OVERSEAS STUDENTS' FEES

HL Deb 21 January 1976 vol 367 cc561-633

7.15 p.m.

Lord GLADWYN rose to ask Her Majesty's Government on what grounds they have recommended that the increase of fees to be paid by overseas students from 1976–77 as an interim measure should be twice those paid by British students. The noble Lord said: My Lords, I suppose I should begin by declaring my interest in the Question standing in my name on the Order Paper. I am the chairman of what is called UKCOSA, the United Kingdom Council for Overseas Student Affairs, an independent body which does its best to protect the interests of overseas students in this country, for whose welfare we surely ought, not only in our own interests, as I shall seek to show, but also, I think, largely out of some remaining sense of obligation, to pay special regard.

My Lords, according to the latest statistics there are about 95,000 of such persons in the United Kingdom, but if you subtract the 20,000 nursing students (who of course get paid for their invaluable services), together with language assistants (who are also paid) and another 17,000 or so who are in the private colleges, in the Inns of Court, in industry or business, and so on, you get an approximate total of 53,000 who form the effective overseas student population of this country. Of these, the largest section is that of university post-graduates and undergraduates (15,000 and 10,000 respectively), closely followed by those in further educational colleges (21,000, mostly from the Commonwealth), while the polytechnics absorb about another 6,000. Of the 53,000 it is thought (although for some extraordinary reason there are apparently no statistics on this point) that about 23,000 are supported by some kind of scholarship award or grant; and among them, of course, are the officially sponsored students, whose fees are paid for them anyhow by Her Majesty's Government, by their own Governments or by international agencies. All the remainder—that is to say, about 30,000; but, as I have indicated, there might well he more—are dependent on their families or local communities in their home countries, or on their own personal savings, if any.

Naturally, some of these people have means of their own, more particularly, though by no means always, if they come from rich or what might, I suppose, be called nouveau riche countries. But the great bulk, chiefly from the poorer Commonwealth countries, find it extremely hard both to find and to make do on the £20 to £30 a week, which is now about the minimum required for mere existence in the United Kingdom. This is all the more the case if, like many of the post-graduate students, they are, not unnaturally, married. It is, I need hardly say, this category which is hardest hit by the recently announced 30 per cent. increase in the fees which they pay, which for those in universities and advanced further educational establishments, as they are called, will now come to no less than £416 a year, as compared with £250 a year in 1974–75, home students paying only £182 and, in some cases, £150 for the same facilities. There is, therefore, unhappily, good reason to suppose that, given the economic climate now prevailing all over the world, a fair number (and possibly even, I am afraid, a large number) will now simply be forced to pack up and go home.

Should that happen, then, apart from any other consideration, Britain will be deprived of the £1,000 to £1,500 a year which they, the people who may go, spend in this country, and our balance of payments will therefore presumably, pro tanto, be unfavourably affected. Indeed, it has been calculated—and this is an interesting point—that for every 1 per cent. of students who leave there may well be half a million pounds or more loss of income to set against the saving in fees. Under this showing, therefore, a loss of no more than 5 per cent. of students (shall we say, about 1,500?), could result in a net financial loss on balance to this country. Nor can it be denied that in a general way we stand to gain enormously if overseas students go back to their country with a good opinion of Britain and capable of putting their acquired skills to good use in the lands from which they come. Furthermore, they will tend to favour good relations with Britain and look to us as natural trading partners. Up to this point I hope that your Lordships will agree that I have confined myself to a simple statement of uncontestable facts.

It is with this background that I approach the recent decision, made public in a Written Reply to a Private Notice Question in another place on 16th December last. What must strike any observer is that this procedure bears what might be described as a sinister resemblance to the procedure adopted in 1967 (when discrimination was first introduced) by the Labour Minister of Education. In both instances it must be assumed—we can hardly assume otherwise—that the intention was to avoid any criticism that might be voiced in Parliament of a measure of which, in its heart of hearts—if that is not an absurd expression in the circumstances the Government were probably ashamed.

It is true that the present Minister has been cleverer than his 1967 predecessor; for on the face of it he seems to have squared the Vice-Chancellors—something which his predecessor, as noble Lords who heard the debate in this House in February 1967 will remember, signally failed to do. It is, however, a pyrrhic victory since the recommendation of the interim report of a Joint Working Party of the Vice-Chancellors' Committee and the University Grants Committee runs directly contrary to the great bulk of the arguments involved. It is true that, as an interim, or short-term measure, the Working Party suggested that the fees of all students (that is to say, both home and overseas students) should be increased by 30 per cent. to keep them, in real terms, at the 1975–76 level. It was no doubt hoped in this way to create or to seem to create an atmosphere of impartiality. It does not appear to have occurred to the Working Party that such a measure would increase the deplorable discrimination against overseas students initiated in 1967, and all overseas students will be aware that the vast majority of their home-based colleagues do not pay a fee—in any case, 60 per cent, less than theirs—but, in effect, have them paid for them by the State, by one means or another.

Above all, the present Minister has seized on the Working Party's tentative recommendation without seemingly having paid attention to other features of this rather tortured report, whole paragraphs of which—I hope I shall not bore your Lordships—are well worth quoting. For instance, in paragraph 27, it says: Overseas members of universities have always been most welcome and their presence has itself contributed a special dimension to the quality and character of the work and achievements of the universities.… There can be no doubt that Britain benefits from the cross-fertilisation of ideas and cultures and the mutual understanding that are fostered by the international movements of students and scholars. How true! A little further, one learns that: …one main effect of higher fees, other things being equal, might be to reduce the numbers of applications from overseas students in a way related to the ability of the student or his government to pay. Any seriously diminished opportunity to recruit overseas students would be of academic disadvantage to the British universities. Apart from the general stimulus and educational influence that comes from the presence of able people of overseas background, their entry, especially at the post-graduate level"— and I emphasise "post-graduate level"— …increases the concentration of students with advanced training and exceptional ability in a way which makes the British universities more attractive and academically productive. It concludes with the striking words: A substantial increase in discrimination in fees (or perhaps even any further increase in the level of overseas student fees) could be very damaging to the universities. That is what the report declares.

My Lords, quite apart from this strange way of leading up to a proposal for a large and discriminatory increase in the fees payable by overseas students, the Working Party moreover says that it will welcome wide discussion before making final recommendations and that if it is felt to be in the national interest—thereby passing the buck back to the Government—to limit or reduce the size of the subsidy at present provided for the education of overseas students, all kinds of alternatives should be considered including the mitigation of numbers by quota and, even, a "tariff-quota" system in respect of which, not unnaturally, it sees grave difficulties.

My Lords, one of the simplest solutions, to which it does not allude, is that all fees payable by qualified—I repeat "qualified"—overseas students might as an excellent form of "aid" be met out of the existing budget of the Overseas Development Ministry, pruned, perhaps, of some of its present, more questionable, items. Such a reform might be all the more acceptable in the light of the recent report by M. Tindemans on the future of the European Community to the effect that we should …gradually transfer to the Community a substantial part of national appropriations intended for development cooperation (major development projects, food aid, financial aid) and in coordinating the remainder of our activities in this field. That is what is proposed by M. Tindemans. In other words, that eventually we should have a common aid programme as well as a common agricultural programme and, no doubt, therefore, a common policy as regards overseas students fees all of which ideally could be met out of common funds.

As for students from the wealthier and oil-rich countries—to which we know in the last few days attention has been drawn in the Press—I would draw noble Lords' attention to paragraph 33 of the Working Party's interim report: While there are strong temptations to charge what the traffic will bear in the case of wealthy oil countries—and indeed it has become fashionable to talk in terms of 'paid educational services' involving the imposition of full-cost charges on a contractual basis—there are good reasons for caution in moving in this direction. Such schemes are simple only when they involve courses mounted specially and the normal practice of charging the full cost can be applied, and they are also likely to conflict with the paramount need for the selection of individual students to be a matter for the admitting university to decide and not one that can be subsumed by inter-governmental agencies or private contractors. Again, the report says that.

My Lords, turning now from the virtual condemnation of the Government's recent action by the Vice-Chancellors' study group, we might profitably recall what was stated in the Overseas Development Ministry's White Paper in October last. Here, when describing its admirable policy of More Help for the Poorest, the Ministry observes that: We believe that it is essential that a poverty-focused aid policy has to be related to the circumstances of each individual country and that one has to proceed by means of detailed programmes related carefully to the circumstances and wishes of each country and not by way of general guidelines to be applied regardless to all countries. It adds: We shall continue to offer training and further education in this country for those who require it and for whom the appropriate facilities are not available or cannot be economically provided nearer home. It must be clear to any unprejudiced person that the latest fee increases contradict both these laudable aims in that they hit rich and poor students alike and actively discourage those from the poorest sections of the poorest countries from taking up training opportunities in the United Kingdom, no doubt in fields where there may well, as things are, be spare capacity in our own educational establishments—a point on which the noble Lord, Lord Bowden, is going to dwell in his forthcoming intervention.

Noble Lords will now possibly be in a position to judge whether the recent action of the Government was at all reasonable; and if they are not so persuaded by me, I feel they will be unable to resist the much more powerful arguments put forward by Professor Rolf Dahrendorf in his splendid article in yesterday's Daily Telegraph. Why then did the Government do such a foolish thing? To save a little money? But it looks as if even this objective will not be achieved. To quieten apprehensions of certain local education authorities? Perhaps. Or was it to appease some of their supporters, or others, who do not care for foreigners, of whom, according to Mr. Enoch Powell, there are already far too many in this country? Quite possibly, I fear.

As to the local authorities, the new increases and the associated DES Circular to them (14/75) is only a further proof of the lapse of interest in overseas students following the flat rate increases that came into effect last year These increases were at least the same for British as for overseas students—that is, not discriminatory—and the then Secretary of State, Mr. Prentice, asked local education authorities and universities to exercise their discretion in cases of hardship. Yet in Circular 14/75 there is merely a reference back to an earlier circular on the question of using discretion.

Admittedly, the allocation by the University Grants Committee of hardship funds to universities seems to have met, or may have met, the needs of students in difficulty as a result of last year's increases, but whether it will do so in the wake of the much larger increases proposed for the coming year is very doubtful. In the State sector colleges, where the largest number of overseas students are studying (as well as the largest proportion of students from developing countries), the local education authorities do not seem, unless I am wrong, to have waived fees in cases of hardship. The same arrangement may therefore be totally inadequate to meet the hardship which these fresh increases will cause. Special central arrangements will obviously be required. I hope that the Government realise that.

But, my Lords, whatever the reason for the Government's foolish action, and whatever the steps taken to mitigate its effects, one thing stands out a mile. Her Majesty's Government's policy discriminates heavily between home and overseas students, a thing that no other advanced European democracy, save only the Irish Republic, has ever ventured to do. Indeed, in many of these democracies (including the Federal Republic which, admittedly, has a quota but not a serious quota) no fees whatever are charged, and in France there is only a nominal fee equivalent to £15. France, surely, is in a position very similar to our own. She stands, as we do, at the head of an important language and cultural area and she has, as we have, certain continuing responsibilities as a one-time head of a world-wide Empire. It is true that, under the French system, there are more university students than with us; it is true that the students do not usually, as usually with us, have a tutor or the equivalent of a tutor. This applies to all French students and therefore there is no discrimination in this respect. But none the less, 9 per cent. of the total French university student body—that is to say some 60,000 as opposed to our 25,000—are from overseas. The very idea of penalising seekers after knowledge in metropolitan France is foreign to the French mind, as it should be to ours, were we not in some danger of being overwhelmed by an inward-looking and indeed a provincial mentality that can probably only be countered by the triumph of the European idea and the consequent gradual formation of a more outward-looking democracy.

The real trouble with our present system, which results in such ultimately self-destructive measures as the latest discriminatory increase in student fees, is, in fact, that there is no body, and certainly no person, responsible for considering the problem as a whole in the general interest of this country. All the many Ministries involved have their own axe to grind, some of them very small and local axes. Eventually some compromise emerges from the machine which is then perhaps rubber-stamped by the Cabinet. But since there is no governmental spokesman for the unfortunate overseas student himself, it is inevitably the grievances of some local authorities, or even the complaints of those who dislike foreigners—and particularly dark foreigners—to the effect that our own students are not getting a fair deal, which carry the greatest weight.

After the last fuss we made in Parliament some eight years ago, an attempt was eventually made by the Foreign and Commonwealth Office to remedy this situation to some extent; but with the transfer of Mr. Kershaw to other duties, and with the change of Government it seems unfortunately to have faded out. This is a great pity—particularly as in May 1974, the noble Lord, Lord Goronwy-Roberts, now a Minister in the Foreign and Commonwealth Office, agreed to regard it as part of his Ministerial responsibilities to take an interest in matters affecting overseas students. Was the noble Lord, Lord Goronwy-Roberts, consulted before this discriminatory increase in fees was made? I suppose he was. It would be interesting to know.

Moreover, apart from fees, there are a number of issues (some of which I hope will be taken up by other speakers) still in need of urgent consideration, I could list them very briefly as follows: the continued unclear and unworkable vacation employment regulations for overseas students; the absence since 1963 of any guidance from the DES to local education authority colleges on the welfare of overseas students; or since 1967 from the Home Office on admission procedures and immigration regulations; no established contingency arrangements for emegency situations such as faced students from Biafra, Uganda, Cyprus and Ethiopia recently; continued discrimination against overseas students in local education authority hostels—that is, differential charges for overseas students in hostels attached to polytechnics and technical colleges; the need for a more adaptable successor scheme to the Overseas Students Welfare Expansion Programme (OSWEP); the Government-sponsored housing subsidy programme administered by the British Council; and, finally, the exploitation of overseas nursing students as cheap labour with little concern for their educational needs.

