness Warnock

I strongly support what the noble Baroness, Lady Lockwood, has just said. There has been a tremendous confusion between two groups of people from state schools, some of whom—as reported in today's press—are not going to the top universities because they did not apply. I think that that is one set of problems.

There is a quite different set of problems which comes down to how people in the state system are prepared for higher or further education. It addresses a different problem and is about a different group of people. Can the Minister in her reply clarify in very simple terms—because I find myself totally confused—how OFFA can be said to have no influence on the admissions policy of universities if its remit is to widen access?

I think I am being very stupid about this, but I simply cannot understand how those two things are compatible. So I should be very grateful if the Minister could say something about that.

Baroness Carnegy of Lour

We all appreciate that whatever the noble Baroness is, she is certainly not stupid. She has made some very important suggestions without making them too clearly. I am sure the Minister can read what she says.

I agree with the noble Baroness, Lady Warnock, that the noble Baroness, Lady Lockwood, put a very good case. It seems to me she was in fact perhaps talking in favour of the amendment, because she was saying that the funding council to a great extent is already doing that which OFFA will do.

I do not speak with the deep knowledge that noble Lords have of exactly how this system works, but it seems to me that the noble Lord, Lord Sutherland, said something very important. He said that the world needs to know what OFFA is doing. It needs to know what OFFA is up to because it is going to be absolutely critical to whether the Bill works or not. It is, to my mind, much the most dangerous part of this Bill. In the end, I suspect the Bill may sink because of it. It is a tragedy that OFFA is in the Bill. If it is going to be there, we need to know what it is up to. I originally argued, at the meeting with Universities UK, that perhaps its function should be subsumed in the funding council. I thought then that was a less bureaucratic option. I now think what the noble Lord, Lord Sutherland, has said is very important.

Universities regard OFFA as the political penalty they have had to pay to get the small amount of their funding from the students. That is the simple fact—they felt they had to accept this. It seems to me that it is the duty of this House either to get rid of OFFA or to make OFFA a good deal less dangerous than it otherwise would be, or we really will not have done much service to the nation in respect of this Bill. It is the crux of the matter. With regret, I cannot support the noble Baroness's amendment, although I think I would have done so a week or two ago, and I am sorry about that.

Lord Quirk

I also began by thinking that whatever role OFFA eventually had it would be better to have it subsumed under HEFCE. Like others, I have also come to the conclusion that that was wrong and that OFFA should be set up independently if it has to be set up at all, if only so that we can keep an eye on it better.

One of the objections I raised at Second Reading to the existence of OFFA was the danger of "mission creep", and I still see that as a major danger. As has been pointed out by the noble Baroness, Lady Warnock,inter alia, if the job is to widen access, then OFFA can, quite legitimately, see widening access as narrowing access to other types of student coming in to university.

We have seen today the further attack upon independent education in this country, but there is another major area where universities like to recruit and have the freedom to recruit, and have the financial necessity to recruit—overseas students. With some institutions, the number of overseas students—that is, full-fee students, I am not talking about EU students—represent fairly hefty percentages. The Government have repeatedly assured me, when I have brought this up with individual Ministers, that that is not the intention of the role of OFFA. I fully accept that that is not the intention, but it is none the less a logical development of OFFA. I would therefore like an assurance—not necessarily on the face of the Bill, but at least inHansard—that the universities will not be penalised if, as penury increasingly hits them, they increase the proportion of students coming from full-fee paying clientele.

Lord Eatwell

The noble Baroness, Lady Sharp may be pleased to know that I support her amendments. I do so for four reasons. First, her set of amendments will save a substantial amount of money—something that has not been referred to in a sector that everyone admits is desperately under-funded. It is surely obvious that the creation of yet another regulator will involve a substantial diversion of resources away from teaching and research, support of students and new outreach programmes, and toward the maintenance of a new bureaucracy in OFFA itself and in the universities responding to OFFA. Suppose, for example, that we accept the Government's figure that OFFA will cost £500,000. Then let us suppose that each university employs just three new people to deal with relations with OFFA. This costs each university a modest £100,000. Given that there are 130 universities, that means for the sector as a whole, costs will rise by in excess of £13 million, excluding the cost of OFFA itself.

I am sure my noble friend will be aware of the recent report of your Lordship's Select Committee on the Constitution on the regulatory state. Page nine of this report states that, The recommendations of the Better Regulation Task Force (BRTF) that regulators should produce Regulatory Impact Assessments (RIAs) on all new major policies and initiatives has been accepted by the Government and should be applied throughout the system. Could the noble Baroness outline the regulatory impact assessment—particularly its impact on the universities—when she replies? Can she also tell us whether any independent bodies, such as the Audit Commission, have assessed the cost of the creation of OFFA on the university sector as a whole? So the first reason I support the noble Baroness is that her amendment will save a lot of money.

Secondly, exactly the same goals can be achieved by her amendments. Great note should be taken of the quotation which she read from my right honourable friend Mr Alan Johnson in Committee. What did he say? Let us consider what the noble Baroness repeated for us: we do not expect universities to do anything differently from what they do now. If universities are not expected to do anything differently, what is the role of this institution? Then Mr Johnson said, they will produce the same pieces of paper that they currently produce—no extra paper will be going to Bristol.".—[Official Report, Commons Standing Committee H, 2/3/04; col. 379.] That is, the essential tasks are already being performed by HEFCE. If that is the case, exactly the same goals can be performed by HEFCE and by the noble Baroness's amendments.

The third reason that I support the noble Baroness—which I regard as the most important—is that I think it is an enormous mistake to create a regulator with such a narrow remit. The Government tell us that OFFA will not have anything to do with admissions, but will concentrate solely on widening the pool of applicants. That is a very important task, but it is but one task and a very limited one. Creating a new regulator for this new task will have one over-riding consequence—the regulator will be looking for things to do. As the noble Lord, Lord Quirk said, there will be mission creep. Like all bureaucracies since time immemorial, it will create things to do. It will demand new surveys, it will continually redefine its terms of reference to make more work, and it will impose ever more elaborate work on the universities. This is exactly what we have already experienced with the TQA. We have already seen this happen in that earlier regulatory disaster that was imposed on the universities. Exactly the same thing will happen with OFFA. It is far better that the role of monitoring access plans should remain where it is now in HEFCE—an institution that already has a very wide range of work to do and will not need to find extra work to justify its existence.

My fourth reason for supporting the noble Baroness is that I reject the argument—which I know has been made by many noble Lords, and I have listened very carefully to what they have said—that there is a need for some independent director of access outside HEFCE, and that independence is itself important. The only argument I really heard for this was the noble Lord, Lord Forsyth, saying that it would be easier to abolish the organisation. I am not a betting man, but I am quite willing to take a substantial bet that this organisation will not exist in five years' time. I believe that this notion of the need for independence is a spurious argument, and one contradicted in the Bill itself. After all, the Bill requires HEFCE to impose various conditions of grant with respect to the setting of fees. How is that in any way different from the conditions of access plans? If HEFCE is perfectly capable of making assessments and imposing financial penalties on such a controversial and complex issue as fees—and many other aspects are monitored by HEFCE—why is it incapable of making assessments and imposing penalties on the issue of access plans?

By supporting the noble Baroness's amendments, you can save money, you can do the same thing, you can stop mission creep and you can ensure that HEFCE can continue to monitor access procedure, which it already does very well.

4.30 p.m.

Lord Phillips of Sudbury

I can say only that the noble Lord, Lord Eatwell, put a good deal better than I would have done what I was poised to say when he leapt to his feet. I am slightly baffled by the noble Lord, Lord Forsyth, and the main strand of his opposition to my noble friend's amendments, which seems to revolve around the potential danger of the whole proposal about widening access if we have an independent body, as compared with keeping the function within HEFCE. The normal argument would work the other way. If one is anxious about a body taking over a function and purpose that one is against, the odds of that happening if one creates a body specifically and only for that purpose are much greater. It comes back to mission creep, as mentioned by the noble Lord, Lord Quirk.

Lord Forsyth of Drumlean

An argument that I did not mention might help the noble Lord. HEFCE is the funding body; therefore the leverage and power that it can apply in pursuing its interfering practices is greater.

Lord Phillips of Sudbury

That is a fair point, unless we adopt a variant of what I think the amendments tabled by the noble Lord, Lord Sutherland, are designed to achieve; namely, that if the widening of access remains with HEFCE, that aspect of its functions should have the public transparency and openness for which the noble Lord hopes. There is no reason on earth why that should not prevail within HEFCE.

I am also influenced by the extraordinary remarks of Alan Johnson in the other place. It makes all my antennae wobble furiously when we have a Minister saying, "There's absolutely no purpose in setting up this organisation, so we're going to set it up". If that is not a prelude to mission creep, I do not know what is. My noble friend's amendments serve the purposes of those on the Conservative Front Bench and of a number of other speakers rather better than they think.

Lord Dearing

Once upon a time I was the chairman of the Polytechnics and Colleges Funding Council, and then of the Higher Education Funding Council. Then they merged into the Higher Education Funding Council for England. It is a rather heavy job to be a chief executive, or even the part-time chairman, of such an organisation, and I am worried, first, about whether they could devote the time and thought necessary to this very sensitive issue. Secondly, I worry about the concentration of power. I always worry about that when there is not the clearest of accountabilities. Thirdly, I agree with the noble Lord, Lord Forsyth, about on-the-spot accountability. For those reasons, although I am clear that HEFCE could do the job, it would be safer and better to have a separate organisation.

Lord Hannay of Chiswick

I am one of those repentant sinners who started thinking that HEFCE was the right place, but have now been convinced that it is not, as said by the noble Baroness, Lady Warwick. The clinching reason for me was that given by the noble Lord, Lord Forsyth—risk of contamination between the role of HEFCE as the dispenser of very large sums of money to the universities and its remit on widening access. I cannot support the amendments. It is absolutely fundamental, however, that the distinction between OFFA's activities in respect of applications and its non-activity in respect of admissions should be clearly established in the Bill. There are amendments designed for that, and I shall support them.

I slightly contest the view that the provisions are a kind of Faustian pact. I am not worried about Faustian pacts between the Government and their Back-Benchers in the House of Commons; that is nothing for consenting adults to worry about. However, I am worried about the suggestion that the universities are entering into a Faustian pact. They are not; they do not for a minute dispute the strategy of widening access. The university with which I am concerned spends a great deal of time and effort attempting to widen access. The universities will continue to do so, OFFA or no OFFA.

The provisions do not cause us any serious worries so long as the distinction between applications and admissions is made clear beyond peradventure. I hope that the Committee, with the co-operation of the Government, will bring that about.

Lord Sutherland of Houndwood

I apologise for speaking again on the topic, but the arguments put forward in favour of the amendment are very good arguments for having no OFFA at all. If that were the proposal, I would be with it. To put OFFA under HEFCE does not in any way guarantee that there will not be mission creep, additional bureaucracy imposed on universities, or additional costs for universities. Consider, for example, the research assessment exercise, which is very significantly under the funding councils. It has increased the bureaucracy on universities dramatically, year on year. I thoroughly accept that there are attempts to slim it down, but the exercise did not have the beneficial effect suggested. Full-time people are employed, certainly at universities, to deal with the research assessment exercise as an additional cost.

Lord Lucas

I am very grateful for that speech. I was getting quite close to agreeing with the noble Lord, Lord Eatwell, for the first time in 12 years, which was a worrying experience. However, I frequently agree with the noble Baroness, Lady Warnock. I want to amplify what she said in rather less delicate language. Those who think that there is a difference between widening the pool of applicants and admissions criteria are living in cloud cuckoo land.

We should look at some of the problems with access at the moment. In order to read architecture at Cambridge, when someone applies for admission they have to show a wide knowledge of architecture. That is a very clear set of prejudices against anyone coming from inner-city Manchester who simply happens to think that there is something inspiring about the built environment; they may never have come across architecture textbooks on the reading list compulsory even for consideration by Cambridge. That is an admissions criterion. If we want to widen the pool of applicants for architecture at Cambridge, we have to change the admissions criteria.

If we want to get people from comprehensive schools to study more languages at our great universities, we have to offer courses that have rather more relevance to the modern world than some of those offered at Oxford and Cambridge. The whole question about why people do not apply to the great universities, particularly those popular with pupils from independent schools, has to do with the courses that they offer and the admissions criteria that they put in place.

We will charge students large sums of money, so why do we say, "You have to take three years to do this degree. We will teach you for six hours a week, but we will make you stay here three years"? There would not be any problem at all, except for a little more work for academics, in compressing most degree courses into two years—apart from the fact that students would have much less fun. People from backgrounds in which they want to get on with life and work, whose priority is not faffing around playing sport, drinking or whatever else might take their fancy, might like to have access to two-year courses at the great universities. If they are not offered, that affects the pool of applicants for those universities.

We cannot separate the business of applications and the policies of the university when it comes to admissions and the courses that it offers. I oppose this creature because it is inevitable that it will reach out into the guts of a university—what it does, what it offers, and the terms under which it allows pupils entry. If that creature is to influence fair access, that is what it has to do. The only sensible relationship between a university and a government on the matter is one of a conversation of equals. For universities to lie prone on their backs, waiting for the eagle to tear their liver out, is a terrible shame.

Lord MacGregor of Pulham Market

I had not originally intended to participate in the debate, but it has become rather a Second Reading debate on OFFA, so I want to express my views in response to some of the points made.

As a member of the Constitution Committee that produced the recent report on the regulatory framework, I entirely agree with the noble Lord, Lord Eatwell, that there should be a clear regulatory impact assessment for the regulator. One should take into account the impact on the universities, not just the costs of setting it up. If it is set up, I hope there will be post-introduction impact assessments to see how it is worked out.

I also agree on the point about an appeal. We shall be coming later to the amendment in the name of the noble Lord, Lord Sutherland. That too is an issue to which we in the Constitution Select Committee drew attention. Our experience of the evidence we took of other regulators was that that was a highly desirable feature of a regulator now with the power that regulators have. We shall return to that issue later. I accept entirely the point about mission creep, but not just mission creep. It is the pressure from outside on regulators to move into other areas. I can envisage what will happen here because I have seen it happen in other bodies which to some extent I have been responsible for setting up. Outside pressures either from government, the media or pressure groups urges such bodies to move into other areas.

There is a danger that new regulations may come from the Government on what OFFA might do. They might be in response to other pressures from those who want to see OFFA moving from access into admissions. As the noble Lord, Lord Eatwell, pointed out, it is a narrow remit. It would be tempting to anyone taking on that role to wish to expand his remit as time goes on. I agree with all the points that he forcefully made, but that led me to the same conclusion as the noble Lord, Lord Sutherland, that we should not have that body at all.

All the vibes I get from the universities indicate that they did not want the body either but felt that they had to accept it as a political compromise for the tuition fees that they wanted. The danger is that, as the noble Lord, Lord Sutherland, properly pointed out, it is for the universities to deal with wider access, which they are doing anyway. Anything in that area can only further compromise the independence of the universities in that regard, about which I feel strongly. For the reasons given by the noble Lord, Lord Eatwell, I am with the noble Lord, Lord Sutherland, and not the amendment. He put the points very well.

Baroness Ashton of Upholland

It is always difficult to respond to a Second Reading debate on the third day of Committee, so noble Lords will have to forgive me if I restrain myself. I shall pick up some of the points noble Lords have made about future amendments, assuming that they will not make them again as we reach those amendments.

It is important that noble Lords have had the opportunity to wrap up their comments in that area so that I have the chance to respond to them at the appropriate time. I am grateful to the noble Baroness, Lady Sharp, for setting out in great detail the specifics of her amendment, which means that I do not have to do so.

I shall begin by saying to the noble Lord, Lord Lucas, and the noble Baroness, Lady Warnock, that we shall be looking later, without heralding too much, at amendments concerning admissions. I am categoric in saying that there is a big difference between applications and admissions; they are not the same thing. If one happens to live and go to a particular school in the beautiful city of Manchester, which I know and love well and which has some of the greatest architecture in the country, one is capable of reading the books and understanding the beauty of architecture wherever one goes. What matters is that one has the opportunity to get the hooks and to understand how to do that.

