HL Deb 18 June 1986 vol 476 cc902-8

5.57 p.m.

The Earl of Swinton

My Lords, with the leave of the House I shall repeat a Statement on student support which is being made in another place by my right honourable friend the Secretary of State for Education and Science. The Statement is as follows:

"The measures just announced by my right honourable friend the Secretary of State for Social Services mark a return towards a system in which support for students will be provided through the single channel of the educational maintenance system. It is a limited step, taken in close consultation with my department. I am, however, convinced from the many representations I have received that it would be very difficult to make further progress towards disentangling students from the social security system without a wider examination of the whole structure of student support.

"My right honourable friend the Secretary of State for Scotland and I, in association with the Secretary of State for Social Services, have therefore decided to institute a comprehensive review of all aspects of financial support for students in Great Britain studying at first degree or equivalent level. It will examine the maintenance needs of students and the extent to which they should be provided for from public funds, having regard to other actual and potential sources of support, including loans.

"The study will be carried out under the chairmanship of my honourable Friend the Parliamentary Under-Secretary of State for Education and Science, the honourable member for Buckingham. The Scottish Education Department and the DHSS will be represented on it and the education departments of Northern Ireland and of Wales will be associated with it. The review will be carried out within government. But we shall be open to representations and advice from every source. We shall undertake extensive consultations and consider international comparisons. The outcome of the review will itself be in the form of published proposals for public discussion and consultation.

"Meanwhile because the Government recognises the needs of students, we have mitigated the proposed removal of benefit whilst maintaining the level of compensation through the grant system originally proposed. Subject to the agreement of Parliament, the maintenance grants of students living away from home will be increased by £36 a year from the beginning of the academic year 1986–87. This will be in addition to the increase of 2 per cent. which my predecessor announced on 16th December and will result in an overall increase of 4 per cent. on present rates for students living away from home. This is higher than the current rate of inflation. A similar addition to grant will be made in Scotland. A paper setting out detailed grant rates is being placed in the Library. The main rates of grant applicable to Scottish students are being given separately in a Written Answer by my right honourable friend the Secretary of State for Scotland today.

"Student numbers in higher education are at an all-time record level. We want still more to benefit. The Government stand by the principle of access to higher education for all who have the necessary intellectual competence, motivation and maturity, regardless of parental income. We want to ensure that students will neither be deterred from entering higher education nor handicapped in their studies by lack of means. But in doing so we must have regard to the claims on national resources. That is why I think the time is ripe to investigate with an open mind all possible forms and sources of support. I hope the House will welcome the review which I have announced today."

My Lords, that concluded the Statement.

6 p.m.

Lord McIntosh of Haringey

My Lords, the House will be grateful to the noble Lord for repeating the Statement which has been made in another place. Will he accept from the outset that we are not saying from these Benches that everything about that Statement is bad? In particular, the announcement of a review, which although it is to be carried out within the Government will nevertheless take representations from interested parties and will publish its results, I hope with rather less delay than the results of the review of the Social Security Advisory Committee, is welcome. It has been the policy of my party for a number of years that a review of this sort should take place, and we are pleased to see the Government accepting the logic of our position.

Nevertheless, the Statement refers with some pride to the fact that with the addition of the £36 a year the level of grant for 1986–87 is above the level of inflation. Is it not the case that the real value of student grants has been eroded by something like 20 per cent. over the seven years since this administration took office? Under those circumstances, is it justifiable for the Government to congratulate themselves on maintaining the position in this year only when the real loss has been so great?

In view of the very considerable justifiable alarm and despondency which there has been among students, parents and educational institutions at the lack of decision about student grants over the years, is it adequate for the Government simply to postpone the decisions in this way by postponing until 1988 the effects of the abolition or disregard of deemed grant by postponing until 1987 the changes which have been proposed on rents, and by maintaining the unemployment benefit for the long vacation? Is it not the case that those who claim unemployment benefit have very often earned that unemployment benefit from previous employment and therefore their entitlement to it comes as of right and not from any sense of privilege or debt to the Government or to society? The grant which is now available to students is simply not adequate even to maintain students during the short vacation, and is it not the case that the Government ought to think again about this and to review their decision to take away the unemployment benefit from the short vacations?

We welcome the Government's continuing commitment to access to higher education, but how can we be convinced that this commitment is a real commitment in the light of the reduction in the real value of the student grant and in the light of the very considerable uncertainty and insecurity which students have felt?

If the Government had been wholly sincere and wholly well-meaning in announcing the review, they would have delayed some of the measures which have now been proposed. As it is, will the Government accept that they have gone only part of the way to reassuring those involved in higher and further education about the goodwill that the Government feels towards them?

Lord Kilmarnock

My Lords, we on these Benches should also like to thank the noble Earl for repeating that important Statement. The thrust of the Statement is:— a return towards … the single channel of the educational maintenance system". Is it not because that single channel has broken down through erosion that the social security system has had to be relied on increasingly? Would the noble Earl not agree that that is the case?

