HL Deb 18 June 1975 vol 361 cc968-92

7.42 p.m.


My Lords, I hope that I have the same good fortune as my noble friend Lord Garner in meeting with general consent and support for the point of view which I would wish to put before your Lordships' House. Your Lordships will notice that the wording of the Question is:

"To ask Her Majesty's Government how the Open University can fulfil its dual function of maintaining impeccapable academic standards and making provision for students of all income levels."

I do not think I need spend much time on academic standards. It was understandable that, when first the idea was put forward of creating a new type of university which would use the mass media, there were those who had legitimate fears that the introduction of the mass media in any form—radio, television and the rest—would lead to deterioration of academic standards.

We can be both proud and grateful that the distinguished academics who sustained the Open University have won their spurs. No one would now challenge the academic quality of the Open University, and it is a great pleasure to many of us travelling abroad as well as at home to find that not only in our own country but in some of the poorest and often some of the richest countries in the world the standards set by the Open University are not only being admired but are being imitated.

I come now to the second part of this matter; and that is, how we can make provision for students of all income levels, because the very essence of the Open University is that it should not be for the rich or for the poor, for black or white, for men or for women but it should be judged on its academic standards and be available to all. I may be making what seems to some of your Lordships a very obvious point. It would not seem so obvious if you recall the criticism I received, mainly from my own comrades in my own Party, in the early years of establishing this university. I was reproached again and again for not giving my time exclusively to creating a working man's university. My reply to that was that I would certainly not be associated with an educational ghetto. I considered it an insult to working men. I thought of my own family—many of whom were distinguished scholars—and of the sheer effrontery of assuming there was a certain type of university that would be suitable for the poor, something which quite frankly made me spit blood. I would not be in any way associated with a university which sought to exclude people because they were too rich, because their skin was too white or too black; because their sex was too determinate or too indeterminate. It had, of course, to be universal.

But I hope I have the sympathy of your Lordships' House when I say that I cannot understand how it is possible that a Labour Government, the Government that encouraged me to create, and to help in the initial work of presenting, this university, should now be bringing forward proposals which would discriminate against the poorest members of our community. This for me is a very serious matter. I had an exchange with my noble friend when the Question was raised at an earlier time. Our distinguished Secretary of State said that, of course, any proposed increases in fees were in line with increases in wages. Since that time I hope that he will have considered exactly what that implies and how unfair it is. There are some trade unions who have received considerable increases in wages in keeping with inflation and rising standards of life. But if a man or woman belonging to one of the strongest trade unions becomes a committed student they have to give up overtime, they have to give up the second job. Many men and women have two jobs. They pay-as-you-earn on one job, and at weekends or evenings they have a second job.

But the Open University is not an easy option, and straight away even those industrial workers who have had increases in wages corresponding to increases in the cost of living have to make a sacrifice. They cannot do the overtime and they cannot do the extra job. What about the millions of men and women who are not in that category? We still have men and women working in many industries—local government, hospitals and many other fields—who are not able to meet the present level of fees. There is a strong case to be made for reducing the present level of fees; there is no case at all to be made for increasing the level of fees.

Not only are there those who are industrial workers and the standard working man or woman whose conditions vary so enormously, there is the housewife. The housewife is being driven from pillar to post at the present moment in budgeting for the increased cost of living. That is where inflation is hitting hardest. We have now 41.8 per cent. of students who are women, of whom we should be very proud. The possibility of studying in the Open University has given a new lease of life to thousands of women. I have most wonderful letters reaching me. But the housewife is in great difficulty in meeting the present fee of £25 per subject, plus summer schools and the rest of it.

Your Lordships may have noticed today that our distinguished Dean and Director of Studies, Professor John Fergusson, has both produced a book and given a number of Press interviews. In his statement to the Press, he said that the reason why some of our existing students are taking longer to complete their degrees is that they find they cannot afford to pay £25 for two subjects, so they are spreading it over a longer period. Would the Minister accept that statement which is backed by the Vice-Chancellor and others? Does he accept that many students of the Open University are finding the greatest difficulty in meeting the present level of fees and other expenses?

Can I rely on a statement by a most responsible educational correspondent, which appeared on 15th April in the Guardian, saying that because the Open University students have so much less local authority grant money at their disposal, the minimum real contribution of Open University students to the cost of their education is 8 per cent. compared with 2 per cent. in other universities? That is either true or false, and I should be grateful if the Minister would say which. This calculation is based on the fact that 20 per cent. or one-fifth of our local authorities give no help whatever to Open University students, 80 per cent. give some help and 35 per cent. behave very generously, giving help with fees, summer school and the rest. Can there be any justice in a situation where Open University students have to pay four times as much to the cost of their university as do the students of other universities? As I said, the average for the other universities is 2 per cent. and for the Open University it is 8 per cent.

