HL Deb 05 March 1986 vol 472 cc226-61

6.24 p.m.

Lord Annan rose to call attention to the case for a new structure for the governance and funding of the universities and polytechnics; and to move for Papers.

The noble Lord said: My Lords, in moving this Motion I want to put a case to your Lordships. The case is this. The present system of higher education must be changed. It must be changed if we are to give the present number of 18 year-olds higher education and to increase that number. It must be changed if we are to retrain key men and women in industry and business, and also the long-term unemployed. It must be changed if we are to keep in a few institutions the level of research that has made British scientists and scholars famous—research that has often helped industry, business and medicine to lead the world in developing new lines.

I am sure we shall hear from every part of the House this evening pleas to spend more on higher education but, with respect, I ask those who do so to reflect whether any government of any persuasion could sustain the system that was created between 1958 and 1968. In that decade we created eight new universities, turned the 10 CATS into universities, founded business schools and the Open University, extended postgraduate support and services for student health, sport, counselling and careers. A Social Science Research Council was added to other such councils, all of whose budgets were greatly increased. Then 32 polytechnics were created and the teacher training colleges were upgraded. That finally broke the bank.

Individually each of those acts was defensible, but together they were indefensible; and it was typical of the time that when Lord Todd's Royal Commission on Medical Education reported, the cost of purchasing sites and erecting buildings that they recommended was so astronomical that most of the proposed reorganisation was never carried out.

The expansion was not wrong. What was wrong were the principles on which it was financed and organised. That was our first mistake. We were right to expand the numbers of students and academic staff. We were wrong to think we could give all students a Rolls-Royce higher education. No country could do what we tried to do. Every Western country differentiates between its institutions. In America, colleges differ enormously in their aims and levels of funding. In France, the Grandes Écoles are elite institutions, whereas in the universities the staff-student ratios (as they are in Germany and Italy) seem to us preposterously bad. But even in American universities the ratio is far worse than ours at undergraduate level.

I think we got the finance wrong because the organisation of the system was wrong. With the wisdom of hindsight, I wonder whether Mr. Macmillan (as he then was) was well advised to appoint as chairman of the committee a celebrated professor, Lord Robbins, and, as his henchman, the wiliest of vice-chancellors, Sir Philip Morris. Was it wise to have university academics in the majority on the Robbins Committee? No one can doubt the idealism of those men, but they had such a respect for the academic model they knew that they showed little understanding or sympathy for any other model. They were wrong to accept without examination that all universities should be treated exactly alike. The trouble was that they wanted their recommendations to be acceptable to their colleagues, their fellow dons in the common room. That was not what happened in 1853, when the dons were outraged by the proposals of the Royal Commission on Oxford and Cambridge. But Lord John Russell stood firm and insisted on reform.

It was much to Mr. Crosland's credit that the Labour Government rejected the proposals for organising higher education on the lines advocated in the Robbins Report. Instead, Mr. Crosland set up the binary system—and I remember Lord Boyle saying to me that he, too, had he still been Secretary of State, would never have allowed the whole of higher education to move out of public control. But Mr. Crosland, too, made his mistakes. The binary system was inflexible and he insisted that the 32 "polys" he created should have parity of esteem with the universities and give three-year degrees. What was as bad was that he allowed the polys to slip out of his grasp and into that of the local authorities. The local authorities gave them so much freedom to develop as they wished that the polytechnics became arty-technics.

We have ended up with a system incapable of reforming itself—with autonomous universities and local authority-controlled polytechnics. Everyone in the universities blames Sir Keith Joseph for their present plight. That is unfair. The Secretary of State has no powers over them. He cannot tell individual universities how to change themselves. He cannot modify the polytechnics. His only sanction is financial.

Over the years, the universities have shown that they are deaf to any hint from Government on how to change their habits. In 1969, they rubbished Mrs. Shirley Williams's 14 points. In 1981, when they were forced to cut staff, they inflicted the maximum damage on themselves by failing to cut out whole departments and by encouraging some of the best of their staff to retire. Lord Melbourne once said in this House: Universities never reform themselves. Everyone knows there is too much competition and jealousy.

That was why our forefathers set up no fewer than three Royal Commissions on Oxford and Cambridge and several committees of inquiry on London. Just such a fundamental inquiry is needed today to find remedies for our present discontents.

What could those remedies be? One could be to designate certain places as centres of excellence and remunerate the staff and fund the research at a level higher than that at other institutions. Another is to designate numbers of universities as centres for liberal studies—scientific as well as the humanities—in which no postgraduate work is done. Hundreds of such universities exist in North America, and excellent many of them are. Another is to make the staff ratios in most institutions less opulent. Lord Robbins argued for years that that should be done. Another is to recognise that in all institutions it is perfectly natural for senior scientists and technologists, whose best creative work is behind them, to spend a considerable part of their time in raising funds for research. That is what Nobel prizemen in physics in America do. It is what the vice-chancellors of Aston and Salford have done with conspicuous success.

There is another possibility, which is to make the polytechnic degree a two-year course, or to admit all students in universities and polytechnics to read for a two-year course and give a third year only to the most proficient in examinations or to those who, in the judgment of their teachers, have the greatest promise. We could give students at all institutions a two-year course leading to a degree, with a further two years for the few who need specialised professional training, most probably at another institution.

Another line to pursue is to differentiate between classes of students for eligibility of grant. For instance, all students should receive some grant, but only the poorest should receive a full grant. I fear that under the present Government that does not seem to be much of a starter. We should make the students in all but a few universities and subjects pay higher fees if they come from a different region, as is done in each state of the United States.

Have we ever asked ourselves why all academic staff in universities or in polytechnics should be paid on the same scale? Why nearly all universities offer a spread of subjects from mathematics to languages? Some of your Lordships may be saying, "What do the University Grants Committee and the National Advisory Board for the Polytechnics exist for if not to consider such matters?" There is a limit to the kind of advice that they can give at present. For instance, the chairman of the UGC has said that his committee cannot recommend the closure of a university. As the UGC is composed largely of academic staff from the spectrum of universities, is it likely to recommend the drastic changes needed to reform higher education? Should the UGC be composed mainly of university staff! Perhaps we need to do what has been done for broadcasting—a review on the state of higher education by an independent body every 10 years or so.

I hesitate to ask for another inquiry to be set up. Universities probably feel that over the past few years they have been inquired into to death. I hestitate for only one reason—there is already a committee in existence under Lord Croham that is studying whether any change is needed in the powers of the UGC. May I therefore ask the noble Earl, Lord Swinton, whether the committee's remit is wide enough to take into account the problem that I am raising this evening? If it is not, will his right honourable friend the Secretary of State consider widening its terms of reference? Furthermore, does the Secretary of State envisage setting up a similar committee to advise him on the powers of the NAB and whether the polytechnics should continue to be funded from the rates and governed by local government?

The Secretary of State has already said that he intends to take powers to alter the statutes of universities so that academic staff can be made redundant. Can he not seize this moment and do what many of his predecessors have hinted that they wanted—fundamentally to alter the organisation of higher education so as to make it a less crushing financial burden for the taxpayer? If we are to have—I hope to hear no voice opposing this tonight—higher education of the many, a great deal of it must be much cheaper. Equality of opportunity to obtain higher education, yes. Equality of funding, esteem and purpose for all institutions, no. That is a dream, and not even a pleasant dream. If we leave our institutions with exactly the same roles as they now have and financed on the principle of equal misery for all, we shall irrevocably destroy our reputation for education, learning and research.