That is a combination, as I have said repeatedly, between the best of the education sector being able to provide for such young people and universities in their outreach talking about the joys of coming to university to study architecture. That is an appropriate and proper coming together of those two matters. but it is different from admissions, which we will talk about. I did not want Manchester to be attacked on the way.

We thought carefully about whether we should introduce a new body into the legislation and in particular whether the role could be carried out by HEFCE. As noble Lords have said, HEFCE is capable of carrying out that role, but we thought that a separate body was the right approach for a variety of reasons. I am reluctant to rehearse them all again because noble Lords have indicated them, not least the noble Lord, Lord Forsyth, in his description of the wider role of HEFCE and the role of the Secretary of State in terms of the relationship between government and HEFCE, which is different from that proposed for OFFA.

The clear distinction between the two bodies is that HEFCE is primarily a funding body and OFFA is a regulatory body. We were concerned that if HEFCE undertook the role of the regulatory body, it might find itself in a conflict of interests. The responsibility towards the financial health of the sector is critical. Perhaps HEFCE could one day be asking itself whether the activities it funded which were carried out according to its guidance were adequate to justify charging higher fees, particularly if it knew how acutely an institution was in need of extra resources.

4.45 p.m.

We think that those are important reasons why it is critical to have the two bodies separate. But we have said that in doing so it is important that we do not duplicate the resources within HEFCE that could be of value to the director. We have said that we do not want cumbersome new bureaucratic machinery and that we expect it to cost about £5,000 per year, as noble Lords have said. We hope that we will obtain the best of both worlds, with the director making use of HEFCE's staff and its systems but with a remit to make clear and independent decisions.

My noble friend Lord Eatwell raised the regulatory impact assessment. There is a copy in the Library. It was published in January 2004. I agree entirely with him that it is important—and the Government have accepted this—to carry out a RIA assessment on all aspects of policy. As a Minister I certainly do so and I know that my colleagues do, too. My noble friend asked me specifically about the cost to the university. The assessment says that compliance costs will vary according to the institutions' progress in widening participation and the needs of their students and potential students. Institutions will know OFFA's expectations in advance and will be able to plan accordingly.

Lord Eatwell

Will the Minister tell me what monetary assessment is placed on the first year's compliance costs?

Baroness Ashton of Upholland

I cannot say offhand, but I shall ensure that I get that information to my noble friend through the RIA work and that other noble Lords receive it.

The noble Lord, Lord Quirk, talked about overseas students and admissions. OFFA has no role in admissions. Students are not in any way affected by OFFA's role, nor would we wish them to be. I hope that that deals with that question categorically.

We expect over time that the director will become a centre of expertise on safeguarding access to higher education and through working with HEFCE we will expect a wide dissemination of information. It is important for the regulatory role of the director to be paramount.

An annual report to Parliament will be vital in tracking the effects. I know that noble Lords have made the political point about this being some kind of trade-off across the Back Benches. It is important when we make such a major change in our relationship with the universities and the way in which people charge that we make some effort to consider the consequences, hence the commission three years later. We are clear that we want to ensure that students apply to universities and recognise that they can and should apply to all the institutions where they are capable of being accepted.

We do not see this as a trade-off. We see it as something for something and part and parcel of the kind of university sector we want to see in place for the future. A number of noble Lords made reference to my right honourable friend Alan Johnson's quote from Committee. As I understand it, he was referring to the fact that access plans will subsume widening participation strategies. We shall be changing the number of plans that are produced, but they will be different in nature because they will be written for OFFA.

I hope that that gives a general picture of the approach we have taken. We believe that it is important for OFFA to have the right kind of relationship with HEFCE and for it to be a small office that will not have mission creep. We will come to amendments that other noble Lords have tabled later in our discussions on OFFA, but it will be clear in its remit. It will be playing a regulatory function, which we believe is important as part of the future of higher of education. On that basis, I hope that the noble Baroness will withdraw the amendment.

Baroness Sharp of Guildford

I am grateful to all noble Lords who participated in the debate, particularly the noble Lord, Lord Eatwell, for his vigorous support of my amendment. The central issues we are debating—as the Minister indicated, to some extent it has been a Second Reading debate—are the two models on offer in the Committee today. One is my model of putting OFFA within HEFCE and the other is of leaving OFFA as a separate institution but drawing its teeth. We shall proceed now to see whether we can draw its teeth.

I always maintain, and shall continue to maintain, that the functions that we are going to give to OFFA are carried out at present by HEFCE. I take on board that the Minister says that HEFCE is a funding organisation and OFFA is a regulatory one, but if ever we talk about mission creep, it is about the mission creep that has already taken place within HEFCE.

I was stirred by the words of the noble Lord, Lord Lucas, who talked about OFFA being a creature which will reach out and grab you in your guts. That may be the case. If we think about ways in which to tame that creature, it is arguable that we could tame it just as well within HEFCE as we could if it were a separate organisation.

I also take on board the point made by the noble Lord, Lord Sutherland, and others, who said that, by setting up OFFA as a separate body, one creates greater transparency with regard to what that creature that grabs your guts is doing. There is therefore some advantage in terms of transparency and accountability in setting up such an organisation separately. As mentioned by the noble Lord, Lord Forsyth, it also has the advantage of being easier to abolish.

Nevertheless, as we discuss the amendments this afternoon, I think that we need to question very hard whether it really is necessary for OFFA to be a separate body. It does, and will, cost a lot of money. Do we really need it? Those are real questions. I shall read again what the Minister and other noble Lords said and we shall undoubtedly think further on these matters. However, in the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 59 to 61 not moved.]

Clause 28 agreed to.

Clause 29 [Director of Fair Access to Higher Education]:

Baroness Perry of Southwark moved Amendment No. 62: Page 14, line 4, at end insert "who shall be subject to the guidance of the Civil Service Commission

The noble Baroness said: In moving Amendment No. 62, I shall speak also to Amendments Nos. 64 and 65. The amendment provides a very different vision of what OFFA could be, although I admit that my heart lies largely with much of what the noble Baroness, Lady Sharp, said in relation to her amendment and her wish to get rid of OFFA altogether. Privately, I hope that the noble Lord, Lord Eatwell, wins his bet and that OFFA disappears in five years' time. I am sure that we would all be very happy to see that happen. In the mean time, we shall live with what I am sure is a necessary part of the total package of the Bill, but our vision of OFFA is very different from the vision provided by what is now on the face of the Bill.

Our vision is of a director who is politically independent, who has no remit in individual institutions and has none of the negative enforcing powers but who has a role in genuinely enhancing and adding value to the efforts to promote fair access that universities are themselves making. Later amendments will deal with those other issues. This group of amendments concerns the political independence of the director of OFFA and makes that post into a Civil Service post—a servant of the Crown, appointed through the Civil Service Commission and paid out of the parliamentary vote with pay and conditions according to the Civil Service rules. For such a key post, we feel that that political independence and integrity is absolutely essential.

I was very struck by an interview with the noble Baroness, Lady Prashar—our first Civil Service Commissioner—in the press at the weekend in which she described the importance of the involvement of the Civil Service Commission in public appointments of this kind of seniority. She said that, we are custodians of the civil service core values of integrity and honesty. We also ensure that it remains impartial—that there is no political patronage".

I should like to see the director of OFFA in exactly that kind of role—independent of any political interference or political choice. I should like to see a director of OFFA who is neither a creature nor a crony of the Secretary of State. On the face of the Bill at present, the director will not be independent in that way. She or he will be appointed by the Secretary of State and will take directions from the Secretary of State, and his or her pay and conditions will be determined by the Secretary of State. I do not believe that that is right.

As other noble Lords said earlier, tradition has rightly insisted on an arm's length relationship between government and universities. These amendments take a step in that direction by ensuring that the director is a servant of the Crown and is independent in that way. We are making no change to the reporting mechanism. We recognise that the Secretary of State will need to report and answer to Parliament for what is happening in this area, and we accept that. However, we do not believe that the crucial appointment of the director should be subject to any political influence whatever. I hope that these amendments will go a long way towards ensuring that. I beg to move.

Lord Sutherland of Houndwood

I support Amendment No. 62 and, consequentially, Amendments Nos. 64 and 65. To extend the metaphor that the noble Baroness, Lady Sharp, developed with great skill, teeth are here, and if Jaws is alive and well in the cool water of academe, perhaps drawing some teeth is an important consequent. If we are to have a regulator, we must make two consequential decisions that are absolutely fundamental.

First, as the noble Baroness, Lady Perry, pointed out very well, the independence of the appointment is critical. This individual must not be conceived to be, be seen to be, be thought to be or actually be an extension of any political office. He or she must be someone who speaks with independence. Equally, there must be independence in the manner in which the duties are carried out, and those duties must be subject to independent scrutiny. The two consequential amendments—Amendments Nos. 64 and 65—as well as much that will come later, suggest a way of ensuring that that scrutiny can take place.

I have been a regulator and I was reassured by the independence of my appointment—indeed, it was a Crown appointment. I had very good relations with both Secretaries of State, but that was because the basic independence was there in the first place. I have resisted bullying from political advisers both pre and post-1997. It does happen. Again, unless there is independence both in the manner of the appointment and in the way in which reporting is carried out—and, indeed, in the financing of the appointment—there will be consequential risks. Therefore, the amendments are tabled on the assumption that, if we are to have such a post, we must watch very carefully how it is set up and how the duties are carried out.

Lord Lucas

I find this image of the access regulator much more comforting than either the one posed by the noble Baroness, Lady Sharp, or the one posed by the Government. I do not think that one should downplay the power of a person who has the power of publicity, the power of advice and the power of knowing that, if he is ignored, the Government will do something to ensure that whatever obstacles are placed in his path are removed. Over the past few years, we have had many examples of legislation being set out in that way, with the Government setting up or endorsing something which is advisory, voluntary or supportive with the clear understanding that, if it fails, regulatory action will follow. There is no particular reason why, in setting out the functions in this Bill, we should not make it clear that the powers of enforcement will not be brought into effect unless they turn out to be necessary because due progress is not being made. There is certainly no reason why we cannot build in a concept of independence.

A regulator like that should be capable of ranging much more widely. After all, if all one is offering is advice, there is no reason to keep him out of areas of university life, out of decisions being taken in universities or out of the way in which universities are being run, because all he can do is offer advice. It is not a matter of outside direction, but of someone being able to see the whole picture, so that what is done in universities to improve access for everyone is viewed in the round. It is not as though there are separate pots, one called "access", another called "admissions" and another called "the courses we offer", including all the other support arrangements that take place in and before university. If we have someone who is independent and whose powers are in abeyance, we shall have a much more effective regulator. We shall have to wait to see whether such a matter will go through the other place.

5 p.m.

Baroness Carnegy of Lour

My noble friend should read precisely what is to be done by the regulator before he concludes that the regulator is there only to give advice. He will actually regulate. All kinds of things can happen to universities, including being fined if they do not do what they are supposed to do. He will accept the terms and so on. I believe that he will be in a much stronger position.

I rather like the idea of such a person being reinforced in his or her independence by being a civil servant. That may help, not that I have observed civil servants always being impervious to the will of Ministers. The way in which they react to Ministers is different from the way in which a regulator, appointed under the Bill, will react, as the relationship will be different. I rather like the idea, but I shall be interested to hear what the Minister has to say about this matter. It is an interesting proposition.

The Lord Bishop of Portsmouth

This is not the kind of amendment over which I shall go to the stake, but it merits careful consideration. Whatever the colour of the government in power, the independence of the post is very important.

Lord Forsyth of Drumlean

On a number of occasions when a Minister I recall that the view of my noble friend Lady Carnegy was that Ministers were too inclined not to be impervious to the views of civil servants. I welcome these amendments and congratulate my noble friend Lady Perry, not just on this amendment but on the group. The Minister will be relieved to hear that I do not plan to talk to the later amendments, but it is important to see them as a package. It is clear that what is being done here is to give a degree of independence to the regulator, which must be worth while.

I apologise that I keep taking pot shots at Universities UK, but I was struck that the noble Lord, Lord Hannay, said that there was no Faustian pact between the universities and the Government. I read the briefing from Universities UK which says on this amendment: This amendment, together with a package of consequential amendments to Schedule 5 seeks to make the Director of OFFA a crown appointment. This would impose constraints on the Secretary of State's power to influence the Director of OFFA and influence the mechanism for appointment. The Director would be directly accountable to Parliament". That sounds a good idea, but the rest of the briefing goes on to reject the amendment for reasons with which I shall not weary the Committee.

It is apparent that a deal has been done, which, in terms, is even referred to at private meetings, whereby universities feel that they cannot upset the position in the Bill with respect to the regulator. I do not believe that there should be an OFFA at all, but I recognise that it is in the Bill and that the Government are the government and I believe that this amendment from my noble friend has merit. No doubt the Minister may say that there will be other ways of achieving the end, or whatever, but the key matter is independence. Certainly, Universities UK seems to think that the amendment works in terms of its intention. I certainly welcome the spirit behind it and agree with the points made by the noble Lord, Lord Sutherland. Independence and accountability have to be the hallmark of the regulator and that hallmark needs to be stamped on the bottom of the Bill.

Lord Triesman

From the outset I share the thought that the critical issue is independence. The right reverend Prelate made the point in a few words and it is at the heart of many of the contributions to the debate. I shall deal with that point in talking to the amendments. Many of the other issues, as the noble Lord, Lord Forsyth, has said, will be raised under other amendments and are probably best dealt with later.

I fear that these amendments, as tabled, are unlikely to achieve what I believe have been the expressed concerns of noble Lords, in particular the noble Baroness, Lady Perry. I agree that everyone is rightly keen to ensure that the Director of Fair Access is not subject to government control in the way that he or she is appointed and carries out the task that has been assigned. I wholly share those concerns and I hope that what I say illustrates why the Government have chosen to go in one direction when it is true that other directions were not impossible.

Amendments No. 62, 64 and 65 as tabled would make the Director of Fair Access into an organisation staffed by civil servants and directly funded by Parliament. The normal implication of that, taken as a whole, would be to create a new non-ministerial government department and I do not think that that is what everyone wants. It is likely that a body of that kind will be disproportionately bureaucratic for the size and role of the Director of Fair Access and indeed, from the discussion that we have had, I am sure that that is not the intent. No one is trying to build a bureaucracy. I see noble Lords shaking their heads with some grief that that may be the outcome.

I shall seek to offer reassurance to the Committee that the Director of Fair Access will indeed be independent. That is the test that I want to apply. In thinking about creating the Director of Fair Access a number of organisational possibilities were considered. We were advised by the Cabinet Office that an executive non-departmental public body was the right structure for the director, as we envisaged it, because it would be a small, focused, regulatory body.

The executive non-departmental public body model is a commonly accepted means of dealing with such a conundrum. Government often need to create organisations that will act independently and in the public interest, but which also need public funding and ultimate accountability to Parliament. Regulatory bodies are classic examples: the Office of the Rail Regulator, for example, or the Commission for Racial Equality.

Therefore, there are standard and recognised models and rules that govern how those who run NDPBs are appointed and their relationship with their sponsor departments. We have based the principles on which the director will be established around those key principles. On the appointment of the director, for example, Clause 29(2) provides that the appointment will be made by the Secretary of State. However, as an NDPB, the appointment is subject to the code of practice of ministerial appointments to public bodies, which is overseen by the Commissioner for Public Appointments.

I hope that noble Lords will bear with me for a moment while I cite the guidance that Dame Rennie Fritchie has expressed as being the underpinning of the work that she carries out in that regard. It is a useful description of someone who I believe we all feel has exercised the functions with a great deal of innovation and originality and total independence. I quote her briefly: My task is to ensure that all government departments have systems for public appointments which are visible, fair and open. Further, that all appointments within my remit are made on merit and contribute to the development of strong and balanced boards and public bodies. I believe that having visible, fair and open systems is fundamentally important. However I also believe that public confidence in the process is paramount and that one cannot stand without the other. This requires constant and consistent effort by a wide range of people to deliver this goal". That seems to have the watermark of Dame Rennie Fritchie's approach to those matters.

