§ Mr. Alton
Will the Under-Secretary admit that yesterday's decision to increase student grants this year by only 2 per cent. will mean that by next year students will have sustained a cut in real terms of 20 per cent. since 1979, and that yesterday's decision to reduce students' housing benefit, unemployment benefit and supplementary benefit during short vacations will mean that in real terms £14 million will be cut from students' allowances during the next year, making a net saving to the Government of £20 million? Does he not accept that he is surreptitiously introducing by the back door the provisions of his Green Paper, against the wishes of his own Back Benchers?
§ Mr. Walden
I accept—because it is incontrovertible —that over the years there has been a cut in the grant to students, but the hon. Gentleman must accept that the number of students in this country is at an all-time high. 148 Secondly, he must accept that students in this country benefit from the most generous system of support in the Western world. Thirdly, he must accept that the cost of that support must be shared among students, parents and the taxpayer.
As for benefits, I understand that a written answer on this question is down for reply tomorrow by my right hon. Friend the Secretary of State for Social Services.
§ Mr. Forth
Is my hon. Friend aware that our student grant system is the envy of many students throughout the world, who are expected to make a much greater contribution towards their education? Will he undertake again to review the possibility of introducing a loan system, which works perfectly satisfactorily in many other civilised, developed countries?
§ Mr. Walden
Let me elaborate on the cost of student grants in this country. The United Kingdom devotes a greater proportion of GNP to student support than do our major competitors. For example, it is twice as much as West Germany, two and a half times as much as the United States, and about seven times as much as France and Italy.
I assure my hon. Friend and the House that full consideration was given to all the implications of introducing a loan system, but it was felt that for a number of reasons it would not be right to introduce it at the present time. Two of the reasons were high initial costs and the effect on low income groups.
§ Mr. Andrew F. Bennett
Can we take it from what the Minister has said that the Government are now determined to reduce the record number of students by giving them inadequate support? Why, after six years in office, cannot the Government at least afford to maintain the level of student grants rather than cutting them by about 3 per cent. next year? Should not the Minister come clean and tell us what will happen to student grants as a result of the removal of the right to claim housing benefit during vacations? Does yesterday's statement that there will be some adjustment mean that the grant will be substantially below the amount that will be lost?
§ Mr. Walden
The hon. Gentleman must realise that there is no evidence at all to suggest that the fall in the value of the grant has resulted from a decline in the demand for higher education. Therefore, his first question falls heavily to the ground.
He asked why the Government could not afford to do better. If he took the trouble to look back, he would find that, unfortunately, there has been a steady decline in the value of grants ever since 1962. Perhaps this was another example of this country promising too much, too widely.
Although the hon. Gentleman referred to benefits, I am sure that he would not wish me to anticipate the answer that will be given by my right hon. Friend the Secretary of State for Social Services.