My Lords, I would not wish to restrict my intervention today to a simple denunciation of a policy, wrong in principle and increasingly counter-productive in practice, which no doubt, given our Parliamentary system is as such irrevocable. So I will end by making what I hope will be thought to be some constructive suggestions. If the decision is indeed irrevocable, specific safeguards for privately-sponsored students already here are essential, including some central fund (comparable to the University Grants Committee fund for universities) for those students who are unable to pay the increased fee in the State sector. For the future, increased financial assistance for good, poor students from the poorer developing countries wishing to start their courses or further their studies in the academic year 1976–77 surely could be provided. This could be done by enlarging the OSFAS scheme (the Overseas Students Fees Award Scheme) to include more students in a wider range of study levels than in the existing scheme. At present, only one in four needy applicants receives an award for the payment of his fees under this scheme, mostly at the post-graduate level. With even a modest injection of funds OSFAS could play a much more important role in countering the effects of high fees on poor students on useful courses.

I also think it is most important that the Government should set on foot a wide-ranging inter-Departmental study of the effect of the increases on overseas students, which is related both to the White Paper on overseas aid More Help for the Poorest, and to the final report of the Committee of Vice-Chancellors and the University Grants Committee, when that is shortly to become available. This study should cover the capacity of United Kingdom teaching institutions (staff, equipment, accommodation and so on) to provide courses related to the actual needs of overseas countries. For instance, short practical courses connected with actual projects might well be given priority over longer courses. That suggestion has been made and I think it is a very good one.

I must say in conclusion that I earnestly trust that the Minister who is to reply will be able to say that he regards these proposals at any rate as reasonable, and that he is prepared to adopt them in accordance with what I feel may well be the general desire of the House of Lords. For it is precisely in this sort of sphere that our House can, if it so desires, mobilise a wealth of really informed opinion to which even the vast and entrenched bureaucracy might with advantage pay some attention. It is consequently not entirely without hope that I await the Ministerial Answer to my Question.

7.43 p.m.

Lord BELSTEAD

My Lords, although I do not go the whole way with the case that has been made by the noble Lord, Lord Gladwyn, this evening, I should like to thank him for initiating this debate. With his wide knowledge of the subject the noble Lord has undoubtedly put questions to the Government which require answers if the Government are going to follow a policy of widening the differential fee. The noble Lord has also reminded us of the advantages of attracting overseas students into our universities and colleges. Their presence is of mutual value and it is part of the tradition of our universities that entry should be on the ground of academic attainment.

I expect the noble Lord, Lord Robbins, will remind your Lordships far better than I can that his Report made the point that in higher education contacts may be made which will be of value personally, commercially or diplomatically in future years. For those reasons, I refute the argument sometimes put forward that it is not in the interests of this country to educate men and women who may return immediately to their own countries to work. The fact that in 1973–4 some 74 per cent. of overseas students were from developing countries surely reinforces this argument.

But can we afford the existing financial arrangements? I concede to the noble Lord, Lord Gladwyn, whose knowledge is so much greater than mine, that in other countries universities seldom charge differential rates. Would I be right, perhaps, in claiming that we ought not to forget that few other countries have this system of pure grants for their degree courses and the consequent responsibility on the taxpayer to subsidise the gap between the fees charged and the cost of a place?

For me, a very valuable consequence of this debate would be to have some further enlightenment of the cost of this support. The recent interim report of the Joint Working Party of the Committee of Vice-Chancellors and Principals and the UGC estimated the amount spent on university education for overseas students at £50 million, excluding capital and equipment, and the subsidy as a tenth of the universities' total recurrent grant. Does this accord with the Depart- calculations and have the Government made an estimate of total support for overseas students on advanced and non-advanced courses?

I appreciate that this matter is complicated, not only for somebody like myself without a mathematical mind, but also because of the fact that all our institutions of further and higher education are open to overseas entrants. I also realise that the supporting finance will arise from a variety of sources. In saying this, I do not forget the many independently-financed organisations such as UKCOSA, of which the noble Lord, Lord Gladwyn, is the Chairman, which do so much to co-ordinate and in some ways finance the opportunity for young people from abroad to study here. But the question of cost seems to me central to this debate and has after all been the reason for Government policy since the Labour Government of the day announced an overseas fee in 1966. I trust, therefore, that the Government will tell the House this evening how much they estimate to save by even a 30 per cent. increase for overseas students.

I would ask whether any calculations have been made of the countervailing earnings. The interim report of the Joint Working Party estimated a loss of £700 per head approximately for the drop in overseas numbers following the 1967/68 increase. The noble Lord, Lord Gladwyn, gave his estimate of what that loss might be today. Obviously, personal and dependants' living expenses, expenditure on books, equipment and so on, and even travel to and from our shores, are potential sources of earnings of foreign currency from overseas students. Before embarking on a course of higher or further education, many attend fee-paying schools in this country. Others attend commercial language schools or are enrolled for correspondence courses and, of course, the steady flow of people from abroad cannot fail to be of commercial advantage to this country.

But the over all problem is the total amount of subsidy needed, which has continued to increase at a time when every sector of education is crying out for more resources. The increase in overseas demand, of course, is a tribute to higher education in this country, and therefore to make cuts in our higher education services which may reduce the quality of that education—the very quality being sought after—must surely be avoided if it is possible to do so. The Government's solution is to impose a still higher overseas student fee. Clearly the effects of inflation have caused sharp increases in the cost of a student place and undeniably many young people from abroad would be willing to nay a great deal more.

These are arguments for higher fees on financial grounds, but to my mind they are not arguments for higher fees in order to regulate the numbers of overseas students. Deliberately to price people out would contradict years of tradition and practice; but if the Ministry for Overseas Development were to take over the Government programme for overseas students, I think this would set the higher fee in a different setting, and at any rate in a much fairer setting.

This proposal is by no means new. It was recommended in 1963 by, I think, the Committee of the noble Lord, Lord Robbins, although of course the noble Lord and his colleagues did not support a differential fee; it was put forward last November by my honourable friend Mr. van Straubenzee in another place in a debate on overseas aid, and the noble Lord, Lord Gladwyn, has recommended it today. I always hesitate to recommend any transfer of responsibility from the Department of Education and Science, for, although I disagree profoundly with the politics of the Department's Ministers, I have a very high regard for the administration of them and of their officials. But I think this might work—and the noble Lord, Lord Gladwyn, argued very much better than I could why he thought so—and I trust that the noble Lord, Lord Crowther-Hunt, will be drawing the attention of his noble friend Lord Goronwy-Roberts, who has special responsibility in this field at the Foreign and Commonwealth Office, to what is being said in this debate.

May I make just one or two points on this subject. If support for overseas students went on the overseas aid budget, without of course altering the various bursaries and scholarships already offered, it would clearly show—which is not apparent at the moment—that we are contributing what is, in effect, overseas aid in this respect. ODM is surely the Government Department best placed to do some forecasting of future numbers—I do not know whether this goes on at all at the moment; the best place, also, to ensure that international relations are not impaired by decisions made in this field. ODM could discover best what level of aid other Governments would be prepared to subscribe, and could then award money more accurately to those who are really in need.

I confess that I have been perplexed by the arrangements which the Government currently make for hardship. Perhaps this is due to my ignorance. I understand that when the £70 increase was imposed this year, "hardship arrangements" were introduced which I believe refers to the overseas special fund. I am not quite certain whether this is a fund, which dates back to the hardship fund which was set up in 1967 for students already in this country. I should be interested, if there is time, to hear how this works; whether these hardship arrangements give extra help to married students who were referred to by the noble Lord, Lord Gladwyn; whether in practical terms the hardship fund relates both to local authorities and to universities, and whether these arrangements are to be up rated for next year.

Also when, in a Written Answer on the House of Commons, the Secretary of State announced on 16th December the 30 per cent. increase, Mr. Mulley added: I understand that the Ministry of Overseas Development will pay the increased fees for those overseas students who are assisted as part of the aid programme."—[Official Report, Commons; col. 554.] I assume the Secretary of State meant that the increase in fees is to be met by ODM, and though, doubtless, this was welcome news to the recipients, of course it leaves aside those who are not so benefiting and is, I surmise, on a more generous basis than the hardship arrangements. When one considers that over 62 per cent. of overseas postgraduates and undergraduates at universities, and over 82 per cent. of overseas students on advanced courses at colleges, come from developing countries, the countries which the noble Lord, Lord Gladwyn, so rightly said was picked out in last October's White Paper on aid as needing our training and further education opportunities, then all I can say is that I am driven to the conclusion that Government support would be more fairly administered by the aid programme—and that is not a reflection upon the administration of the Department of Education and Science.

Finally, I hope that the Government will be giving their views at the end of this debate about the total numbers of overseas students and numbers attending particular courses; and here, again, certainly for me, more information would be of help. The noble Lord, Lord Gladwyn, gave the effective number of students on advanced courses in this country as 53,000. I should be interested to know what has been the increase over the years. The noble Lord, Lord Crowther-Hunt, can take any period of time that he likes. Do the Government see the increase in numbers which has taken place over the years as in any way a threat to planning targets for total numbers in higher education, particularly targets which the Government may have for numbers involved in postgraduate work? Is it the case that on certain courses in some institutions the overseas proportion is very high, and does the presence of overseas students upset or help the Government's planning assumptions for the percentage of all students whom they wish to see on Arts or on science-based courses? Those are the questions that certainly I am interested in when thinking of raw numbers of students from overseas.

Your Lordships will, however, be aware that the Inner London Education Authority has recently been concerned with the high overseas proportions in some of its colleges, but appeared to be torn between recognition that the Authority has been extending itself to the limit financially, and the realisation that a cutback in overseas numbers could endanger the viability of some courses, and even of some entire teaching departments. Of course, this problem is seen in particularly sharp relief in Inner London. But wherever this problem exists it is, I suggest, one of resources. It may be a problem of housing, exacerbated, perhaps, by the provisions of last year's Rent Act, and where overseas numbers are very high it is only common sense to recognise that it is a problem of the general policy of the particular institution or local education authority concerned. I hope that today this debate will give us some more facts upon which to base our judgment of the Government's policy. My concern is also to see that the Government seriously consider the possibility of transferring their overseas students support to ODM, for I believe that this move could ensure that wide opportunities continue to exist for entry into our universities and colleges.

7.57 p.m.

Lord BOWDEN

My Lords, may I begin by thanking the noble Lord, Lord Gladwyn, for providing this opportunity for the House to discuss a matter which has of recent years, or even of recent months, become of enormous public interest, and which has excited a very great deal of controversy—sometimes rather ill-informed. With much of what the noble Lord, Lord Gladwyn said, I agree, and I particularly agree with what the noble Lord, Lord Belstead, said a moment ago; that is, that the support for overseas students might with very great advantage be transferred to appear quite firmly as the responsibility of a Ministry other than the Department of Education and Science. In talking to my students, I have sometimes said that the tradition has been that Central Government pay through the block grant system about 95 per cent. of the cost of the education of English students, and about 90 per cent. of the cost of the education of foreign students, because the total cost is vastly in excess of any fees that are charged.

I find it difficult to share the noble Lord's indignation that the English universities and the British Government should be conforming, perhaps very late in the day, to what has been the policy of 80 per cent. or so of all universities in the English-speaking world for more than half a century. I have in my hand figures which have been provided for me by the Association of American state universities and colleges. Your Lordships will remember that in America the individual states each maintain their own university system. There are, of course, many privately endowed universities as well, but it is to these State universities that the great majority of American students go. If, for example, you are a citizen of California you will pay 190 dollars a year to send your son to university. If you come from another state in the Union, or from another place in the world, you will pay 1,500 dollars—a disparity of seven to one. I could enumerate half a dozen other cases, but the average for 350 universities—and this was in 1975–76—amounted to this; that on average the residents of the state were required to pay 500 dollars in fees for universities, and non-residents of the state were required to pay about 1,350 dollars—a disparity of two-and-a-half to one, or rather more. This is a much greater disparity than we ever contemplated and it is applied equally to students from outside the state from wherever in the world they might come; from within the United States or elsewhere.

This has been the policy of American universities for half a century, so we are adopting a policy which has been traditional in much of the English-speaking world, although perhaps not on the Continent of Europe, for more than half a century. Nobody could accuse the Americans of having been unreasonably parsimonious in the way in which they have helped university students from other countries. They have accepted a great many, but this is the way in which they have done it.

I am very well aware of the problems facing foreign students. If I may declare my own interest, at this moment my institution has students from 63 countries, including almost all of the underdeveloped countries I could name. It is probable that the proportion of foreign students in my institution and the number of countries from which they come is as great as that to be found in any other institution in the country, with the possible exception of the London School of Economics whose spokesman will be addressing us in a moment. Therefore, I have a long acquaintance with these people whom we have been educating for many years with a very great sense of achievement, pleasure and pride. But I have become aware of two things. First of all, there is a great and growing resentment at the growth of their numbers. This is based not so much on the number of foreign students but on the simultaneous decline in the number of English students in some departments.

I want to discuss both of these problems simultaneously because one cannot assess the opinions of the public without seeing how closely they are interrelated. I will begin by dealing with a point which was raised by both noble Lords, namely, what has been done to pay the increased fees of students who have already arrived. The answer is that the University Grants, Committee put a fund at the disposal of all universities out of which special grants can be made to students whose fees have been increased during the course of their university career. In the whole of my institution no student has been found to be embarrassed by an increase in his fee or has had to go back home because of it.

On the other hand, we have another fund which is provided for the alleviation of hardship among all our students because their grants have been eroded by inflation and are now quite inadequate. This fund has been very much in demand, but it is quite inadequate and its administration has thrown an altogether appalling light on the difficulties which confront both foreign and our own students. The number of applications for extra grants, gifts or loans—we deal with all of them—up to Christmas of last year was nearly three times as great as the total demand for similar grants in the whole of 1974–5. For example, some students from Uganda receive a grant of £50 a month upon which they are supposed to live. They cannot do so. We have made representations to the Government of Uganda who have noted them and said that they will consider the matter. Other students, too, come with totally inadequate grants and cannot live upon them.

This is a much more serious problem than that posed by the fees which nearly always seem to come separately, to be separately accounted. I cannot believe that foreign students have either been or will be deterred by an increase in fees because the increase in the number of applications from overseas students for places in my institution is nearly 50 per cent. over last year. The increase in the fees, alarming although it may appear to be, is not deterring would-be students—at least, not so far as we know.

