BUSINESS SCHOOLS (MANCHESTER AND LONDON UNIVERSITIES) (Hansard, 11 May 1964)

§ The Lord President of the Council and Secretary of State for Education and Science (Mr. Quintin Hogg)
With permission, I wish to make a statement about British business schools in the universities.
The importance of management studies for the future of our economy has been strongly emphasised by the National Economic Development Council; and the establishment of two major business schools—a new development in this country—was recommended in general terms by the Robbins Committee.
A Working Party, under the chairmanship of Lord Normanbrook, was set up at the initiative of the Federation of British Industries. It was asked to give definition to the proposal made by Lord Franks in his recent Report on British Business Schools for the establishment of two new business schools at the Universities of Manchester and London, and, in particular, to examine the costs of starting and running them, and to establish the basis for partnership between business and the universities in their finance and administration. The Working Party included representatives of industry and commerce, of the two universities themselves, and of the University Grants Committee.
The Report, now being published, estimates that the capital costs of the two schools would be between £2.2 million and £2.4 million; that, over the first seven years, the total net recurrent cost would be about £1.7 million; and that, thereafter, the net running costs would be about £332,000 a year. The Working Party envisage that this burden should be shared equally between business and the universities. They also suggest how governing bodies should be constituted to carry out the principle of partnership.
The Government welcome this principle and have sought the advice of the University Grants Committee on the Working Party's proposals from the point of view of policy on university development. They have been glad to learn that the Committee fully endorses them.
39 For their part, the Government have indicated to the Committee and to the F.B.I. that they are prepared to make provision for the universities' share of capital and current expenditure on the two new business schools within the framework of future university programmes.
They are also prepared to give sympathetic consideration to the suggestion contained in Lord Franks' Report that awards from public funds should be made available for postgraduate students at these schools.
I understand that the Federation of British Industries is now planning an appeal to all sides of the business community for funds for management education which will include their share of the needs of the two schools. I am sure that business will wish to play a full part in this new development from the point of view both of finance and operation.
In pledging full financial support to the universities concerned, I should like to add that the Government do not in any way wish to imply that management studies elsewhere, whether at universities, colleges of advanced technology and technical colleges, or other institutions, will no longer be needed, or are to take second place. Raising the quality of management at all levels calls for the steady development of all the work now going forward in the various parts of our educational system, as well as for the establishment of these two new schools.

§ Mr. Willey
I am sure that the House will welcome the statement that the Secretary of State has made. I am sure, also, that, while we have not yet had an opportunity of looking at the Working Party's Report, as soon as we have had the opportunity we shall wish to express our appreciation of the Working Party's work.
While we welcome the idea of partnership, may I ask the right hon. and learned Gentleman how far the trade unions are brought within this partnership? Can he say how he will expedite this work, for, as the Robbins Committee said, the provision ought to be made, to use its own words, on a large scale? I think that the right hon. and learned Gentleman will agree that this provision is very much lacking in higher education.
40 Can the right hon. and learned Gentleman say what steps he is taking to make sure that the ladder towards this provision in higher education remains wide and that the steps he is taking will not impair but will encourage the provision which has been made in further education?
Finally, can he say what is being done about the question of providing adequate staff? As the Robbins Committee said, we want staff, in this case, to be recruited from people who have had successful professional careers. This presents a difficulty in higher education.

§ Mr. Hogg
I do not think that the trade union movement has yet formally been brought into consultation, but, of course, I shall be very happy indeed to know in what way it can be associated with the proposal. Of course, it is very closely associated with the whole problem of management studies in technical colleges and colleges of advanced technology as well as the universities.
I think that the Working Party believes that full-time staff should have considerable latitude to supplement their academic income with outside fees and that a substantial part of the teaching should be carried on on a part-time basis by persons holding positions in industry and commerce. Although I think that this is, perhaps, not appropriate to these two particular schools, we are, of course, taking steps, as he will have seen, to institute short courses for the teaching of teachers for business courses generally. There were other supplementaries, but I have lost the other two.