Lord Boothby

My Lords, may I ask the noble Lord one question before he sits down? Does he agree that Lord Wolfenden was a good chairman of the University Grants Committee and that he proved that the system could be made to work well? I had personal experience as rector of the University of St. Andrews.

Lord Annan

I take note of the noble Lord's point. My Lords, I beg to move for Papers.

6.38 p.m.

Lord Flowers

My Lords, the noble Lord, Lord Annan, has proposed his Motion at a time when a great deal is happening in higher education and we are grateful to him. When he was vice-chancellor of the University of London, he asked me to help him a bit with the medical schools. Shortly after I finished my work he had the good sense to retire. Rumour has it that he presented the university with two ceremonial urns—one to bear his ashes and the other a notice which reads, "No Flowers by request".

Noble Lords will have observed, I hope with approval, that both urns so far remain empty. I hope that your Lordships have also observed that the London medical schools mostly flourish under their new arrangements. The remaining difficulties have more to do with the hospitals than the schools. That will remain the case until the University Grants Committee and the Department of Education and Science, which provide for the schools, and the National Health Service and the Department of Health and Social Security, which provide for the hospitals, can bring themselves to have a common policy for medical education. That is a subject which deserves a debate for itself, but it is an example of the need for reform.

The noble Lord has raised a great wealth of issues tonight. However, the main point that I wish to make is that the University Grants Committee should be a body respected by the universities and heeded by the Government, through which the universities should be accountable for the expenditure of public money and for the quality of their management of matters, both financial and academic, and which considers the universities as entire institutions, not merely as summations of their parts, which nobody else can do. That used to be the case throughout the great expansion of the 'fifties and 'sixties. Alas! it is no longer so. That should be a matter of great concern to the committee of inquiry at present being chaired by the noble Lord, Lord Croham.

The reasons are not far to seek. During the 'seventies, and even more during the 'eighties, the UGC has had to administer financial cuts of increasing severity, but has not been structured or staffed to do so in a convincing manner with adequate explanations given. And, no doubt partly for that reason too, its advice, quite clearly and repeatedly given to government, that the cuts were being imposed too fast for orderly application, was ignored.

Instead of reforming the UGC to suit the task in hand, the Government began to push about behind the scenes, undermining still further the precarious authority of the UGC. They wanted independent studies of the efficiency with which universities used their resources, and they wanted an inquiry of some sort into academic standards. Both studies were, in fact, set up by the Committee of Vice-Chancellors and Principals. That is the kind of role that will increasingly fall to the CVCP so long as the UGC is treated by government in the way that it is because both studies could—and not many years ago would—have been mounted by the UGC itself.

Thus it was that we had Jarratt on efficiency and Reynolds on academic standards. And let it not be forgotten that the first recommendations of Jarratt were addressed to the Government, and they were along the lines that through the UGC the universities should be given financial indications for the medium term in which they could have some confidence, for otherwise there was no basis on which they could be expected to take and put into effect sensible management decisions.

There were numerous other recommendations to the UGC, to the CVCP and to the universities themselves. So far as I know, they are being vigorously pursued in all the universities and taken further, not least into the academic field forbidden to Jarratt and into governance more generally. They certainly are in my university where for many years we have had a high-level body of the kind recommended by Jarratt with a mixed membership, some academic, some lay, which takes into account the resource implications of academic developments and serves as a link between senate and council.

But the Jarratt recommendations addressed to the Government themselves have been studiously, even arrogantly, ignored. I am not today asking for more money for the universities, even though, Heaven knows! I could with justice do so. It was Mr. Peter Brooke, then Under-Secretary at the Department of Education and Science, who told the House of Commons on 23rd April last year that during the period from 1980 to 1987 he expected university recurrent grant to decrease by about 11 per cent. in real terms. During that same period, public expenditure is expected to increase in total by about 7 per cent.

The Government are perfectly within their rights to demand that the higher education budget be reduced, absolutely and relatively, if that is what they think will benefit the country, and in spite of the need for more and more specialised manpower—and, in these days, womanpower, too—and with no thought for the contrasting views and actions of those countries with whom we are in direct competition as a trading nation. What they really must not think themselves entitled to do is to demand faultless management on our part, when they so abjectly decline to provide the conditions under which good management becomes possible. Those conditions are mostly spelled out by Jarratt, but are totally ignored by government.

The UGC is in need of reform, but so is the Government's heeding of it and the respect of the universities for it. The UGC did well enough in times of expansion. Why has it started to fail in times of contraction? The membership and staffing of the UGC are no longer appropriate—that is why. The committee mostly consists, as the noble Lord has said, of hard-working academics able to judge the worth of teaching and research as well as anyone, but few ever having had to learn the skills of management. There are, I think, only three people from outside the sphere of education among the whole membership of the UGC.

The UGC is in fact much less expert managerially than many individual universities, which have upon their councils men and women from many walks of life, who share a tremendous experience of managing business of all kinds, who give unstintingly of their time and energy, and who provide a background of managerial realism against which academic battles are necessarily fought. And the UGC is also less well staffed in terms of managerial expertise than the universities which are accountable to them.

We have done more in London than possibly anywhere else in the university world to try to bring order back where senseless cuts have caused endless anxiety and confusion. We are reforming ourselves, as the noble Lord well knows. But without the wisdom and experience of the lay members of the university, I am clear that the task would have been beyond us. They have been in the forefront of trying to find solutions which strengthened the best we had to offer at the expense of those activities which could be spared or which could fit in better somewhere else. Full rein has been given to their initiative; and of course the London experience is by no means unique. The UGC needs men and women like that—not three out of 20-odd, but 10 at least and in the majority. Then they might be respected by the universities and heeded by government because of the quality of the decisions they would take and the advice they would give.

I have devoted most of my remarks to the reform of the UGC because I believe it to be the key to the whole problem which has been raised by the noble Lord, Lord Annan, tonight, even to the madness of the continuing cuts. But I do not expect to return to the plenteous days of the 'sixties, and a way therefore has to be found to conserve what is best in higher education as a whole, while meeting in some reasonable fashion the needs for increasing participation. Most of the nation's fundamental research is done by the universities, and the applied research and development that is done by others depends upon it. We have the word of the Confederation of British Industry for that in their own response to the Green Paper—and a very cheering and timely testimonial it is.

At the present time there is a fairly wide spectrum of institutions in terms of the mix of teaching and research. There are some universities that are extremely strong in research, and they can prove it by the number of research grants and contracts that they win on their own merits from external agencies, both public and private. There are some polytechnics which should probably be allowed to do more research than their resources allow, if similar criteria prevailed. And there are some institutions where little research of real distinction seems to get done. It has the virtue of being not a static system but a dynamic one. There are universities now strong in research that once were not; there are others which seem to have lost their once notable position. If as a nation we want some research of the highest international standards, as I am sure all your Lordships would desire, and if money is short, then we have to be selective; perhaps more selective than we really like to be, as the noble Lord has advocated. Otherwise, it is mediocrity all round, and I agree with him.