I must turn now to the point which I raised a moment ago—that our hardship fund is heavily in demand from both our own and foreign students. Unless Members of this House have sons or grandsons in universities, they may not realise just how difficult of late it has become to finance them. This is a point of which the Government must become aware.

If I can summarise the remainder of my argument it is that having built and equipped a splendid university system it is now denying its advantages to the very people for whom it was intended; namely, our own children who are now reaching the age of 18 and contemplating a university career. All parents receive a grant of £50. This sum was fixed in 1945 and was then intended to pay the fees of the universities which were at about that level at that time. When my own children went to college 10 years ago it covered most, if not the whole, of the fee. Thereafter parents have to pay a contribution which is based on a sliding scale, dependent upon their income. I have looked into the position of those citizens of Manchester who are crossing sweepers and dustbin emptiers, and I find that any such man who is on the basic rate of pay is not required to make a contribution towards the education of his children. I am sure that this House will be glad to know it, but if they work three or four hours of overtime and earn a bonus they may be required to pay as much as £50 or £60 towards the cost of the education of their children.

When this system was contrived the original intention was that middle-class and wealthier people should pay for the education of their children, whereas ordinary, working-class people could not do so. It is not reasonable to assume that the kind of person to whom I have referred should be obliged to make a significant contribution towards the education of his son, if his son is able to go to university. As a man's income increases, the contribution mounts rapidly. Suffice it to say that a man and his wife, who between them are earning more than £8,000 a year, have to find the whole of the cost of their children's education, including the fees. That can be costed up as the equivalent of £2,000 gross, and many parents cannot and will not afford it. Last year the Government very generously announced an increase in grants to students. In practice, they gave nothing extra to most students but they found they had a claim on their parents for another £100 or £150 a year. Many parents found that the Government in their wisdom had decided that they ought to give their children another £150 but had not provided them with the means with which to do this.

It is this which has produced the bitter reaction against foreign students. The universities are unable to attract Englishmen but thousands of people from every country in the world come to take courses which are no longer accessible to those people for whom the universities were built. I was talking only yesterday to my former secretary, a girl who graduated in French at Manchester about six or seven years ago. I discussed with her the cost to her parents today of sending her to college. She said, "I would not go today. It would not be worth it and I could not ask them for it". Yet, as your Lordships know, students are coming from 63 countries and people cannot understand how or why it is that they should be coming here in larger numbers all the time while ordinary, middle-class parents should be so baffled by the problems of financing their own children in the universities of their choice.

Lord GLADWYN

My Lords, if I may be allowed to interrupt the noble Lord for one moment, may I say that his objection is not very logical. Surely the reason that British students cannot go to university is that they have not got the means to go there. That is not to say that the presence of overseas students is preventing British students from going to university. It is an illogical objection.

Lord BOWDEN

My Lords, I am not saving that there is a causal connection but that the bitter resentment against the presence of foreign students which is to be found everywhere is due to this.

Lord GLADWYN

My Lords, it is illogical.

Lord BOWDEN

Illogical maybe, my Lords, but ordinary people who see our universities full of foreign students and who are unable themselves to send their own children there most bitterly resent it. Perhaps I may follow this up because I find that this is peculiarly embarrassing in my own institution. As I have said, we have been educating students for 150 years. We have among us students from 63 different countries, and so far, fine. But what I find alarming is that in some departments foreign students seem to be taking over. I could quote half a dozen cases, of which perhaps I may give a couple. In my institute we have a department of textiles which is probably as fine as any such department anywhere in the whole of the civilised world. In one of the classes we have 24 students, every one of whom is foreign, and what am I to say to Lancashire business men who come in and say: "You are educating our competitors. It is wrong. Why have we no Englishmen?" That is the question I pose to the Minister who is to reply to this debate.

To take another case out of scores of such cases. We have a class on the theory of hydrocarbon chemistry—namely, the chemistry of oil and its products—which is about as important a subject as is known in the country today in view of our reliance, growing and great, on North Sea oil. The course was mounted with the support of the Science Research Council and also with the support of the great oil companies. Last year it had 46 students, of whom two were British: the rest came from half the world. No one is happy in the circumstances. Englishmen either will not or cannot afford to come.

To give another example of a course we have been running for 50 years. The first British electric grid was built in 1926. Much of the design work was done in my institute and we are still studying the problems of transmitting power from the dynamo to the switch. For many years we have accepted foreign students and we have been enormously proud of them—I want to make that point—and in fact in the whole of that great are of the world from Algiers to Bangkok there are 15 institutions within which groups of men are designing grid systems for underdeveloped countries. This marks the first stage of their development, their industrialisation and their march into the 20th century. Of the 15, we staffed 13 from my institute. So when I say we are proud of them, your Lordships will understand why. But your Lordships will also agree with me in thinking that when this year we have a class of 26, of whom one is British, we have grounds to fear. How can we survive as a nation if we have not got engineers capable of designing and constructing our own grid?

So I am afraid that the problem of foreign students is much more complicated than the noble Lord, Lord Gladwyn, has appreciated. People are not merely worried at their presence but they are worried at their presence in the absence of British students. The reason why Englishmen do not come is partly because the grants are inadequate, partly because of the cost to middle class parents, and also—and I must make the point very strongly—because of the inadequacy of the salaries which may be commanded by engineers when they have graduated. A man who chooses to become an accountant or a solicitor will earn three times as much as an engineer of the same age—so why be an enginer?

I will illustrate by quoting from two advertisements which appeared on the same day, one in the Evening Standard and one in The Times. The Evening Standard was advertising for a laboratory assistant to work in the Central Office of Information. His qualifications were that he was to be 16 years of age and to have two "O" levels. There could hardly be a lower qualification than that. He was to start at the age of 16 at £1,800 a year, rising to £2,100 at the age of 21. At the same time, the Science Research Council was advertising research scholarships to be given to men with first-class degrees. They were to get £1,050, which is less than half as much as the laboratory assistant was to get at the same age. Why should we expect people to come and study engineering? How can we expect to survive as a nation if the whole purpose for which our universities were first developed is totally frustrated, first by the inadequacy of salaries of engineers, but most particularly by the inadequacy of the grants enabling engineers to come to college? In my opinion it is quite intolerable, particularly when one thinks of the history.

Your Lordships will remember that the first impetus for the expansion of universities came with the Barlow Committee's Report of 1946. It urgently recommended that British industry would not survive if it did not have more engineers, and it must therefore have more university places in which these men could be educated. This began the move for the expansion which culminated in the enormous expansion which the Report of the Robbins Committee stimulated. But it was always the case that the expansion was justified on the grounds that the industry and the community needed educated men to go into it in order that it should prosper. We have built what I believe to be a very good system of universities, although they are rather small by international standards, and it is intolerable to the public at large that they should be taken over, as they are in some cases, by foreign students who can come here from the ends of the earth when our own students cannot come at all.

So the question of the overseas students' fees cannot be seen in isolation; it must be seen in the light of the general view of the public that their own people are being kept out for the benefit of people to whom, after all, we owe nothing at all.

Lord GLADWYN

My Lords, it is not the foreign students who are keeping the British students out; it is the inherent inability of the British students to go. It is nothing to do with the foreign students, except as a kind of sentimental reaction to it.

Lord BOWDEN

My Lords, this is the point I am trying to make—that the universities are emptying and providing places for foreign students because our own people cannot afford to go there. That is the gravamen of my charge. This is what I believe to be the fundamentally important thing. This is why, in essence, the ordinary man in the street, the ordinary newspaper editor, finds it so extraordinarily offensive to his idea of fairness and sense that we should go on at great expense educating our principal competitors and not educating our own people. I do not believe that the question of student fees by comparison is really significant. I believe that the change which has been suggested; namely, that this part of the cost should be borne by the Overseas Development Board, is perfectly satisfactory. I do not believe that we should have any sense of shame that we conform to American practice rather than to French practice. I would remark that most of the foreign students in German universities are in fact Germans who have gone abroad because it is easier to get in as a foreigner. Half of all German foreign students are in fact German nationals who have translated themselves to Switzerland to come back again under those circumstances.

But these I think are trivial matters. What I am trying to stress—and I stress it with a tremendous sense of urgency—is that our own universities are being destroyed and denied the opportunity to educate the people for whom they were created. This is thrown into awful relief by the foreign students, and this argument about foreign students' fees has been exacerbated and has acquired the bitterness which is so evident today for this reason and for no other.

8.18 p.m.

Lord ROBBINS

My Lords, I think I should begin by declaring an interest. As the noble Lord, Lord Bowden, indicated, although perhaps in a way which may not have been intelligible to all present, I have been associated for a very long time indeed—with the exception of the Second World War since 1924—in one capacity or another with an institution which I fancy recruits its students from at least as wide an arena as the Manchester College of Technology. I must say en passant—for this morning I delivered a lecture to an audience of many nationalities—that I am not aware of any seething bitterness at present in the foreign students at the London School of Economics. Indeed, I am quite sure that on the part of students and staff alike, it is a matter of pride. The reason I put down my name to take part in the discussion this evening was that I think that what has been decreed by the Ministry is likely to be inimical to the international atmosphere, which I regard as good, of institutions such as ourselves.

The noble Lord, Lord Bowden, raised a series of questions concerning the reluctance of British students to go into the universities. I do not intend to go into that in this connection. From my point of view the centre of gravity of this debate is the issue of discrimination, of charging one fee to foreigners and another fee to our own native students. I am not unaware of the circumstances to which the noble Lord, Lord Bowden, made allusion, of the extraordinary muddle as between the different States in the great confederation across the Atlantic. But what is much more germane to the subject under discussion this evening is the fact to which the noble Lord, Lord Gladwyn, has already drawn attention; that is, that in the EEC. in the different countries of Western Europe—apartfrom Eire—we are the only country which practises discrimination as regards fees. Incidentally, I think it is germane to the matters which worried the noble Lord, Lord Bowden, that it is not a question, so to speak, of living in a world in which overseas students have only one place to go in order to acquire industrial skills which, perhaps, they may use in con-petition with us. It is a fact that in continental Europe the various university institutions—particularly the technological universities—offer a splendid alternative and one which, in my opinion, we have to keep in mind.

Therefore, I have no doubt at all that the practice of discrimination and its intensification as regards absolute amount's by the Ministry recently, while it may lead a certain number of people from poor countries to go home in despair because they do not know the languages of continental Europe and do not know how to acquire them, will probably lead to a certain amount of switching. The Germans, the French, the Dutch and the Belgians will be training our competitors, if that is the real ground of offence, and in our universities there will be a comparatively small proportion of foreigners. It is not true that they are taking over the universities yet awhile.

My Lords, what are the results of this? I find it extremely difficult to answer the questions posed by the noble Lord, Lord Belstead. So far as the more or less direct financial effects of driving people away are concerned, I am quite sure that it is to get an entirely false perspective simply to look at the marginal cost as represented by the Working Party of the University Grants Committee and the Committee of Vice-Chancellors, and not to look also at the amount brought into this country, in one way or another, by the people who pay us the compliment of regarding our education as being worth while to secure.

But whether, in the end, the result of what has happened will be plus or minus in this larger context is not a matter on which I should feel professionally sure, without making a good many more investigations, which, at the present moment, I do not know how to make. I do not know how to judge the elasticity of demand by foreign students at the present prices which have been fixed. I defy anyone to be cocksure about it. What seems to me to be much more certain is that if we drive away a substantial number of foreign students, particularly students from the developing countries, we shall lose indirectly quite considerably from a commercial point of view as the years go by. If these people go to France, Belgium, Holland and so on, they will acquire the jargon, the technique, the ease of moving about in the technological communities in which many of them aspire to move. To that extent—it is not the only influence, of course—we shall suffer. How much we shall suffer seems to me again to be a matter which is indeterminate; it is a matter for conjecture. For these and other reasons, I fancy that, in the long run, we shall suffer quite considerably.

My Lords, when I turn to the academic side of the question, I really have no doubt at all that spiritually we shall suffer a great deal. Most of my academic career has been at least 50 per cent. concerned with the training of graduate students from various parts of the world —not only from the underdeveloped countries but also from America, Canada, from continental Europe. I have no shadow of doubt that if these people cease to come, or are deterred from coming, in such numbers as they come at present, then the spiritual atmosphere of those institutions which cater for them will suffer. I am also fairly sure that our general status in the world will receive one more blow by the gradual realisation that this kind of thing is what we are doing; that is, that in Europe—which, on the whole, has regarded education at any rate as one of the things in which it is not going to practise the art of discrimination—we, whose glory it has always been to attract a considerable number of foreign students and to treat them on exactly the same footing as we have treated native students, have shut up shop and are now discriminating according to country of origin.

My Lords, I have not much more to say. This is the bicentenary of the publication of Wealth of Nations by Adam Smith and consequently all economists must be doing quite a lot of homework in that connection. I was reading Book IV of the Wealth of Nations only the other night when I had already put down my name for this debate. I noticed this mordant sentence, which I submit is not entirely relevant to the practice of discrimination: The sneaking acts of underling tradesmen are erected into political maxims for the conduct of a great empire. Needless to say, there are no personal references here, and it may be thought that the 18th century terminology is a little harsh.

Reflecting on this matter, I think of the shame that I should have felt, in my capacity of advising the academic board at the London School of Economics, if there had existed at that time these discriminatory practices; the shame I should have felt on asking Mr. Trudeau, Mr. Pat Moynihan, Dr. Emminger, for instance—to name a few of the distinguished people who have done us the honour of coming along to Houghton Street. When I think of that, I am ashamed of the growing insularity, the inward-looking nature of the attitude which has inexplicably come over this country in my lifetime. In my young days the Progressive Party proclaimed the brotherhood of man. We now resort to these mean and pettifogging expedients.

8.31 p.m.