§ Mr. Willey
There was one other point. I referred to the need to make sure that this does not impair the provision for further education, but that we shall be able to extend and encourage the provision made for education at the same time.

§ Mr. Hogg
I wholeheartedly agree with that.

§ Sir G. Nicholson
Is the accent in these new institutions to be on the educational or the business end? Are they to be regarded as coping stones of education, or primarily as a help to businesses—to people of all ages engaged in business and commerce?

§ Mr. Hogg
Two separate courses are to be held at these schools. One is a one-year course for 200 post-graduates, and the other a 20-week course, or a half-year course, for 100 post-experience students. The idea is that the first should take those people who have recently graduated at universities and give them a course which will fit them for managerial posts in industry. The other will take persons frrom industry, who will be given an academic course to make them more useful for industry. Both parts are equally valuable.

§ Mr. Grimond
I welcome the Government's decision to set up these schools, but is the Secretary of State satisfied that it is wise to have one of them in London? I appreciate that many students may come from London, but London University is already by far the largest university. Will not this increase the magnetism of London? Secondly, is the right hon. and learned Gentleman aware that there is great concern in Scotland that a similar decision should be taken about business training there? At the end of his statement he said that the Government would encourage other courses of business management. What action is proposed for Scotland, and what assistance are the Government prepared to give?

§ Mr. Hogg
The Report was confined to the attitude of the Government to certain specific proposals which were made by Lord Franks and commented upon by Lord Normanbrook. I do not think that I could go through the agonies which no doubt Lord Franks suffered in selecting the locations for the two schools. This would be to undo what he has done. But I agree with the right hon. Gentleman that business training is wanted at several levels in all parts of the country and that Scotland must not be left out of that. Primarily, the responsibility for suggesting what should be done lies with the educational establishment themselves and with business itself. I would certainly wish to encourage movements of that kind.

§ Mr. J. Rodgers
Does my right hon. and learned Friend realise what great satisfaction is given by his statement that the Government are willing to enter into partnership with business in the creation of these two business schools? 42 I should like to follow up his remark about the need for more courses for business management in other institutions, such as universities and the like, because the one great bottleneck there may be in relation to these courses is the supply of teachers. Would the Government be willing to enter into partnership on a £-for-£ basis with industry in supporting management education courses and the like at our universities, including those in Scotland?

§ Mr. Hogg
I am grateful to my hon. Friend for the first part of his supplementary question. The two subsequent parts are probably too broad for me to commit myself on unequivocally without notice. There is a fundamental difficulty in finding suitable teachers for business studies. It is largely to overcome that difficulty that we are starting research into the content and methods appropriate in the provision of the 10-week course for would-be teachers in this study.
I would not go so far as to say that business studies must be available in every institution—that must ultimately be a question for the institutions to decide for themselves—but I certainly agree that expansion in the different areas is required.

§ Mr. Snow
I am sure that we are all pleased about this announcement, but can the right hon. and learned Gentleman assure us that we shall extract the best that we can from other schools, for instance, the Harvard School, bearing in mind this country's reliance on exports and the need for higher executive training in overseas marketing?

§ Mr. Hogg
I agree with the hon. Gentleman in his tribute to Harvard School, which has won an unrivalled place in this field for its particular method of teaching, namely, by case study. But this is not the only method, and we shall take other methods into account and apply them.

§ Mr. Emery
Does my right hon. and learned Friend realise what satisfaction his statement will give to professional bodies and institutes dealing with business management which, up to now, have had to carry much of this training burden themselves? Will he consider consulting them about the appeal for 43 money? Although these institutes may not themselves be able to contribute, their members should be fully behind the appeal. This would probably increase the effect in industry.
Secondly, will my right hon. and learned Friend ensure that consultation is carried out with their educational departments, because a great deal of experience has been gained there and would readily be given to the two new schools?

§ Mr. Hogg
I certainly endorse what my hon. Friend has said about the importance of professional bodies in business studies generally. If there is any way in which I can bring them in or help in this way I shall be very glad to do so. I could not say offhand exactly what the financial relationship between the various professional bodies and the F.B.I. would be, but I would certainly hope that the net would be cast as wide as possible.