The code that will be used was developed precisely to ensure that some core principles were followed in public appointments. Those principles are listed in the code. with which I know Members of the Committee are very familiar. In a nutshell, the key elements of the code are: that all public appointments should be governed by the overriding principle of selection based on merit; that no appointment will take place without first being scrutinised by an independent panel, or by a group including membership independent of the department filling the post; that the principles of open government must be applied to the appointments process; and that those appointed must be committed to the principles and values of public service, and perform their duties with integrity.

Ultimate ministerial responsibility for appointments is exercised in accordance with those principles. Departments are responsible for ensuring that the principles are followed in actual recruitment exercises—

Lord Forsyth of Drumlean

I am sorry to interrupt the Minister. Is an executive non-departmental public body, which is how he described OFFA, the same thing as what we used to call an executive quango? If so, is that not a league away from an appointment made by the Civil Service Commission; for example, that of the chairman of the Crown Estate? The Minister appeared to dismiss my noble friend's model by suggesting that that would create a government department that equalled a bureaucracy. Surely there is a distinction between a quango and an appointment made by the Crown?

Lord Triesman

I will outline in more detail the distinction made earlier. I certainly do not intend in any cavalier way to dismiss the propositions, because they should be weighed seriously one against the other. I find it difficult to answer the noble Lord's question about whether it was what he used to call an executive quango because I am not sure what he used to call an executive quango.

Lord Forsyth of Drumlean

I am grateful to the Minister. I used to call an executive quango what the Civil Service called a non-departmental public body, large numbers of which the noble Lord's party pledged to abolish when it was elected in 1997.

Lord Triesman

If the noble Lord is in the happy position of having to find both ends of the equation, no doubt his definition will be accurate in his own terms. I do not know whether it will help us greatly in this debate.

The principles that we want to follow in appointing the Director of Fair Access are very similar to those used by the Civil Service Commission for appointing civil servants, but they are adapted to the fact that appointees to NDPBs—whether or not some call them executive quangos—are not to be civil servants. They will not, for example, owe a duty of loyalty to the Government. The important principle is that the Government should not have that degree of control.

Amendment No. 64 would make the Director of Fair Access and his or her staff servants or agents of the Crown. That status for the director and staff is incompatible with an executive NDPB, the status that we envisage as most appropriate for the director. If the director and staff are to be servants or agents of the Crown then the organisational structures within which they would normally operate will be a government department. I wish to make the distinction about why the choice was made. It was not the Government's preference, because we believed that whoever was responsible for approving and monitoring access plans must be independent of government and of higher education institutions.

There was the option of a non-ministerial government department akin to Ofsted. Other such examples include the Inland Revenue and the Office for Fair Trading—large and complex organisations with broad remits. Although that option certainly offers the necessary independence from government and institutions, it would involve the kind of organisation that I described as a disproportionately bureaucratic way of organising the very targeted function that we expect the Director of Fair Access to perform. It has been the will of the Committee in the debate so far to ensure that it is focused in precisely that way. I have heard no Member of the Committee argue that it should get into any form of drift. I am sure that Members of the Committee would not want all the machinery that goes with a non-ministerial government department.

Amendment No. 62 would mean that the Director of Fair Access was recruited by the Secretary of State but in accordance with the guidance of the Civil Service Commission. The Civil Service Commission guidance applies to the recruitment of civil servants, so the amendment would imply that noble Lords wished the director to be a civil servant. Forgive me for spelling it out, but that would be the implication.

We decided against the director being a civil servant, ultimately accountable to Ministers and with a duty of loyalty to the Crown, and opted instead for a director who was visibly independent of government as the head of a non-departmental public body. I believe that that view will be widely shared by the higher education sector generally. The role of the director is closer to that of the Rail Regulator or the chair of the Commission for Racial Equality than to that of a Permanent Secretary of a government department. We are most concerned that that independence should be completely visible.

5.15 p.m.

Amendment No. 65 says that the director shall be paid out of money provided by Parliament. The director as currently envisaged would be an executive NDPB and as such would need to have a sponsor department. Members of the Committee may be prompted by a concern that direct funding from Parliament would give the director greater independence from the Secretary of State. That has been part of the argument that was put so well. The director will have a duty to carry out the functions within his or her remit in the way that he or she thinks fit. There is no question of the Secretary of State dictating to the director how to go about his or her business; the Secretary of State simply cannot do that. The director's decisions on access plans will be his or her own.

The Government have never intended to interfere in how the director conducts his or her business. We accepted an amendment in another place to remove the Secretary of State's powers to regulate when the director should or should not approve access plans. There are no powers in the Bill to enable the Secretary of State to give a direction to the director. He may issue guidance to which the director will need to have regard and may provide for regulations that are subject to parliamentary approval. But he simply cannot dictate to the director how the functions should be fulfilled.

I hope that that explains why we chose this direction. I accept the argument that it was among different directions in which we could have gone. We chose this direction because we believed that it enhanced the independence to the highest possible extent, and that the selection would be made on the basis of criteria that noble Lords believed essential in the context of other important public appointments. I hope that those reassurances will enable the noble Baroness to consider withdrawing her amendment.

Baroness Perry of Southwark

I thank the Minister for the gracious way in which he presented his arguments but I remain totally unconvinced. The examples that he quoted of non-ministerial departmental bodies vary in size enormously. Just because the two or three that he mentioned happen to be quite large, there is absolutely no reason that there should not also be a small one of the same kind. Let us be innovative; let us show that one can have such organisations without making them large.

I was an HMI in the Civil Service for 17 years. We worked within a government department and were appointed by the Privy Council but we certainly proved ourselves to be totally independent and at times deeply embarrassing to governments of all colours. I see various previous Secretaries of State nodding wisely as I say that. It was occasionally our duty to the Crown so to be. So I am afraid that, from personal experience, I do not find the noble Lord's arguments particularly persuasive. The Minister did well in trying to demonstrate that independence is somehow conferred by the kind of arrangements that the Government are proposing. However, when an official is head of an NDPB, but he or she must take direction, advice and guidance from the Secretary of State, is this like the guidance that HEFCE gets every year, in that it must be followed to the letter, or else? Must he or she have regard to that guidance in everything that he or she does? That does not sound like independence.

I still rest on the importance of the kind of independence that an appointment through the Civil Service Commission gives. We have seen too much in recent times of cronies and creatures of Secretaries of State being appointed to senior positions. I find it very distasteful, whichever party does it. I shall probably return to this with some force at a later stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Perry of Southwark moved Amendment No. 63: Page 14. line 5, at end insert— (4) The Director shall identify and promote best practice in fair access arrangements, and shall provide where he considers appropriate advice and training to institutions on best practice as identified in their reports to the relevant authority and the Funding Councils.

The noble Baroness said: This amendment creates another plank in the vision of what OFFA's role should be. It should in a sense be read together with the opposition, to come later, to Clauses 34, 35 and 36, which shows what many of us believe that OFFA should not be. OFFA should not be a regulatory power that has power to punish people if they do not follow a particular line. I am anxious to say that this vision of OFFA as an office that identifies and promotes best practice and offers appropriate advice and training to institutions on best practice is not in my view a wrecking amendment. We are not trying to wreck the Bill, but we are doing what is proper for this House to be doing; that is, asking the Government and those in the other place to think again about the role of the Director of Fair Access.

I for one welcome the Government's emphasis on fair access. I yield to no-one in my commitment to it—the whole of my career has been in one way or another concerned with providing access. I know how desperately difficult it is to reach out and get applications in from groups that are often alien to the higher education world. I am delighted to know that the Government are committed, through this Bill and through other activities, to improving this situation. I simply do not believe that the way in which universities can be made to redouble their efforts in improving fair access is by punitive powers of regulation and then punishment if they do not meet what they say they will do.

I wish to turn this into a different kind of model, one that genuinely enhances what universities are already doing, and which undoubtedly addresses the deficiencies that I am sure can be found in some recruitment processes. I am not pretending that everything is rosy and that it is a perfect world at the moment. Clearly, not enough is happening, and therefore probably not enough is being done, although I remain of the view that much of what is not being done is not the fault of the universities, but of schools.

Nevertheless, I see a positive role for a small NDPB, a small OFFA, that would provide an analysis of the plans that universities send in as to what they will do; which would engage in dialogue with them as to whether their plans are seen as adequate in the light of other plans; which would identify from those plans good practice and best practice, and make that widely known. Also, crucially, it would provide the necessary training. Certainly, some of the deficiencies that have already been identified in the press and elsewhere could probably be helped by a central body that provided advice and training in the way that is suggested in this amendment.

My noble friend on the Front Bench has referred several times to the Universities UK briefing. I was a little surprised to see that in the UUK briefing on this amendment, it says that it does not support the amendment, because UUK believes that the primary responsibility for widening participation rests with institutions themselves. In that case, it seems odd that the noble Baroness who is the director of UUK has not tabled any amendments, for example, to alter the duties of the director, to promote and safeguard access to higher education, which we support and believe is right.

It goes on to say that UUK has already done much of this work itself—so it has. It has brought out and widely disseminated some excellent publications that identify good practice. UUK could in no way measure up—because it has so much else to do—to the power to read through every access plan of every university and to do a real analysis of those plans, which would rest with OFFA and its director. Therefore, it would be appropriate to follow many of the recommendations of Professor Schwartz's report, to have a body not with regulatory and punitive powers, but with advisory, training and dissemination powers. I beg to move.

Baroness Ashton of Upholland

I appear to be the only person without the Universities UK briefing. I have just managed to snitch a copy from somewhere. I wonder what that says about me.

This is an interesting amendment, because I come at this from completely the other end of the telescope to the noble Baroness, Lady Perry. I accept her commitment, and she is well known for all the work that she has done in supporting and promoting access. The noble Baroness feels that this is a role for the Director of Fair Access, instead of the regulatory function. There is much in this amendment that I can support in principle, but I would say that as part of his regulatory function, the director will inevitably become a source of best practice, because he will learn and know so much about it.

I would be happy to accept this amendment in principle. Inevitably, there are technical issues to do with it, such as the position in Wales. This amendment does not allow for the different position in Wales. As I have indicated, we would see that because of the regulatory functions of the Director of Fair Access, he will gain expertise in this area, and therefore he will become a source of such expertise, in the way that the noble Baroness indicated. With the leave of the Committee and the noble Baroness, I suggest that we take this away, craft a suitable amendment, discuss it with the noble Baroness, so that she can see exactly what we have done, and bring it forward.

Lord Forsyth of Drumlean

I do not wish to delay the proceedings, especially as the Minister is in such a helpful and supportive mood. I am delighted that she did not read the Universities UK briefing, and that she has taken her own counsel on the excellent amendment proposed by my noble friend. It is for my noble friend to say, but I very much welcome the positive response from the Minister. No doubt we can make swift progress as a result.

The Lord Bishop of Portsmouth

Many noble Lords are concerned with the sheer volume of work that is likely to arrive at the door of the adjudicator's office on day one. This amendment, unlike the following one, is not a wrecking amendment. Good practice and training will be vital if the work of the adjudicator is to be effective. I am glad that the Minister will look favourably on it.

Baroness Perry of Southwark

I thank noble Lords who have spoken, and I particularly thank the Minister for her positive reply. I look forward very much indeed to further discussions with her. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

5.30 p.m.

On Question, Whether Clause 29 shall stand part of the Bill?

Baroness Sharp of Guildford

The Question whether Clause 29 shall stand part is linked with the amendments that I moved. I do not wish to speak further to it.

Lord Baker of Dorking

The clause is not necessary. There is no need for an access regulator to ensure that higher numbers of children from disadvantaged areas go to our better universities. That view was expressed a few moments ago from our Front Bench by my noble friend Lord Forsyth of Drumlean.

The phrase "Faustian pact" has been used several times. I presume that, in this Faustian pact, the Secretary of State for Education and Skills is Mephistopheles and has done some sort of deal with the universities. That is not a pact. The pact that has been done is between the Secretary of State for Education and Skills and the Left wing of the Labour Party in the House of Commons. The deal is simple: the Secretary of State has said, "You give me fees, and I will give you an access regulator to open up the ivory towers for our lads". The fact is that their lads have been going to the Ivy League universities in our country in huge numbers for the past 20 years—not in hundreds, thousands or tens of thousands but in hundreds of thousands.

I remember a conversation that I had a fortnight ago with the headmaster of the Landau Forte City Technology College in Derby. I was speaking to him because the chairman of that college, Lady Brigstocke, had been tragically killed in an accident. I asked how the college was getting on. The college was built in the most deprived part of Derby, where educational expectations were zero, 12 years ago. The college now has 90 per cent A to C grades at 16 and a staying-on rate of over 80 per cent at 16. At 18, many students go on to university.

The thing that made the headmaster proudest was the fact that, last year, seven of his pupils had got into Oxbridge. That would have unthinkable. Why did it happen? It did not happen because of an access regulator, and it will not happen because of an access regulator. It happened because the college had an inspirational head teacher and inspirational teachers who lifted the expectations of their pupils and said, "You can strike at the top of the tree. Be ambitious. You don't have to go to a college of further education or one of the newer universities". That is where the change must take place. It must take place in the motivation of pupils and students. We do not need an access regulator for that, and I fail to see why one is necessary.

Today'sTimes covers a report by Sir Peter Lampl and the Sutton Trust. The headline reads: Best universities snub state pupils". The figures show that pupils from private schools with a lower combination of A-level marks got a higher proportion of places than pupils from state schools. The headline was wrong. The article includes Sir Peter Lampl's comments. He said that the reason for the figures was that pupils from many schools did not apply to the Ivy League universities. I am glad to see the Minister nod; I shall suggest how she can spend a little money more sensibly than by setting up the OFFA regulator.

With his own money, Sir Peter provides summer schools for children from deprived areas. He takes them to Oxford, Cambridge, Imperial College, the LSE and many other universities, such as Warwick. He encourages them to apply. He is much better than an access regulator. Instead of appointing an access regulator, the Government should give some money to Sir Peter Lampl for more summer schools, so that we can lift the expectations of those children. That is what we must do. In the words of Browning: Ah, but a man's reach should exceed his grasp, Or what's a heaven for?". That is what the Government should do. For that, we do not need an access regulator.

Lord Rix

I suggest that the Minister goes to seeThe History Boys at the National Theatre, the new Alan Bennett play. In that play, it is only too clear that six or seven boys in the class are going to Oxford entirely because of the thrust and enthusiasm of a very unpleasant headmaster.

Lord Norton of Louth

I support my noble friend Lord Baker of Dorking and am much influenced by what he said. Like him, I cannot see the case for OFFA. There is, perhaps, a misperception on the part of the Government of how much the proposal to create that body is resented. OFFA is seen as an additional burden. It cannot be seen in isolation in addressing a particular problem.

I have made the point before that academics are underpaid, under-resourced and undervalued. What they have in excess is regulation. Over the past 10 to 20 years, a massive regulatory burden has been imposed on the universities. There has been no off-setting increase in resources, and the regulation has been notably inefficient, consuming time and resources to marginal benefit. It may have helped raise standards in some of the less good institutions, but only at the expense of the rest. It has made no substantial impact on the quality of university education. One cannot see the additional burden as something that deals with a particular problem, detached from how academics view the burden that they already have. OFFA is an additional burden and is resented very much by those who work in the universities. It may be that the intention is to have a light touch, but that is the perception. We cannot divorce the two.

Secondly, OFFA will not deal with the problem that it purports to address. I agree with my noble friend Lord Baker of Dorking on that. The real problem is a cultural one, embedded well before pupils reach sixth form and start to think—or not think—of going to university. It is not even a case of persuading schoolchildren from disadvantaged backgrounds to apply to university; it is a case of creating a culture of attainment and of wanting to go to university in their family, well before they get to secondary school. The universities can help—I did my bit this morning, talking to year 10 pupils in a Hull secondary school—but they can only do so much. OFFA misses the point in that respect. If we really want fairness in the system, we must change the system so that applications for entry are made after A-level results are known.