Of course, it is necessary to be selective about the right things, and in considering the institutions of higher education, research is only one of those things. It is also necessary to be selective about how one supports teaching. Here the UGC is I think in danger of making a capital mistake. Saying that they do not know how to measure quantitatively the quality of teaching, they have concluded that no selectivity is possible, and that we must all be paid the same for a given amount of teaching, however good or bad it may be. But quantitatively measured or not, we all of us can distinguish good from bad teaching, and regularly have to mark the results of it.

That was in parenthesis. The question raised by the noble Lord, Lord Annan, is essentially whether the selection of institutions where research should be allowed to flourish can be settled once and for all by some external agency or as the result of some powerful inquiry or whether—as is usually the case in human affairs—one achieves better results through evolution (guided evolution, if you like, my Lords, in response to clearly-enunciated national need and indications of performance, but evolution for all that), in which the successful are rewarded by being funded to do more, and the less successful are funded less, but nobody is forbidden to better themselves, because that way there is no incentive to improve.

If the UGC is reformed and restaffed in the fashion that I have tried to indicate and uses sensible criteria, and if there continue to be research councils that select proposals for research grant on the basis of timeliness and promise, then I would be content to leave the evolution of the university system in their hands.

6.51 p.m.

Lord Beloff

My Lords, the House is privileged in discussing so important a subject as this to have heard first from the exponent of radicalism where higher education is concerned, and then a reply by one of the most notable representatives of the academic establishment. So your Lordships have had both the case for radical change and the case for evolution.

My own sympathies, as might well be guessed, are, on the whole, on the radical side. However, I should like to put the argument in a slightly different fashion from that of the noble Lord, Lord Annan. I myself believe that the position in respect of higher education in this country is worse than even noble Lords who have spoken have indicated. We are really in a situation of crisis in which the Government do not understand the universities, the universities clearly do not understand the Government, and the tax-paying public do not understand either of them.

That is not surprising, because we have inherited a system of university governance and finance devised in a very different situation—and I would go back long before the expansion of the Robbins era—but which we are trying, I think unsuccessfully, to adapt to two national demands. One is, as the noble Lord, Lord Annan said, that we should have in this country at least a number of universities that can compete with the best in the world in research and in teaching—because without that, the country would be poorer spiritually, quite apart from any loss to industry from failures in scientific research. The other demand is the demand common to all advanced countries, and increasingly in developing countries as well, that the largest possible number of young people should have at least an acquaintance with what is meant by higher education.

What we have are institutions singularly ill-devised either to look at that problem or to present it and its financial consequences to the public. In the first place, we have no Secretary of State whose sole responsibility is in that field. What this country requires is not a Secretary of State for a multiform Department of Education and Science having a variety of different demands being made upon it by local authorities, the public, and a whole range of institutions. We require a Secretary of State for Science and Higher Education who could put the case for the first of those things at least to his Cabinet colleagues and make certain that the money was available for it.

One then thinks that a Secretary of State for Education, or perhaps a Secretary of State for Education and Training, relieved of that responsibility, might take a look at the schools. Another area of misunderstanding, or of miscomprehension, is between the schools and the universities. The schools complain that the universities interfere and dictate too much the course of the curriculum. The universities complain—and, I fear, with increasing proof—that in some fields of study at least, the schools are not supplying youngsters prepared for the demands that the universities have to make upon them. I should have thought that there was enough there for two Secretaries of State.

The noble Lord, Lord Flowers, believes that reform and enlargement of the UGC is the key. However, the UGC itself is a tremendous anomaly. It was created after the First World War to distribute to the universities funds provided by central government that were a tiny proportion of the universities' general income. The UGC's structure has no doubt developed and grown since then, but fundamentally it is not devised, and never was devised, to be the institution through which 90 per cent. of university funding would come. It is not surprising, therefore, that although the UGC worked reasonably well when money was plentiful, it has proved incapable of dealing systematically or credibly with the problems of contraction. I do not believe that anyone could blame the UGC for that.

It seems to me necessary that if there are to be institutions having major responsibilities for research in both science and the humanities, then they must have some kind of freedom from annual, triennial or even quinquennial current grants. The great strength of the American institutions, to many of which the noble Lord, Lord Annan, referred, is that they have massive endowments. If they were wholly dependent, let us say, on Congress, given what we know about Congress, or if they were wholly dependent upon the state legislature, given what we know about the state legislatures, then their position would be even more parlous than that of our own universities.

How universities, or a limited number of them, can be given an endowment and freed altogether from the apron strings of the UGC or its successor is a matter to which proper attention should be given. I do not myself believe that one can have the independence that is required to plan and to meet new contingencies if one has to go cap in hand for funds all the time, either to the UGC or to the research councils.

One other effect of the system of course has been that it has created a lock step, with the universities having to deal—as the noble Lord, Lord Annan, has said—with degrees taking up the same amount of time, measured in the same way, for very different intakes, and with little opportunity to experiment. Experimentation was something that, in our tiny way, we were able to do at Buckingham, with 40-week, two-year courses which have proved in a limited number of fields perfectly effective but which no state financed university felt able to experiment with. That tiny example perhaps shows that one thing that is necessary if one is to experiment—and we cannot expect universities to be static—is to have at least some control over one's own sources of finance.

The noble Lord, Lord Annan, referred to the fact that there is another way in which we have inherited a very difficult position; that is, in relation to what is sometimes called the student grant question. I would call it rather the question of student support. Having had a relatively small number of students in our universities until relatively recently, we felt in the period of expansion that it would be possible to emulate the level of material support—and this, of course, affects the staff-student ratio as well—which was thought manageable when the number of students was much smaller.

Our European allies and competitors have never thought it possible that the taxpayer should pay for a large number of young people to enjoy a comfortable, middle-class standard of living in their early years even when this is largely paid for out of the taxation of people who will never earn the incomes that they are being prepared to earn. We got into this situation—and the noble Lord, Lord Annan, referred to it—which is an extremely difficult one to get out of because parents have their expectations. Nevertheless, it is not a system which encourages expansion and it is a system, I think, which aggravates the shortage of funds and makes more difficult to explain what it is that universities require of government.

I think that if we are to have a serious look at these matters we need to look well before our present discontents and see whether we should not consider the examples that we are offered both by our European neighbours and, in a very different situation, by our friends in the United States.

7.2 p.m.

The Lord Bishop of Ripon

My Lords, one of the privileges of speaking in your Lordships' House is that one is able to share in debates with those who speak with great authority and experience. The noble Lords who have spoken before me all have experience as vice-chancellor and the corresponding authority that goes with it. I have no such authority and the point which I wish to make this evening is fairly modest, though I believe it is an important one.

It has to do with the place of the voluntary colleges within the system of higher education. The noble Lord, Lord Annan, referred earlier to a binary system of universities and polytechnics but it is the case, as your Lordships know, that there are other colleges of education within which the voluntary colleges find their place. Indeed, as I listened to the noble Lord, Lord Annan, describing a liberal arts college it occurred to me that it was not unlike the college at Ripon and York, of which I have the privilege of being a governor.

Before I speak of the place of these colleges I should like to make one general point about education and about the philosophy of education. As I listen to the debate on education I hear a number of voices saying that ways must be found to measure the efficiency of education; that we must in some way be able to quantify the results and that that may be done by reference to the part which those who are so educated play in the creation of wealth. It is said that we are investing in people and that we are doing so in such a way that that investment may be returned by the part they play in the creation of wealth and, by implication of course, in the salaries they earn in so doing.