Lord WYNNE-JONES

My Lords, I came intending to make one speech. I shall now make a totally different one. After listening to what has been said in this House tonight, I feel that we really are putting to ourselves the questions: What do we mean by higher education? What do we mean by further education? What do we mean by universities? What do we mean by polytechnics?—and everything else. I should have thought that we are faced, both from their inception and from their development, with the fact that first of all higher education is concerned with the advancement of knowledge, that it is concerned with a community of learning which transcends all national boundaries. But we also have another obligation in higher and advanced education. It is the one to which the noble Lord, Lord Bowden, has referred, and it is of serving the needs of the community in producing trained people in order to do all the jobs which are required in the community. I think that we are slightly confusing these two.

My Lords, I would be utterly opposed to any form of discrimination between countries, between peoples inside countries, in so far as access to higher education is concerned. But it is rather a different matter when you consider whether you are going to set up and equip institutions, laboratories and so on, in order to give specific training, because you believe that there is a national need for that training, and then you find, as the noble Lord, Lord Bowden, has pointed out, that you have not got the people apparently in the country to fill those places.

The noble Lord, Lord Gladwyn, raised the question of cost and the noble Lord, Lord Robbins, I was glad to find, was not prepared to answer, because it seemed to me, on the face of it, it was an almost impossible question. It is not simply dealt with by taking the total cost of running the institution and dividing it by the number of students, and saying that it therefore costs £1,500 per student. This is utter nonsense. If you are running a laboratory, then it will not cost you £1,500 per student; it will cost you £3,000 or £4,000 per student. If you are giving lectures and your class goes up from 100 to 110 it adds virtually nothing to the cost of running the class. Therefore, it is quite absurd to compare the cost of providing a laboratory, equipped for supplying technical information, knowledge and training, with a lecture-room in which lectures are given to a class of any size; so long as the lecture-room can still hold the students, you are all right. Of course in the Sorbonne they do not worry, they let them go out in the street. That is why the French system of education is much cheaper than ours. It is only in the Ecoles they give highly specialised training.

We come to another point. The noble Lord, Lord Robbins, seemed to me to indicate that if students did not come to this country they would go perhaps to Holland, Germany, or somewhere else to get their training. Our technical training is the shortest and most condensed in the world. If you go to Holland and take technical training you do not get it in three years, you get it in six to eight years. The technical training in almost every country on the continent of Europe is a longer one than our training, and very frequently students come here because they can get their training more easily, in a shorter period of time, than they can abroad. I do not blame them for doing it.

We are now faced with a real problem, which I think is not fully appreciated; that is, that on the one hand you want to encourage the best students from everywhere to come. I think the London School of Economics, with which the noble Lord, Lord Robbins, has been associated for so long, has built up a reputation which is worldwide. It would be a disaster, in my opinion, if students did not come from all over the world to the London School of Economics, because the very fact that it acts as a centre for the very best in their fields of study makes the London School of Economics what it is. One therefore wants the students to come. Is the same thing true of a technical college run by the Inner London Education Authority when they may be forced to put on a course in a technical subject because ten foreign students and not a single British student have turned up? If you are to run a course in a local education authority, you must have, I think, a minimum of either six or eight students. This means that if four students from this country turn up the course will not be run, but if eight students from abroad turn up the course will be run. The course may be an extremely expensive one to run, and it is run purely as a technical course.

I think this is a different issue altogether from charging fees for universities, places where you are trying to attract the best people in order to develop the subject and get the whole intellectual life improved. I would submit that you give a technical training because this country needs the technical training. If people will not come forward in this country for the technical training, I can see little justification—except, as has been suggested, as a method of helping developing countries—but in that case it ought, as has been suggested by the noble Lord, Lord Robbins, and the noble Lord, Lord Belstead, to be put on a separate Vote. It should not come under the Education Vote, because you are taking away from what ought to be supplied for developing the educational system and using it for aid to developing countries; it is per fectly legitimate, but it ought to be put on a different Vote.

There is one other point one wants to bear in mind, and that is that when we talk about the developing countries we are talking about a vast range and spectrum. We include India as a developing country. India has 84 universities of its own; 3½ million university students. I would suggest that it is not sensible for Indian undergraduates to be coming over to this country to study unless there is a special field in which they must come. In the main I would say that it does not do them any good, because very often they do not understand the language well enough to profit by the training which is given here. I know this because I have taught many of these Indian students, and much as I have enjoyed having them it has often taken a lot of time to get ideas over to them. At the same time it holds back the development of the universities in their own country if we try to attract them here.

Lord ROBBINS

My Lords, might I say that it is certainly my observation, which I think would be borne out by statistics, that so far as the ambiance I was talking about was concerned comparatively few Indians come here until they have reached a first degree in their own country.

Lord WYNNE-JONES

My Lords, I accept what the noble Lord says, and it is always difficult to get up-to-date data in the field of education since all the information service of the Government became computerised. It now takes about three or four years to do it instead of getting it out in a year or so. So far as I can find out, in the year 1971–72 the number of foreign students coming to this country from Asia was 7,322; the number coming from the American continent was 4,551; the number coming from Africa was 3,666. In other words, the numbers are coming from India still, although I admit in nothing like the numbers they used to come. They used to flood into this country, but they no longer come in those numbers, thank heavens! I say "thank heavens! "not because I do not want the Indians here, but because I think it was bad for them to come. They were often coming merely because the reputation of an Indian university was not good enough. If they got a degree in an Indian university they found it more difficult to get a job in India than if they got a degree in this country, and that was an unfortunate thing. Therefore, I am glad that the Indians are going in much more now for helping their own universities. This is a healthy sign.

When we consider the whole field of higher and further education, we must distinguish between the purely technical side to which I have referred and the side which I would call wider, higher education. In my opinion there should be absolutely no balance in the main field of higher education. But I do not believe that it is an obligation on this country to put on courses—I can speak for the university with which I was associated for 25 years—for instance in the field of naval architecture, which even 20 years ago were attended almost entirely by Norwegians and Greeks with about three or four British students. The result was that the Norwegians were able to build up quite a good repair industry on the shipping side largely as a result of the training given to them in the University of Newcastle. I do not think that it is our business to be doing that type of technical training for other countries unless they are developing countries and we do it in an entirely different way.

I would beg my noble friend, when he replies, to consider how proper relief can be given in this whole field of higher education for those who come to this country for perfectly good, sensible, genuine reasons, and whether it is not possible to find some system, whether it be scholarships or whatever it may be, in order to prevent students from being excluded because of this increased fee which is being put on. I personally would like to see all fees for higher education abolished; I think that the thing is an absolute nonsense. In fact, the fees for higher education have been largely maintained because the universities themselves wanted to have what they called an independent income, and by getting their fees fund increased they pretended that this was a private source of money, whereas of course most of it was coming from public sources in any case. But they were able to put it in a separate column in their accounts, and they pretended that this was their own money and not money given to them by the Government. I wish we could abolish fees altogether. May I put to my noble friend that the great step forward that he can make, that the Secretary of State can make, is to go on now from this point of differentials to abolish fees altogether, and then differentials do not matter.

8.46 p.m.

Lord GARNER

My Lords, with such a galaxy of noble Lords with far more experience than I in this field wishing to take part in this evening's debate I propose to be brief, especially as so many points on my mind have already been touched upon. I do not wish to become involved in any question of detail, and the discussion so far has clearly shown how complex so many of the factors are. Nevertheless, I must confess that I have an instinctive reaction that any discrimination against those from overseas, and particularly any substantial discrimination, is unfortunate and could have bad consequences, and that reaction—call it a gut reaction, if you like—is fortified by certain basic reasons. I mention only two.

First, I am no pessimist about the future of this country, but I imagine that we should be facing the fact that the heavy manufacturing industry resulting from the fortunate accident of the Industrial Revolution, on which our prosperity was built up in the last century, has had its day and we have to look for other forms in which to create our prosperity. One of these clearly is increased technology, specialised equipment of one sort or another; but another field was, particularly, services of all kinds (banking. accountancy, architecture, and so on), and perhaps exploiting the heritage of this country both in stone and in natural beauty, the arts, the theatre, literature and so on. One of the most important factors in this area was precisely education.

The quality of our universities is universally recognised, and incidentally the English language is an accrued advantage. This is something that all the world looks to us to provide, and it would be tragic if at this time—and I am not saying that this has happened—we were to risk the chance of throwing this away by earning internationally a reputation for being either niggardly or inhospitable.

The second general Point that I would make is that it seems to me—and various other noble Lords have made the same point—quite impossible to strike a balance in mathematical columns, but we should not overlook some of the factors that it is very difficult to quantify: the enrichment of our university life with those coming in from abroad, the great contribution that has been, and no doubt will continue to be, made to research, and moreover the actual material benefit that comes from costs of travel or purchases and various other things that should fairly be taken into account. But perhaps still more significant are the un-quantifiable benefits that come from people who have enjoyed and benefited from their stay in this country returning to their own countries, spreading goodwill, enhancing our reputation, returning for visits and no doubt, incidentally, in the process, giving publicity to British wares and equipment and acquiring these for use.

My only other point is to reinforce the plea that was made by the noble Lord, Lord Gladwyn, that the Government should look at these matters as a whole, and he developed this point and spoke about its history. I have not seen very great evidence almost at any time in the discussion of this matter since 1967—certainly there was no great evidence in 1967, as I know because I was in Government service then—that some of the problems are looked at as a whole and that the important policy considerations which should apply in the Foreign and Commonwealth Office, in the Ministry of Overseas Development and in the British Council are fully brought to bear.

In this connection, I found very attractive the ideas that were put forward by the noble Lord, Lord Gladwyn, and others that the Ministry of Overseas Development should be looked to in future not only for guidance over the whole problem of education from overseas but also some responsibility for the financial provision. I hope that the noble Lord who replies—of course, he will be replying on behalf of the whole Government—will be able to assure us that that is no mere formality and that wider considerations are being, and will be, taken into account on this complicated issue, as has not always been the case in the past.

8.52 p.m.

Baroness VICKERS

My Lords, I feel rather diffident at taking part in this debate because I am probably the least academically trained Member in the House at the moment. I offer sincere congratulations to the noble Lord, Lord Gladwyn, not only for an interesting and informative speech, but for raising a matter that has not been raised since 1967. I venture to enter the debate because I helped in 1946 to set up the Social Welfare Department in Malaysia —Malaya, as it was at that time—and I had the opportunity to select students, to send them to this country, later on to receive them back and, still later, on going back to Malaysia, to see the excellent work that they had achieved as a result of their training in this country. I am President of the International Friendship League and the Women's Corona Society—working president, I am glad to say—chairman of the Anglo-Indonesian Society and on the Executive of the Commonwealth Parliamentary Association. Thus, I have been able to keep in touch with a great many overseas students. When I was Member of Parliament for Devonport I regularly had them to my house—we always have supper parties for them—and I got to understand their problems, and of course I also refer to those who came to the docks for naval training.

I consider, having read the document, More Help for the Poorest, that on page 23 of Cmnd. 6270 the Government are really committed to more training in further education. I hope, as the paragraph goes on later to mention, that it will not be the policy for particular centres of excellence in their own countries to be used because I consider that it is very beneficial for students to come to this country, particularly for advanced studies. What we have to decide tonight are the priorities—what we are going to spend our money on. While we know that only a limited sum is available, I suggest that education is one of the best ways in which this money can be spent. I have always been an advocate of practical help and I have seen far too much money wasted on various projects. When I have been overseas I have received, for example, woollen garments in tropical countries. In Indonesia, following the Japanese destroying the sugar mills, we were anticipating new machinery, but when it turned up it was for beet sugar and not for cane sugar, and of course there is no beet sugar in Indonesia.

I regret very much the attitude taken by the Daily Express and the Daily Telegraph, which in my view has been detrimental to the general taxpayer, who may think he has been milched. That is not the case at all. I was, therefore, particularly grateful to Professor Dahrendorf for his article in yesterday's Daily Telegraph, which put the matter straight, and I hope that that will be equally well read. It is interesting to note that in 1974–75, 12 per cent. of students in universities came to Britain as against 9 per cent. in 1969–70,but the interesting fact for those who are worried about the numbers is that that has not kept pace with British students, in other words, there were more British students on the dates I have mentioned. It has been pointed out that in Germany, Luxembourgand Denmark the educational facilities are free. It is also interesting to note that Switzerland has the highest number of students and that they charge only the same as their own students pay.

I regret that the noble Lord, Lord Bowden, is not still in his place because he was stated in an article to be "the tough principal "of the University of Manchester. I was going to tell him that only an hour ago I met some people from the Seychelles who told me about how much they appreciated the period they spent in Manchester, particularly those training to be civil servants in their own Parliaments. I suggest that if students in this country are not coming forward for engineering and if the people running the textile industries are worried, it is up to them—that is, if the people cannot afford it—to start scholarships. There is no reason why these industries should not start scholarships of their own to help the people in this country.

I believe that there has been no hardship for our students other than from the monetary point of view; none of them has been turned away from the colleges concerned. It should also be remembered that many students from the developing countries may have to return this September to their homes because of this great increase. It seems unfortunate —and here I agree with the noble Lord, Lord Gladwyn—that an announcement about such increases should have been made in 1966 and 1967 and yet again on 16th December of last year, yet slipped by practically everybody. It did not slip by the noble Lord's vigilant eye and we are therefore particularly grateful to him. Despite the propaganda about oil millionaires, one should realise that this is an exceptional case; I feel rather sorry for the poor girl who is implicated in these articles. Most of the students are sponsored by their own Governments and come from the poorer developing countries. These are surely the ones who need the most help. It seems particularly regrettable that it will be ability to pay, not the potential of the individual, which will be the main criterion for future students. I therefore suggest that we look at this matter very deeply.