My noble friend referred to the survey by the Sutton Trust, reported in this morning's press, which suggests that pupils from state schools miss out to those from independent schools in admissions. I notice that the Minister of State for Lifelong Learning, Further and Higher Education in another place said that that justified having the director of fair access, but that destroys the point that the noble Baroness was making about the distinction between applications and admissions. The chairman of the Sutton Trust pointed out that, it is not that the universities are biased. They don't really have the data when they make the decisions". It is a consequence of A-level results not being known at the time of application. Offers are made on the basis of predicted grades, and that can give rise to disparities in the system.

OFFA is not the answer. It will not get at the nub of the problem. The director will largely have an impossible task. However hard universities try to encourage applications—the somewhat ambiguous wording of Clause 31(4) appears to emphasise applications—they cannot guarantee that pupils from disadvantaged backgrounds will apply. I appreciate what Clause 29 seeks to do, but this is not the way to do it. If anything, it will generate resentment and, I fear, little else.

Lord Triesman

I think that the noble Baroness sought leave not to speak to the Question that the clause stand part. The Question has not been proposed.

Lord Lucas

The position is that the matter is open to the Committee.

Lord Norton of Louth

What the Minister said is not procedurally correct: it is open to any Peer to speak to the Question that the clause stand part.

Baroness Ashton of Upholland

Then I shall speak to the Question that the clause stand part and on the essence of what the noble Lord, Lord Baker of Dorking, said with such great passion.

I have no difficulty with what both noble Lords said about the role of schools in raising aspirations and about inspirational teachers and head teachers. I agree. However, we know that teachers will tell us how difficult it can be with children for whom it is not part of their culture to think of going to university and in whose family there is no experience of anybody doing it. Such children may not even consider it to be appropriate, as it is not what they and their mates do. There is a deep-seated issue about getting support to some of our brighter young people, and I know that the noble Lords, Lord Norton of Louth and Lord Baker of Dorking, would agree.

We are trying to look at both ends of the situation and, for me, it is not a question of "either/or", but of "both/and". I recognise and accept that universities do a great deal in terms of outreach because they know very well that some of our school pupils do not think of going to university. They have no experience of university, they would not go near a campus, they would not understand either what it was for or was about, and therefore they need the experience. That is extremely important. It is true to say that many universities do great things in this regard, but I would say that some institutions could do more. That is inevitably a truism. I should like my own children to be invited to visit our local university, one that is five minutes down the road from their school but they have not set foot in it. So it is important to ensure that we do more.

I turn to a point made earlier in the debate. It is important to take what will be a very different step in our relationship with universities. It is one which, in terms of the argument about ability, they have welcomed. I know that some noble Lords who represent universities will say that this is "not enough" and "does not go far enough", but it is an important development.

However, it is also the responsibility of the Government to look at the potential impact here. It is not just about the "left wing" of a party; that is too easy to say. Having read the media reports and listened to students and their representatives, it is clear that they are worried about the impact and implications. We have a responsibility to look at both of these issues and be clear about them. We are trying to create a system that gives universities their freedom, but in doing so ensure that they look carefully at the outreach work they do and at the bursaries they provide in order to make sure that the system is working well. Indeed, some fantastic and highly innovative work in this area has already been undertaken by universities like Cambridge.

Baroness Perry of Southwark

I thank the noble Baroness for giving way. There is no argument in the Committee that more could be done and, in some cases, more should be done, or that there is a real problem in attracting applications from people in under-represented groups. All sides agree on those points. However, what concerns some of us and certainly concerns the universities is that the way to make this happen is, according to the Government, by regulation, by punitive powers, by fines and by placing more burdens on universities instead of trying to encourage them.

This is the old story of the carrot and the stick. All we are being offered here is the stick. We are not being offered anything that would enhance and improve what universities, with the best will in the world, are trying to do. No university seeks to exclude bright kids; they want them. We would welcome an organisation that helps and supports that aim, but not one that will be yet another set of regulations with punishments if universities do not do exactly what it says.

Baroness Ashton of Upholland

I accept the aspiration of the noble Baroness that we should all work together in a rosy and cosy way. I hope that that will be the case. But it is also incumbent on the Government to be clear about their expectations, which form the regulatory part of this provision.

I can say to the Committee that I would be astonished if the regulator does anything other than work with universities in a very positive way. I would expect that. However, it is the job of the Government to lay out the consequences if it does not happen. It is as simple as that, otherwise universities will be unsure of the position and left feeling uncertain.

It has been my experience during the passage of every piece of legislation on which I have had the good fortune to work that noble Lords look at the bold, bald elements which often seem to be the negative part of the experience. But this is meant to be about clarity and recognition. Nevertheless, the universities have to understand what the position would be should they not participate in the way we have set out.

My ambition is exactly the same as that of all noble Lords, and I think that the package that we have put together in this Bill is a very good one. It will be much better for universities and will ensure, in a supportive way, that the young people we have all identified and feel passionately about have the chance to gain the qualifications that will enable them to be accepted at university. They should understand that they can go to university and that universities will support them—not as individuals, but collectively. On that basis, I think that this clause should stand part of the Bill.

5.45 p.m.

Lord Lucas

In the context of what the noble Baroness has just said, will she consider postponing the bringing into force of Clause 35 until it is shown to be needed? Can the Bill be changed from what it is at the moment—a provision that will come into force immediately—to something that would come into force later by regulation so that the stick was not put immediately in the hands of the access regulator, but which could appear later if things did not work out? I should have thought that would at least slightly shift the balance so that the dons are offered, if not more carrot than stick then perhaps more claret than stick.

Baroness Ashton of Upholland

As I have said, the Bill stands as a package and the package has to be clear. The role of the Director of Fair Access, as he takes up his functions, will be to work with the institutions and to consider the issues with them. We know that the universities are concerned to ensure that they have sufficient time to develop their plans with the director. I see that as a positive relationship. It is not about delaying provisions, it is about this Bill going through and providing the package that we have suggested. It is the right one to take forward for our universities.

Baroness O'Neill of Bengarve

Does the noble Baroness agree that if it is right to look positively on the encouragement that universities provide to school children, but that nevertheless it has to be enforced by a stick and fines, a parallel approach would be appropriate in the case of those schools that do not take a sufficiently active approach to their own pupils by encouraging them to apply for the most ambitious courses?

Schools should provide the A-level support that is needed for some of those courses. Very frequently young people tell me that their schools do not provide teaching in further maths at A-level, thus excluding them from certain engineering and science courses. I have also been told that schools have actually discouraged pupils from applying, for example, to universities in the south of the country. That is an unfortunate situation.

If a stick is needed in one quarter, it is needed in the other quarter, although I suspect that what is really needed is encouragement in both quarters. What is sauce for the goose is surely sauce for the gander when it comes to encouraging applications.

Baroness Warwick of Undercliffe

Perhaps we should remember that the basis for the introduction of the Office for Fair Access was the corollary of the change in this Bill to allow students to be charged a very considerable increase in fees. Although we have made clear our view that additional fees are most unlikely to put students off—we can look to the experience in Australia and Canada for that—and although we can say that the universities are doing excellent work to ensure that widening participation is a key mission statement, we must recall none the less that when this debate was held in another place, the Minister was put under great pressure not only by Members on the Labour Back Benches, but also by parts of the higher education sector, particularly the National Union of Students. The sector wanted to ensure that there would be some degree of guarantee that students would not be put off. That is the balance of the argument that the sector has had to face up to. We have not yet convinced many doubters of the willingness and determination of the sector to follow this through. It is on that basis that many vice-chancellors have felt able to support what the Government are doing.

Universities UK has concentrated on looking at the very specific problems that might be associated with OFFA and has brought forward amendments which it believes will address those issues. I do not think that eliminating one part of the Bill, the part intended to reassure those who doubt most strongly that the other part will be successful, will in any way assist the universities.

Lord Dearing

Before we do not vote on this matter, perhaps I may say a word, although why I know not. I agree with those who have argued that the answer to the problem of access is to be found in our secondary schools. It is the case that those with two A-levels go to university pretty well irrespective of class. The problem is the proportion of those in the less well-off social classes who get that far. One of the reasons why young people do not get that far is that they do not stay on in education after the age of 16.

Some would say that the battle begins right back in primary school, or even earlier. We have to win that battle. It is right for the Government to say that they are placing great priority on making a big investment in the infrastructure and structure of our secondary schools. Various programmes have been put in place. A £1,500 per year maintenance allowance is now being introduced to encourage families to keep their young people in further education. But it is going to take years for that to come through.

Meanwhile we need all the help we can get. I say "we" as a society, because it is a society issue that we should have more of these people going to university. We should come together to encourage, foster and facilitate. All right, it is seen as a negative, but I am hoping—especially with the kind of amendment that the noble Baroness, Lady Perry, produced—that there is guidance and encouragement: that is the important part of its role.

Rightly or wrongly—and many noble Lords may think wrongly—there is a suspicion that entry to the more prestigious universities is associated with social class. It may be a false correlation, but it is seen. I think, painful though it is, that in the long run it will help universities to have an OFFA giving that public assurance. Maybe those universities which are looking forward to 2010 may find that if they are going to have their dreams come true, OFFA has been passed at the gateway to that.

Lord Sutherland of Houndwood

I would like to think that the last sentence of the comments of the noble Lord, Lord Dearing, would apply. But I want to put on the record the resistance some of us have to OFFA. I understand, and it has effectively been said, that there is a package there, but there is another way of doing it which will allow regulation in a much more straightforward way. If universities are told simply that a proportion of the moneys earned and raised from the additional fees had to be set aside for needs-blind admission and therefore scholarships for those who could least afford it, that could be audited through the accounts of the university very quickly and easily.

There would he a corollary, however, which is why the proposal may not be politically acceptable: the fees would have to be higher to make that worthwhile and workable. But I do want to have on the record that there is an alternative: you do not have a £3,000 cap on fees; you do not have a cap; but you insist that whatever the proportion—and it might have to be about one-third—it goes into a needs-blind admission system. Then I think we could achieve some of the goals we have been aiming for. I would not like the Bill to go through without alternatives at least having been put on the record.

Clause 29 agreed to.

Schedule 5 [The Director of Fair Access to Higher Education: supplementary provisions]:

[Amendments Nos. 64 and 65 not moved.]

Lord Rix moved Amendment No. 66: Page 31, line 29, at end insert— ( ) Each such report shall include the Director's analysis of whether or not provision for part-time undergraduate European Union students is developing at the same rate as provision for full-time undergraduate European Union students.

The noble Lord said: Before moving Amendment No. 66, I must first declare an interest as Chancellor of the University of East London, where we have 6,232 part-time students, and also that my younger son, Jonathan, is a lecturer on inclusive education at the Open University, which has considerably more.

I must also apologise for my absence last Thursday afternoon. As I explained to the Minister and others concerned, I had a long-standing invitation, together with my noble friend Lord Slim, to be at the splendid new gurdwara in Southall. While I was there, I was able to touch on the subject of higher education, albeit briefly—a theme then being debated in this Chamber.

Having readHansard, I am aware that my absence also caused the noble Baroness, Lady Sharp of Guildford, to speak at greater length than she had planned, and I apologise for that, too. The noble Baroness informed us that no less than 42 per cent of higher education students in Britain today are part-time. Could anyone in all seriousness describe themselves as a director of fair access if he were to ignore those 800,000 students? Hence my amendment ensuring that the director includes them in his annual report. If the Government's view of their policy is correct, my amendment would allow the director of fair access to trumpet their wisdom. If the pessimistic among us are correct, my amendment will require the director of fair access to sound a warning. It seems perfectly reasonable to me.

The noble Lord, Lord Barnett—who unfortunately is not in his place—is also supposed to be speaking to an amendment on part-time higher education, to which my name is added; that is, Amendment No. 77. I will, if I may, say a few words on that.

I believe that last Thursday the noble Lord was speeding towards Manchester as I was struggling through the rush-hour traffic to get to Southall. I imagine that the noble Lord reached his destination rather earlier than I did, but he certainly seems to have missed the boat this afternoon. Amendment No. 77 puts the onus on the Secretary of State to take into account the participation of part-time and full-time students, whereas my Amendment No. 66 puts the onus on the director of fair access.

I do not need to dwell on the virtues of part-time education and the especial place held in the country's affections for the Open University. They were well rehearsed at Second Reading by, among others, the noble Baronesses, Lady Blackstone, Lady Dean and Lady Boothroyd, a formidable triumvirate indeed, well up to the fire power of the originals: Pompey, Caesar and Crassus. Further reinforcements arrived last Thursday with no fewer than six noble Baronesses—and one lone noble Lord—attempting to prize out of the Government even more improvements than they are proposing for part-time and/or mature students.

It seems to me, having read the Minister's friendly but carefully worded reply, that even after making pro rata adjustments, part-time students will receive significantly less help than their full-time colleagues, and that universities—wholly or mainly supporting part-time students—will also be disadvantaged by the Government failing to make appropriate financial provision to safeguard their multifarious and extremely valuable activities.

I pray in aid for this assertion two quotes given to me by my noble friend Lord Quirk, both from pre-1992 universities: Leeds and Leicester. First, Leeds: Damage would be inflicted to current programmes both by individual numerical losses (pushing up teaching costs) and possible clustering of lower recruitment in some programmes, making them unviable. It is difficult to see a simple or immediate way out of these problems". Now Leicester: An immediate manifestation of not adapting form to purpose is still treating full-and part-time students as distinct species. It matters to institutions that cater wholly or mainly for part-time study, and to others for whom it is a major part of their business".

The position of the Open University was brought to your Lordships' attention by several speakers last Thursday, particularly by the noble Baroness, Lady Carnegy of Lour, who is in her place. To illustrate my claim that part-time students are one of the keys to widening participation, I stress that more than 9,000 disabled students are studying through the Open University—more than 9,000—including quite a number with a learning disability. The first course concerned with that subject was launched over 20 years ago. It was a co-operative effort between the Open University and Mencap, at a time when I was that organisation's chief executive. The work continues to this day, and is an initiative—together with many others—of which any university would be proud. I am at a loss to understand the Government's apparent reluctance to make appropriate financial provision.

A consequence of not being in my place last Thursday is that I have had an insight into the Minister's reply. In referring to those amendments which seek to support the position of part-time and mature students, the noble Baroness, Lady Ashton of Upholland, described them as either being unclear or adding to the burden of regulation. I agree. My amendment does add to the burden of regulation, but not the regulation of universities, rather the regulation of servants of the Crown—in this case the director of fair access. If we are not here to regulate the actions of servants of the Crown, what are we here for? I beg to move.

6 p.m.

Baroness Sharp of Guildford

I spoke at some length on this issue on Thursday last and I do not intend to do so again today. I wish only to endorse the remarks of the noble Lord, Lord Rix, and to reiterate two points that I made in my speech last week.

Two sets of people will lose out under the current proposals. One group consists of the part-time students themselves. As I pointed out, there are, roughly speaking, 800,000 part-time students in this country, four-fifths of whom pay their own fees. There are some improved bursaries available but only to those on very low incomes. Many of the students who pay their own costs are faced with an increase in fees from £570 to £1,500, almost treble the amount they now have to pay. Many will be put off from studying part-time as a result of the increase in costs.

The second group of losers consists of the universities themselves. They will not benefit in any way from government procedures to compensate for students. The Open University, in particular, will lose students. Ordinary universities with full-time students will receive their fees up-front from the Treasury; universities with part-timers will not receive equivalent amounts and will lose out.

The noble Lord, Lord Rix, quoted from an article written by Chris Duke, a professor at the University of Leicester, about the impact of the Bill. He said that it mattered to learners and the wider community that part-timers should have a variegated range of access. Chris Duke said: Many more might upskill to the knowledge society away from the low-skills, low-wage equilibrium economy if support, opportunity and goodwill made part-time study a normal part of a healthy, learning society". In the 21st century we must recognise that the way forward for our universities is to make part-time study as easy as full-time study. We will not do so with this Bill. It is an opportunity missed.