However, I believe that to link education so closely with the creation of wealth is to make a grave mistake. I, as a churchman, would wish to argue, as I think I heard the noble Lord, Lord Beloff, saying, that there are much wider criteria which have to be taken into account. He referred to education for the spiritual state of the community and I would add that that spiritual state needs to take account of social awareness. I believe that there are many people who will wish to have the benefits of higher education without necessarily thinking that the consequences for them will be a high standard of living or a high salary. For instance, I think of many of those who find themselves in my own profession whose financial rewards are by no means large.

I wish to argue that the voluntary colleges, particularly the Church colleges which form a part of that voluntary sector, preserve such ideals. But I wish also to argue that they show some of the ability to be institutions which are managed in a way to which I believe noble Lords have already referred. The voluntary colleges do not, however, have the protection of the University Grants Committee. They do not relate through the UGC and are in fact funded by direct negotiation with the DES. It is remarkable, given the way in which funds have been reduced, that relationships between the voluntary colleges and the DES have remained so good and creative; and I should like to pay tribute to the DES for the way in which those relationships have been maintained.

Nevertheless, for that reason the voluntary colleges are in a particularly vulnerable position. They do not relate through the UGC and therefore they do not have a body with great power to speak for them. Nor, of course, do they relate to a local community, as do polytechnics, and therefore do not draw on funds from a local authority. For that reason they are exposed.

I hope, therefore, that any structure for the future governance of our universities and polytechnics will take account of the position of the voluntary colleges. I say that because I believe they have demonstrated a degree of management and an ability to survive in a very cold climate which other institutions might take note of. The college in Yorkshire on whose governing body I sit has seen itself as being in the business of survival for several years. Each year we are by no means sure that that survival will take us far into the future.

One of the ways in which that survival has been ensured is by the provision of vocational and professional courses for which it is believed there may be a demand, particularly in that part of the country. It is by that kind of management, in part, that an institution such as the college of education at Ripon and York is able to continue. I think it is also the case that such institutions provide that kind of variety for which the noble Lord, Lord Annan, was pressing in his speech. They do not have large research departments. Their costs are comparatively low. They have managed to survive with a very considerable reduction in the kinds of funds available. I am not complaining about that, but I am saying that it places enormous strain upon any institution to live with such uncertainty, knowing that such voluntary colleges can of course come to an end at any time.

I also believe that they provide a cross-section of education, both vocational and professional, and general degrees in the arts and sciences which I think makes a good mix and provides the context within which the kinds of ideals that I mentioned earlier can be realised. Were there to be a change in the governance and funding of universities and polytechnics there would be a danger that such voluntary colleges as I have mentioned would become exposed. I hope that the noble Earl the Minister will be able to give me a reassurance at the end of the debate that whatever changes are proposed will include some measure of protection for the voluntary colleges.

7.9 p.m.

Baroness White

My Lords, I am sure that anyone who heard the noble Lord, Lord Annan, speak in the debate on higher education last December will not be surprised that he has returned to the fray today. I am sure he is right to draw attention to the basic difficulties in our current situation although, frankly, he offered us such a wide choice of remedies—some of them incompatible one with the other—that we need a great deal further consideration to decide which are the most promising for the future.

The noble Lord, Lord Flowers, has described the current state of higher education, particularly in our universities, with such authority and knowledge that I have no intention of going over the ground which he has so admirably described. However, I take it that the main argument which is being put forward by the noble Lord, Lord Annan, is that the present Government really see no instrument of change to hand, however desirable, beyond setting up the Croham Committee and reducing resources in every direction. This situation has brought despondency to so many people in higher education and an air of uncertainty as to how they can possibly improve matters.

Whether or not it would be possible or desirable to elevate the Croham Committee into what I presume would be a Royal Commission on the lines suggested by the noble Lord, Lord Annan, is no doubt a matter for consideration. Of course it would delay any major reform. But possibly we have reached a stage, as I think the noble Lord, Lord Annan, is insisting upon, where we ought to go back and look at some of the fundamental characteristics of higher education.

I ought here perhaps to declare a modest interest. I am chairman of the Council of the University of Wales Institute of Science and Technology, though needless to say I speak today entirely for myself and do not reflect any corporate view, beyond perhaps mentioning how disappointed we are in Wales that there is no Welsh voice of any kind on the Croham Committee. At one time I was a member of the UGC under the chairmanship of the noble Lord, Lord Dainton, whom we shall shortly be welcoming among us, and Sir Edward Parkes. But I should like to go further back in history—more than twenty years in fact, and therefore pre-Robbins. The Robbins Report appeared in October 1963. A few weeks later, in December, the noble and learned Lord who now sits on the Woolsack, who was then Lord President of the Council and also Minister for Science and Technology (which is of interest to some of us), assumed departmental responsibility for university matters, including the University Grants Committee, which of course had until then been the direct responsibility of the Lords Commissioners of the Treasury.

In the period leading up to these exciting times many discussions were held on the shape of things to come. Earlier today I saw the noble Lord, Lord Taylor (the first of the four noble Lords of that name who have recently joined your Lordships' House) and I hoped that he might perhaps have felt himself able to speak in this debate. He was chairman of the pre-Robbins Labour Party committee of inquiry into higher education. I was a member of that committee and I still regret that some of our proposals were not heeded. We were much concerned with the binary divide and with the consequential demarcation between students, mainly in the same age range, who could find themselves on one side or other of the line, sometimes by a very narrow margin, with wide variation in the kind of provision that they could then expect.

We were concerned about this situation because we felt that to a large exent this was decided upon grounds which were not educational but concerned in particular with local government organisation. We were thinking not only of the technical colleges, which became CATs or polytechnics, as the case may be, but also of the teacher training colleges, which became colleges of education, the colleges of art, music and other such establishments. Of course, we recognised the necessity for specialised academic provision at various appropriate levels, but we could see no reason why, as regards their residential, social and sports activities for example, students could not be just students, sharing such facilities as could be provided for them in the most convenient and economical way.

I think that that would have gone some distance at least to meet the situation in which more elaborate amenities were provided for the majority of university students, though I would by no means go all the way with the noble Lord, Lord Beloff. I am certainly not in accord with him on the difficulties with which students will be faced because of the forthcoming cuts in their support. Nevertheless, I believe that we could have provided an equally satisfactory and a more economical basis for the social and residential arrangements for the larger number of students that we were contemplating. In our committee proposals we suggested that if this notion of combined operations for students seemed too revolutionary, at least some experiments could be tried out. We had in mind Brighton and Coventry as two areas which could have lent themselves to such a pattern of a cité universitaire, each with a variety of existing or proposed institutions of higher education. The University of Sussex came into being before the Robbins Report appeared, and Coventry had Lanchester and an excellent teacher training college before the birth of the University of Warwick. But this ship never sailed.

The late Anthony Crosland, for whom many of us had a high regard in other respects, was simply not prepared to abandon the binary line. So we now have a number of frustrated polytechnics which want to be universities and which for the most part enjoy far less in the way of amenities than their more upmarket university brethren. The academic problems of collaboration between polytechnics and universities are real, not to mention the administrative problems. Nevertheless I have recently been very much interested to note the discussions that are now in train between the University of Keele and the Polytechnic of North Staffordshire, which are trying to devise some measure at least of sharing academic responsibilities and resources. It seems to me that, if we are going to advocate any major pattern of change, such possible relationships will have to be examined. At the present time there seems to be no mechanism for doing this, other than the kind of local initiative which is being taken in Staffordshire.