On 21st May 1968 the Department of Education and Science sent out to local authority colleges Circular 71/56/ 02, with the full economic costs of boarding in hostels attached. These are going up, too, and this of course is very detrimental for overseas students, because in many cases they will have to pay double the amount compared with our students. On 1st March 1957 the DES Circular 320, commending the virtues of hostels to local authorities, stated: The opportunity of mixing with other students outside the hours of formal study has long been recognised as a valuable contribution to education in technical colleges, as in schools and universities. I do not think that paying different rates will encourage students to live together. When this was challenged by the National Union of Students in 1968 it was stated that it was not a new policy on the part of the Administration. But Memorandum No. 490, which was issued to local authorities in 1955, had not been implemented. However, in April 1975 there is discrimination in regard to accommodation in hostels and full board can cost as much as £23.50 for overseas students, compared with £10 per week for United Kingdom students. The overseas student welfare expansion programme was introduced by the Government in 1961. I gather that it has provided 6,000 places, but it appears no longer to be available.

I should like to touch on the question of married students. I think it essential that the wife should come with her husband even if only for a short time, because I have noticed when I have been overseas that it is very often frustrating for a student to find after he has spent several years in this country that he cannot adjust to his wife who has lived all the time in the country of origin. The Foreign and Commonwealth Office, the British Council, UKCOSA and the National Union of Students agreed by implication that the present discrimination was indefensible. The Foreign and Commonwealth Office position was stated in a letter to UKCOSA of July 1974, which said, Although we are opposed to the discriminatory charges and, indeed, opposed them when they were initiated, there is little likelihood of them being abolished. That is what I am worried about. In a letter to the then President of the National Union of Students dated 21st June 1968, the Leader of the House in another place said: It is certainly not my intention to discourage students from outside England and Wales from taking courses of further education. Whatever his intention, this action of putting up the fees will discourage students coming from the less developed countries.

The Ministry of Overseas Development has said that only a quarter of overseas students are financed from British sources. Others are financed by the United Nations or their own Governments. Three-quarters are privately financed. I feel that that is a remarkable record. I should like to suggest that a special overseas students' local authority fund should be established to subsidise overseas students wishing to use or in need of local authority hostel accommodation. The allocation of funds should be administered either by the British Council on behalf of the ODM, by the ODM itself or by delegation to local authorities. I suggest that such a fund will be a small token out of a formal budget of thousands of millions to ensure the Government's commitment in aid terms to the education of the overseas students in the United Kingdom. I believe it could be seen to be of real benefit. I hope that the few words which I have said in this debate may make your Lordships realise that I am very much against any form of discrimination and should very much like, though I know it is not possible at the present time, to follow the suggestion of the noble Lord, Lord Wynne-Jones, that these fees should eventually be abolished. In the meanwhile, however, surely we can make them more equitable.

9.4 p.m.

Lord BROCKWAY

My Lords, I should like to express my thanks to the noble Lord, Lord Gladwyn, for having initiated this debate and for doing so in a speech which seemed to me to express the historic liberties for which Liberalism has stood. I am speaking with some diffidence in the same way as did the noble Baroness, Lady Vickers. I am encouraged by the fact that she said that she had not many academic qualifications because the speech which she delivered was one of the most valuable we have heard during this debate.

I have never had the privilege of being a student at a university. I have had no part in any administration of higher education. I therefore speak, particularly after the contributions which we have had from those who have given distinguished service in those spheres, with a great deal of reservation. All I can say is that I have had very close association with students at universities throughout the country and that for 30 years I have been particularly associated with students who have come from overseas and especially from the developing countries.

I have noticed one great change in the attitude of overseas students during the past 30 years. Immediately after the last world war I became aware of a rather ironical situation: students from the developing countries who came to British universities became anti-British, while students who went to universities in the Soviet Union became anti-Communist. In my contact with students today, I find that the situation is very different and that, broadly speaking, overseas students who are at our universities no longer have the anti-British attitude which they had 30 years ago. This is partly because of the recognition of the right of their territories to self-government and the new political climate, and partly because they are finding at their universities a tolerance and, indeed, a fellowship with British students which they did not have 30 years ago. Because of his authority, I listened with a disturbed mind to the speech of my noble friend Lord Bowden. He suggested that among both students and staff there was now bitterness towards students from overseas. I have not found such bitterness. I do not claim to have his authority, but I go among students, including those at Manchester University, and I have not found that temper among the English students.

Today there has been issued the annual report of the British Council. It pays tribute to the great value to this country —economically, and in many other ways —of overseas students at our universities. Overseas students contribute importantly to research, and there are language teachers at our universities and schools. The total of 90,000 overseas students includes 20,000 nurses, and all of us who have been in hospitals know the value of their service. In money terms they contribute £90 million annually in foreign currency to this country. Therefore, even from the point of view of the advantage of this country, the presence of overseas students is of value.

But from the point of view of the estimation of Britain in the world, what they do when they return to their countries is of even greater importance. There are the skills and the techniques which they take there. I hope that other Members of your Lordships' House saw that remarkable television programme—I think it was last night, or perhaps the night before—about the health service in Tanzania and the contribution which nurses who had been trained in our British hospitals had made to that country. Overseas students who have been to our universities are the best missionaries of good will from this country that there are in the world today.

In passing, I wish to pay my tribute to three Members of your Lordships' House who are associated with the British Council which has prepared this report. The first is the noble Lord, Lord Ballantrae, who is the chairman of the British Council. Secondly, there is the noble Lord, Lord Goodman, who is a vice-chairman, and thirdly the noble Lord, Lord Beaumont of Whitley, who is one of the most useful members. I believe that the thanks of the whole House is due to them for their services.

My Lords, my main criticism of the increase of fees to overseas students at our universities is the discrimination which it expresses. It took place first in 1967 differentials. The increases which are expected to be imposed in September mean that the fees of home students will increase from £115 to £150 a year, while the fees paid by overseas students will increase from £320 to £416 a year. I am wondering how this discrimination can be made consistent with our Race Relations Act, which makes illegal any discrimination in this country on the ground of national origin.

It is true, as my noble friend Lord Bowden said, that there are hardship funds at the universities, but I have found that a number of overseas students are reluctant to apply for grants under the hardship fund because they fear that if they indicate that they are in financial stress they will have provided reasons for the immigration authorities refusing permits for them to stay in this country.

The hardest hit of overseas students are not those at the universities but those at the polytechnics and at the colleges of further education. Most of these students are privately supported by their families, by their communities, it may be by industrial firms and by their own savings. There is no hardship fund for them: there is only local authority discretion on the recommendation of university principals. I should like to know whether the following statement is true. The National Union of Students state that they do not know of a single case of a polytechnic or college of further education student who has had any contribution from a hardship fund on the recommendation of the principal of one of those institutions.

My Lords, before the publication of the British Council Report today, with its figure of 95,000 overseas students in this country, the National Union of Students had information of 52,587. Of these 52,500 students, 42,772 came from the developing countries, and only 13,000 received awards from either their home or the British Government, or from communities or industrial concerns. I say this quite conciliatorily, and I say it with particular emphasis to the Front Bench of a Labour Government. If these increases of fees to overseas students continue, we shall find that it will be only rich students from abroad who will be able to come to our universities.

My Lords, I want finally to admit a difficulty. I do not want our Government to be subsidising, at our universities, the sons of rich oil sheikhs or other rich élite from overseas, from the developing countries, but we should recognise this. Of the 52,587 students from overseas, only 7,349 come from the OPEC countries, and not all of these are the sons of sheikhs. I hate the means test—I went through the 'thirties—but there may be a case for laying down an income level, asking overseas students on their entry forms if they reach it, and making them liable for misrepresentation. But we must avoid any elaborate system of the old means test methods of interrogation of all students. That must be avoided. We should welcome foreign students, particularly those from the developing countries. They could become the greatest diplomats of international co-operation which we can contribute to the world.

9.19 p.m.

Lord MILFORD

My Lords, it is very difficult for me to make a speech after the noble Lord, Lord Brockway, because I agree with every word he has said; and, like him, I work very closely with the National Union of Students. At this moment I should like to praise enormously the work that the National Union of Students is doing concerning education and foreign students. They are fighting right from the ground floor to get the poorest students a good education.

This question of education is tremendously important for the whole world. Tonight we are talking about the developing countries. I want to spread it farther down still to the undeveloped countries, to the poorest people in the world. I want to help lift them up by giving them better education.

One must remember that there are a billion people in the world today who have got an annual income of under £90. We must have a sense of guilt towards these people, I think, because when I was a young boy at school the map of the world was covered with little red blobs, all over the place, where British colonies existed or British protectorates. It is largely today those red blobs that are the underdeveloped countries. We took the wealth from those countries and we did not bring them into the modern world. So that I think we have now a tremendous moral sense of bringing those people up, saving them from starvation. The way to do this is through education. Only education can rescue them from starvation by giving them the skills and knowledge necessary for their economic development. This chance, the best possible education, is one of the most valuable gifts that Britain can offer to the poorer nations. If we cannot do it freely—I have heard tonight that certain countries do it freely, and I do not see why we should not—then we must do it as cheaply as possible.

If we have differential fees—I think that these are absolutely wrong—they should be devised so as to help the poorest students first, as was strongly advocated in the recent White Paper on racial discrimination. Yet in 1967 differential fees were introduced and the overseas students have to pay more than our home students. As the noble Lord, Lord Brockway, has said, the overseas students will now have to pay £416 while the home students pay£150. Imagine the effect on a poor-country student wanting to come and get our wonderful education! We must bear in mind that the majority of the nearly 100,000 overseas students, about 75 per cent. of them, are from the poor, underdeveloped countries and they have managed to get here only through their families saving, their friends giving them presents and scraping together themselves.

To those poor students from the poorest countries in the world what a dismay this 30 per cent. increase must have been! Does it not raise the level of discrimination, of unlawful discrimination, on the grounds of national origin? By contrast, most home students will get their fees paid by the local authorities or they will be transferred to the local authorities from the universities. Of course, I am afraid that some will suffer; those whose fees are not paid by the local authorities and those on minimum grants without help from their parents.

The home students should not be thrown into difficulties. But the greatest concern is for the overseas students who are going to be far harder hit. If we go on raising fees in this way, we will still only be getting students backed by big business, the oil sheiks or foreign Governments, and they can get education without any difficulty whatever. We are not concerned about this élite, we want to help the poor, underdeveloped countries. This is what I want to go on emphasising. The main effect of the fee increases falls on the overseas students. We can only infer that it is meant to do so. The Government mean it to fall on the overseas students to provide cash to offset the Government's cutback in education expenditure in this country. It is incredibly mean to make overseas students pay for our difficulties.

In the universities there are arrangements for a hardship fund for overseas students. As the noble Lord, Lord Brockway, said, it is accompanied with the heaviest means test. Imagine what a means test looks like to a poor overseas student from a poor country! He fears, if the Home Office finds out that he is in difficulties, perhaps they will refuse to renew his visa. In what position are the first year students who went to the university a year ago, and did not expect fee increases? Already the poor overseas student is harassed by the Home Office through the 1971 Immigration Act. He cannot work during the vacations to earn money to increase his income. The result is that about a third of all overseas students do not qualify for the hardship fund in universities.

As the noble Lord, Lord Brockway, said, the polytechnic students are the hardest hit of all. They are mostly privately funded from their families, friends and personal savings. No hardship fund exists, only a local authority's discretion. The students' union, which fights these cases and tries to help students, says that no local authority has exercised discretion; they cannot and dare not because of the pressure from the Government to cut back so far as possible on local government expenditure. And there are even worse examples. For instance, the City and East London College denied to the National Union of Students that it had powers to exercise discretion. Are colleges unaware of their powers, or are the local authorities not carrying out their statutory duties? This whole question of the overseas student is heavily threatened by the growing racialism in this country and by chauvinism. An enormous cam paign against overseas students is mounting and is being heroically fought by the National Union of Students, based on their theory that the poorest must be helped first against increasing discrimination.

.Another great problem is the question of hostel fees. Student surveys show an increased differential in hostel fees—and it is increasing more and more. For instance, in Bradford overseas students pay £21 and home students £12. In the North-East London Polytechnic, overseas students pay £62 and home students pay £12. The result is that in the North-East London Polytechnic hostel there is only one overseas student.

The drive against discrimination comes up against those clinging to neo-colonialism and the attitude of ex-colonial Powers to the developing countries. The noble Lord, Lord Bowden, put this attitude clearly not very long ago when he said (and it was reported in the Press): It worries me greatly to find that some of our most effective graduate schools are educating men who, in the natural course of events, will go home and compete with hard-pressed British industries. Surely the economic truth is that the more wealthy the backward nations become the greater markets they will offer for our own industries.

Another form of attack on the existence of overseas students comes from those who are raising the fear among the British public that by financing the students we are constantly raising the local rates. But very few people talk about the benefits that overseas students bring to this country—for instance, there are language assistants, nurses and £90 million worth of foreign currency, together with multicultural and multi-lingual education systems and research. There are over 15,000 postgraduate students in this country and most of them are in research, which is tremendously valuable for us. But, as the National Union of Students say, We must not produce this list of benefits that we get from overseas students in the struggle to support them."

Our aim is to offer a gift to the huge, poor, undeveloped world, to whom we owe so much—for how we have neglected their interests in the past! And for that gift to be acceptable, it has to be as cheap and easy to obtain as possible. When those countries are educated, we, and the whole world, will gain. To take the line that we cannot afford to do this because of our own financial problems or because our rates will go up is madly short-sighted. The more overseas students are as highly educated as possible the better solution they will offer for us and for our trade, and for the trade of the whole world.

9.34 p.m.

Lord SHER FIELD

My Lords, two general considerations strike me about the subject under discussion. The first is that most of the points on one side are quantifiable while most of them on the other side are unquantifiable. To simplify, it is largely a case of hard cash against imponderables, and this complicates the debate. The second point is that the subject arouses, especially as it is treated in some parts of the media, those xenophobic and nationalistic feelings which are never far below the surface of our national life, though I doubt whether these are very prevalent among the younger generation. These manifestations, in so far as they surface, obfuscate the argument.