Baroness Seccombe

The amendments enable us, once again, to highlight the important work of institutions such as the Open University and Birkbeck College. I thank the Minister for the full reply that she gave to the Committee last week. I hope that this opportunity to discuss the issue again will enable her to provide more of the detail that she was reluctant to go into on the previous occasion. I also hope that it will enable Members of the Committee, having had time to mull over her answer, to probe the Minister further. The noble Baroness said that her door was open on these issues. What further meetings has she had, or has planned, in relation to part-time and mature students?

The Government have proposed a review of funding to address the imbalance between these two groups but this is unlikely to take effect before 2007 at the earliest. Can she assure the Committee that a review will indeed take place and that it will be implemented as soon as possible? What progress have the Government made on an alternative, first-aid solution, as suggested by the noble Lord, Lord Dearing, as an interim measure while awaiting the 2007 review?

Lord Phillips of Sudbury

I thoroughly support the sentiment behind the amendment and the importance of ensuring that part-time undergraduates are taken as seriously, if I may put it that way. as full-time undergraduates.

I wonder whether the noble Lord, Lord Rix, can answer a query for me. Amendment No. 66 refers to part-time undergraduate European Union students but, as I apprehend it, the general duties of the Director of Fair Access apply only to home students under Clause 30 of the Bill. I wonder how, as a matter of practicality, the director can have regard to and survey the impact of part-time student provision across the Union.

Lord Rix

I shall try to answer the noble Lord. The information I have received is that anti-discrimination legislation enables universities actively to discriminate against overseas students if they are so minded. In this sense, "overseas" does not have its natural meaning of "Fog in the Channel, Continent cut off", but relates to outside the borders of the newly enlarged European Union.

I gather that the Government's policy on fee regulations applies to all full-time European Union students. If fees for full-time students rise, fees for part-time students will follow. If the Bill should be passed, it will affect each and every European Union student but not overseas students. I therefore felt that the gauge of the Director of Fair Access should extend beyond the cliffs of Dover but stop at the boundaries of the newly enlarged European Union. I may well be corrected on this by the Minister.

The Lord Bishop of Portsmouth

There were a number of references to part-time students in the Second Reading debate and I am glad that the amendment has been brought forward. I hope, too, that the last point made by the noble Lord, Lord Rix, as a matter of clarification—which I think was greeted with a little scepticism around the Committee, but not by me because I do not know the details—will be brought further into the light of day by the Minister when she replies. It is a fine amendment and should find support, even among those virulent "savers of the pound" who are Eurosceptic.

Baroness Lockwood

I spoke in the debate on Thursday and I therefore do not intend to speak at any length today. I support the principles embodied in the noble Lord's amendment. The intention of my Amendment No. 105, which is in this group, is to bring within the ambit of the Bill all part-time courses of at least one year's academic length and which do not exceed twice the amount of time needed to complete a full-time course. That would, of course, bring most part-time courses under its scope.

In her response, the Minister put a good deal of pressure on the promise that there would be a review of the position of part-time students. If the review takes 12 months, clearly there will be no inclusion of part-timers in this Bill. I know that she was sympathetic to helping part-time students but, if the Government cannot accept amendments which seek to include part-time students within the Bill, will they consider making a statement which would guarantee some additional assistance to the Open University and Birkbeck College, both of which will be at a disadvantage when the top-up fee becomes operative for full-time students in 2006? It would help a great deal. If the Minister cannot do so today, perhaps she will have another look at the issue and come back with a positive statement of some help for these two institutions in particular.

Lord Dearing

Following up on that question, can the Minister confirm that the Bill would allow fee deferral for part-time students if that were decided at a later stage? If so, one group of candidates that I hope will receive early consideration consists of those on 50 per cent part-time courses.

Baroness Carnegy of Lour

Have the Government considered the position of Open University students living in the European Union who study in the European Union and get degrees from the Open University? A student from France or Germany, who may have a brother or sister at a university in England, pays the same fees as English students, because that is the European arrangement. However, top-up fees will affect that situation. What will be the position of the brother or sister who lives in Germany or France, who is studying with the Open University there, and collects a degree at the Open University degree-giving in Paris?

Baroness Ashton of Upholland

I hope to be as positive as I can. I was not reluctant to enter into this debate on Thursday but conscious of the time and the number of noble Lords in the Chamber. Noble Lords will be relieved to hear that I do not intend to repeat everything that I said on Thursday. However, I can show noble Lords a booklet that has just been produced called Financial Support for Part-time Students in Higher Education. I have arranged for 50 copies to be placed in the Library of the House. Noble Lords may wish to look at it because it is a very good document about what is now available to part-time students. I remind noble Lords that, before 1997, there was no support for part-time students. We have moved to a system that has ended up with grants being available for part-time students, which is the right thing to do.

I put all my remarks in the appropriate context for this discussion. As the noble Lord, Lord Dearing, indicated, if we decide that fee deferral should be available for part-time students, we could do that without the need for primary legislation. That is important in reassuring noble Lords that that facility exists. I also remind noble Lords about something that the noble Baroness, Lady O'Neill, said on Thursday. Part-time students are many and varied, which is a great joy. Noble Lords will recognise that many of those students are very different from each other. Some are sponsored by their employers and some are not. Some will not know whether they are sponsored by their employers. For example, my own department encourages individuals to take up part-time education. It does not pay their fees up front, so it would not be listed as doing so, but it reimburses them in other ways. That is exactly the dilemma that I said that we would be trying to resolve through the students' income and expenditure survey, which, for the first time, will include all students, including Open University students.

As I said to the noble Baroness, Lady Boothroyd, when she came to talk to Alan Johnson and me, we are very keen to look at what we can do in that context when we have better information. We are not reluctant to consider supporting part-time students or we would not have introduced the support that we already have. We are keen to ensure that if we go further—if we can—it is in the right way. As with any government, that relies on good, positive information. Should fee deferrals be part of that, the Bill has the capacity to include them. I wanted to put that in an over-arching context. I do not accept the amendments because, in that context, I would not.

To answer the question asked by the noble Baroness, Lady Seccombe, I have not had the chance to have any further meetings since Thursday. However, we are in ongoing dialogue, especially with the Open University, which we recognise is important. I am keen to continue that dialogue with the Open University and with Birkbeck, and with all the other institutions that have an interest. We recognise that this is an important part of their work. I can confirm that a review will take place and will be implemented as the noble Baroness indicated. I know that the Open University has expressed its intent to make a case for special interim funding. I cannot make any commitment on that: it is a matter for HEFCE. However, I encourage HEFCE to listen carefully to what the Open University has to say.

6.15 p.m.

The noble Lord, Lord Rix, is right about European students. The fees paid by full-time European Union students will be capped at £3,000, as is the case for British students. However, just as part-time British students are not within current or future regulation regimes, nor are part-time European Union students, so OFFA would not cover them, as the noble Lord indicated.

I shall deal with the specific amendments, which I hope will enable us to make progress. Amendment No. 66 moved by the noble Lord, Lord Rix, specifically requires the analysis that is undertaken to include provision for part-time undergraduate European Union students. We think that it is important that the director's report covers surveys of access plans, the way in which institutions are improving outreach, the kind of bursaries available, how institutions' ambitions are affecting the picture in higher education generally and so forth. Of course, the director will contribute to the commission's review, after three years, of the work undertaken. However, I hesitate to go further in being overly prescriptive.

Lord Rix

If I change the amendment on Report and drop the words "European Union", would that be acceptable to the Government?

Baroness Ashton of Upholland

The noble Lord is asking a Minister to work without a brief. Perhaps he will say that that is easy. Because the matter is important, I undertake to work with the noble Lord and look at the issues that he raised. It is my job to look specifically at the amendment tabled. Noble Lords will know that amendments often have technical defects. We are having a general debate.

I understand what the noble Lord is saying, and I will talk to him further on this matter. I am concerned that we recognise that there is a big difference. Institutions such as the Open University are rightly concerned about the impact of our new policies. That is why the commission is so important and why part-time study should be included. It is also why we need to get much better information about part-time students and work with those institutions that support part-time students right across the education sector to ensure that we get it right.

I genuinely believe that our positions are not very different. Quite rightly, those representing institutions with a large number of part-time students are concerned and want to push us to ensure that we have their interests at heart. I am keen that we have a meeting of minds on the matter, because we are not far apart. However, part-time students are not regulated and I am conscious of the director having a clear remit in full-time education and not confusing the issue. Rather, it is a job for the Government to look beyond that.

Lord Rix

Would Amendment No. 77 meet the Bill more accurately than my Amendment No. 66?

Baroness Ashton of Upholland

I was going to come to Amendment No. 77. I am sorry that the noble Lord, Lord Barnett is not here. Mischief is the word. I am keen on the offer to go to the National Theatre, because I have not been for some time. It does not look as though I will be going, but it would be nice.

As the noble Lord indicated, Amendment No. 77 would ensure that the guidance to the director does not discriminate between full and part-time courses. He will not be surprised to hear me say as an aside that the amendment as drafted does not have a clear legal effect. It is, as we often describe such amendments technically defective because it does not tie in with the sentence that it would amend. Having said that, I recognise the purpose of the amendment is to initiate discussion.

As I have said several times, the director's role concerns the regulation of full-time undergraduate higher education courses and initial teacher training courses. As we have indicated several times in your Lordships' House, we recognise the importance of making sure that potential students are not put off. Therefore, all of these measures as a package seek to support our universities and encourage the aspirations of students to come forward to our universities. Our access plans relate to full-time students because that is where we have introduced the new measure of variability. That is what the director is to regulate. That is important and understood. However, we recognise the valuable role of part-time study in higher education, and the promotion of lifelong learning is critical. There are many recipients of valuable part-time courses and Open University courses in particular, whom we all know. However, where we differ is that, because of the way in which the director is being set up, part-time students should not be a mandatory element of the director's remit. That is the difference. Institutions can show the director their plans. They can look at the whole question of part-time provision if they wish. That is for the institutions to decide, not for us to dictate. That is the difference in what we wish to set up.

With the proviso that I am very happy to talk further—and the understanding that within the Bill as it stands we could move to fee deferment if that were appropriate, as I have already indicated—we recognise that the individual and collective institutions have issues with respect to part-time education. We are in discussion and will continue to be so. We absolutely accept that we need to get more information upon which to make decisions. But we are also very proud of the work that we have already done to support part-time students, and I refer again to my little booklet.

On that basis we do not want to be too prescriptive with regard to the director. It is important that the director focuses on the work to be done on full-time undergraduate courses, as we have indicated. Mature students are included in that. I suspect that we look at the issue of part-time students differently, but I am very happy to continue the discussion on that.

Lord Rix

I would like to thank the Minister very much indeed for that warm invitation and I suggest that I try to put together the "A team" to see if we can push through the open door of her office to discuss this matter further.

I am also very grateful to all noble Lords who have taken part in this debate and to those who took part in Thursday's debate. There has been a very good airing on part-time students and less airing on mature students, although we just had recognition of mature students from the Minister. I am grateful to all noble Lords—I am sure we are grateful to each other—for raising this matter. Part-time students number nearly a million people in this country. That is an awful lot of students and undergraduates.

So as we can knock on the Minister's door some time between now and Report stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 67 not moved.]

Baroness Sharp of Guildford moved Amendment No. 68: Page 31, line 29, at end insert— ( ) The annual report shall include the results of the monitoring of the effects of variable fees on all groups underrepresented in higher education during that year.

The noble Baroness said: In moving Amendment No. 68 I shall also speak to Amendment No. 69. Both these amendments relate to the functions of the Director of Fair Access as set out in Schedule 5, one of which is to produce an annual report. Both amendments relate to that annual report.

The first amendment relates to monitoring the effect of variable fees on all groups that are underrepresented in higher education. One of those groups is disabled students, who are perhaps the most underrepresented group in higher education. Many institutions do not include specific outreach activities for disabled students in their widening participation strategies. It may be that, without further direction from HEFCE and OFFA, they will not do this in their plans for OFFA approval. Those representing the disability groups think that it is essential that the universities be required to include in their plans details of how they intend to increase the number of disabled students.

Many of these disabled students have to study part-time because of their impairment. Paragraph 7 to Schedule 5 requires the Director of Fair Access to Higher Education to produce an annual report which the Secretary of State must lay before both Houses of Parliament. This amendment to the Bill would require the director to monitor the effect of variable fees on all under-represented groups and to include details of the monitoring in his annual report. This is a wholly reasonable amendment, given the under-representation of disabled students among the student body and the lack of detailed statistics both of needs and resources within the sector on this issue.

Amendment No. 69 picks up the issue of the lack of information and seeks to make OFFA the authoritative source of data on—and trends in—potential student applications to higher education, and to do this by reference to specific underrepresented groups. The process will help inform its own work and priorities and will also embed its value as a body in the eyes of the outside world.

At present there is no single authoritative source of data on student access. We have talked about the lack of data on part-time students. The Higher Education Statistical Agency supplies some data, and the funding council provides other information. It makes absolute sense for OFFA to become the authoritative source of such information if it is to be seen as the access champion. This would allow OFFA to generate informed debate on the issue of access to higher education and help it to be seen as the champion of those who are aspiring to higher education. I beg to move.

Baroness O'Neill of Bengarve

I would like to see greater availability of statistical information and I share the view of the noble Baroness, Lady Sharp, about the unsatisfactory nature of HESA statistics in many respects.

I am not sure that we can expect OFFA to do better. Some of the material that is mentioned in these amendments is information to which I think OFFA will not have access, and in particular—looking back on earlier provisions in the Bill and the requirement that universities not be required to do more than they already do—I do not see how the universities can provide information that they do not have. Universities do not have information about their applicants that would satisfy even the least exacting of statisticians.

Students are not required to declare their disability. They may find reason to do so, but very frequently they find reason not to do so and I sympathise with their desire to keep certain things a private matter. Students may self declare under the bizarre categories that do duty for ethnic monitoring in this country, but they have a right not to. My experience is that, increasingly, they choose not to, very often because they are of mixed background.

Admirable as it might be to know all these things, in the end we are likely to have reasonably clear information about age—they give their dates of birth—and they can usually manage gender, but we are not likely to obtain information about family income background, ethnicity and disability that would be worthy of statistical elaboration in the course of the admissions process.

Some information on family income background has to be sought when it comes to supplying a bursary. However, in my experience universities that are at present doing this are riding piggyback upon local authority family income assessment. Of course, the basis of that assessment is to be changed in certain ways. It is notoriously unreliable information. It does not wholly fit with national income statistics. Many more are exempted from paying a tuition contribution than the national income statistics would suggest should be exempted. If we are to have more statistics let us have them, but only if they can be made good statistics. I do not believe that these categories of information are available to universities, or to UCAS, or to OFFA, or to HEFCE.

Baroness Lockwood

I support the principle behind these two amendments. It is important that we have as much information as possible on the question of access and the contents of the annual report.

In view of the noble Baroness's comments—and I accept the difficulties that individual universities have in obtaining this information and therefore supplying it—there are surely other sources from which the information can be obtained. Perhaps it should be part of the remit of the department to try to collate this information as part of an ongoing monitoring of the situation. Even if the actual figures are not available, the trends are surely available, which would be helpful, if not detailed, information. The trends would show what progress was being made.

6.30 p.m.

Baroness O'Neill of Bengarve

I thank the noble Baroness for giving way. The problem is not that the information is a bit ropey or that the trends are not available. The problem is that the information is essentially personal and subject to data protection, and is not sought by universities or UCCA and is not available in any systematic way. We would have to do far more to discover trends.

Baroness Lockwood

I sympathise entirely with what the noble Baroness says. I know the difficulty that my own university in Bradford has in obtaining that information when it does its monitoring of equal opportunities policies, and the percentage of questionnaires that are sent out which are not returned. I accept that point, and the problem of the Data Protection Act, but I believe that we should seriously consider what is intended by the amendments to see what further information could be obtained nationally, which could be made available to OFFA when it compiles its annual report.

Lord Addington

This will be the first time that I have spoken in this Bill, so I beg the indulgence of all those who have taken such a core part. My noble friend's amendments, especially Amendment No. 69, relate to disability. It relates to the disclosure of, and encouragement to disclose, hidden disabilities such as impaired hearing and dyslexia. Those are the two biggest ones, which people may not even be aware of as a problem but may discover later on.