Can there be any justice in a situation where whether one receives help as an Open University student depends on the part of the country in which one happens to live? There can be no justice in that, because no matter where one lives one is a taxpayer and is therefore helping to pay for the Open University. But if one is unfortunate enough to live in some parts of the country, one gets no help at all as a student.

These are injustices that must be cleared away and I am glad that the noble Lord, Lord Alexander of Potterhill, will be taking part in this debate, because I am deeply in his debt for the help he gave me in the grey dawn in the early pioneering days, when it was understandably hard to convince local authorities of the seriousness of the Open University and the need to help its students in the same way as students of other universities. I am grateful to those local authorities which have responded, but we cannot sustain a situation in which it is a matter of caprice, depending on the part of the country in which one lives, whether one will get help. So something must be done to put this injustice right. If the mandatory principle can apply to other universities, why not to the Open University?

If that is not acceptable, what do the Government intend to do? As your Lordships may have noticed in today's Press, the number of applicants for the Open University is higher this year than ever before—52,551, 14 more than last year. But now comes the sad part of the story; more than one-half of them will be turned away. Professor Fergusson, in one of his more pessimistic moments, has said that instead of accepting over 52,000 the university may be driven, on the money available, to accept fewer than 20,000. I find this bitterly ironic all the more so, because I know how hard the present Government, and particularly the present Prime Minister, fought to establish the Open University. In trying to understand how all this has happened I must say that I should like to know who is making policy, civil servants or Ministers. I am a pedantic constitutionalist. I believe that policy should be made by elected Ministers and not by civil servants.

In my experience, if Treasury officials get their way the Open University will be clobbered, and if Treasury officials had got their way there would have been no Open University. They maintained their hostility to the last year of the 1964–70 Labour Government. In that year, they were wanting to reduce the number from 25,000 to 10,000, which would have been nonsense. They were insisting on 18 year-olds being accepted, which would also have been nonsense. Since then we have had a pilot scheme for 18 year-olds and that has shown the nonsense it would have been.

Unfortunately, the Chancellor accepted the advice of his officials instead of listening to me. But, fortunately for me, the Prime Minister went into battle and it took all his resources and those of my good friend, who then became Secretary of State for Education, Mr. Edward Short, to prevent the Open University from being destroyed even before it had come alive. It was a great piece of good luck for me that Mr. Short had been a secondary schoolmaster in the North of England, and his wonderful wife had been a headmistress in an infant school in the North of England. Mr. Short therefore understood what the Open University could mean to people excluded from so many other privileges.

I speak bluntly. I want to know who is making policy—civil servants or Ministers. I hope I do not sound rough. I am not being rough, as I tried to explain privately to the Minister. This is not a personal matter between us, but I tell him that he will be clobbered, and so will the Open University, unless he insists on going before the Cabinet, as I did when I occupied his position as Secretary of State, because I have confidence in the Cabinet and I do not have confidence in certain senior civil servants. They are not wicked men but are simply prisoners of their own environment. They could not understand the needs of the poor and those new ideas. But I believe that if our Minister has an opportunity to state the case for the Open University in Cabinet, he will be surprised by the support he gets.

He knows perfectly well, as we all know, that Prime Ministers are not dictators. They cannot just press buttons. When there are different points of view, these matters have to be argued. I was very proud of the Cabinet in 1964–70, because time and again when I went to the Cabinet on the Arts or on the Open University front, the consensus was on my side. It was wonderful—not for me, but because I recall that all the Ministers around the Cabinet table needed more money for their respective Departments. I was not asking for £100 million for the Concorde or Leylands. The money at stake was an extra £1 million or so, and the money at stake at the present time is on that same level.

There are a number of Members of this House who have immense knowledge of all the problems of the Open University, so I do not want to speak longer. I just want to say that it will be a very sad thing if it is a Labour Government, under a Prime Minister who cared and still cares so much, which is responsible for making this a class university and for excluding the poorest members of our society. There would have been no Open University but for our Prime Minister. He fought steadfastly and on every front. This is his child and what I am asking him and my comrades, colleagues and Ministers in the Labour Government is not to let that child be maimed in this cruel way.

8.1 p.m.


My Lords, I disagree with the last sentence of the noble Baroness. I do not believe that the Open University is the Prime Minister's child. I am sure that a male cannot perform that function. I am quite certain that it is the noble Baroness's child. I had the privilege and the pleasure of working fairly closely with the noble Baroness when it was born. I admired the aggressive affection with which she fought for her child then and I admire the fact that, now that the child is of school age, she still fights with the same intensity. I entirely agree with her purposes but not with her solution.