Not even all the facts and figures seem to agree; for example, as regards the increase in the numbers of overseas students in proportion to the increase in the total number of students. Certainly, in the case of one institution of which I have some special knowledge, the proportion of overseas to indigenous students at both undergraduate and postgraduate levels has scarcely changed over the last decade, and this supports one of the points made about the London School of Economics in yesterday's Daily Telegraph article by that former overseas student, Professor Ralf Dahrendorf, to which reference has been made in this debate. Clearly, up to the present, different samples give different results, though it is too soon to detect whether the last increase in fees and the one in prospect will alter these percentages

A good deal has already been said in this debate about the imponderable and unquantifiable arguments, but I should like to develop just two of these a little further. Anyone who, like myself, has been involved over a period of years with scholarship schemes for overseas students or exchange arrangements, can testify to the important and enduring effect in their attitude to Britain on people who usually attain some positions of influence in their own countries. Most of them—not all, of course—go back with a favourable impression, as the noble Lord, Lord Brockway, said. Many of us taking part in this debate have had to deal with former graduates of British universities operating in important positions. The consequences in terms of benefit to Britain, political or economic, are certainly difficulty to assess, but I have no doubt in my mind that it all adds up to a large plus. At a time when we receive too many overt reminders of our relative impotence in international affairs it would, in my opinion, be foolish to jeopardise this covert contribution to the maintenance of British influence in the world. Your Lordships may say that this is a typical Foreign Office argument, but I advance it none the less without apology.

On a more material level, there is the foreign exchange aspect. We are told that it is indefensible to subsidise the education of the sons and daughters of relatively wealthy foreigners, and that is a very plausible sentiment. This position can be, and has been, attacked from several directions. All I want to emphasise is that the personal expenditure of such a student during his stay here may well offset any public money laid out on him or her, while one visit from the parents can far more than make up the difference during a single week-end in terms of the export of goods and services. Moreover, since most overseas students acquire an attachment to their universities and therefore develop an animus revertendi, they will by coming back frequently to this country continue to contribute favourably to our balance of payments for the rest of their lives.

Then there is the contribution which the overseas students, especially the post-graduates, make to the research and development effort in our universities which, in the institutions of which I have knowledge, is greatly valued. I would hazard a guess that they give as much as they get. One institution in particular with an international reputation in a large discipline of which I have knowledge attaches the very greatest importance to its overseas relationships.

I have seen suggestions, to which the noble Lord, Lord Bowden, has alluded, that overseas students take away with them valuable technological information. I find this quite difficult to believe. Anybody who has spent as much time as I have in trying to organise the exploitation of the research and development information in British universities can tell you that there is very little of commercial value to make away with, and in so far as overseas students contribute to the transfer of basic technology to the less developed areas of the world the process is surely to be welcomed.

Lord BOWDEN

My Lords, if I may interrupt the noble Lord, I was referring in particular to Turkish students. It so happens that at the moment the Turkish textile trade is almost destroying part of the Lancashire business. A large number of Turks who are taking courses in technology in my institution will go home and improve the performance of their own industry to the detriment of ours. We have been doing this—goodness knows why!—for 100 years. We felt that it was fine just so long as we were still able to educate as well a few Englishmen.

Lord SHERFIELD

My Lords, while accepting that there may be special cases, whose fault is it that the British people are not studying textile machinery technology? In general, I venture to assert that the balance is in favour of taking no action which would discourage overseas students from coming to this country. In conclusion, I would emphasise one point. When faced with a welter of conflicting arguments in relation to an item of expenditure it is very tempting to a Department of State to cut the cackle, to settle on a figure, however hard it may be to substantiate its fairness or validity, and to say that this is how it is to be. I hope that this is not what has been done so far in this connection. Quite apart from what the Committee of Vice-Chancellors and Principals and the University Grants Committee may ultimately propose, there are many diverse and probably conflicting departmental viewpoints and interests. It may be that a body exists within the Administration which has tried to reconcile these differences and make an assessment in depth of the imponderable factors and which can listen to outside opinions before a figure is pulled out of the air or broader policy is finally deter mined. If there is not, then I support the suggestion that has already been made by the noble Lord, Lord Gladwyn, and the noble Lord, Lord Garner, that the noble Lord should endeavour to persuade the Secretary of State to set up such a body.

9.44 p.m.

Lord CARADON

My Lords, at this late hour we must resist the temptation to follow the arguments that have been put to us by certain speakers. Sometimes outside this House and sometimes even within it, the discussion is too narrow, too parochial and too prejudiced. Tonight we are dealing with a much wider issue. I should like to deal with the question solely from the point of view of our contribution to international development. I believe that in the education provided for overseas students in this country we have a method of contributing to international development which is the most advantageous, effective and valuable.

As to advantage, I do not propose to get involved in any attempt to deal with this matter on a calculation of costs, but I believe it is unanswerable that the foreign students who come to this country contribute in the money they bring with them far more than anything that is paid by this country on their education. I do not think that can be challenged. It is a fact of great consequence because it destroys the attempt to deal with this matter merely on a refusal to meet the necessary charges. I do not think it can be disputed that the foreign students bring practical, positive financial advantage to this country.

The system of education provided by this country for foreign students is also the most effective form of overseas development aid that could possibly be devised. I have had some experience of the provision, through international agencies, of the experts who are sent with the support of our Ministry of Overseas Development to different parts of the world. Naturally some difficulties arise: it is not always easy to get the best experts to go overseas for a year or two. They have to be highly paid; the costs of travel are considerable; they are sometimes unsuitable; they have no knowledge of the language. Nevertheless, in my own experience some hundreds of them from this and other countries often do a remarkable job.

But what a comparison it is between a few hundred experts with certain natural disadvantages going to help the poorest countries in the world and tens of thousands of their own citizens going every year in order to carry the skills and the benefits of their knowledge and their education not only for a year or two, as in the case of the United Nations experts, but for the whole of their lives. The comparison means that this form of assistance is much the most effective that can he devised and it is also the most valuable. None of the standard criticisms made against overseas aid apply. In the first place, no expense is involved; on the contrary, there is financial benefit to this country. Secondly, no balance of payments is involved; on the contrary, it is to our benefit in the balance of payments that they should come, and it does not leave behind, as so often in the past has been the casein our overseas aid, the burden of loan repayment which has to come from the poorest countries in the world. No burden of repayment of loan arises. So in all three respects this is the best form of contribution that this country can make to overseas aid.

As is the case with some others in this House, most of my working life has been spent in the Colonial Service overseas and I claim for my service that we have made some contribution—we would hope an economic and political contribution—to the advance of a quarter of the population of the world in British territories. But our contribution is as nothing in comparison with the contribution of British universities.

I do not know whether any of your Lordships are aware of a remarkable article written by Ambassador Moynihan of the United States of America, who has achieved something of a notorious reputation of late. He wrote an article which he called "The British Revolution ". He said that the most important development of the last generation, or the last fifty years or so, was the contribution which had been made by British education (and he mentioned in particular the London School of Economics) to the developing countries of the world. He called it "The British Revolution "because he believes that we have made the largest contribution of all. He spoke about it as an immensely good thing. Ambassador Moynihan is not very apt to give lavish compliments, but he said that this was an immensely good thing that had been done.

I believe it is so. I believe it is a British lead given in the world which, in our suburban parochialism, we tend to underrate. It is a lead we have given. Certainly we have been ahead in the world, and have made a greater contribution in this respect than any other country in the world. We continue to do so. I am glad when I hear that we do so on a steadily increasing scale. So it should be; and it should be our pride. Edmund Burke said that our leadership in equality and in training for freedom was the peculiar and appropriated glory of England. In these days, of course, one should make reference also to Scotland and Wales. But it is so; it is the peculiar and appropriated glory of England that, through the education provided by this country, we have sent out maybe hundreds of thousands of people to all parts of the world, carrying with them what we can give them, which is much more than any material thing—the benefits of an English education. I do not think we should underrate this. I do not think we should be ashamed of what we are doing.

My Lords, I do not know whether it is relevant, but I remember when the Soviet Ambassador in the United Nations accused me of pretending that all had been well in the advance of British colonies to self-determination. He said that all the leaders of the British colonies had been in British prisons, from Nehru to Nyerere. I was able to reply that I felt sure the distinguished representative of the Soviet Union would agree that it was better to make Prime Ministers out of prisoners than prisoners out of Prime Ministers. Indeed, that has been the progress on which we have been engaged in recent decades. I believe we should be proud of it, and that we should welcome it.

My Lords, we should recognise that nothing else we do is comparable with what has been done in this sphere, and which now can continue to be done in the post-Imperial era. If we fail, and if we allow miserable arguments of petty cost to interfere with such a magnificent achievement, then I think all of us will be very severely to blame. I think it was a disgrace that in 1967 we introduced discrimination; it is a disgrace that we now increase it. We should consider it, and we should look at it again, on the basis that has been suggested by the noble Lord, Lord Gladwyn. It is not a matter for the Department of Education and Science alone. It is not a matter for people like the noble Lord, Lord Bowden, who speaks about the bitterness of opposition, which I would contest. I do not believe it is so.

One of the things which gives me greatest comfort in this matter is that the National Union of Students and the organization which the noble Lord, Lord Gladwyn, represents have come forward and taken a lead in this campaign to beat down the miserable considerations put before us. I am glad to see that some of the universities—we should pay tribute in particular to the University of Bradford—have refused to put into effect the requirements of discrimination. So I would say that if all other aid, if all other contributions from this country to the development of the world, particularly in the fight against poverty and squalor, were all to stop—and God forbid that it should!—then this at least should continue. This contribution, of which we can be genuinely proud, surely should be one thing we should jealously preserve, instead of talking about whether it is a matter of financial balance that the student has to justify before he can be given the opportunities of our education.

Before we can start talking about division and bitterness, we should be prepared to justify what we have done, and to demand that we go back to a basis of reasonable equality. Otherwise, what are we doing? What we are doing is to tell the world that we do not like it; that we are going to make them pay as far as we possibly can. The harm that that can do is beyond computation. What is more, we are doing exactly as has been suggested; we are suggesting that we want only the rich ones, and those who come from the poorest countries and the poorest families we are glad to eliminate. That is not an attitude which I think can stand well in the reputation of this country. Therefore, I think this remarkable debate, as it seems to me, with its able introduction, although we have gone on much longer than we imagined, has been well worth while.

9.56 p.m.

Lord ANNAN

My Lords, I would not disagree with one word of what the noble Lord, Lord Caradon, has said about the influence which in the past graduates of our universities have had overseas. You have only to go to India and there you will find that all the elites were either at Cambridge University or at the London School of Economics at the time when I was an undergraduate and Lord Robbins was teaching.

Having said that, may I now turn and become as parochial as I possibly can, for I have the melancholy distinction of having been the one member of the Vice-Chancellors' Committee who in 1967 defended in your Lordships' House the decision by Mr. Crosland, who was then the Secretary of State, to introduce this differential. I did so because I knew what Mr. Crosland was up against as Secretary of State. He was faced with a decision on priorities. The priority was whether he would get money for the educational priority areas, the slum schools, the disgusting primary schools which had not been changed by one brick since they were built in the middle of the 19th century, or whether he would go on with the fee system as it was. I said to your Lordships that I realised that this struck a very sensitive nerve in the universities. I did not hesitate as to which I would have chosen, and I think he was right to make that decision.

I think that your Lordships in this debate have displayed a marvellous and Olympian disdain for the way the finances of the country are run and for the way in which Government works in this country. For we know that people can get money on a Vote only if they are prepared to make concessions on something else. This really should be borne in mind. For instance, the noble Baroness, Lady Vickers, in a speech which was as charming as it was moving, recommended, if I heard her aright, that local authorities should set up a fund to help hardship cases among overseas students. How can this be done at a time when local authorities are being urged, indeed compelled, by Government to cut their costs all over the place, to cut the number of teachers in the schools, because there simply is not the public money available? Again, not one single noble Lord has mentioned devaluation. The reason, of course, why there is to be an increase in fees is to take account of devaluation.

These are parochial matters if you like, but this is the stuff of politics. We cannot, at a time when we have a rising number of unemployed in this country, 1½ million rising perhaps to 2 million, totally ignore the fact that cuts are having to be made all through the economy. The public sector in some ways has escaped more than others, but it, too, will have the axe wielded even more severely. I am not at all sure, if the Lord Chancellor would listen to this, that there should not be a Standing Order of the House that any noble Lord who advocates an' increase in expenditure should, in the same sentence, indicate from what quarter he would make cuts in order to finance that increased expenditure.

Lord CARADON

My Lords, does the noble Lord accept the argument repeatedly put to him that the bringing of overseas students to this country does not lead to a deficit but leads to a financial advantage?

Lord ANNAN

My Lords, I shall certainly come to that point in one moment, if the noble Lord will allow me. The facts arc that here is a sum of money which is raised in this particular manner. What is it in the educational field which ought to be cut in order to provide this sum of money? This is in fact the argument that has to be argued in Cabinet, with the Treasury, in the Department, and inter-departmentally. It is too easy simply to advocate that on some global way of looking at the economy you can justify this particular cut in income of the Government.

There are a great many points to be made, and I shall make a disjointed speech tonight because there are some points I want to make very much on the other side. Before I begin on those, and before I pass to other points of detail to which I should like the noble Lord the Minister to reply, I wonder whether I might say that one of the reasons why we have so many overseas students in this country is—and this has been pointed out tonight—precisely that English universities, polytechnics, the whole of our institutions of higher education, give a very remarkable education, with pass student ratios unknown anywhere else. I think that it was the noble Lord, Lord Wynne-Jones, who pointed out the degree course and the qualification one can obtain in three years compared with six or seven years in another country. What is more, when students come to this country they learn the lingua franca of this world. As Latin was "the "mediaeval language, so English is now "the" language, and that is why so many wish to come to this country: they will be learning not merely the subject they came to study technically but also the free language of the world, the one which is most used in gatherings and institutions.

I myself believe that today it is not a question so much as to whether there shall be a differential. The differential is there; it is going to be exceptionally difficult to persuade any Cabinet or Minister to get rid of it. My memory does not go back to the line which the Conservative Front Bench in Opposition took in 1967, but I certainly saw no inclination when the Conservative Government were on this side of the House between 1970 and 1974 to remit this particular charge.