Universities and everybody involved cannot give assistance unless they find out what is going on. I have had mainly informal contact with a number of people who have had hearing problems or mild dyslexia and have managed to get through the system. They often try to give information to universities too late, once they are in the process of having their degrees assessed or are coming up to exams. If we can encourage a process by which people examine those problems, there may be an initial increase of work for the universities but in the long term it will save them both time and money. There will be fewer appeals and many fewer pupils failing. According to the trend, things are getting better overall, but examining the problem at a central point has got to help.

It cannot just be me who is discovering that such problems are occurring. For instance, the son of someone from whom I am renting a house is dyslexic and is struggling through a degree. His university did not know that it was perfectly normal practice to dictate exams. That is the sort of absurdity that emerges time and again. It may be that his university knew but that his tutors did not. If there is that degree of ignorance in that one field, I would suggest that gathering such information is essential. If we can get such a requirement for gathering information into the Bill—and I believe that more legislation will do so in the future—it would save time. effort and money in the long run.

Lord Sutherland of Houndwood

It is in the interests of the universities and the national system that we get better at producing this information. It is clearly not adequate at the moment, for all the reasons that we have heard, but this seems a sensible way in which to tackle the problem—although early reports would have to have a very large health warning on them.

Baroness Seccombe

We recognise the principles behind the amendments, particularly from the RNIB and SKILL lobbies, and understand that information is required. We all want there to be an increase in the number of disabled students who reach the criteria in higher education, but I do not feel that it should be a duty placed in the Bill. The Secretary of State could require that information without a change of primary legislation.

We on these Benches are just as committed to equality for disabled students. In fact, we have argued throughout these discussions for equality for all students, so that they can be assessed and accepted on their skills, ability, aptitude and excellence. However, fairness, as highlighted by the Scwartz report, does not mean that the Government, directly or indirectly via OFFA, should be able to choose students. The autonomy of admissions should remain with the higher education institutions. I fear that such information may be used if, for example, there is not enough of one ethnic group at a particular university.

We do not want the system of admissions to become such that students who meet the required criteria are not awarded a place because it has to be allocated to an individual in a group considered to be underrepresented, regardless of whether they meet the skills and ability criteria. If such under-represented groups have the necessary qualities, access through the current "widening access" programme employed by universities should be used to attract them.

The Lord Bishop of Portsmouth

When this debate began, I wondered whether this amendment was yet another add-on under which the Bill might sag. However. I have reached the stage, particularly after hearing from the noble Lord, Lord Addington, of believing not only that the amendment is appropriate, apposite and right but that if it is not passed, we may be judged by a future generation that is yet more sensitive than us to the kind of people who would benefit from it.

Lord Triesman

These amendments would create new requirements for the Director of Fair Access to monitor issues relating to particular groups and to report them to the Secretary of State. On all sides of the Chamber there has been a great deal of sympathy with the motivation behind the amendment, which is to protect the interests of groups which, for one reason or another, may be under-represented in higher education. I am grateful to the noble Baroness, Lady Sharp, for giving us the opportunity to discuss these matters, as they are sensitive and important.

Amendment No. 68 would require the director to include in each annual report the results of monitoring the effects of variable fees on all groups underrepresented in higher education during that year. It is of course important that we should consider closely the effects of the policy on under-represented groups. That case has been made powerfully on behalf of disabled students by SKILL and the Royal National Institute for the Blind, which are keen to ensure that we monitor our proposed measures for higher education to ensure that they have no detrimental effects on under-represented students.

I agree completely with the noble Baroness, Lady O'Neill, about the difficulty in collecting a great deal of the information, whatever our good will or motivations. Personal information is often declared only by individuals and only when data protection applies. The consequence for HEFCE—and it is likely to be true of OFFA as well—has been gaps in data.

Interestingly, as I have observed over the years, the more individual organisations collect data, the greater the mismatch may be between the data that they collect. It is not as though an easy composite can be constructed out of data, like the bits of a jigsaw puzzle simply fitting together. However, over time, it is also true that data have improved. Even with part-timers, where there was not a complete gap but there was nothing very good, there have been serious improvements in the amount of information as sources have produced it.

The one area in which it is extremely difficult to make great sense of all the data is in the construction of trends, which often depends on the data being particularly accurate at the beginning. I should tell my noble friends who raised the point that I suspect that the reason why some of our predictions about the numbers and kinds of students who might want to go into all sorts of post-school education have been way off the mark is because we have tried to construct trend-lines from data that were deficient at the start of the process. I draw the conclusion that we must try to do a lot better. It is not wholly impossible, but it is extremely difficult.

Amendment No. 69 is very similar and would require the director to include within the annual report an analysis of applications to full and part-time higher education courses, with particular reference to family income, ethnicity, age, gender and disability. All sides of the Committee would agree that they arc important issues. Of course it is right that we should monitor the effects on those groups. I wholly take the point made by the noble Lord, Lord Addington, about the kind of disabilities which are often not apparent until someone makes them so. That may be well into the course—not at the point of applying or of admission—and therefore particularly difficult in the context of this legislation. I think that that was the great burden of what the noble Baroness, Lady O'Neill, said.

Let me assure the Committee that we will take, of course, a very close interest in the effects of reform. That is why we have said that we will commission an independent review to look at exactly those kinds of issues three years after the introduction of variable fees.

The remit of the commission, published in a statement by my right honourable friend the Secretary of State on 27 January, includes looking at participation for particular groups. I have no doubt that disabled and ethnic minority students and students from low income backgrounds will be included in that.

The commission will also look at students' choices of institution, courses and modes of study and include the take-up of provision by full and part-time students. Given the responsibility for overview of access plans, the director will naturally have a significant contribution to make to this review.

Other interested parties—charities, lobby groups, academics and organisations such as HEFCE and Action on Access—will be looking carefully at the effects of this policy, not to mention the whole of the sector itself. It will be interested, to say the very least, and my guess about its reaction is that it will be very alert.

As regards the director's annual report, we are reluctant to be over-prescriptive in legislation about what he should include. We fear that over a period of time we could construct a very long list and fall into a list mentality, which would not be particularly helpful for all the reasons I have given.

Other than the usual accounting requirements set out by the Treasury, I think that we should leave the detail of the report's content to the director. I think that that was the force of what the noble Baroness, Lady Seccombe, was saying in her contribution a few moments ago.

Much information is already available from HESA (Higher Education Statistical Agency) on ethnic origin and disability, for example. I hope that we would not want to try and duplicate it because the effort is already being made. It is at least questionable whether the director needs to add to that with further data collection and analysis. Certainly, the director should receive that information. It is critical that the information is received, but not necessarily that further data and analysis are generated, other than the increase in the quality and volume of data that HESA seeks to achieve.

Perhaps I may say that I encourage noble Lords to seek information from HESA for themselves. It is an important source of information, which is intended for the public domain. The better informed we are as we review these matters, the more likely we are to reach good judgment. I anticipate that HESA will wish to help in that. I do not think that I should elaborate further; the arguments have been well-rehearsed. There is no lack of concern anywhere in the Committee for the position of those students described in the debate. I think we should try and ensure that over time the institutions we have do their job better, rather than trying to replicate the job in other ways and probably sowing the seeds of some confusion. It is in that light that I invite the noble Baroness to withdraw the amendment.

6.45 p.m.

Baroness Sharp of Guildford

I thank the Minister for his considered reply. I say to noble Lords who have participated that in the process of the debate I have been convinced that OFFA is not the right body to gather these statistics. Noble Lords will note that in Clause 31(4)(a) one of the requirements on governing bodies in drawing up plans is to, secure the taking of, measures to attract applications from prospective students who are members of groups which, at the time when the plan is approved, are under-represented in higher education". Someone has to gather the statistics, but I think that probably the right organisation is the Higher Education Statistical Agency in cahoots perhaps with UCCA, pooling their information. I take on board very much the point made by the noble Baroness, Lady O'Neill, that universities do not gather this information and for reasons of data privacy do not particularly want to gather and store it; and that it is not necessarily appropriate that they should.

However, what is quite clear is that among its duties OFFA will have to take what information there is—and one hopes to see the improvement of that information over time—and to look at trends and to judge the progress of each individual higher education institution against the available data. However, in the light of the replies that I have had, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 69 not moved.]

Baroness Perry of Southwark moved Amendment No. 70: Page 31, line 36, at end insert— ( ) The Director shall take account of views expressed by Parliament in response to his report under this paragraph.

The noble Baroness said: This is a small amendment. It need not delay us very long. I am sure that once the Secretary of State has laid a director's report before Parliament it will be placed in the Library. Some Members of Parliament may read it, and others may not. I am trying to ensure in the amendment that Parliament actually takes note of reports, whether through the Select Committee in another place, through a debate or so on. I should like to ensure that Parliament knows what is going on in terms of the universities' efforts to widen participation and to take note of reports, simply because there are so many myths around. There are myths at both extremes of the university system. Perhaps I may say that I have suffered from both in my own career. First, there are criticisms of Cambridge, Oxford and other elite universities being too posh to care about poor students and so on, and generally being distorted in their admissions. Secondly, there are myths about the post-1992 universities letting in any old Tom, Dick or Harry—people who are too thick to go to university, who really should not be there in the first place and so on—with no understanding of the enormous care in recruitment and selection which goes on at both ends of the system. I would just like Parliament to write something into the Bill to make them take note. I beg to move.

Lord Sutherland of Houndwood

I support the amendment not only for the reasons given by the noble Baroness, Lady Perry, but also because I believe that the director of OFFA should be able to give reasons for either accepting or rejecting views—plural—expressed in Parliament.

Lord Skelmersdale

I rise briefly to support the amendment. It occurs to me that there is a small problem. The Bill states that the report has to be laid before Parliament and therefore it will be within the scope of Parliament's discussions. I, of course, have always envisaged that, like my noble friend, it would be the departmental Select Committee that would take a particular interest in that. However, I suspect that legislation does not allow us to say so. It will be interesting to hear what Ministers have to say on that score.

Baroness Ashton of Upholland

I am grateful to the noble Lord, Lord Skelmersdale, for in a sense heralding what I am going to say. I say to the noble Baroness, Lady Perry, that I completely understand and totally accept the principle behind this, but I have been advised as late as today that there are some important constitutional difficulties which prevent me accepting it. It is extremely important that the director should pay heed to the views of Parliament. The director's annual report, as the noble Lord, Lord Skelmersdale, said, will be laid before Parliament and probably through the Select Committee system. We will see scrutiny of those reports. The same applies to any special reports that the Secretary of State might invite the director to undertake. It is possible that Motions will be tabled and resolutions passed, and each and every Member of Parliament in either House will be able to express their views in debate.

Therein lies the rub—Parliament does not necessarily speak with one voice, and a Motion passed in your Lordships' House may not pass in exactly the same form in another place. The report from a Select Committee may not be accepted by the whole House. Views, however well expressed, will not necessarily be the views of every Member of Parliament. I am advised there are serious difficulties in placing on the director a duty to take account of the views expressed by Parliament, given that there is no commonly accepted definition of those views. The considered will of Parliament is embodied in legislation, and a director will of course take account of that. We run the risk of placing the director in an impossible situation. I do understand the concern of the noble Baroness and other noble Lords, and I will reflect on whether there is any way that we can respond constructively.

I apologise for the fact that I have not been able to clarify the situation earlier, but as I say, the formal, proper advice came today. It is an important principle, and I hope I have clarified that there are real difficulties but that I will look further. On that basis, I hope that the noble Baroness will feel able to withdraw her amendment.

Baroness Perry of Southwark

I am very grateful to the Minister for that reply. I knew that the amendment was not quite the kind of proposal that could be agreed to, but it enabled me to say what I feel very strongly. On the basis of her kind reply, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 5 agreed to.

Clause 30 [General duties of relevant authority]:

[Amendments Nos. 71 and 72 not moved.]

Lord Forsyth of Drumlean moved Amendment No. 73: Page 14, line 9, after "education" insert—

• "( ) not require any governing body or higher education institution to discriminate against or to prefer any student or prospective student on the basis of the school or type of school at which they were educated; and"

The noble Lord said: I do not wish to detain the Committee very long over this amendment, although it is important. Indeed, in the interests of making progress, I might have been tempted not to move it, were it not for the fact that I read in a newspaper today a statement made by the Minister in another place in respect of a survey indicating that children from state schools were not achieving places at the so-called "Ivy League" universities. The survey, which I believe was commissioned by HEFCE according to the newspaper report, identified that a number of youngsters were not going to particular universities, not because they were being refused admission but because they were not making applications. The Minister in another place, as has already been referred to, said that the fact that these youngsters were not getting places at these institutions was why we needed OFFA.

The amendment would state specifically in the Bill the fact that OFFA may not require universities to exercise any form of discrimination against or in favour of an applicant on the basis of choices made by their parents about their school. I believe it is necessary to have that in order to deal with the kind of mistaken impressions that are being created. I have a daughter who is at present making applications through UCAS to universities. As a result, I have quite a lot of contact with youngsters. She went to an independent school—I went to a state school, so I can just about remember what that was like. Amongst her generation, many believe that they are being discriminated against by particular institutions in making their applications. I have no doubt that people will jump up and say it is not true, it is not happening, but in politics, perception is everything. I think it is particularly damaging if youngsters believe that no matter how hard they work, however much effort they make, at the end of the day, people are going to cross them off the list because they went to a particular school. That, to my mind, is as bad as discriminating against people because they went to an independent or a state school—both are equally unacceptable. Children are innocent of the wealth of their parents, or of the schools they attend. It is essential that they should be looked at by universities on the basis of their aptitudes, skills, abilities and potential to make the best of a particular course. Everything I have seen about the way in which universities tackle this difficult matter seems to point to the area of concern lying not with the universities but with the schools.

The noble Baroness, Lady O'Neill, made the very succinct point that perhaps some of the stick should be placed in the direction of the schools. There is almost nothing in this Bill which points to the failure of the schools to prepare candidates. How can universities admit pupils who are applying for courses in mathematics or physics if they have not actually reached the required skill levels to embark on the course in the first place? That is a problem of the schools. I noticed the Minister, who has been very helpful this afternoon, was nodding in agreement when I said that children should be treated solely on their merits. Therefore I am very hopeful that she will not have a problem with accepting some form of wording—if not this amendment—which will at least reassure the many people who believe they are to be discriminated against because their children went to independent schools.

There is a certain injustice in what this Bill proposes. Parents who have means or who decide to give up particular items of expenditure in order to send their children to independent schools find that when their children apply to universities, they are to be discriminated against in terms of receiving places. In return for doing so, the universities are entitled to charge them fees for which they and their children get no support through maintenance grants. It does seem to be very unjust. I expect the Minister to say this is not what is going to happen and that this is not the position—in which case I very much hope she can accept Amendment No. 73. I beg to move.

Baroness Buscombe

I rise to support absolutely everything that my noble friend said. Noble Lords may remember that this is the point that I focused on at Second Reading. I was in the state sector but my three children are currently in the private sector. I too feel genuinely and deeply concerned that they will be penalised because they are in the private system. Indeed one of them is on a scholarship in the private system, so she wonders what the point is. We have got to do all we can to allay those fears, if indeed those fears are unfounded.

I want briefly to refer to one of the reasons why I am really worried about this—the Schwartz review. The consultation document states that apparently research has been carried out which shows that, all things being equal, children from the state system do better at university than those in the private system. I want to say loud and clear that I understand that that piece of research has been misused, and I am glad to report that representatives of the independent sector among others are now carrying out research to check whether that has any grounding whatever. I personally doubt that it has. Many pupils from the independent sector are better able and prepared to cope with the private system—particularly some of the more "difficult" universities, if I dare call them that, such as Oxbridge—than are those who are not used to living away from home and fending for themselves in lots of ways from a young age, as is the case with children, in the private sector, particularly those at boarding school.

I agree with what my noble friend said about application to universities focusing on aptitude, skills and potential only. Does the Minister believe that universities need to know at all what schools pupils have attended? Universities UK is very keen to ensure that OFFA should not have any involvement in admissions, but we need real reassurance from the Minister that any reference to a child or pupil's secondary education would he treated as an irrelevance.