In 1969, when the Open University was being founded, we accepted that at that stage it was reasonable that the support for students should be discretionary, not mandatory. We therefore sought to give advice to local education authorities on certain principles which seemed reasonable. We took the view, for example, that it was the right thing for an intending student to have to pay something in order to show a genuine intent to pursue the course of study which was to be offered to him. The fee at that time was £20, and we thought that that was a not unreasonable burden for an intending serious student. Accordingly, we did not recommend that assistance should be given with that fee. We did recommend that assistance should be given with travelling and with the cost of the residential courses, which at that time was £30 and £35, according to the level of the course. I think it fair to say that those recommendations worked reasonably well for a period of time.

Since then, two or three things have happened. The first is that the general level of wages has risen as costs have risen. In 1969, the relationship between the then fee and the average basic wage—and I am excluding overtime—was in the ratio roughly of 4 to 5. If the fee of £40 which I gather has been proposed were applied at the present time, that ratio would not be worsened. In fact, it would be slightly improved. The increase in basic wage rates between 1969 and 1975 is 136 per cent., unless the Department of Employment has misled me. Therefore, the doubling of the fee is, in my view, entirely justified. Similarly, there would necessarily be adjustments in the fees for the other elements which are involved. The increase from £30 to the present figure of £38 over a period of seven years bears no relationship to increasing costs. Therefore, I do not ask that the fees should not be increased. I accept that they should be. What I do suggest, however, is there are other things that have happened.

At the present time, as the Minister of State will be only too well aware, local education authorities are under extreme financial pressure. They are trying to carry out policies determined at national level without the resources to enable those policies to be carried out. In the nature of the estimates of the budgets of a local education authority, discretionary grants inevitably suffer because they are within discretion. Something like 85 per cent. of a local education authority's budget cannot be cut. There are loan charges and teachers' salaries and so on which have to be paid. So one comes to a limited area, and discretionary grants are part of that area. It is in that setting that I accept the argument of the noble Baroness, that it is undoubtedly true that local education authorities are not at present able to meet the inevitably greater hardship which would arise from an increase because, with the present level of fees, they are not able fully to meet the demands they receive.

Therefore, I want to put a proposition to the Minister. I have given it a good deal of thought and I believe that it would solve this problem while still enabling the fees to be increased as proposed and while not involving the establishment of a precedent. It would merely apply the principles which apply now to other universities, but with appropriate adjustments. At all other universities the student is given a mandatory award on the basis of an income scale, with a prescribed amount of assistance according to that scale. The Department of Education and Science pay 90 per cent. of the cost of that expenditure. The local education authority bears 10 per cent., which is ignored in the calculation of rate support grant.

These are the principles which apply. My suggestion is that the Department should apply the same principles but with appropriate adjustments. Clearly, it would not be the same income scale which would be used but one related to the income of the student, as distinct from the parents. The degree of assistance would clearly, I hope, accept the basic principle which we adopted in 1969 —that is, that it is a right thing for some payment to be made as a token of good intent, but with a scale of assistance which would prevent the hardships to which the noble Baroness has referred.

For myself, I hope that the Department would accept 90 per cent. of the cost, leaving 10 per cent. to the local education authority, again with the latter amount being ignored for the purposes of rate support grant. I believe that the local authorities would accept and operate that. I have reason to believe that the Open University would welcome it, and I can find no adequate reason why it could not be operated. I am aware that, on 23rd April, when the Minister replied to a Question by the noble Baroness, he said that there were difficulties in applying a mandatory system.

I am conscious of that and I recognise that this would be making a special provision—which would not necessarily satisfy all the criteria normally applied to mandatory awards—in relation to the Open University. I accept that. But the Open University is a special institution, and therefore I see no reason why special arrangements should not apply. I believe that such would not have an impact on, or would affect, the other area of discretionary awards. I do not believe that it would have any impact on other universities or on the principles that apply.

I earnestly hope that the Minister may find it possible to examine that proposition very carefully. I do not believe that the expenditure which would be involved would be of a sufficiently severe nature to warrant ignoring the proposition. I do not believe that in the years immediately ahead you can rest on discretionary awards in this area and yet hope to meet the problems to which the noble Baroness has referred. I say this with regret. As the Minister knows, I have no faith whatever in transferring financial responsibilities to Central Government. I believe profoundly in the distribution of power in the education service, and therefore I would always hope that local education authorities would be only too willing and eager to fulfil their obligations. But I recognise that at the present time the financial pressures and the limitations of resources have put them in an almost impossible position. Therefore I plead with them to find another answer to what I believe is a genuine problem and continue to make the Open University available without hardship to those who seek admission and who can properly benefit from it.

8.12 p.m.


My Lords, when my noble friend Lady Lee of Asheridge previously put down a Question on the Open University I thought it my duty to be present, but I did not ask supplementary questions, taking the view, rightly or wrongly, that a Chancellor of a university should always be a long stop and that the less often he opens his mouth in public the better. After all, he has every opportunity of putting his views to the Vice-Chancellor and the other officers of the university. This evening I do not wish to say anything on behalf of the University, or as Chancellor, but I have another capacity. I think I am the only Chancellor in the country who is also a student of his own university. I therefore wish to speak from the student's point of view. I am now a second year student, and I have met many students at my tutorials and at local study centres.