In taking this unpopular stand tonight, I hope your Lordships will recognise that all I am trying to do is to say that there are certain facts in politics, certain facts in governmental finance, which I do not believe have been adequately faced. Let me immediately agree with the noble Lord, Lord Caradon, that there is a substantial gain by foreign students coming to this country. The figure that I have from the Department of Trade and Industry was not £90 million, but it was certainly £50 million as an estimate which was put on the foreign currency which they will bring into the country. This undoubtedly affects the case. No one wants to kill the goose which lays such golden eggs, particularly as the geese so often become swans of great value to this country when they return to their own. I have heard it suggested, for example, that one reasonable and sensible amendment would be to have a differential but to modify it if the overseas student is a part-time student. There are many such part-time students and I think it is for consideration whether they should not pay a part-time fee such as, for example, the home based students in this country pay.

There are some who argue that while it is legitimate to charge a differential against those who take up graduate-taught courses or post-graduate-taught courses, we should be more indulgent and remit the fee, the differential, for those who are studying for higher degrees such as a PhD. This can be argued on the general grounds of scholarship with no discrimination, and in this field of higher scholarship we should indeed have no discrimination at all between those overseas and those at home. They argue that it is only here, in this post-graduate stage, that one gets that cross-fertilisation of ideas, culture and understanding and that that is fostered by the movement of scholars across national borders. Attractive as this argument is, I am not persuaded that it would be administratively easy to cope with such a scheme.

Let us not forget that every time a modification is introduced in regulations this increases the number of civil servants to administer such a scheme and increases the number of administrative officers in universities. The pride of our universities is with what small administrations they manage to cope with the manifold problems with which they have to deal today. The administrative staffs are very small and the reason for this is that the teachers—and exactly the same applies with the polytechnics—prefer to do the administration themselves. This is unlike the situation in many other spheres; for example, in the Arts much of the increased expenditure has gone on Arts officers rather than on actors, singers and performers. I hope the Minister will say that he will look into the question of whether we might have some modification of the differential for part-time students. For example, often a foreigner in this country who is in a job will have a wife who herself would like to take a part-time course at a university. Often somebody who is finishing off a thesis or other work has to go part-time for a year.

I come to the wider topic of whether there should he any restriction imposed in universities on the acceptance of overseas students. I am glad that I have not heard any suggestion from the Government about introducing any quota system. Those who say that there should be no differential at all will find very soon that, if there were no differential, a quota system would then be imposed. That is the choice. Which does one prefer, a differential or a quota system? I do not think there will be any doubt as to where opinion in the universities will lie. If they have to choose, they will choose a differential rather than a quota. I think a quota would work unfairly and there are many reasons—I will not go into them at this late hour—why it would be thoroughly undesirable.

As part of the national economy campaign, I think that far fewer postgraduate awards are available for our own students, and this is what has led to the situation which the noble Lord, Lord Bowden, described at Manchester University. We must face the fact that this is a fact and we must take account of it when we come to decide which of certain alternatives we shall be faced with. But I believe there is a danger that, in these days of broad-brush planning in the Department of Education and Science, someone among the officials will have the bright idea that if the number of overseas students were reduced by, say, 20 per cent., the space and resources in the universities and polytechnics could then be allocated to a flood of suitable British undergraduate students who were at present queueing for places.

I hope no such argument is adduced in the corridors of the DES because that is the kind of dream which certain civil servants in the Department may have when afflicted by insomnia and when they are trying to get to sleep. It is the bureaucratic equivalent of counting sheep. It simply does not follow that because one reduces the number of overseas students one will be able to fill their places with equivalent British students either at the post-graduate or, much more likely, the undergraduate level. There is at the moment no queue of students, particularly, I am afraid, for those departments of science and technology where most of the overseas students are to be found. There is no flood of postgraduates because, as has already been said today, there are no grants except for a trickle of British post-graduates.

This is the situation as I see it. I should be worried if the understandable feeling which we all share as to the need for overseas students to come to our universities so affected our judgment that we believed that there were no arguments at all in favour of the differential. The differential was imposed in 1967. The direst prophecies were made that no overseas students would be found in a British university or polytechnic, but here they are today in their thousands. I wonder whether this will substantially affect the numbers who can come. I am all in favour of those who have said how important it is that the poorer student should come. I believe that the answer has been given during the course of the debate and that the way out is to ask the ODM to see if it can take on the responsibility for bringing that kind of student to this country. As the noble Lord, Lord Crowther-Hunt, knows well, this is a very familiar and popular argument in universities today. I do not believe that it is purely dodging the question; I believe that it is a logical administrative change, not just a bit of inter-governmental accounting.

I should like to put one last question to the Minister. Will he consider redefining what is an overseas student? There are some grotesque anomalies about. For instance, a boy or girl who is as British as they come but whose parents have been resident overseas, not because they are tax-evading expatriates but because they are earning hard currency for this country, may find that he or she suddenly has to pay overseas students' fees. This seems to me to be an anomaly. It is perhaps an equal anomaly that a wily and skilfully advised alien who has sent his child to an English public school for three years can then relish the fact that the child qualifies as a home based student. I wonder whether these matters can be looked into.

As your Lordships will have realised, a very great deal of deeply felt sentiment surrounds this subject. I feel that this rhetoric is honourable but that some of it reflects the realities of governmental finance. The truth, as I see it, is that there is no single criterion which enables us to follow a line of policy. It is a bit of a hotchpotch and the level of fee charged will ultimately be a mixture of what is politically possible and what is economically realistic. I believe that we have a right to charge for our unique facilities, but I should be entirely in sympathy with all those who think that any such charge should be realistic and. in the case of anomalies, that mercy should always be shown.

10.15 p.m.

Lord RITCHIE-CALDER

My Lords, I make no apology for rising even at this late hour. I put down my name to speak but it was omitted from the list, and this is a subject on which I cannot possibly restrain myself. I never thought that I would ever have to make this speech. I have been a member of the Labour Party all my life and I never thought I would find myself in a situation where I would be dealing with a subject which should be so deep and so completely a part of our blood corpuscles. Why should we be thinking at this stage of discrimination—and it is discrimination of the worst kind—on the question of fees, differential fees and rising fees for the world at large? This is an irony beyond all measure. I follow my noble friend Lord Caradon very closely on this. In the past 27 years I have travelled 2¾ million miles for the United Nations and the biggest investment in foreign aid, and the biggest and best investment we have ever made, has been in the people we have educated, either by sending others out to help in their education or by bringing them here to be educated. I agree with my noble friend Lord Caradon that the people who go back to multiply the products are the best investment in the world.

I remember on one occasion being with Paul Hoffmann who was the managing director of the United Nations' Development programme. We had been over all the ground and discussed all the things, which had to be done in the world, and we always came to this cul-de-sac which was education. Until one can get the thing started and generated, and push it on and transfer it, there is very little one can do. One came back eventually, in the last resort, to something which must be of the nature of classroom education. We came out of the United Nations' building into the Plaza, and on First Avenue I saw on a passing coach an advertisement which read: "Teachers bottled for export in Scotland" I thought to myself: That's the spirit!

We are considering the whole business of how we are to magnify and multiply the capacity for the most important and only thing which really matters ultimately in foreign aid. I hate to call it that; I prefer to call it "mutual aid," at best because we learn and gain so much from others. But the most important thing here is the sharing of knowledge and skills, and we should be backing it up with material resources. However, the first thing is to establish the method of communication. I just cannot believe that we are now gradually closing these doors which have never been closed. I think of the wandering scholar; after all, the world is full of wandering scholars. How did Scotland acquire its education and its educational system?—by wandering, and by people wandering to Scotland.

We now have a fantastic situation. While we are talking about renouncing pay beds we are apparently creating educational pay beds for the sheikhs because eventually the only people who will be able to pay for education will be the wealthy. This is a very great British tradition, because all the great public schools started as foundation and charity schools but finished up by providing merely for those who could afford to pay. How can anyone try to work out a system which would exclude from all the so-called sums and computations we are making the completely immeasurable values that we are talking about? Do not forget that in the pockets of these poor students there are also blank cheques, because the people who come here to be educated are those who go back to their own countries to become Ministers of Finance or take up similar posts.

If you want to look at it in terms of pure Mammon that is one thing. The other thing I can see is that, if you start establishing this principle, how can you ever hold your head up again and say that we in Britain are now not only turning our system into a commercial educational system but in fact providing for the well-to-do and the rich? By this system of increasing fees, the people we have been talking about—the people my noble friend Lord Brockway has been talking about and the people that the noble Lord, Lord Milford, has been talking about—will not be able to come here to be educated. The only people we shall get will be the paid people, the people who will be allowed to leave the country. I do not want to cause any diplomatic crisis, but think of the Shah of Iran. The poor wandering Persian coming out of Ishbahan with his parents' money in his pocket is not going to be allowed to come any more, so all we shall be able to get will be the people they will hire and send. The same thing will happen commercially. The only people we shall get will be those whom the oil people, or whoever it may be, will want to train.

I am sorry to say this, but I did not expect to hear the kind of argument we heard from my noble friend Lord Bowden—that there are too many overseas students in our classes—because, like Lord Gladwyn, I did not quite follow the logic of it.

Lord BOWDEN

My Lords, may I briefly explain? I was complaining about the shortage of British students.

Lord RITCHIE-CALDER

I know, my Lords, and that is exactly the point I want to make. What are we blaming anybody for? We are short of British students. If we took the foreign students out of the classes the teachers would be fired. What are we talking about? This is the same sort of argument as I had in the 1930s, in Lancashire, about Lancashire weaving research. There were complaints that we were producing machines which we were selling to the Japanese. Why? It was because the cotton industry would not buy them. They were putting themselves out of the market—it was not the Japanese who were putting them out of the market. It was because they were not using the latest machinery and were leaving the initiative to the Japanese. This is the kind of completely illogical argument that I cannot understand. When I find it also divorced from the morality with which I really am concerned in this matter, then that is it. All right, talk about economics, but the point is that here is an issue on which I feel that we are going to abdicate one of the most important things, one of the invisible flags which will still be flying on the flagstaff when the British Empire has been forgotten.

10.22 p.m.

The MINISTER of STATE, DEPARTMENT of EDUCATION and SCIENCE (Lord Crowther-Hunt)

My Lords, I am sure that we are all grateful to the noble Lord, Lord Gladwyn, for giving us the opportunity of this debate and for so ably reminding us of the importance of continuing to welcome students from all over the world into Our universities, polytechnics and other establishments of higher and further education. As has been emphasised this evening, learning transcends national boundaries, and we in this country have a proud record of opening the doors of our educational institutions to students from all parts of the world. It is also beyond dispute, my Lords, that our institutions have benefited greatly from those students from other countries whom we have welcomed here. It is equally beyond dispute that many British students have benefited from the facilities afforded in other countries. There is, I am sure, no disagreement between us on this score, and our common concern must be to preserve these opportunities on a mutually satisfactory basis.

Before I seek to reply to some of the precise and detailed points which have been made, let me first of all try to set out the facts of the situation, as the noble Lord, Lord Belstead, specifically asked. We start from the fact that the numbers of overseas students in higher and further education in the last ten years have roughly doubled, from about 30,000 in 1964–65 to over 60,000 in 1974–75. In percentage terms, this is an increase from 8.6 per cent. to 9.7 per cent. of all students in higher and further education. This is not exactly the record of an inward-looking, insular people, as the noble Lord, Lord Robbins, suggested our record was during this time; nor does it represent any gradual closing of the doors, as my noble friend Lord Ritchie-Calder has suggested. Quite the con trary! This is a very large expansion which has taken place during those ten years in the number of overseas students in this country; and it has not only developed in absolute terms but has increased percentagewise as well. This is a very great record of which we can be proud.

The numbers of overseas students on degree and other advanced courses, including post-graduate courses, in higher and further education over the same 10-year period have increased from about 22,000 to nearly 40,000, an increase from 10.3 per cent. to 11 per cent. of all students on degree and other advanced courses. The numbers of overseas students on postgraduate courses over the same 10-year period have increased from about 8,500 to over 16,000. In percentage terms this is an increase from 29 per cent. to 32 per cent. of all students on postgraduate courses. In our post-graduate courses now 32 per cent. of the places are occupied by students from overseas. The numbers of students on non-advanced courses over the same 10-year period have increased from about 9,000 to about 22,000. But this is not the end of the story. In addition to these students in universities, polytechnics and other institutions of further education, there are large numbers of overseas students who come to this country to train as nurses in our hospitals, as barristers in the Inns of Court, to train in private establishments and in commerce and industry for a variety of vocations. The total numbers of all overseas students coming to this country has increased from about 68,000 in 1964–65 to over 95,000 in 1974–75.

Increases of this magnitude would inevitably raise questions, even if there were no financial constraints. But as noble Lords are well aware, there are severe financial constraints and we are concerned tonight with those which affect overseas students in higher and further education. As we are frequently reminded, the tuition fees paid by overseas students represent only a fraction of the average cost of tuition. The average cost of tuition for degree and other advanced courses is currently of the order of £2,000 a year and the recommended level of tuition fees for overseas students this year is £320 as against the average level of cost of £2,000. Next year it will be £416. The recommended levels for home students are £140, on average, for 1975–76 and £182 for 1976–77. The corresponding figures for non-advanced courses in further education are an average cost of tuition of about £1,000 a year and fees of £200 in 1975–76 and £260 in 1976–77 for overseas students. At the same time the recommended levels for home students are £80, on average, for 1975–76 and £104 for 1976–77. Although the actual cost of any particular student or group of students cannot precisely be assessed, these figures will indicate the order of magnitude of the subsidy we are providing.