I shall not presume to dwell on the intra-university realignments which may come about in the next decade or two. All I can say is that I am involved in the merger between UWIST and University College, Cardiff. The noble and learned Lord, Lord Elwyn-Jones, is the revered president of that institution. We are both within the federal University of Wales. I think he would agree with me that it is a very wearing and exceedingly expensive exercise, though I believe it will be thoroughly justified in the longer term. But, as in the University of London on a much larger scale, it seems to me that this kind of exercise must be faced in various other situations if we are to establish a more satisfactory system for the future.

I am sure that various noble Lords will be interested in the description of the experience at the University of Buckingham and in the advocacy by the noble Lord, Lord Annan, of some of the practices, mostly I think on the other side of the Atlantic, with liberal arts colleges, two-year degrees and so forth. No doubt they have their place, but I hope that we shall not go too far down that road. My own view is that, given the choice, if we must have limited resources and make choices, we should concentrate much more on mature students, mid-career retraining and what used to be called "women returners" to fill any university places which become available following the demographic decline in the 18-year-olds which will soon be upon us.

It would be criminal not to make use of such facilities as we have. But in my view the mid-20s to mid-40s age range is in some ways a better investment than liberal arts or two-year degrees on the American pattern. I should like to see much greater attention being given to that problem. Partly because of my experience with residential adult education, I am aware that the motivation of the mature student can often be more valuable than to spend the equivalent resources on a youngster who can gain a great deal of experience in life before settling down. If he or she is not particularly academically inclined one can get far better results a bit later on. Again, I feel that there is a gap in the consideration being given. I am not speaking simply of technical up-dating, but of a much broader concept of education.

In my view none of the spate of Green Papers, Statements, Jarratt reports and other documents of recent months has sounded the note of confidence that one needs if one is to encourage major reforms of the kind advocated by the noble Lord, Lord Annan. The note of confidence is lacking. There is uncertainty, apprehension, hesitation and disappointment in the university world. I hope that we can have a response from Her Majesty's Government that will indicate that they recognise that. They cannot simply cut resources and threaten further cuts of 2 per cent. per annum. Some of us were told this morning by the most authoritative sources in a Select Committee upstairs about the deficiencies in equipment grants. That will simply not enable us to face our responsibility as a country or to maintain our position in relation to countries that are no greater than ourselves but are our vigorous competitors in world markets.

We should be grateful to the noble Lord, Lord Annan, for asking us to think much more fundamentally than we have been doing. That is a great service. But a great deal more thought is needed if we are to restore to the universities and to the other elements in higher education the confidence that is required to re-structure our higher education system which I think we all believe to be essential.

7.22 p.m.

Lord Mackie of Benshie

My Lords, as with the universities, I shall cut my speech according to the time allocated to me. My excuse for getting up to speak is not that I am an academic, I can assure my noble friend, but I held the ancient office of rector in one of the newer universities in Scotland, the University of Dundee. As most people will know, Scotland has a much longer record of wider education than England, which I understand for years had only two universities whose names I have forgotten! In Scotland we now have eight universities, and I think that they should remain as universities. They should be independent centres. They may have to go cap in hand to a UGC committee, but whenever one gets money one's cap is in one's hand, whether it is an endowment or anything else. He who pays the piper does rather call the tune.

In Scotland the eight universities deserve a great deal more understanding than they can possibly get from a United Kingdom UGC. It would only be right for the Secretary of State to continue to fund the central institutions, the engineering colleges, and so on, and to deal with them according to the needs of the day. But the eight universities should continue to be independent centres of excellence and evolve their own contracts. In other words, they should be as independent as a proper university should be. I think that that would benefit Scotland. That justifies a sub-committee of the UGC or really a separate UGC to understand the needs of Scotland, and it would perhaps adopt a more consistent attitude.

I became rector of Dundee in 1980. It then came under the 1981 cuts and had to cut 15 per cent. in three years. It was a savage experience. When I went on to the court I was impressed by the practicality of its approach. For instance, long before the cuts it had a committee which re-examined every post that became vacant. There was no automatic reappointment. It was streamlining the different faculties towards the centres of excellence that were evolving. I must say to the noble Lord, Lord Annan, that the university had no choice in the 15 per cent. cut. It simply had to find redundancies where it could, and having to cut that money made a nonsense of its previous policies. It had to let go people whom it wanted to keep, but there was no other way to make the necessary cuts.

My noble friend had a point when he said that what is needed is better management of the cuts. The four old Scottish universities have strong and famous medical schools, and their people are involved in clinical work, ward work and operations in the hospitals. About 30 per cent. of the care in hospital wards and theatres in Dundee is undertaken by university staff There is not enough understanding in the allocation of funds from the UGC to the university of the fact that it has to pay its clinical staff on terms set by an entirely different body, the NHS. There are many other such inconsistencies. A Scottish UGC would understand that rather better.

We have talked about the excellence of teaching and the necessity to reward on merit. It is difficult for a university to do that when salaries are set nationally and they can make no award for merit. I understand that in certain universities in Canada the dean of a faculty has a merit fund from which he can reward people who have done good work; I understand that it can also be used to discourage people who are not wanted. If a university is to develop as a university it must have independence, and that means being able to pay and reward people as it would like and finds necessary and not as a nationally negotiated agreement dictates.

I do not want to take up too much time. My main plea is for consistency. The universities have not had that. The Government must think about what they want them to do. They must give them a target and stick to it. When the 15 per cent. cut was made no mention was made of a 2 per cent. cut for four years thereafter. We cannot go on like that and expect the morale of the universities to remain reasonable. They must have a target and be able to go for it.

Dundee, as I may have mentioned previously, is an excellent example of a good new university. It has raised £4 million from industry for research under contract. That is a creditable amount to raise. But, again, the Government have to be consistent. If they expect universities to raise money, they must reform the tax system in order to encourage industry to cooperate. It is all very well to say that the Treasury will lose income. Of course that will happen. But normally funds that pass through the Government and go somewhere else lose something in the process. If a contribution is made by a company, it is not only tax that is given but also the remainder. If the Government are serious, it is necessary that they should reform the tax system so that companies give more freely.

I conclude by simply saying that the Government should be consistent. They should enable universities to act as universities. If that happens, institutions throughout Scotland, at any rate, will continue to do the country of Scotland and the country of Britain a great deal of good.

7.31 p.m.

The Earl of Perth

My Lords, the noble Lord, Lord Annan, may be right. There is a need for radical change. In the meantime, to use his words, there is the present discontent and equal misery throughout all the universities of the country. The noble Lord, Lord Beloff, said that it was a crisis. The noble Baroness, Lady White, used very much the same language. It is about this "in the meantime" period and what the Government must do before making any radical changes and grasping whatever nettle is necessary that I wish to speak.

I have spent nearly 15 years on the court of the University of St. Andrews. My time there is coming to an end. It might be some help if, on the theme of what the Government should do in the meantime, I recall my experience during that time. I joined the court at a time when we had just split from Dundee. The noble Lord, Lord Mackie of Benshie, will forgive me if I say that we should perhaps join together again. I may not be popular for saying that. The noble Lord, Lord Tedder, may go along with me. We have many Scottish speakers taking part in the debate, the noble Lord, Lord Tedder, and myself both from St. Andrews. Let me go back, however, to examine what the problems were that we faced at that time.