I think that the students would undoubtedly agree with my noble friend Lady Lee with regard to the basic intention. We have a Royal Charter, which is approved both by the Government and by Parliament, and it imposes an obligation on us to provide for the education of the community generally. Another point to be borne in mind is the Government's wish for an expansion in university qualifications. Questions of economics are involved. I fully accept, and I am sure that every student accepts, that they ought to pay something. We are in very difficult times, and the Open University cannot be expected to be made the only exception. But some of the figures contained in Professor Ferguson's book, published a few days ago, might be borne in mind.

Those figures are for 1972 and, although they may all have now risen in terms of inflation, I believe that the comparison is the same. The capital cost of a place at a conventional university is £3,000. The capital cost of a place at the Open University is £165. The concurrent costs at a conventional university are given at £940 and at the Open University £251. Therefore if the Government wish to expand university education, and to do it economically, it would not be surprising if they strongly favoured the Open University.

Obviously student fees matter very much to the students. I agree that they should pay something. The cost given for an Arts degree is £500; for a science degree £700; for an honours degree in Arts £700; and for a science degree £1,000. This is a very great deal of money, and there is a lot of difference between those figures and saying that the student ought to pay something; indeed, with rising costs all the time they are. There are not only the tuition fees. There is the cost also of one, or in seine cases, two summer schools, the cost of the set books, travelling expenses, and so forth.

My noble friend has already mentioned the position of housewives. I am aware that the noble Baroness, Lady Vickers, also wanted to be here to raise the same point, but has had to leave. The housewife is disadvantaged in two ways. As I expect the House knows, the Open University is the Scottish, indeed North Atlantic, system of having to obtain a certain number of credits: six credits for a BA degree; eight credits for an honours degree. Few can attempt more than one course a year, but there are exemptions in relation to credits for existing academic qualifications. For example, as I already have a university degree, I have the maximum of three credits. So I have to obtain only three more credits and am therefore hopeful of obtaining a degree by the end of next year.

But the Open University was essentially for those who have no university degree or academic qualifications. Few can attempt more than one course a year. It is said to be 11 hours a week, but we students all find that it involves a great deal more than this. For those with no existing academic qualifications it involves a hard slog for six years, year after year. There are two ways in which the poorer students are disadvantaged. First, the educational authorities—I can quite understand it—take the original view that 18 year olds at conventional universities have no money. Therefore, the State has to pay for it all and so the grants are mandatory. But with regard to students of the Open University, the view is taken that they are at work, that they can afford to contribute and that therefore it should be made discretionary. Only 34 out of 100 local education authorities provide at least for the tuition fees. Of the 34, 29 confine their grants entirely to those students who are teachers with that local education authority, and only five of them provide the same thing for housewives.

It is quite understandable, in a sense, that local education authorities should want to assist their own employees. I am not saying anything against teachers. When I was a young barrister I did a lot of work for the National Union of Teachers and I have a very high regard for teachers. But the teachers who have formed—though decreasing slowly—about a third of the total of our students have something to gain by obtaining a degree, because they will get additional remuneration for their university qualification. But the ordinary housewife has nothing but the sheer love of learning.

This works in two ways. As the grant has been exercised in practice it is those who need it least who get it and those who need it most who do not. They are disadvantaged in a second way because a teacher will get a degree in three years, whereas a student with no existing qualification needs six years. He has six years' worth of tuition fees and six years' worth of set books, instead of three years' worth. Therefore it is more expensive for such students and yet they are the ones who have the least.

My noble friend Lady Lee and the noble Lord, Lord Alexander of Potterhill, have put the case so clearly that I do not desire to say anything more, except to ask my noble friend Lord Crowther-Hunt what are the present instructions, or what will be the instructions or advice, from the Central Government to local education authorities as to how they are to exercise their discretion? Frankly, for the reasons I have mentioned, as it has been worked in practice it has been very hard indeed on those who need help most. No doubt the noble Lord will tell us whether the admirable suggestions made by the noble Lord, Lord Alexander of Potterhill, commend themselves to the Government. The Open University, after all, was intended to be a university for everybody, and it would be a tragedy if it ended up as a university only for the well-to-do.

8.20 p.m.


My Lords, the grievance which those of us associated with the Open University have about the present situation is the fact that we are being victimised for our success. The achievements of the Open University are beyond any question. If you discuss the Open University abroad, it is regarded as one of the great advances in educational thinking. They are envious of the flying start we have because it is not an imitation of anything that ever was, it is a new creation in the best sense of the word.