Let me go further to answer precisely some of the points made by the noble Lord. Lord Belstead, in this connection. We have naturally made some attempts to estimate the amount of subsidy provided by the British taxpayer and ratepayer and we have concluded that the cost of courses for overseas students in higher and further education, less the income from fees, could be put at more than £100 million a year—that is, if one wanted to put it in this context—more than £100 million in subsidy terms. I might add that I do not know the basis of Lord Gladwyn's assumption or, indeed Lord Caradon's about the balance-of-payments benefit, which both noble Lords asserted with a great deal of authority was naturally flowing in our direction from overseas students. What I do know is the Government's view that the expenditure by foreign students in this country is much more than offset by the resource costs of providing for their education and other needs, to the tune of over £100 million in a year. In other words, one might say that, whereas the expenditure of foreign students is put at about some £60 million a year, the resource costs of providing the education they have is put at something like £170 million a year.

Lord GLADWYN

My Lords, is the noble Lord saying if we had no overseas students in this country we should benefit to the extent of £60 million to £100 million? Is that really his argument?

Lord CROWTHER-HUNT

My Lords, I am not saying that at all. There are imponderables in this connection; I should like to come on to them later. What I am saying is that, so far as we can see, expenditure by overseas students here is something of the order of £60 million, whereas the resource costs of the education and facilities which we provide are something of the order of £170 million. If the noble Lord can subsequently produce figures to challenge that, I shall be glad to consider them. So in referring to a subsidy of over £100 million, which I mentioned earlier, I am saying that this is not a miserable argument about petty costs, as the noble Lord, Lord Caradon, put it. One hundred million pounds is not a petty cost by any stretch of the imagination.

The differential fee for overseas students was first introduced in 1967–68 when it was recognised that there was a need to contain the increasing level of subsidy. By 1974, however, it was clear that, with rising costs and our worsening economic situation, some further steps were necessary and, indeed, that the whole question of tuition fees, for home as well as overseas students, would have to be looked at again if the opportunities for higher education and its quality for our own students as well as for those from overseas were to be preserved. It was for that reason that my right honourable friend the then Secretary of State for Education and Science announced on 18t1; March 1975 that he was recommending universities and local authorities to increase fees for the academic year 1975–76. This recommendation was intended to restore the proportion which university fee income bore to grant in 1967–68 and to save some £4 million in further education. In the case of universities the proportion of fee income to grant had already fallen from about 8 per cent, to about 5 per cent.

Towards the end of 1974 the University Grants Committee and the Committee of Vice-Chancellors put in hand a review of the structure of tuition fees which it was hoped would be completed in time for their recommendations to be considered before fees were fixed for the 1976–77 academic year. In fact, they have completed and published an interim report, but propose to consult widely before writing their final report. It is hoped that their final recommendations will be available later this year in time to consider what changes in fee levels might have to be made for the 1977–78 academic year.

I should also make it clear that the Government too have been examining the whole overseas student question along the lines the noble Lord, Lord Gladwyn suggested including the levels of tuition fees. I think the noble Lord, Lord Sherfield, said, "Let us make an assessment in depth ". The noble Lord, Lord Garner, called for an interdepartmental study, as indeed did all speakers in the debate. This is what the Government set in train some considerable time ago. This review has been timely both in relation to the extent of the problem and also because of the growing polarisation of views on the subject. We are hoping that the fruits of this and the Government's decision upon it will be available in the not too distant future, because we have to recognise in this House that there is a growing polarisation of views on this question. While there is support, which has been admirably expressed tonight, for the liberal tradition we have always followed in this country over education, nevertheless the fact has to be faced that there is a large and growing pressure from those in the country who are concerned about the large number of overseas students, as they put it. I get more letters of complaint on that side than on the other. There are two schools of thought here.

On the one hand, there are those who argue that there should be no differential in the fees charged to overseas students and that discrimination of this kind is objectionable in principle and conflicts with the European liberal traditions of higher education. Perhaps I might make another point to reinforce this argument. Those who take this line suggest that those who have such first-class higher and further education facilities to offer, as we have, have a duty to make them freely available, particularly to students from the newly developing countries in the world. This sentiment has been expressed in your Lordships' House tonight.

This argument is again reinforced by the view that this is not only the right thing to do morally but is also right from the point of view of enlightened self-interest. It is pointed out that the presence of overseas students in our academic communities enriches the quality of the work and life of those communities; their presence may provide significant benefits to our international standing and our commerce in the future, particularly if the people who train here subsequently go home and want to buy British in the scientific and technical fields in which they have trained. Therefore, in this way there will be a long-term contribution to our earnings of foreign currencies. This is one of the imponderables which have been talked about.

The contrary view is that, whatever the countervailing advantages, we cannot afford to provide for unlimited numbers of overseas students, and that, of the various ways by which the level of subsidy might be controlled, the charging of higher fees accompanied by the provision of help under Government aid programmes for those coming from developing countries is the least objectionable. In this context, some go so far as to say that our excellent educational facilities should be regarded as an international marketable commodity and that we should get the best price for them in the international commodity markets of the world.

These, in summary form, are the two opposing views on this difficult question and full weight is being given to them in the Government's review. The longer-term policies which will result must take account of our position in the EEC. There were under 2,000 students from EEC countries studying in this country in 1973–74, compared with 50,000 other students from overseas. Her Majesty's Government have always up to now considered it equitable to treat all overseas students alike, and have not sought to distinguish between those from particular countries or regions, whether the EEC, the Commonwealth or the developing world. We subscribe, of course, to the desirability of encouraging mobility within the EEC, on the lines agreed between EEC Education Ministers in Brussels in December. However, this is a question with more to it than the issue of differential student fees and it is one which we and the Community will be studying in all its aspects.

However, to return to the noble Lord's Question, which is related to the 1976–77 increases, in the view of the Government it became necessary to raise tuition fees on an interim basis simply to reflect the increases in costs since fees were fixed for the previous year. A decision had to be taken, moreover, before the end of 1975 if the budgeting procedures of the local education authorities and establishments concerned were not to be again disrupted and if adequate notice was to be given to those who might be affected. It was for the those reasons that, as the noble Lord, Lord Gladwyn, pointed out, my right honourable friend announced on 16th December that he was recommending a 30 per cent. increase in tuition fees for 1976–77.

I was asked earlier who had been consulted, and I would say that this decision was taken by Ministers collectively; this was no unilateral decision within a single Department. This decision was, in fact, as the noble Lord, Lord Gladwyn, was ready to agree, consistent with one of the recommendations of the interim report of the UGC Committee of Vice-Chancellors Working Party, which recommended an increase in fee income in line with rising costs, and the local authority associations, who were consulted, fully agreed.

In considering the size of the latest increase, the paramount factor which had to be taken into account was the substantial increase in costs of tuition in the establishments concerned. This increase naturally varied between the different kinds of institutions involved but, in general, was between 29 per cent. and 34 per cent. It would have been impracticable to suggest raising fees sufficiently to cover the actual amount of increased costs. The least that could be done, in equity to the community at large, was to increase fees by a percentage of the same order as the overall increase in costs hence the recommendation of a 30 per cent. increase.

At this point I should like to put the situation of overseas students in its general perspective. The 30 per cent. increase which has been recommended will affect all categories of students in this country, from home and overseas. It is 30 per cent. for everybody. The number of students, home and overseas, who will be required to pay from their own resources an increase of this order —and I stress those words—is likely to be about 1¾ million, of whom some 100,000 will be full-time students in universities, polytechnics and other further education institutions, while the remainder are the very large number of self-supporting part-time and evening students in further education. The number of overseas students included in these figures who will be paying higher fees may well be about 60,000 in all, of whom some 8,000 will have the increase met by British Government aid programmes, through ODM, the Foreign and Commonwealth Office, and the British Council. I accept, of course, that it can be argued that overseas students on university courses will pay an increase of £96 (30 per cent. on £320), whereas home students will pay perhaps £42 (30 per cent. on £140). But the converse to this argument is the fact that the overseas student will still be paying less than one-quarter of the true cost of his course, whereas the home student's parents or sponsors, in addition to paying a fee of £180 or so, will of course be making a direct additional contribution through taxation. And it is fair to add that a 30 per cent. increase based on cost-of-living changes does no more than preserve the existing level of Government subsidy of overseas students in real terms. If we did not increase fees pro rata with inflation the effect would be to increase the proportion of subsidy for such students carried by this country; and the actual sterling amount of the subsidy will increase in cash terms even with the recommended increase.

In our present financial position, if any one category of students were to be specially treated, and there are several categories which might be thought worthy of consideration—and not all overseas—it could only mean increasing the burden on the remainder. For example, if overseas students were to be sheltered from the increase by a lower percentage being applied to them, home students would have to pay more.

It is true that overseas students are already paying a higher fee than home students because of the differential which was introduced in 1967–68, but to have lessened the increase for overseas students in 1976–77 would have meant increasing home students' fees at a rate far higher than the increase in costs. In these cir- cumstances, the Government have concluded that the only equitable course of action is to recommend that all fees should be increased by the same percentage—a percentage reflecting, as I have said, the increased costs in the institutions concerned. Any other course of action would have altered the existing fee structure, and decisions of this fundamental kind must await completion of the longer-term review to which I have already referred.

The kind of overall proposals which have been made relating to what we should do about this question have surprised me. I start with the noble Lord, Lord Bowden, who put his finger on the point that the question of overseas students is highly complex and that the problems are not open to a simple solution. He emphasised, that the basic reason for much of the criticism, as he saw it, was that many home-based students cannot afford to go to university. He stressed the inadequacy of the system of student grants in this country and said that a much more generous support system would be advantageous. I should point out that the system of student support which we have in this country is more generous than that which is to be found in any other country I know of in Western Europe. At the moment it costs us about £244 million a year.

The noble Lord, Lord Bowden, is saying, "Increase it ". We shall, of course, review the matter again for the next academic year. However, the noble Lord is saying, "Increase it now. It should be more now in relation to the cost of living than it already is, so let us add more millions to it. Then let us add more millions to postgraduate studentship awards, which for 1975–76 amount to something like £20 million ".

Then the noble Lord, Lord Wynne-Jones, helping to solve our problems, suggested that the right course would be to abolish altogether fee income in the universities and polytechnics. The cost of doing that would be another £30 million to £40 million. The noble Baroness, Lady Vickers, said, "Let us establish a local government fund." Well, that would also cost more money.

This is why I was particularly grateful for the points which were made by the noble Lord, Lord Annan. He introduced a breath of realism into the very difficult problems which we face. This is essentially a question of priorities. I liked the noble Lord's suggestion that we ought to have a rule in this House that any noble Lord who advocates an increase of expenditure should show what should be cut by way of compensation—and, I would add, or what rates or taxes ought to be increased if there is to be no compensatory cut. This seems to be a very sensible suggestion. As was pointed out by the noble Lord, Lord Annan, we are faced with—I was going to say three alternatives but you cannot have three alternatives. There are, however, three possible courses.

The first is that there should be no restriction whatsoever on overseas students; we should provide places for them free of charge and impose no restrictions. Do we want to go down that road? The noble Lord, Lord Annan, said that if there were no restrictions and no fees this would soon produce the demand for a quota system, because without a good deal of extra cost we could not provide the extra educational places and the teaching posts which would be required if we abolished all charges. If, therefore, we cannot abolish all charges, we move in a quota direction, and clearly noble Lords would not want that. So the noble Lord, Lord Annan, came back to a differential fee suggestion. These are matters on which the Government will be taking a decision in the light of their consideration of the review that is being made, but it is important to stress that we are faced here with real choices. They are very difficult choices and we have to decide where the balance of advantage lies to this country and to the newly developing countries and all those we want to help, in the light of our present economic and financial resources.

To turn to a further point made by the noble Lord, Lord Annan, he asked if we would look at the question of redefining an overseas student and he quoted the situation in which someone counts as an overseas student whose parents may have been working abroad for three or four years and for this purpose they and their children are counted as overseas; and he is putting that alongside what he would say are bona fide overseas students who have established a three-year residential qualification in higher education in this country and under those circumstances qualify not only for a mandatory grant but also for paying home student fees. These are problems that I am happy to take on board and we shall certainly look at them.

I should like now to come to one of the very important suggestions that were made by a number of noble Lords: that the ODM should, as it were, take over the whole problem of overseas students' fees and overseas students generally and co-ordinate their aid within an EEC common aid programme. This point was put not only by the noble Lord, Lord Gladwyn, but also by the noble Lords, Lord Annan, Lord Belstead, and Lord Wynne-Jones. This line of thought closely relates to the major policy issues which the Government are now considering in the review that is under way and I can assure noble Lords that it will be taken into account.

The noble Lord, Lord Brockway, raised the question of race discrimination in the discriminatory charges so far as overseas students are concerned, and he implied that the higher level of overseas student fee is discriminatory. As I have said, there are sound reasons for this. Overseas students are already heavily sub-sidised by the United Kingdom taxpayer and we could not expect the taxpayer to increase his subsidy at the present time by reducing the fees charged to overseas students to a single, home rate. But we shall consider carefully, in the context of our general review of student fees, the consequences of the Government's new anti-discrimination proposals.

The noble Lord, Lord Brockway, and I think the noble Lord, Lord Milford, asked whether local authorities have actually assisted students from a hardship fund. It is entirely at the discretion of local authorities whether they apply, waive or modify the fees recommended. In Circular 3/75 the Secretary of State requested them to continue to exercise discretion in hardship cases, and he again referred to this consideration in Circular 14/75. How local education authorities exercise their power of discretion in hardship cases and how these are identified are entirely matters for local authorities. In fact, we do not have central information on this but in this area there has not been any substantial body of complaint

I really do not want to keep your Lordships all night. Those specific points to which I have not replied I will deal with by correspondence, and I hope it will be an assurance to noble Lords to say that this is a matter that the Government have had under review for a number of months and that all the points that have been raised in the debate will be within the purview of that review and will be taken into account. For that reason, my Lords, this is a particularly timely debate in your Lordships' House: it has come at a time when the points that have been made here can have a major impact on the decision-making of the Government as they face up to these crucial issues.

Lord GLADWYN

My Lords, will the noble Lord reply to the three concrete proposals I made for mitigating the effects of the proposals of the Government? Will he let me know whether he agrees with my proposals?

Lord CROWTHER-HUNT

My Lords, I will write to the noble Lord, Lord Gladwyn, specifically on that point.