There was a lack of facilities, a lack of numbers and a shortage of housing for the students. We overcame those problems partly by appeals and partly by help from the University Grants Committee. For example, the committee recognised that we had no adequate library. But at that time morale was good. The students were relatively happy. They saw quite rightly that it was to their advantage and became members of the court. We even balanced our budget. But what has happened since them? First, we were told that we had to cut. That first cut was probably a reasonable request. We managed, by one means or another, to achieve what we were asked. There was undoubtedly a certain amount of fat in the administration. Without exception, however, all universities at the time said, "Please, have us make these cuts over five years and not over three". But the Government were adamant. The sequel was most unsatisfactory and indeed costly.

What happened? We had to have haphazard cuts, and voluntary redundancies. Academic posts were not filled. The sequel was something pretty lopsided. We could of course have had compulsory redundancies. But unless legislation is introduced to this effect—I know that the Secretary of State is considering it—this will mean a tremendous struggle. It is the last thing that the academics will accept. I believe they are wrong, but that is another story.

We got over the first hurdle of cuts, and life began again. We saw a better future. More important, we thought at that time that the Government would give us level funding over subsequent years. We had one or two new chairs. We took other initiatives. Above all, we had more collaboration with industry and a new stress was placed on science and technology, just as the Government wanted. Then, however, things changed. The Government's promise of level funding no longer persisted. We were asked to make further cuts.

This time, there were no obvious economies to make. We had to consider cutting out whole disciplines. We had to consider cutting out music and cutting out maritime archaeology for which we are specially qualified. We had to consider cutting the botanical gardens side of the university, and also the Crawford Arts Centre. The arts centre may sound a luxury in London or Edinburgh. In a place like St. Andrews, it is essential for the students. Linguistics had already gone. How were we to balance things? One solution for many universities was the encouragement of overseas students. And very welcome they are! But there is a limit to the number that one should have. There is the dilemma that many well-qualified United Kingdom students find there is no space for them. I must say, however, that the overseas students have saved us at St. Andrews from bankruptcy. It is as simple as that.

A new blow then fell. We were asked to plan for the late 1980s a 2 per cent. cut per annum. This was beyond all reasonable demands. And what after that? It was argued, I believe, on a statistical basis that as the baby boom declined there should be fewer students. Surely it should be just the other way round. There was a chance to have a higher percentage of students receiving education. What has been the sequel for Scotland? A body called STEAC—I must get its name right—which stands for the Scottish Tertiary Education Advisory Committee, has thought out the solution that Scotland should go it alone and that it should operate through the Scottish Office on the grounds that it might be a beneficent helper. Despite what the noble Lord, Lord Mackie of Benshie, says, I am confident that this would be totally wrong. I am a devolutionist. But this would be a disaster.

What would happen? At present we have 18 per cent. of the cake of the university grant. There are reasons for this—our system of education and the fact that we have many English students, who are most welcome. Our percentage in respect of other matters is under 11 per cent. Despite what the Government might undertake—the principals advocating this policy suggest that there should be a government undertaking that the cake would not be cut—the proposal is nevertheless politically most naive. No government can bind their successor. I am absolutely certain that if we went to the Scottish Office over the years we would find that our basis would be cut and the 18 could drop to the 11. That would be a disaster.

Lord Mackie of Benshie

My Lords, what I said was not that we should go to the Scottish Office. The Scottish Office was going to fund the central institutions. But I wanted a separate University Grants Committee for Scotland.

The Earl of Perth

My Lords, I am glad of that. I am sorry if I misunderstood. However, there is another reason for my strong belief that this is wrong. I think that all the universities are, if I may put it this way, in the same boat. We all have our contributions to make. We should all stand together and not try to divide, because to divide is fatal. I hope that this idea of devolution to the tune of the Scottish Office will be dropped. I am not at all averse to a sub-committee—or whatever form of University Grants Committee it may be—to help those who are concerned with the overall problem; but that is as far as it should go.

I look with sadness and dismay at what I find is the morale of the university at the present time. I beg the Government to stop, to look, to listen and to consider that until they grasp the nettle of change they must continue to help at the present level and must not keep on trying to have equal misery for one and all.

7.42 p.m.

Lord Hunter of Newington

My Lords, in 1982 there was an important event very relevant to tonight's debate. The advisory board of the research councils and the University Grants Committee set up a joint working party to survey for the very first time, I believe, the support of civil science by the Department of Education and Science through the UGC and the research councils focusing specifically on university scientific research. The report is of the greatest importance because it portrays the situation after the first round of university cuts and inevitably therefore cuts in research support, threatening the "well-founded" department provided by the UGC—so much the pride of successive governments—and creating the environment for specific staff and equipment grants from the research councils.

There is another dual support system of a somewhat different kind, to which reference was made by the noble Lord, Lord Mackie. That is the support by the grants committee and the Department of Education, on the one hand, and the Department of Health and Social Security, on the other, for medical education.

However, to return to the joint ABRC-UGC report, one thing that adds to its significance is that Sir Alec Merrison's successor, Sir David Phillips, as chairman of the ABRC, giving evidence to your Lordships' Select Committee on Science and Technology only a few weeks ago, made essentially the same points of importance that were made by the joint working party. The principal observation by the working party was that, because of public expenditure decisions, the capacity for universities to undertake basic research was being seriously impaired.

Lord Rothschild, in his report in 1971, listed the questions which one cannot answer about government research and development. Those were questions such as: what research and development are we doing that we should not be doing; or, is there an adequate machinery at the centre critically to evaluate the overall research and development programme; or, is the balance between pure and applied research about right? Your Lordships' Committee on Science and Technology has made, in successive reports, substantial progress in the examination of research and development. Their greatest achievement is perhaps persuading the Government to publish an annual report on government-funded research and development. There are, however, difficulties in taking this too far and Lord Rothschild's questions posed as above are unanswered and likely to remain so.

The reason I have referred to Lord Rothschild's view about research and development is that the same can be said about universities. There are some things which one cannot assess or answer. The conduct of research council funding and grants depends on peer review and it must be recognised that it has limitations. One cannot achieve a cost-effective situation because of some uncertainties which are important and continuing. Sir Alec Merrison's joint committee was also impressed by the dual support system which they would like to see continued, as does Sir David Phillips. It caters for the nurturing of new talent, for the emerging of innovative work, and additional support for promising new lines.

The advisory board for the research councils then and now has this view, as has the UGC. I believe that the Secretary of State has made substantial efforts to respond in a difficult financial situation. The universities therefore feed the research councils with new ideas and proposals. Cutting this university basic research may have the disastrous effect that these ideas and proposals of quality will not be reaching the research councils, leading to a very significant slackening of their effort. A vital part of this system is that there should be a little slack in UGC funding, allowing the modest support of the unexpected which has not been budgeted for. It is this slack which is disappearing but it is this slack which is also anathema to cost accountants and, I believe, the Treasury. Without it, universities may be severely crippled. Availability of research funds to respond to these innovations is just as vital.

How can all this be handled for the benefit of British research? Almost certainly not by committees in the first instance because it depends upon trained people with hunches and crazy ideas. All committees tend to be conservative, reluctant to face the unknown. The collaboration of all five research councils on biotechnology wanting to do the same thing is not a management decision. It is the decision of trained scientists with similar goals.