The success we have had is reflected by the fact that this year, as last year, we have 52,000 applications for places from people who are part-time students. They are part-time in the sense that they are admitted to the studies while at work, although one would not call a housewife anything but a hard worker. The studies are extremely exacting, and probably my noble and learned friend Lord Gardiner has a struggle to keep up with the studies anybody is expected to undertake. What I find depressing is that the whole intention of the university was to be non-discriminatory and non-privileged. We are not denying the rich the privileges of our educational system, but we are concerned to see that the poorer people have its advantages. We did not ask for academic qualifications for admission because we regarded this as a university which was to deal with people who were getting their second chance, the people who left school either through economic reasons or bad teaching—the fate of some of us—but later discovered they had been missing a great opportunity and were hungry for the things they had missed. This is almost entirely the composition of the Open University membership.

I do not believe the majority of students I have seen regard a degree with snob appeal, something which so many people take. They are there for the interest and study and creative force which is released in the process of the Open University. It is tremendously impressive to see the people, as I saw them recently, at the graduation ceremony: fathers and sons; mothers and daughters; mothers and sons; fathers and daughters; husbands and wives; and a woman who handed her baby to somebody else in order to receive her degree. The crippled have also become graduates, and this year we had a man under life sentence who took his BA in gaol. There is an enormous diversity.

Apart from that, something of an embarrassment to the Open University is the fact that once these people are hooked, they do not want to quit. They go on taking more and more courses and, as last year, we have had to limit the numbers to 20,000, although 52,000 applied. This year we had another 52,000 applicants and we will not be able to take even half of them. This is a complication because there is a ceiling for the number of students that the Ministry are prepared to support. If you take it at 49,000—and we have sneaked beyond that number already—in addition to your new intake you have people who are going on from the BA to the honours degree and to different courses.

The very thing we should have been wanting to encourage has happened. We are satisfying this hunger for education which has been demonstrated in the case of the Open University, and it is for the people we are now liable to victimise. I agree with my noble friend Lady Lee of Asheridge that this is a victimisation. I also agree with the noble Lord, Lord Alexander of Potterhill, that a fee is essential as proof of serious intention. But the level of that fee will have to be determined. I met a married woman yesterday who said she could not take on a second course because she could not afford it. That means there is the problem of spreading over the years because instead of a course over three years it now may take six years.

My noble friend who is to reply may appreciate the point about encouraging science and technology in every way we can. The Open University is one of the best encouragements to science and technology of any institution in the world. I am saying that not in terms of the substantive material, but in terms of the inspirational material which is most important. You cannot have a science course unless you are prepared to keep it up to date. You cannot produce an on-going process in the teaching of science and technology unless you are prepared to change the television programmes and, above all, increase the number of staff available in this specific field to handle the course materials and evaluations and so forth. This is baulking the very thing we are trying to do. It is depressing, because you can think of all kinds of ways in which you can spend money unwisely. As a member of the Council of the Open University I can assure your Lordships that we do not spend money unwisely. We spend it ingeniously, but not unwisely. Here is a possibility of a threat which will discourage all the great adventure of the student and the great experiment of the university, crippling an institution which is demonstrably successful.

In time of economic crisis, what is most manifest is how you invest in success—and this is a success. Not only that; it is a very good source of export trade. We get a lot of attention from abroad, and we can develop it. Above all, following the earlier debate, we are injecting into the Third World new ideas of education and teaching techniques which will enable them to find their way to the things we were talking about, through the example of the Open University. It is a very serious problem that we are facing, because we will be judged by how we regard and treat our outstanding success that has been the Open University.

8.30 p.m.


My Lords, it is barely a year since we last discussed the Open University, but as to the first part of the Question of the noble Baroness—namely, how that university can maintain its standards—there is no more doubt now than there was a year ago. Its standards are universally applauded. As to staff, there is no criticism that I have heard of; in fact, one member of the staff of this four-year old institution has now felt secure enough to offer some friendly advice and criticism to colleagues on more conventional campuses which have been at the job for a hundred times longer than the Open University. As to students, these are surely rated as second to none, both in the width of the social strata from which they are drawn, and in the sustained devotion which they show towards their studies. The noble and learned Lord, Lord Gardiner, has just confirmed this.

The materials they use are universally admired and envied by many longer-established institutions. The methods they use are internationally studied and emulated the world over. I think the last few days have shown that in the field of public relations we have now to deal with the most sophisticated institution, with books, Press releases and Parliamentary debates, all coming out on top of each other in sharp focus. As the noble and learned Lord, Lord Gardiner, said, we have here a most economical way of obtaining a degree—several times more economical than any other institution of higher education. It is a popular institution, too, because for the second year running we have over 50,000 applicants for rather less than 20,000 places, wanting to start next January. There are not many other universities in this country at the moment which can show figures of that sort.