7 p.m.

There is a problem. I know that it was a long time ago but, when I was in the state system, I did not have the confidence to apply for Oxbridge. I wish that I had, which is why I feel it so important that we widen participation. I applaud what the Government are doing in terms of seeking to widen participation and encourage universities to make people—people such as me, as I was—feel that they are up to applying; it is a sadness in my life that I felt so shy about applying to universities at all. However, admissions should be based on skills, aptitude, potential, interviews and, if needs must, what one might call secondary exams for application to university, like the old S-level. If any of my children apply to Cambridge, for example, and want to read medicine or law, they will have yet a further exam above their A-levels in order to apply. In the circumstances, given that so many pupils achieve a number of straight A grades, that may be a fair approach.

I want to speak out on behalf of the many parents who make a number of compromises in other directions to put their children through the private system. I know many parents whose cars barely get them to the school, and who compromise holidays and all sorts of other enjoyments in life. There are also those lucky pupils from poorer backgrounds whose parents simply cannot afford private education, but who are bright enough and have the aptitude to get scholarships and bursaries. Will they be penalised too because they have been in the private system? I hope not.

It disturbed me at Second Reading that even noble Lords referred to "the rich students". I take huge exception to that. I feel that I speak for thousands of parents who feel strongly that their children are lucky to be in private education because they get, in the main, a really excellent education. However, parents will be quietly making compromises to ensure that their children get the best. In life, we can give our children only two things: a lot of love, and a good education. It is up to the schools to improve standards of secondary education, to ensure that all pupils get a good education.

Baroness O'Neill of Bengarve

I have some sympathy with the aims of the amendment, although I perhaps take it on a rather broader front. Those of us who do admissions in very selective universities are accused from both directions of discriminating against cohorts of young people on the basis of the type of school to which they have been. We look at not merely their potential and achievement, but their enthusiasm for their subject and the opportunities that they have had. Nevertheless the job is an art, not a science, although it is very conscientiously done.

We have to reckon that there are, every year, many disappointments. Far too many young people get three, four or even five A grades—we look at only the first three—for all of them to get their first-choice university. There are disappointments. and it is very easy for a pupil, parent or school to feel that there has been discrimination. The point is not simple, because the effects on reputation are hard to avoid with even the most scrupulous procedure.

I take the serious point about the amendment to be that we should not repeat the history of the United States in respect of college admissions by trying to institutionalise a representational form of access as opposed to fair process for everyone. I think back to the Bakke case at the University of California on admission to medical school. I hope that the Minister can assure us, as we would all support it, that the Bill's provisions have been read with an eye to whether anyone—be they a disgruntled school, parent, a local authority or, in view of the points raised by the Opposition, the Headmasters' Conference—can claim that discrimination has taken place because availability of university places is hinged to factors other than those that legitimately have a role in admissions.

Baroness Carnegy of Lour

Whatever the Government may say, there is no question but that a lot of young people who are or have been at schools in the private sector have the impression that they and their friends are discriminated against in their choice of university. I know a large number of such people—some young relations, many of their friends, and many other people of my acquaintance.

It is very important that the Government dispel that. It is absolutely wrong that those people should grow up with the impression that they have been discriminated against by the Government, which is what they think. It may often not be true—we do not know—but the impression is there. There seems no reason whatever why there should not be something in the Bill to make it plain that that cannot be. The provision should perhaps not be worded like the amendment, but there should be something in the Bill to reassure such people. It is very unfortunate for people who may well in future take a lead in society to grow up with that grudge.

Lord Shutt of Greetland

We should be a little careful on the matter. I would like to think that there is no particular discrimination against those children from independent schools who choose to go to university. Once or twice today, we have mentioned the subject of the courses that are available in sixth forms and whether they reach the heights at which universities want to attract certain students. I think that the noble Baroness, Lady O'Neill, mentioned it in an earlier debate.

We have to bear in mind the balance of resources between the independent schools and the state schools. I would be particularly concerned if the resources of the independent schools enabled far greater academic prowess than were really required to go to university, and if that were to then discriminate in some way against the perfectly good students who come out of the state system. One would not want to discriminate against those from independent schools, but we do not want to build hurdles that the resources of state schools cannot get anywhere near getting their students over.

Baroness Ashton of Upholland

It has been an interesting debate. I recognise the concern of Members of the Committee to ensure that the Director of Fair Access does not interfere in the admissions processes of institutions. We will be debating amendments on that shortly. It is absolutely clear that it is not the director's job to interfere. It is for institutions to select their students on the basis of academic merit, irrespective of their background or the type of school that they attended. It is very important that we recognise that.

We have no designs on academic freedom, nor do we seek in any way to disadvantage students from independent schools. It is for institutions themselves to decide which students best fit the courses that they offer and who should be part of their community of scholars. I agree that it would be quite wrong for the director to dictate to institutions which students they should admit, no matter what the basis. It will not be the director's job to do that.

It is worth saying that the quote with which the noble Lord, Lord Forsyth, began, was a misquote in the Times. I want to repeat what was said at the beginning of the quote, and I shall make sure that I give the noble Lord a correct copy. Alan Johnson said in his opening statement: All the evidence suggests that admissions are generally fair and that is why it will be outside the remit of OFFA". I hope that that offers some clarification. There is a longer quote, which I shall ensure the noble Lord receives, but I want to place that matter on the record because it is important.

The noble Baroness, Lady Carnegy, may have gained an impression, which is widespread, which I understand, particularly from the remarks of the noble Baroness, Lady Buscombe, who has personal experience of the matter. It is not the place of the legislation to deal with false impressions. It is about clarifying that admissions are entirely the responsibility of institutions.

The noble Baroness, Lady O'Neill, said that there was a difficulty because some universities are oversubscribed with good candidates. They make choices based on a range of factors that might include how far they think the students have travelled in terms of their ability, knowledge and so on and their confidence level—which was an important factor as the noble Baroness, Lady Buscombe, said, in her own background and certainly in mine—and how much students have developed themselves in that process. On the one hand, as the noble Baroness said, that might be because they have experience of living away from home and are more mature; and on the other hand, they did not have a school that provided them with that, but my goodness look how far they have come.

Universities weigh up all such factors when they consider their cohort of students. That is right and proper. We do not believe that they should discriminate and we do not believe that they do so in considering applications. We have always said that the issue is that the Director of Fair Access makes sure that we get students to apply who do not have that confidence factor and do not necessarily attend a school that promotes it and has never heard of the university.

I have said several times today that it is not an either/ or situation; it is not the schools or the universities, it is both/and. It is building on the enormous amount of work that universities do in outreach in waking up students to the idea that university could be for them. For a student who has never heard of a university or never thought of it, a day spent going round a science lab in a university could be one of the most exhilarating experiences of their lives. There are many instances, as noble Lords know, of individuals describing the moment that they made the decision that university could be for them. We want the Director of Fair Access to address all those factors in encouraging applications from students, but we do not want any form of discrimination.

The noble Lord, Lord Forsyth, will not be surprised to hear me say that the impact of Amendment No. 73 goes wider. The only proviso in respect of what I have just said is that the director might want to suggest to a university that it might want to consider outreach to its local schools. There are a number of instances—I talked about my own children earlier—where it is important that universities in a locality have a relationship with local schools, particularly those where there is not a tradition of going to university.

I do not think that any noble Lord would find that strange, but the amendment would effectively prevent that from happening. This is about the director and the institutions letting good common sense guide them. We have indicated in our guidance to the director on the bursary requirements that eligibility will be defined by financial need and not at all by the school.

I hope I have reassured the Committee that this issue is about institutions being responsible for admissions. I hope that the words I have placed on the record—if noble Lords, especially the noble Lord, Lord Forsyth, will reflect on them—make the Government's position crystal clear. I hope that I have reassured the noble Baroness, Lady Buscombe, and the noble Baroness, Lady Carnegy, to that effect.

I also recognise what the noble Baroness, Lady O'Neill, said; that while sometimes the pendulum swings between those attending state schools being unable to get in and those attending independent schools being unable to get in, on balance when students apply universities behave properly and applications reflect the issues for us in making sure we receive the applications from students that all noble Lords wish to see. On that basis I hope that the noble Lord will withdraw his amendment.

Baroness Carnegy of Lour

The Minister has not reassured me at all. Of course I agree with everything she said about the way that universities will set about this. I want to be able to say to a young person that it is the university's job to decide whether they will go there and no one can tell it not to admit them. The Minister has just said that the director of OFFA might say that a university has to take more people from local schools, so it could not take my young friend.

Baroness Ashton of Upholland

I absolutely did not say that. I said that in the process of looking at an outreach programme that a university might instigate to explain what university life is about it might be reasonable—this is an example I have plucked out of the air; it is not written down anywhere—for the director to say to the university, "Your local schools would welcome the opportunity for someone from the university to go and talk to them". Lots of universities do that. I was not implying or stating anything further than that, so the noble Baroness should be reassured.

7.15 p.m.

Lord Brooke of Sutton Mandeville

In the far-off days in the mid-1950s when I was a college representative on the National Union of Students, NUS policy was to seek to abolish the then minimum maintenance grant. I took part in a plenary debate on the issue to move a contrary amendment, citing a cousin who was capable of going to university but would feel that she could not impose on her parents for the total expense if the minimum grant was abolished.

As the debate developed, representative after representative said that they had been mandated to vote for the motion, but citing the considerations I had raised they were going to change their vote, and I carried the amendment. Irony being the stuff of life, 40 years later I recommended to the late great Sir Keith Joseph that he should abolish half the minimum maintenance grant and then in the second year he should abolish the rest of it.

My concern in support of my noble friend's amendment is for a young person like my cousin who might be put off striving to get to university for fear that they are being weighed out of the race. I am partially reassured by what the Minister has said in reply, but they are words that need uttering again and again. "Trust the universities" is as useful a slogan as "trust the people".

Lord Forsyth of Drumlean

I congratulate the Minister on the ingenious reply. We have spent a long time saying that there should be no interference with the admissions procedures of the university. She has turned the argument neatly round against us and said that we cannot possibly interfere with the admissions policies of the universities, even if it is to prevent them discriminating against people from particular schools.

It is ingenious, but it does not quite wash. The Minister is a member of a Government that have spent a lot of rhetoric creating the impression that universities are discriminating against pupils from state schools and from particular areas. I could almost sense the weariness in the helpful contribution of the noble Baroness, Lady O'Neill, for the universities are between a rock and a hard place.

Ministers are saying things and creating an impression that is perhaps exaggerated by the media, as the Minister indicated may have happened today in the case of the Minister for higher education in another place, but nonetheless it has an effect on the people who read it and the culture that operates.

If one is responsible for admissions at a university and there are far more candidates with three or four "A" grades than there are places, there will be great difficulty where the well has been poisoned with the view that it is not the enthusiasm, ability, expertise or potential that governs whether people are awarded places, and indeed that universities will be subject to financial penalties from a Government that believe that they are not doing enough in this area.

I understand and welcome what the Minister had to say, but I feel that her colleagues have created an atmosphere in which people believe that there is discrimination. I am grateful for the contributions to the debate. My noble friend Lady Carnegy reinforced what I said about my experience: youngsters believe that they are being discriminated against. Many ask me why they have to put on their UCAS form the school they went to and why it should be a relevant consideration from the point of view of the university.

On the other hand, I understand the point made by the noble Lord, Lord Shutt, concerning the importance of the resources available in state schools. But that is not a problem for the universities; the resources and standards in our schools, which is where the focus of attention should be, are a problem for the Minister's colleagues in her department. However much one wants to give a place to a youngster with ability, it must be impossible to do so if he has not learnt the basics required to set forth on the first-year course, and it will be extremely difficult for him to move forward. Therefore, in so far as those problems exist, I believe that the emphasis should be on schools.

I did not understand the point that the Minister was making—perhaps she could help me—when she said that the amendment would prevent universities having outreach programmes at their local schools. My amendment states: not require any governing body or higher education institution to discriminate against or to prefer any student or prospective student on the basis of the school or type of school at which they were educated". To my mind, that does not prevent a university having an outreach programme at schools in its area.

However, if that is all that troubles the Minister in respect of the wording, I should be very happy for her to amend it slightly in order to deal with that point. Given the words of support that she expressed—very welcome they were, too—I still do not understand why she could not undertake to consider this wording and perhaps come back with a revised form.

I am most grateful to my noble friend Lady Buscombe, who rightly pointed out the huge sacrifices that people make to send their children to independent schools. Indeed, other people send their children to state schools and make huge sacrifices by buying houses in the appropriate catchment area. Therefore, it is not an entirely even-handed debate as between the state and independent sectors.

I shall not follow my noble friend Lord Brooke into discussing what I may or may not have said at NUS conferences, where the noble Baroness's Secretary of State was a contemporary. Goodness me—looking at this Bill, his views have changed somewhat. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Deputy Chairman of Committees (Lord Haskel)

I must inform the Committee that if Amendment No. 74 is agreed to, I cannot call Amendments Nos. 75 to 77 because of pre-emption.

Baroness Perry of Southwark moved Amendment No. 74: Page 14, line 10, leave out paragraph (b) and insert— ( ) The Director shall not in the performance of his functions frame his advice by reference to particular courses of study or programmes of research (including the contents of such courses or programmes and the manner in which they are taught, supervised or assessed) or criteria for the selection and appointment of academic staff and for the admission of students.

The noble Baroness said: Amendment No. 74 addresses the issue of academic freedom, and I am sorry that we are reaching it just at the point when noble Lords are disappearing for their supper, very understandably.

The issue of academic freedom was a key concern of almost all noble Lords who spoke at Second Reading, and rightly so because the principle of academic freedom is, for all of us, an absolute. In a free and open society, there is no way that universities should not have freedom of academic expression or freedom to criticise and be critics of government or of any aspect of society, and no one—especially in the political sphere—should have any control over them whatever. That, for me, and I believe for most noble Lords, is indeed an absolute.

The amendment uses the words of the 1992 Act in respect of the Secretary of State giving grants to the funding councils. Looking around the Chamber, I believe that perhaps only five or six of us were here in 1992 when the debate on that Act took place. I can assure Members of the Committee who were not here that it was a fierce and long-lasting debate. As I recall, it ran for more than seven hours. In response to a concerted attack from all sides of the House, the then government brought forward an amendment with wording identical to that in my amendment.

It is interesting to note that, at that time, the comments from all sides of the House addressed in particular the absurd possibility that one day some future Secretary of State might wish to interfere with the criteria under which students are admitted or might wish to interfere with the processes of recruitment. In 1992—only 12 years ago—it seemed impossible that any encroachment on that freedom could ever be envisaged or be likely to happen. What a long way we have come since then.

It is important to say that there is every possibility that, if OFFA did its job properly, it could go a great deal further than simply consider applications. That point was made earlier by my noble friend Lord Lucas, who pointed out that the kind of courses that universities offer and the kind of decisions that they make about the overall pattern of their courses very much predetermine the kind of applications that they will receive. It can either encourage certain kinds of applications or discourage others.

Therefore, it seems to me that there is absolutely no way in which OFFA could not be tempted—in some ways, properly tempted, given its remit—to go far more comprehensively into, for example, setting targets for individual courses. Could we not show concern that, whereas certain courses are very appropriate for attracting applications from underrepresented minorities, others are not, and therefore we must consider the other courses which are not doing so well?

Could OFFA not also go into the manner in which courses are taught? Certainly, I know from personal experience how very hard some of the universities which have a very strong access commitment and which take a large number of students from underrepresented groups alter the way in which they teach, particularly in the first two terms of a course, because they expect students to enter university with inadequate preparation from their schools. Therefore, of course the teaching must be different from that at universities which attract people from schools which have taught their students and prepared them well for university. Should not OFFA also concern itself with the way in which courses are taught?

Similarly, those of us who have worked very hard to attract applications from under-represented minorities know very well that the profile of the staff in the university is very important. If all the staff are white, middle-class males, the university is conveying a certain kind of message about itself. Therefore, we worked very hard to ensure that our members of staff were representative of the wide diversity of students whom we wished to attract.