The joint committee's concept of a properly supported research area is funds for the recruitment of "new blood" posts, and, secondly, the provision of basic equipment. New blood posts, an idea of the Science Research Council, has been accepted by the UGC and the universities. It is simple but brilliant and workable. But linked to this is accommodation and resources. One striking point about this country is that so many research institutes are isolated and there is a sharp contrast between that and the MRC policy of putting research units beside universities. This has not been followed. As developments and trends change, accommodation could be redistributed or reallocated. Could it not be a government decision now that all new accommodation for government research institutes should be located at or near universities? How many could be moved now? This is the complementary move to the development of science parks with industry. The isolated nature of Ministry of Defence research institutes comes to mind. But this is perhaps something to consider in preparing these centres for the 21st century.

Against this background one must examine the proposals about research contained in the Government's Green Paper The Development of Higher Education into the 1990s. Paragraph 5.3 states: The Government's aim is that the contribution of the higher education system to the nation's research effort should continue at about the present scale". To university staff this means personnel, equipment and accommodation at the present scale, but from a study of the related paragraphs it is perfectly clear that to the Government this means money. Let me take only one example—equipment. Successive reports, including that of our own Select Committee, have made it abundantly clear that equipment costs are escalating and, therefore, in order to continue with the same scale of research, future costs will be substantially greater than they are at the present time. Therefore, paragraph 5.3 really means substantial cuts.

There is no disagreement with the statement in paragraph 5.4 that there is no evidence that all academic staff must engage in research; I think that is agreed. The same applies to paragraph 5.5, that the UGC should be more selective in its allocation or research support. But the Government and the UGC have to be consistent in this matter. That the UGC is more selective on anything more than a temporary basis means a departure from the "block grant" principle, and it looks very strange when considered along with paragraph 5.7, which states: Universities will still have discretion over the funds at their disposal. What does all this mean? I hope that the Minister will be able to enlighten us.

In these circumstances, it is difficult to see how the original remit of the UGC can continue to be discharged and how they can maintain the autonomy of the universities, which is their job. The "well-funded" department provided by the UGC for other sources of funds than research council funds, is to my mind a new invention of the writer, or writers, of the Green Paper. I hope that the Minister will be able to clarify this point. If this were to be so, the UGC element on basic contributions towards research funds would have to be very substantially increased, particularly in the engineering departments.

Paragraph 5.7 states: greater concentration and selectivity may mean that some departments or even whole Universities will lose research funding from the UGC. This is so serious a proposal that I feel it should be fully examined. What about the block grant and autonomy? The University Grants Committee under present circumstances could not remove all research from universities, and the statement is, in fact, contradicted by a later part of paragraph 5.7 which makes it clear that the block grant principle holds and the grants committee's job is to protect the autonomy of the university. What seems to be proposed is a fundamental alteration of the UGC's role and it proposes the introduction of intensive peer review. This idea has been linked in the minds of some to "upgrading" the grants committee and handing over to its sub-committees decision-making powers, like the research councils do to their boards. If these things happen, the grants committee will be removed from its present role, and in the minds of many this is a recipe for chaos.

7.53 p.m.

Lord Tedder

My Lords, it is perhaps cheek of me to speak when your Lordships' House has such a galaxy of former vice-chancellors and distinguished academics, many of whom have spoken today. However, just as the general staff are behind the front line and see a different picture from the soldiers in the front line, so the vice-chancellors see the overall picture, but this is different from the picture seen by academics who are still working in the laboratories and lecturing in the lecture theatres.

It is only North Sea oil which keeps our head above water, and what is the relevance of that? Although there is controversy over how soon it will run out, it is a diminishing resource and eventually the oilfields of the Gulf States will also run out. Long before then Britain will be without any major resource except its trained people. We should therefore be doing all we can to increase our scientific manpower.

At present proportionally fewer British students go to university than in our competitor countries, the United States, Japan or Germany. Worse still, on current figures so-called "level funding" means that by the end of the decade most university chemistry departments will be without money for consumables. Taking figures for my own department, for the 1984–85 session the chemistry department of the University of St. Andrews received a pay-roll of £567,000 and a class grant (for spending on chemicals and other consumables) of £62,000, giving a total of £629,000 for chemistry in one year.

If we take the Government's figures, the grant will be supplemented by 2 per cent. per annum, but against that the salaries are likely to increase at a rate of at least 5 per cent. a year. On these figures, for the session 1985–86 the salaries would have increased to £641,600, while the money available to the class grant—the chemicals, etc.—would have decreased to £46,000. If we continue these calculations until the end of the quinquennium, 1988–89, we find that there is insufficient money to pay the salaries even if there is no expenditure at all on chemicals. In other words, if inflation continues to rise at 3 per cent. above the so-called inflation index until the end of the decade, we either have no chemicals in the chemical laboratories or we have to save on pay-roll expenditure. This implies pay increases of less than 2 per cent. per annum or all vacancies to be frozen. How you get either of those past the unions is beyond me!

We have been encouraged by the Government to take in more students from overseas who will pay full cost fees. Accordingly, my university has increased its overseas fee income from £800,000 in the session 1983–84 to £1,500,000 in the present session, 1985–86. This cannot go on indefinitely. Too many overseas students would change the character of St. Andrews. Furthermore, it would be intolerable if we had to reduce the number of well-qualified Scottish students so that we could take in more indifferently qualified foreign students. Let me repeat that because it is so important. It would be intolerable if we have to reduce the number of very well-qualified British students so that it would be possible to take in more indifferently qualified foreign students.

I have not mentioned the equipment grant, but taking the DES's own model, the equipment grant is running at about 20 per cent. below what is considered necessary to provide a base for research and innovation. The other source of income to the universities comes from the research councils. Chemistry comes under the Science and Engineering Research Council. In 1983–84 the chemistry committee of that council received 586 applications which, if funded, would have represented £26,800,000. These were considered by the chemistry committee. Fifty-five per cent. were graded Alpha, which means of a quality that should be supported, and 19 per cent. were graded Beta, which means that if there is money left over they would be worthy of support. The actual awards were 34 per cent. of demand by number or 24 per cent. by value—I hope that is clear. That is what was actually funded. These figures are very similar to the SERC's total expenditure. The demand for Alpha satisfied last year was 74 per cent. by number, or 48 per cent. by value. The overall demand satisfied was 26 per cent. by value. Thus, not only are the funds available to the UGC being cut so that universities cannot meet their teaching commitments or provide a base for research, but similarly the actual research funding is being squeezed so that the research performance of British universities is being seriously curtailed.

The universities have done their best to mitigate the problems caused by the original cuts. We understood that having coped with these we were to have true level funding. We have not had that. My Lords, there is much more that I could say, but I expect that your Lordships have had enough of this from us tonight, so I shall end here. However, I hope that those of your Lordships who are not on the university side will have some idea of what we are up against.

8.1 p.m.

Lord Wilberforce

My Lords, at this late hour in the evening and after the fine and authoritative speeches we have heard in the previous stages of this debate, my own contribution must necessarily be a modest one. I have, it is true, some connection with one of those older universities whose names escaped the memory of the noble Lord, Lord Mackie of Benshie, for the time being, but for the purposes of this debate I would rather put forward a point of view—perhaps the point of view—of a smaller, newer university which may be typical of many others.