It is the second part of her Question which clearly concerns the noble Baroness and others who have spoken on behalf of the Open University tonight. The fact is that there are curbs on all forms of public expenditure, and it is inevitable that the Open University cannot be exempted or excepted from them. So, for my part, I cannot join in any claim that there should be any substantial increase of public expenditure in response to the call we have been hearing tonight. Therefore, either there is no expansion beyond what the grants from Her Majesty's Government and the Department of Education will allow, or there is some further expansion with help from the main body of students themselves, even though I would agree that in 1975 they are already contributing almost £1½ million in fees to the funds of the Open University, which represents a much higher proportion of the overall cost of their institution than is being contributed by other students in other universities. I shall be interested to hear from the noble Lord, when he replies in response to the noble Baroness, what the percentage is. Is it 8 per cent. as compared with 2 per cent. from other universities?

I acknowledge the unfair burden falling on the Open University students at the moment. The noble and learned Lord, Lord Gardiner, spelt out precisely how that arises. Nevertheless, my judgment would be that a very large majority of those 52,000 applicants who have applied to join in 1976 would vote to pay annual tuition fees of £40 and more, if necessary, to get on their course, rather than have the course held at £25 and have thousands of people turned away who could otherwise join. I confess this is hard on the minority who cannot pay, but surely it is a very small minority among people in full employment—as most of them are in the Open University—even if the majority of them are unskilled manual workers, which, as the noble Baroness said, they are not. There is a very small minority who cannot afford to pay an extra £15 a year on today's wages, even with today's prices; and grants are available to those who cannot afford to pay this extra £15, from local education authorities at their discretion—a discretion which most of them exercise sensibly and as generously as present circumstances allow. The noble Lord, Lord Alexander of Potterhill, has spelt out what those circumstances amount to and their implications for the local authorities.

Certainly I would not agree that the present situation justifies mandatory grants for part-time courses for students in full employment, and I hope the Minister will not be lured into such a policy. I also hope he will tell us whether the university, or any other private bodies, can offer grants on top of those now available from the local education authorities, or whether any institutions such as banks can offer loans to deserving candidates, many of whom are in employment and therefore in a different position, vis-à-vis the banks, from students entering universities at 18, who under present circumstances are not able to be helped by the local education authorities as generously as the authorities would wish. Do the Government contemplate further guidance to local education authorities, as suggested by the noble Lord, Lord Alexander, concerning the use of their discretion in the case of Open University students?

I hope this is a sphere in which the Government will move, and provided they show some flexibility in this direction I think that circumstances have conspired to provide an opportunity—indeed a necessity—for this university to choose not only whether to advance and expand, but how to expand. As I said a year ago, I think the nature of the expansion that is now undertaken by this university is almost more important than the expansion itself. If the right judgments are taken at this stage, the fact that a careful decision has to be taken, rather than expansion on all fronts, will prove to be a boon for the future of the university in the long term.

8.38 p.m.


My Lords, I greatly welcome the opportunity to reply to this further debate on the Open University. It is of course to my noble friend Lady Lee that we owe this occasion, and I want to begin by adding to the many tributes which have been paid to her pre-eminent role in the establishment of the Open University. We are indeed greatly indebted to her, and it is quite understandable that she should continue to keep a watchful eye on the university's fortunes, and an even more watchful eye over those of us who now have some responsibility for those fortunes. I welcome the friendly "kicking" which I get from the noble Baroness on many occasions about all this. It is also a mark of the importance of the debate that it should have attracted such notable interventions by others closely concerned with the Open University's development, and particularly my noble and learned friend in his dual capacity as Chancellor and student, with his three credits already lined up and three more credits to work for.

The noble Baroness is rightly concerned that in the tide of rising costs the university should remain open to all and should not be forced to lower those high standards for which it has already achieved renown both at home and overseas, as noble Lords have mentioned. Let me say here and now that the Government fully share this concern. Impeccable standards are an essential basis of the university's continuing development. I share, too, your Lordships' enthusiasm and respect for this new university's achievements; for the success of the undergraduate courses and for the high quality, the very high quality, of the course material which is in great demand abroad and in other British institutions. The contributions here of the Open University are very impressive indeed, and some of our traditional universities, in my view, could well learn from the Open University's excellent materials and the excellent way they are produced.

No one would challenge the academic quality of the Open University, as the noble Baroness said; indeed, far from challenging it, people can only envy it. I would also in this context wish to pay a tribute to the Vice-Chancellor of the university and to the scholarship and dedication of the academic and other staff, who have worked so hard and with such inspiration and imagination to make an enormous success of this institution. I of course include here the British Broadcasting Corporation staff who have been so closely associated with course developments.

The university's success is best measured by the 10,000 students who have graduated in the last three years, over half of them in 1974. This is in itself a reward to the staff, as well as to the students, for their great endeavours. Over 100 of last year's graduates had no formal educational qualifications whatsoever when they started, and yet by the end of only the fourth teaching year they achieved a degree of a quality of which we can all be proud. It really is a very notable achievement.