We certainly welcome a wider examination aimed at disentangling students from the social security system; but the Government must realise that this cannot be achieved simply as a cost-cutting exercise. We are told that the comprehensive review will examine all potential sources of support, including loans. I am not implacably opposed to loans in all cases, but I should like to ask the noble Earl if the Government will include in this review a serious examination of support for adult learners. It is monstrous that adult learners are at present left out in the cold, and it is indefensible to go on preaching about adult re-education and adult retraining while doing nothing to facilitate these things. So will that area be taken into account in the comprehensive review?

We are told that the review will be carried out within the Government. I quote: But we shall be open to representations and advice from every source". There will then, it appears, be a further stage of consultation on the published proposals. At which stage in this process is the Government prepared to look at submissions from other parties and relevant bodies? I hope it will be before and not after they have made up their minds.

On the £36 which we had in the last Statement, I am not quite sure from where the Government get their figure of 4 per cent. from December because there is presumably a gap until the £36 actually comes into operation, so there must be a period in which only 2 per cent. is what is being provided, in fact.

What does take my breath away is paragraph 5 of the Statement. I quote: Student numbers in higher education are at all-time record level". Surely, this is extremely smug by international comparisons. With 40 per cent. in Japan and 50 per cent. in the USA taking some form of higher education. This really takes the biscuit for smugness. Is the Government still planning on the lower of the two departmental projections of student demand? That would leave us with an age participation rate of 14 per cent. in the 1990s when we on these Benches would aim for 20 per cent. at least. There is no way in which the revised Robbins principle which is quoted in this Statement can be met on that projection of demand.

Of course we welcome the review. We hope that it will be positive and durable and lay the foundation for a fairly funded student maintenance system which will last, and for the increase in numbers in higher education not least among adults which this country so sorely needs.

The Earl of Swinton

My Lords, I am grateful to both the noble Lord, Lord McIntosh of Haringey, and the noble Lord, Lord Kilmarnock, for the way in which they have received this Statement. At least the noble Lord, Lord McIntosh of Haringey, seemed to treat it as something of a curate's egg: it was not wholly bad all through. The noble Lords did make a number of comments and asked some questions.

The noble Lord, Lord McIntosh of Haringey, said that he hoped this review would be speedy and would not take as long as the present ones. I cannot give any date as to when the review will report. This is the first major review of the subject since the Anderson Report in 1960. I can give the noble Lord an undertaking that it will be conducted as expeditiously as is consistent with thoroughness, bearing in mind the need for wide consultation and the need to examine the arrangements in other countries with developed systems of student support. I mentioned consultation and I can tell the noble Lord, Lord Kilmarnock, that anyone will be invited from the outset to give evidence to the department and to the committee going into that matter.

The noble Lord, Lord McIntosh, went on to refer to the much-quoted figure of the loss of 20 per cent. in the value of grants since this Government came to office. The decline in real terms in the value of the grant between 1979–80 and 1985–86 for the great majority of students who study away from home has actually been 12 per cent. I know that that is not perhaps a marvellous figure; but it is better than 20 per cent. The 1986–87 grant settlement, including the £36 increase announced today, is expected to maintain the value of the grant in real terms for those students, although it would not make up for the loss of DHSS benefit. To restore the value of the grant to its 1979–80 level would cost another £90 million.

I think that I would take this opportunity to point out that, in comparison with our European neighbours, we are still being extremely generous. After all, the 390,000 students currently in receipt of maintenance awards will this year cost the taxpayer some £470 million in maintenance grants and nearly £1,400 million in tuition. The United Kingdom spends on average between three times and five times as much per student as is spent in the Netherlands and West Germany and much more still compared with Denmark, France and Italy. We devote a much higher proportion of our gross national product to student support than other major developed countries. The noble Lord asked whether the fact that we are so mean, or not as generous as we might be, has not eroded the number of students and possible entrants into higher education. I am not being complacent, as the noble Lord, Lord Kilmarnock, said earlier, but I think that I must point out again that despite the fall in the value of grant there are nearly 80,000 more students in higher education now than there were in 1979. Moreover, the proportion of 18 year-olds and 19 year-olds entering higher education is about 15 per cent. higher, and the number of mature entrants 12 per cent. higher, than when this Government took office.

The noble Lord, Lord Kilmarnock, said that this was just a cost-cutting exercise. The purpose is not to cut costs but to examine how the principles of access to higher education can be reconciled with what the nation can afford. The cost of student support must be considered in relation to the cost of maintaining the quantity and quality of higher education provision. There are of course also the competing claims of other groups such as the old and the sick; and the level of the student grant represents a balance between the students' needs and the total expenditure which taxpayers and ratepayers can reasonably be asked to contribute, given some of the other claims of which I have given examples.