In other words, unless we can prevent it happening, it seems to me that those are all concerns which OFFA may find itself becoming involved in—not only in relation to applications but in relation to the criteria for admissions, the way in which courses are taught, the content of the courses and the structure of the staff and so on. I believe that we would all agree that that is wrong. We do not wish any outside body, particularly not a non-departmental public body, to involve itself in matters of that nature. That is why my amendment is comprehensive and covers, as the 1992 Act did, the whole range; that is, courses of study, programmes of research, the contents of such courses, the manner in which they are taught, supervised or assessed, the criteria for the selection and appointment of academic staff and the admission of students.

I conclude with two brief quotations from a speech made by the noble Baroness, Lady Blackstone—I am sorry that she is not in her place—in the 1992 debate when she was the Opposition spokesman on higher education. She said, in a tone of surprise: It is not possible to anticipate or determine what some future Secretary of State…might do about, for example. the kind of students who should or should not be admitted, the kind of academic staff who should or should not be appointed, or about departments which the Secretary of State has taken against and wishes to close. Lists of exceptions cannot encompass every possibility. An interfering Secretary of State could always find ways of exploiting loopholes".—[Official Report, 20/1/92; col. 651.] Again, she said at Third Reading that, the selection of students and their admission are entirely, and must be, matters for individual academic institutions. No government…should be involved in such detail. We must trust responsible people to get on with the running of institutions, deciding whom they can teach and who can best benefit from the courses they run".—[Official Report, 3/2/92: col. 102.]

I find myself in total agreement with what she said. I beg to move.

7.30 p.m.

Lord Forsyth of Drumlean

I support the amendment moved by my noble friend. Given my failure to persuade the Minister to accept Amendment No. 73 and given that I have consistently been robust about the briefing from Universities UK, on this occasion the briefing in respect of these amendments is helpful. I look forward to hearing the Minister's reply.

Lord Sutherland of Houndwood

I too support the amendment. I was here in 1992, but up in the gallery. However, when I was younger I did not have the stamina to listen to seven-hour debates. Perhaps that comes with maturity as one accepts a place in the House. I prefer this amendment to later versions because it picks out the content of academic freedom in this context: course content, programmes of research, appointment of staff and selection of students. I believe it is necessary to include all those.

Baroness Warwick of Undercliffe

Noble Lords will know that I have tabled my own amendments on this subject. They are the culmination of long months of discussion, including discussion with the Government. I certainly support the spirit of this amendment, but I look forward to moving my own shortly. I shall explain my amendments in more detail when we come to them, but I want to touch briefly on why I prefer them to that tabled by the noble Baroness, Lady Perry.

The word "admissions" is potentially ambiguous. We have had an enormous amount of discussion about this matter. I am clear that admissions standards, requirements, procedures, policies and decisions all need to be excluded from OFFA's remit. A wide interpretation of the word "admissions" would do that, but it could also exclude other matters that are properly the remit of OFFA, such as open days or outreach activities which the Minister has said are entirely appropriate to OFFA.

However, a narrow definition of "admissions" might simply be admissions decisions. In that case this amendment would prevent OFFA from involving itself in admissions decisions, but not practices. So, for example, OFFA might be able to require institutions to end the practice of conducting interviews and fine it if it does not. I am not convinced that these amendments do what is necessary. I hope that when I put forward my amendments the Committee will consider that they take a clearer approach.

The amendment would also prevent the director of OFFA interfering and widening participation at the level of individual courses. Institutions may wish to refer to particular courses in their agreements, but OFFA should not be able to require them to do so. I believe that it is right that OFFA should consider widening participation generally but should not examine matters on a course-by-course basis. That would lead to an unacceptable level of micro-management by OFFA and could open the way to political pressure in certain areas.

Many factors affect application to particular courses which are outside the control of institutions. I have tabled an amendment on this subject too. Although I support the thrust of the amendment and although its wording reflects the wording, as the noble Baroness has said, of the Further and Higher Education Act 1992—it certainly appears to be sensible—because of the problems of the word "admissions", I believe that my amendments would more successfully fulfil the aims of the noble Baroness.

Lord Dearing

I have put my name to an amendment tabled by the noble Baroness, Lady Warwick. Like her, I find myself in accord with the proposals made by the noble Baroness, Lady Perry, but the point about the word "admissions" made by the noble Baroness, Lady Warwick, is valid. It has the advantage of being interpreted more widely than in Amendment No. 74. While I support the noble Baroness, Lady Perry, on what goes in, I am less confident about excluding the fact that the Secretary of State may give advice to the director.

When I dealt with the curriculum for schools it was said that one may give sex education, but that one should hold back on the practice. On the amendment tabled by the noble Baroness, Lady Perry, which we discussed earlier, there was considerable support for widening the remit of the director to include advice, guidance and training. If I were the Secretary of State and the director was getting a little too enthusiastic, I would want to say, "Cool it, mate". Providing that the direction was published, I would not want to say, "It's wrong to provide something like that".

Baroness Sharp of Guildford

We support the amendment tabled by the noble Baroness, Lady Perry. I listened with interest to what the noble Baroness, Lady Warwick, had to say about the differences between the two and in particular about the issue of "admissions". On the face of it, I cannot see that there is that much difference. As it stands, I support what the noble Baroness, Lady Perry, said so eloquently in introducing the amendment.

Baroness Park of Monmouth

I hesitate to speak because I have not been able to do so before. Therefore, I may say something that has been said many times. I hope I shall be forgiven. I speak as someone who was state educated and went to Oxford on scholarships, so I know what that is like—it was wonderful. But later when I was head of an Oxford college, I became conscious of three points that this appointment should consider. First, not enough people from state schools went to Oxford because at that time many teachers regularly said to their children, "Oxford is not for you; it is elitist; it is Brideshead Revisited", and so on. We tried to counter that. Our undergraduates used to go to comprehensive schools, as I did, to reassure the students, but it was an uphill struggle.

I remember one extremely promising girl who, although she performed extremely badly, was taken by the chemistry tutors because she had had six teachers of chemistry in one year. They recognised that it was a time of great upset in the school, but they took her just the same. Another girl who had won a place very nearly did not come at all because her teachers told her that she was a class traitor. They said so to her friends and family.

To some extent we must look at the need for this appointment to educate schools and to make the point that if Oxford takes only 100 medical students that is because of the size of its medical school and because it cannot expand. Equally, there are limitations in law. I do not believe that any of those points are made sufficiently clear to schools. We read about such matters in the newspapers, but schools need to be told. It must be explained that if a pupil is the 101st pupil, that is desperately bad luck but it is not prejudice. We need to consider the matter much more from the point of view, not of what the universities are doing, but of the situation that confronts people.

Lastly, I can remember very well the effects of social engineering when we indulged in it from time to time. The weak undergraduates had to be propped up by the strong ones. One will never cure undergraduates of helping each other and trying to work to enable the weak ones to manage. That is social engineering which has a very bad effect.

I wholeheartedly support the amendment, but I believe that the concept of the appointment should be considered. We need someone who knows the problems of all universities, who is close to them and who understands them. We need someone who will go to schools and say, "These are the problems; every effort is being made to help you but that is how it is".

Lord Winston

The noble Baroness, Lady Park, makes an excellent point. Rather than considering the director as encroaching on academic freedom, perhaps one should consider him as someone who may assist at the front end of admissions to universities. I hope that that is taken to heart.

I wish to make a point wearing not so much my Imperial College hat as that of chancellor of Sheffield Hallam University, which has striven hard to increase access. Thirty per cent of students at that university come from social classes C2, D or E. At Sheffield Hallam we believe that one of the things that should be written into the Bill is that OFFA is barred from having any influence over admissions. If OFFA is allowed to intervene in admissions decisions—for example, by setting admissions targets for students from specified groups or social classes—that would lead to the taking of many wrong decisions that could be damaging to students and universities.

The current proposals suggest that financial sanctions imposed through OFFA would be against failure to deliver a widening participation strategy. It is unclear how performance against delivery of such a strategy would be measured. Logically, the only feasible means of measuring delivery in this area—setting admissions targets and imposing sanctions against the delivery of specified admissions targets by class or social grouping—would undermine the fundamental principle applied by higher education institutions that admissions must be based on ability to benefit and probability of success in the course. By encouraging institutions to focus on volume, that would increase the risk of failure.

Baroness Buscombe

I support all that the noble Baroness, Lady Perry, has said on her amendment. I hear what the noble Baroness, Lady Warwick, says on her later amendment—I am sorry that the two are not grouped. I prefer the one tabled by the noble Baroness, Lady Perry, because it appears more all-encompassing and therefore more reassuring. At the same time, however, it will be worth while to listen to what the noble Baroness, Lady Warwick, says on her amendment.

Lord Wilson of Dinton

I, too, support the amendment tabled by the noble Baroness, Lady Perry. I accept entirely the Minister's argument about the need to widen applications. Taking one university as an example, I have found extraordinary figures in the Cambridge University Reporter to show that of the last round of applications some 36 per cent came from London and the south east, 20 per cent from overseas and 1 per cent from the north-east. There is a clear geographical imbalance.

There are many ways in which we face a challenge, as the noble Baroness quite rightly pointed out. The Bill as drafted is unbalanced. On the one hand, it proposes a great apparatus of law on universities' access plans. On the other hand, on the very important issue of academic freedom, the law would say nothing if the Bill were passed as drafted. That shows an imbalance that needs to be corrected.

We have heard arguments about this group of amendments and about ones that we shall consider later. I wish that we could agree both, but I can see that that is not practicable. One way or another, it is important that the issue of academic freedom is addressed in the Bill to rebalance the picture. I look forward to hearing the Minister's comments.

Lord Lucas

I very much support my noble friend's amendment. Clearly, if we are to have an access regulator with teeth, he must keep his teeth out of such an area.

Presumably, one of the first things that the access regulator will do is talk to students who have not gone to university or to people in the north-east who, despite having good qualifications, have not applied to Cambridge, and find out what their problem is. If the reason given is, "All the Cambridge courses are too fusty. Of course I do not want to go there; I want to go where there are modern courses", or if it is found that schools are not up to it, that the kids are not getting far enough and that Cambridge has no arrangements for accepting people who have done a one-year access course to bring them up to standard, will the access regulator simply close his book and say "I cannot touch it"? If he did, he would be entirely ineffective, because he would not be addressing the problems that exist. Alternatively, will he open such discussions and questions with the university and be given a raspberry?

My difficulty with the model of the access regulator is that he is too powerful. He cannot discuss the real problems because they are the problems of the university. If the amendment were agreed he could not mess with the universities in this area; therefore, he could not deal with the real problems.

7.45 p.m.

Baroness Carnegy of Lour

I was present at that great debate all those years ago. I remember great blasts from my late friend Lord Beloff towards the government that he supported about their monstrous behaviour. I said afterwards to our Front Bench, "For goodness' sake, put in a phrase about academic freedom and that will shut everybody up". I cannot remember whether they did, but that seems to be happening with the amendment tabled by the noble Baroness, Lady Warwick. She has made one or two proposals that would of course be very desirable.

However, my noble friend Lady Perry has carefully used words, lifted from other legislation, that specifically say what the regulator cannot do. That seems a much more effective approach than the golden syrup of providing that there must be academic freedom and the subject of student admissions must be avoided.

My noble friend included the question of staff and explained why. Listening with a fairly fresh ear and without a mental picture of what goes on during the admissions process, I think it is very important that the universities decide who will be their staff, where they come from and whether they should be from an ethnic minority. That is their job. I wish to goodness that the Government would leave it to universities. I get more and more angry about OFFA.

Baroness Ashton of Upholland

It would have been enormously helpful to me if we had been able to group these amendments with Amendment No. 75, but I understand why the noble Baroness, Lady Perry, wanted separate debates. I am in a slight dilemma about how to handle things, so I hope that Members of the Committee will forgive me if I do not quite get the procedure right. I shall be brisk, because I recognise the lateness of the hour.

If the noble Baroness, Lady Park of Monmouth, and my noble friend Lord Winston have the opportunity today to look back on reports of earlier debates, they will feel that they have echoed what was said about the role of schools, including the issues that the noble Baroness, Lady Park, put very well. I hope that they will forgive me if I do not refer back to those matters, but we have had the opportunity to discuss them. I hope that the noble Baroness will come back to me if she feels that I ought to say more.

The noble Baroness, Lady Perry, is doing what she talked about at Second Reading: recognising this House's proud record in defending academic freedom. It is a proud tradition. and it is right that noble Lords seek reassurance that that freedom is not under threat.

I have given assurances in your Lordships' House—I no longer know how many times—that the director will not be responsible for admissions, so I shall turn the page to avoid repeating much of what I have already said. One of the things that I wish to say to Members of the Committee from universities is that current evidence suggests that admissions are generally fair. It is important that we restate that point. Attracting applications from under-represented groups is a problem.

The noble Lord, Lord Wilson, referred to admissions to Cambridge from the north-east. In looking at those statistics, Cambridge University may decide that some of its outreach should be in the northeast. That would be a reasonable conclusion to draw, but it is for the university to consider such issues. There are always interesting dilemmas for some of our top universities, in particular, in looking at where their applications come from. It is hard to get representation from the north-east if students there simply do not apply.

However much noble Lords have tried to shift OFFA on to schools, there is also an issue about the extent to which universities can be involved in that. As Members of the Committee know, my right honourable friend the Secretary of State's draft guidance says: Institutions' admissions policies and procedures will be outside your remit". Amendment No. 74 uses the wording of the Further and Higher Education Act 1992. I understand her desire to reflect that in the Bill, but we must consider other issues, some of which have been raised by my noble friend. I repeat that I have not had the Universities UK briefing, therefore I am the one person in the Chamber who does not know what will be said.

It is part of the group of amendments proposed by the noble Baroness and the noble Lord, Lord Forsyth, which are about changing the function of the director to an advisory one. Therefore, the term that the noble Baroness uses is "frame his advice". On its own, this amendment does not work. It does not adequately cover the director's functions. It would not prevent the director taking admissions into account in doing things other than providing advice—for example, in agreeing plans—which is not what the noble Baroness would wish to happen.

Furthermore, the reference to particular courses of study creates some difficulty. Clause 31(1) requires universities to include in their plans the fees of each qualifying course, which means any course for which variable fees might be applied—that is, full-time, undergraduate courses. Access plans are necessarily tied to the freedom to charge higher variable fees for full-time undergraduate courses. It would be wrong to sever that tie, which this amendment would do. As noble Lords have indicated—the noble Lord. Lord Dearing, in particular—it would remove the duty on the director to have regard to the Secretary of State's guidance, which, not surprisingly, the Government think is important. It is valuable to have that.

I have reservations about the technicalities of the transference of the 1992 legislation to this legislation. It does not work. Had they been grouped, I would have gone on to say that we are mindful to accept Amendment No. 75, and as we return from dinner. I hope that we will have a useful debate in which I will be able to state how important it is that noble Lords have convinced me and my colleagues to put this right in the Bill.

Lord Lucas

Will the noble Baroness briefly address my question? What will happen if the problem is with the admissions procedure or the courses? If that is what is causing the lack of applications from the northeast, or from comprehensive schools, or from a particular social class, does the access regulator have nothing whatever to say? Must he just shut up?

Baroness Ashton of Upholland

The access regulator's relationship is with the university in looking at what the university can do to support applications. The instance that the noble Lord gave me would not occur in reality. The director would not be talking to students about why they were not applying. It does not work like that.

The hour is late for me; sustenance calls. If I have not responded correctly, I shall have either a word with or send a note to the noble Lord to make sure that I have picked that up?

Baroness Perry of Southwark

I thank the Minister for her reply, and I thank noble Lords who have taken part in this debate. I am grateful for the support for the amendment from many sides of the Committee. I accept what the Minister said about some technical details needing to be looked at again, but I am sure that by looking at this together with the other amendments tabled by the noble Baroness, Lady Warwick, we will be able to come back with something on Report. I am delighted to hear that the Minister is mindful to accept something fairly comprehensive. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Triesman

I beg to move that the House do resume. In moving this Motion, I suggest that the Committee stage begin again not before seven minutes to nine.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.