As the Government and the university attach great importance to the university's being open to all—all income levels, as the noble Baroness put it—it is encouraging that there has been an increase in numbers, a broadening of the intake, in the last few years. There has been an increasing number of women students and also of those least able to benefit from other institutions. Women applicants now represent over 40 per cent. of the total number of applicants and slightly more than that, as I think the noble Baroness said, actually are accepted—I think 41 per cent. was the figure the noble Baroness was quoting. I also welcome an increase in the proportion of applicants from the manual and routine non-manual occupation groups. The proportion of students without normal entry qualifications for other universities also is rising; and one clearly much welcomes that. As the noble Baroness said, it is becoming more and more an Open University open to all, not for one group or another in society.

Having said all that, I now turn to the financial resources of the Open University against the serious economic background with which your Lordships are all now only too familiar. The university's development depends largely upon the Government's recurrent grant, and that for the next triennium will be considered later this year. This grant is supplemented by fee income, and when the grant for 1976 was reassessed to allow for inflation it was intended that the fee income should be similarly increased. Without this extra fee income, the value of the budget of the Open University would not be maintained and the standards and development of the university would be correspondingly threatened.

It is against this background and the background, too, of our present economic difficulties that I turn to the proposal that the university should increase its course credit fees from £25 to £40, and thus its fee income by some £850,000. I repeat here that this increase is not intended to add to the proportion of costs falling on students, but to restore their value to the 1973 position. Here I was particularly grateful to the noble Lord, Lord Alexander of Potterhill, for the remarks he made in this context when he was saying, first of all—and other noble Lords also took this view—that an intending serious student should pay some fee towards the Open University as an appreciation and indication of his determination to pursue his studies. I was particularly grateful to the noble Lord, too, for pointing out, when he was comparing the course tuition fee in 1969 with the Government's present proposals, that during that time wage rates had risen proportionately more than the Government were proposing to increase the tuition fee. It was important that the noble Lord, with his characteristic fairness, should stress that point.

I am fully aware of your Lordships' and the university's concern that increases proposed in this way and of this kind clearly pose some threat to the "openness" of the Open University, and that they may cause some hardship and deter some applicants of the kind we all particularly wish to attract. I recognise here that the proportion of Open University students who have to pay the fees out of their own pockets is obviously much higher than that of students in other universities. It is in this context that the noble Baroness was speaking about 2 per cent. and 8 per cent., and I do not quarrel with the figures she was putting forward at that point. But what one needs to stress in this context, of course, is that the great majority of those who are paying fees at the Open University are in full-time employment; something like over 80 per cent. are in employment and therefore receiving an income. And incomes have generally kept ahead of inflation, although I know there are real problems for some students. It is because of my appreciation of these problems that when I was last asked a Question about this subject in your Lordships' House I said that I was not satisfied with the present state of affairs and was having further consultations with the Vice-Chancellor on these matters.

That is why I had another meeting with the Vice-Chancellor last week, to discuss with him some of my ideas for increasing fee income without discouraging applicants of the kind we want to encourage rather than discourage. At our meeting we spoke about the possibility of lower fees for new entrants taking their first foundation course. For example, small fees for foundation courses might encourage more low-income students to embark on a degree course initially. These students might then, it seemed to me, be helped subsequently through either a scholarship scheme or a hardship fund.

What I have in mind here is that, on the basis of their work during a foundation course, scholarships might be awarded for their subsequent courses to students with no, or low, educational qualifications on entry who had been particularly successful in the work they had done during their foundation course. Then, so far as the hardship fund is concerned, the university already operates a small hardship fund and this might well be enlarged so that assistance could be given to students indentified during their foundation course as being particularly in need of help.

We discussed these and other ideas, but I must stress that at the end of the day, on questions of this kind, it is for the Open University to decide and discuss with us whether or not any of these ideas are practical. I see merit in them myself and we are investigating and discussing them further. No final decision has yet been reached but, as I say, the discussions are continuing and we are all anxious to find a solution which will not jeopardise the "openness" of the Open University to any section of the community. What I am trying to do here, as it were, is to bridge the one gap which there appears to have been in this debate: the gap between the noble Lord, Lord Sandford, who does not want to see any more public expenditure, on the one hand, and the position expressed by the noble Lord, Lord Ritchie-Calder, on the other hand, who said we must invest in success. I have tried to deal with both those aspects in some kind of balancing act.

It is in this context that the noble Baroness asked: who is making policy, Ministers or civil servants? My answer to that question is a very firm one. It is Ministers who are making policies in this respect, including the Chancellor of the Exchequer, who, as part of the collective responsibility in this area, not unnaturally has very considerable weight. It is Ministers who will make the final decisions on the finance which can be made available to the Open University and I do not intend to let that question go by default.