Finally, the noble Lord, Lord Kilmarnock, asked me whether adults could be included in the review that is going to take place. In fact, the committee will match the remit given to the Anderson Committee inquiry in 1958 and is sufficiently formidable. A review which tried to raise the support of students over the whole range, from non-advanced further education to post-graduate studies, would lack cohesive purpose and would be at considerable risk of dissipating its energies and failing to agree on recommendations for action. But I must say to the noble Lord that that is not to say that either the policy of student support in other areas will be subject to no process of continuing scrutiny or that the results of the review will not have implications for student support in other areas.

6.15 p.m.

Lord Annan

My Lords, is the noble Lord aware that the Statement that he has made will give great pleasure to those who care about trying to maintain numbers in higher education? I hope that he would agree that the Anderson Committee, when it formulated the procedures and rules for obtaining student maintenance grants, carried out its deliberations entirely in ignorance of (or, at any rate, without cognisance of) the expansion of universities which Sir Keith Murray was responsible for and also without reference to the Robbins Committee. Therefore, its conclusions were really inapposite to the kind of expansion which was being planned at that time.

I hope very much that the noble Earl will pass on to his right honourable friend the very good point made by the noble Lord, Lord Kilmarnock, about adult education. This is a difficult area because it must comprise two kinds of adults: one, those who are coming to universities from jobs to which they will return for retraining, and those who are adults who may well have retired or are without jobs and who want to improve their qualifications. They are separate problems and they will require separate treatment.

Would the noble Earl also agree that one of the things that is most important is to bring down the costs of higher education as a whole if we are to increase student numbers? I agree entirely with what was said by the noble Lord, Lord Kilmarnock, about the need to increase student numbers but we cannot expect this to be done unless some extra control is exercised over costs. May I also tell the noble Earl that there will be a great welcome for the principle that the maintenance grant should be the sole way in which a student receives grants from the Government for his maintenance and that he should not have to fall on social security.

The noble Lord, Lord Kilmarnock, said that the reason why he had to go to social security for extra benefits was because the maintenance grant was inadequate. But in fact that principle of going to social security was taken many years ago when the maintenance grant was very much higher than it is today or was in 1979. It was much higher in those days of the 1970s when students, showing a very considerable degree of entrepreneurial acumen, discovered a new way of obtaining extra money to supplement their maintenance grant.

I thought at that time that this was wrong; but of course it was very difficult to controvert. I welcome the principle that we shall now go back to a single grant which then will be able to be seen in its entirety as being adequate or the best that can be done in the present financial circumstances.

The Earl of Swinton

My Lords, not for the first time in this House, I am able to say that I an very grateful to the noble Lord, Lord Annan, for the points that he has made, with most of which I would agree. Of course, I will draw to the attention of my (if I may say so in inverted commas) "new" right honourable friend the points that he has made about adult learners. Perhaps I should say, in case I misled the noble Lord, Lord Kilmarnock, in the reply that I gave, that all adult students studying at first-degree or equivalent levels automatically will be taken into account in this review anyway.

Lord Boyd-Carpenter

My Lords, is my noble friend aware that those of us who have a share of responsibility for the acceptance of the Robbins recommendations have always followed with a measure of anxiety the mounting costs (to which the noble Lord, Lord Annan, referred) of higher education in this country and therefore welcome indications of the Government's concern in that area, too.

Is he also aware that the very interesting comparison which he gave us of the cost of supporting higher education in some of the European countries, as compared with this country, reflects to some extent the fact that in those European countries a far larger proportion of students study at home and go to a university near their home, which can be reached fairly easily? Will he not exclude from this forthcoming review the possibility that some saving in the ever-increasing cost of an ever-increasing university population might be achieved by adopting a system which is a little less geared than the present one to encouraging the student to study away from home?

The Earl of Swinton

My Lords, I am grateful for my noble friend's suggestion, and of course I will draw it to the attention of my right honourable friend. The whole idea of this review by this committee—call it what you wish, my Lords—is that it will take evidence from abroad, hopefully with a thought to introducing those ideas here.

I think I really must state categorically to my noble friend and to the House what I said in the original Statement—that the Government stand by the principle of access to higher education for all who have the necessary intellectual competence, motivation and maturity, regardless of parental income. We want to ensure that students will neither be deterred from entering higher education nor handicapped in their studies by lack of means. I should not like my noble friend to get the impression that we are going to try to make them all pay and that only those who can afford it will be able to benefit from it.

Lord Rochester

My Lords, will the noble Earl go a little further than he has done and accept that, in view of the very considerable difficulties which some students in higher education are now experiencing, it is highly desirable that the consultative exercise and the comprehensive review to which he has referred should be carried out and the Government's decision made in time for that decision, if approved by Parliament, to operate before the year 1987–88 if at all possible?

The Earl of Swinton

My Lords, I said that I really cannot give a date, but I should hope that the report would be available by the end of 1987.