HC Deb 21 February 1996 vol 272 cc360-1
12. Mrs. Anne Campbell

To ask the Secretary of State for Education and Employment what is the percentage change in planned capital and recurrent funding for higher education between 1995–96 and 1996–97. [14687]

Mr. Forth

Planned capital and recurrent funding for higher education institutions in England will be £4.6 billion in 1996–97, a reduction of 2 per cent. in cash terms from 1995–96.

Universities and colleges are being encouraged to use private finance to fund capital expenditure so as to maximise the value of taxpayers' money.

Mrs. Campbell

Is the Minister unaware that slashing the capital budget by 30 per cent. next year and by almost 50 per cent. over the next three years will have the most disastrous effect on universities' ability to provide for their students? Further, is he unaware that capital funds are used for the purchase and maintenance of equipment for teaching and research, which is totally unsuited to provision by the private finance initiative?

Mr. Forth

I am aware that we are asking higher education institutions to explore every possibility for the imaginative use of private finance in place of a complete reliance on the public purse and the Government of the day. That is a healthy development.

As I said in reply to an earlier question, my right hon. Friend the Secretary of State and I are in close contact with the Committee of Vice-Chancellors and Principals, the Higher Education Funding Council for England and others to assess the impact of the switch to private finance on different institutions and types of education resource. The impact will differ for each organisation and resource. We will consider the way forward in the light of that assessment. Much work is being done in close conjunction with higher education.

Mr. Jenkin

Will my hon. Friend ask Sir Ron Dearing to prepare two reports after his inquiry into higher education? The first, for the Conservative Government, could highlight policies that would bring about choice, excellence, private funding and independence for our universities; the second could contain a rag-bag of tired ideas for the Labour party to use in its manifesto, which will be redundant after the next general election.

Mr. Forth

Tempted though I am by my hon. Friend's seductive suggestion, I would not dream of asking Sir Ron Dearing to waste his time doing anything of the kind. Sir Ron need prepare only one report, because only we will be in government after the next election.

Mr. Bryan Davies

The Minister's answers on higher education today have been all sound and no bite. Will he explain how the cuts that are being made in the capital budget—which, as my hon. Friend the Member for Cambridge (Mrs. Campbell) said a moment ago, affect equipment also—can possibly be bridged by the private finance initiative, given that institutions are already telling him and the Secretary of State that, at the most, they will be able to get 10 per cent. support for certain capital projects and that the PFI is entirely unsuited to equipment?

Mr. Forth

I do not know whether that is an implied spending commitment by the hon. Gentleman on behalf of his party. I do not know, either, whether he has the permission of the hon. Member for Dunfermline, East (Mr. Brown) to make it. We are aware, of course, that there will be different requirements in different higher education institutions, that different solutions will have to be brought forward and that an imaginative and positive approach will be required by all. As I have said twice already, I think—but I shall repeat myself for the hon. Gentleman's benefit—we are working closely with all concerned to ensure that the switch to private finance, instead of total reliance on the public purse, is successful. As for the hon. Gentleman's accusation that I was unable to produce a soundbite, I regard that as a badge of honour.