There is another financial problem in this area which the Open University is facing and to which they have drawn our attention within the last week or two; namely, the problem of overall numbers which has been touched on by a number of noble Lords. When we agreed last year to increase the grant to the Open University to enable them to admit from last January 20,000 students instead of 14,000—as the noble Baroness has pointed out, the number of applicants to get into the Open University has been gratifyingly and steadily increasing; this year there are over 50,000 people wanting places at the Open University and nothing could be a greater tribute to success than that—we made an increased grant avaliable, and did so on the clear basis of the advice and understanding at that time, that student numbers in 1976—and I stress 1976—would not exceed 49,000. In fact, because students are taking longer than expected to progress through the system, for reasons which have been mentioned in the debate and for other reasons, too, that number of 49,000 has been slightly exceeded already.

My noble friend Lord Ritchie-Calder was also anxious to point out or to admit this. I think he said, "We have sneaked past that number already". That, of course, is true. The Open University now tell us that without additional funds the number of new students that they will be able to admit in 1976 will be less than the 20,000 intended. This is a problem I am considering urgently and, as noble Lords will know, I want to do my best to keep the Open University as wide open as possible.

I come to the question of student awards at this time. I can understand the feeling that Open University students should be considered for mandatory awards. This is a point which was made by the noble Lord, Lord Alexander of Potterhill. The noble Lord suggested that they could be treated in this context as a special case. I agree that the Open University is special; but I have to remind your Lordships that there are many other part-time students in higher education, and it seems to me that it would be inequitable to single out one section of students and put them into the area of mandatory grants just because they belong to an institution in which we all take such pride. The difficult question that has to be answered is why we should give more favourable treatment to these students than to the rest who are also in the discretionary grant area. Nor in this sense could we contemplate mandatory awards for all part-time students in higher education, because the cost would be absolutely prohibitive. However, I always place great weight on what the noble Lord says. Therefore, I will examine the noble Lord's suggestion, although I think it would be wrong of me to hold out the hope that in the near future there is any real prospect of going down that road.


My Lords, I accept the argument relating to mandatory awards, but would not it be possible for advice to be offered on the application of the discretionary awards which give a prescribed income scale and a limit of help?


My Lords, I was coming to that point when the noble Lord intervened, because I wanted to answer the question which was specifically put to me regarding the advice which the Department could give so far as local authorities and discretionary awards are concerned. As noble Lords will appreciate, the difficulty here is that of giving advice about discretionary awards. The more we give advice about discretionary awards and how local authorities should use their discretion, the less discretionary the awards would become. If we were to tell local authorities how to run their affairs—where they must exercise discretion and where they do not have to do so—we should be taking this out of the discretionary award area. At a time like this, when local authorities are under such pressure—I noted that the noble Lord, Lord Alexander of Potterhill, was saying that it is when this happens that they are in great financial difficulty—what they can cut back on is the area of their discretionary decision. Therefore, the noble Lord was urging upon me that at this time it is more important than ever to tell them how to exercise their discretion.

Also, it is all the more difficult to tell them how to exercise their discretion when they are in the midst of so many financial difficulties. Therefore, I was delighted to hear the noble Lord, Lord Sandford, ask whether other institutions could be encouraged to offer some help. The more help that other institutions—banks, industry or business—can give, the more delighted all of us will be. It is because of the difficulties of discretionary awards and so on in these times of hardship and difficulty for local authorities that in my discussions with the Open University I have tried to find a formula by which we could increase fees in such a way that it would not discourage the very groups of students whom we want to encourage. It is because I am so keen to do that that we shall be having further talks about it. In this context I am doing my best to try to produce a situation in which although there will undoubtedly have to be an increase in fees—and we all recognise that the majority of students will be able to meet that increase—for those who cannot meet those fees and those whom we particularly want to help this can be done in a way which will be encouraging to them. Therefore, I am having further discussions with the Open University on these questions.

I must not take up much more of the time of your Lordships' House, but may I say I am grateful to the noble Baroness for giving us this opportunity to explain the background to these problems. I fully understand your Lordships' apprehension that a lack of resources might now put at risk this great educational development. I hope that it will not; indeed, I am determined that it should not. While it is the university which is solely responsible for the final decision as to how its funds should be allocated, I can assure your Lordships of the Government's continued commitment to the openness of the Open University and to maintaining its standards. Naturally, in the present economic climate the Open University, like all other educational institutions, will have to operate within more severe financial restraints than ideally any of us would like. This is undoubtedly true and it is true everywhere. Nevertheless, I am confident that this university will continue to attract a very wide range of students and to maintain and enhance its well-established reputation of which we are all proud. I am trying to do my best to ensure that any fee increases that we have to introduce in the future will be introduced in a way which will not jeopardise its success.