HC Deb 13 November 1997 vol 300 cc1019-22
2. Barbara Follett

If he will make a statement on his proposals to increase funding for higher education. [14321]

The Secretary of State for Education and Employment (Mr. David Blunkett)

In my statement in September, I outlined how we had identified £165 million for investment in opening up access to higher education, doubling the access funding and providing money to sustain the universities and to ensure that young people have the opportunity of taking up higher education in years to come. Yesterday, I was able to make a similar statement relating to further education.

Barbara Follett

I am grateful to my right hon. Friend for his reply and for the funds that he announced for the further education sector yesterday. Does he agree that those funds will send an important signal to the students and staff of further education colleges across the country that their work is valuable—as valuable as that of the universities?

Mr. Blunkett

I agree with my hon. Friend. The £83 million that we have identified for direct investment, and the minimum contribution of at least £100 million from the new deal for the under-25s—which will go into further education through the full-time and part-time options for education and training—will make an enormous difference in opening up potential for more than 70,000 additional students next year. The funds will help to protect the colleges, as we did the universities, from the draconian cuts imposed by the previous Government, who paid lip service to expansion while undermining the quality and standard of education.

Mrs. May

The Secretary of State will be aware of the various comments made by spokesmen for Scottish universities on the likely impact of the decision by the Government that English, Northern Ireland and Welsh students will have to pay the full £4,000 tuition fees, while students from other European member states and Scotland will not. Is he aware that in last week's debate on higher education funding, the Minister for Education and Industry, Scottish Office dismissed the statements that had been made by the Scottish universities on the issue? Who is presenting the correct picture—the Minister or the universities?

Mr. Blunkett

We are of course talking about the £1,000 towards the tuition fee for the final and fourth year for those in the higher income bracket. There is no evidence yet on what the impact might be on English students, because applications have not yet closed in Scotland. One thing is certain: the more fear that is put in students' minds about what they can expect to find and when, the more likely it is that they will not apply. I am confident, as are my right hon. and hon. Friends in Scotland, that the quality of education at universities in Scotland is such that those who are privileged enough to have earnings that will oblige them to pay the full £1,000 fee will feel that it is worth the investment.

Mrs. Anne Campbell

I know that further education colleges in my constituency will warmly welcome the announcement made by my right hon. Friend yesterday. Does he agree that it is an important part of the package to convince young people that further and higher education are worthwhile investments, and that those who take a degree are far more likely to have higher earnings, certainly by their mid-30s and for the rest of their lives, than non-graduates of the same ability?

Mr. Blunkett

I agree entirely. It is statistically proven that what my hon. Friend says is correct. We announced yesterday an expansion for further education, and the fact that adult students in further education already contribute towards their fees and feel that it is worth while to do so will be an encouragement to those who go on to higher education: they will see that the higher return on the investment made will be a tremendous financial as well as an educational and employment gain.

Mr. Beggs

The Secretary of State's announcement of additional funding for further and higher education is welcomed in all regions of the United Kingdom, but we in Northern Ireland are concerned at speculation about the creation of an additional higher education centre in west Belfast, in which £65 million of public money could be invested. Will he consult the Minister responsible for education in Northern Ireland, the hon. Member for Clydebank and Milngavie (Mr. Worthington), and advise him that it is our view that investment in that project is not justified and that moneys available would be better spent on the many existing further and higher education campuses in Northern Ireland?

Mr. Blunkett

I shall be happy to consult my right hon. Friend the Secretary of State for Northern Ireland and her colleagues about how to provide greater access to education for all members of the community in Northern Ireland.

Mr. Jim Marshall

I recognise the problem that my right hon. Friend faces in financing higher and further education, but does he not agree that if the Government's proposals on student funding lead to a dramatic fall in student numbers, that will create an even greater crisis in the sector's finances next year? How does he intend to cope with that potential crisis?

Mr. Blunkett

If there is a drop in the number of students, it will be a tragedy for those who have been discouraged from taking up their places by misleading and scurrilous propaganda: propaganda that suggests that the means-tested family contribution is to rise, when it is not; scurrilous misinformation that suggests to poorer students that they will have to find the £1,000 fee, when they will not; and scurrilous misinformation that deceives them into thinking that the grant is to disappear in one year, when in fact it is being phased out.

There will not be a financial crisis if there is a drop in the number of students, because we are funding those students through the fee process, funding the residual grant and funding the loan. The tragedy would be if those young and mature students were denied the opportunity of better employment prospects and higher earnings from their investment in their own education.

Mr. Dafis

Will the Secretary of State explain in as much detail as possible the connection between the decision to require students to contribute towards their fee, and the additional resources for higher education? Does he intend to ensure that the additional resources from the fee are ring-fenced for higher education, and how permanent will that connection be?

Mr. Blunkett

By 2005–06, on current accounting procedures, an additional £800 million would be available for the further and higher education sector from the introduction of our proposals. That sum would rise substantially under alternative resource accounting processes. That money will be available for lifelong learning. I have made it clear here and in the Select Committee that that is why we are introducing the scheme. We believe that it is an important investment which will open access to the tens of thousands of students who would otherwise be denied it.

Ms Hodge

May I, too, congratulate the Secretary of State on his ingenuity and skill in finding an additional £83 million to invest in further education? Does he agree that the needs of the 2.6 million students in further education are as important as the needs of the 1.8 million students in higher education? Does he further agree that the false divide in the tertiary sector between further and higher does nothing to help the opportunities for all our young people to fulfil their potential?

Mr. Blunkett

I am grateful to my hon. Friend and I entirely agree. Conservative Members might stop laughing if they realised that in our sixth months in office, my Department has identified within our existing resources, which we inherited, more than £250 million for further and higher education. That is £250 million that the Conservatives failed to identify and did not know was available. Their handling of their responsibilities was grossly incompetent.

Mr. Dorrell

Can the Secretary of State confirm that the effect of his proposals is to raise the cost of a three-year degree course outside London for a typical middle-class student by £3,000, and that the cost of the same degree to a student from a low-income background will rise as a result of his proposals by £5,265? Why are the Government abolishing the means-tested maintenance grant when Dearing recommended that it should be sustained and when the effect of their policy is to deliver such discrimination against low-income students?

Mr. Blunkett

We did not accept the Dearing proposition that the imposition of a contribution to fees should not be means tested; in other words, that all students should be expected to find the contribution towards fees. A party that cut the maintenance grant year after year, introduced the current unfair mortgage-type loan scheme, resisted our requests for an income-related scheme, stood on an election platform that did not say whether it favoured maintaining the grant or introducing fees, and has done a double somersault on its previous policies has no right to question us on this issue.