For quite a number of years I have been Chancellor of the University of Hull. This is a small institution of under 5,000 students which has perhaps particular problems which relate closely to the present, or contemplated, constitution of the UGC. For the purposes of this debate I think I have to assume that for some time we are going to live with something like the UGC. I cannot place myself in the empyrean realms which were placed before us by the noble Lord, Lord Annan. I must assume something like it, and try to see where changes might possibly be made which would help us.

I start from the point taken by the noble Lord, Lord Flowers, which I found sympathetic, that the UGC is weak in management. He gave the numbers three out of 20, and of course that is arithmetically correct. But I agreed with him entirely when he said that the management ability of the UGC does not really compare with that which exists in many of the universities themselves.

Certainly our own council—and I know this to be true of many others, and certainly true of the University of Dundee—includes a number of very practical, very experienced men of affairs (businessmen, scientists, local government administrators, and so on) and the council has taken on board in a most efficient and wholehearted way the Jarratt report and introduced changes. The noble Lord, Lord Annan, says that universities cannot reform themselves. Well, in my experience they can and do take radical steps in the way of restructuring departments, reorganising schools, discarding disciplines and discarding courses. One can argue about what is reform and what is less, but certainly extensive changes are made.

As regards the UGC, in relation to smaller and more distant universities there are certain necessary and unavoidable distortions and difficulties. I am not in any way criticising the present body which consists of a number of highly intelligent, hard-working people who are given a totally impossible job. In the first place they cannot, and do not, visit these universities with any great frequency. They have no idea in many cases what really happens on the ground. That is an inherent, inbuilt distortion.

Then there are at least two great difficulties with which they are faced when they apply, as they have to apply, statistics, or answers to questionnaires, or demographic considerations to universities as a whole. Let me mention two of them. The first is what is called in the jargon the "diseconomics of small scale". We all know that when one increases one's output one hopes to get economies. Equally, when one is faced with reduction from a small base, one gets what are called diseconomics of scale. You cannot make reductions in proportion to the size from which you started.

The Government recognise this symptom in relation to education generally. In their Command Paper 7841 they refer to "inescapable diseconomies of the smaller scale". But this principle does not seem to have received recognition in relation to the universities and polytechnics. Surely it should. To any body, I would say, under 5,000 this particular factor is one of potent effect.

Then a second point of a similar kind. When one is trying to assess a reasonable expenditure in relation to an institution, that is not related and cannot be related in a linear manner to the size of the institution. In every case—and everybody recognises this, including the UGC itself—there are, as well as, say, numbers of students, all sorts of special factors, and there is room in the questionnaires for the special factors to be listed.

But what escapes notice is that these special factors have different relative weight when one comes down the scale of size. The noble Earl, Lord Perth, who is not in his place, referred to this in relation to his University of St. Andrews. What may not be a special factor of any great importance for a large institution with a large grant may be a decisive one for a smaller unit with a smaller grant. In other words, one has to recognise the relativity of special factors in relation to different sizes of bodies.

Then, finally, I should like to refer to one other factor of great importance which ought to be taken into account in relation to universities generally. The noble Lord, Lord Beloff, referred to two things which universities ought to do: the pursuit of excellence in research, and the training of youth. I suggest that in many cases there is a third factor of great importance, and that is this: many of the universities—and it is particularly true of civic universities such as Hull—make a significant contribution to their locality, not merely as an employer of labour, although that is quite significant, but as a centre and a source of social and cultural standards. This is particularly—but not exclusively—true of programmes of adult and continuing education, which a writer in The Times recently said was probably the most vital area in which education can develop at the present time. I was glad that the noble Baroness, Lady White, also referred to this point.

For example, for its size and income the University of Hull has the largest programme in adult and continuing education in the country. I cannot answer for Scotland. Maybe they can trump us there. Anyway, that is the fact in England. It is the sole provider of this service in a large section of east England, from Whitby down to Lincoln. That is an area of high unemployment. We believe that we have a role in training and retraining a workforce fit to compete in what one may call the knowledge world.

Is there not a case then for a social factor to be added into the usual equations? Can we not enlist the support of the Secretary of State for Employment—who, we know, is so sensitive to social considerations and who is doing so much through the MSC to advance them—to get beyond the statistics and the graphs? Where have the statistics and graphs led us? They have led us to terrible reductions in our capacity. They have led us to a reduction in our student numbers of 1,000 (a loss of 20 per cent.), and to a current programme—under the 2 per cent. with which we are threatened on top of all previous losses—with a loss of 109 academic and related staff. I shall not pile on the agony because the noble Earl behind me has already drawn attention to it, and it has been reinforced by the noble Lord who has just spoken.

Is this kind of reduction what people really want? Is there not a case for two things? First, there is a case for a more flexible conception of state support and the way in which state support is administered; and, secondly—I quite accept this—a questioning of the almost total dependence of universities on state funds; in other words more private support in the United States style with the taxation consequences and so on. Obviously, I cannot pursue that point this evening but I am glad that it has the authoritative support of the noble Lord, Lord Annan, and other speakers. That is surely a second factor which we have to add to the future, which is now looking rather gloomy.

8.10 p.m.

Viscount Hanworth

My Lords, the noble Lord, Lord Annan, will remember that some 15 years ago after his Reith lecture I initiated a debate on whether university education was fulfilling the long-term needs of the nation as a whole. I spoke again on this issue on 31st March 1976. I do not believe that on the first occasion we were in complete agreement, but, having listened to what he said tonight, I think we are probably very nearly so.

Today the Motion is concerned with funding the universities and polytechnics. But right funding must surely depend on how the objectives of higher education are achieved. Much has changed since I criticised the universities, but even in 1976 they still seemed to believe that whatever they taught and however badly they taught it, because it was taught in a university it was self-justifying. Looking back, I still believe that I was right in thinking that the Robbins Report was a disaster. It had the polytechnics rushing to become universities with the spawning of arts and social science courses, often unsatisfactory in their concept and execution.

Inevitably when a government has to make cuts education must take its share with other areas whose claim to available funds is certainly seen by their protagonists as equally important. It is perhaps worth reminding ourselves that however much one may deplore the selling off of state assets—the family silver as we call it on these Benches—this Government would have had to make more drastic cuts if they were to keep to their policy of balancing the budget and holding inflation under control. Faced with the problem of cuts in education, which of course may have very unfortunate long-term effects, the obvious course is to concentrate on those disciplines, engineering and others, of direct relevance to industry which earns our country its wealth.

My own party has several reservations on the Government's Green Paper. A very important one is the shortage of students at A-level in mathematics and sciences who could fill any increase of places in universities if they were provided. I do not intend to speak about the other criticisms, some of which I do not entirely support.

I believe that some universities are still living in their ivory towers and are failing to meet today's requirements. Within reason we should preserve the aim of training future academics and research workers and, in so far as we are able, of doing some pure research. Nevertheless, let us remember that the vast majority of university students are third or lower second class material. For these people down-to-earth, efficient teaching is all-important. It seems to me very strange that whereas it takes three years to train elementary schoolteachers, some university lecturers presume to teach students without even occasional study periods to improve their techniques. Even more serious in my view is that some lecturers in arts and social science courses come straight from university without any experience in the outside world.

At one time, and I am sure it is still true today, university was a temporary haven for those with adequate A-levels who wished to postpone having to meet the harsher realities of the outside world. Sandwich courses have everything to commend them and the university of Surrey has pioneered such courses for all disciplines, even for music.

Only by experience gained in this way can students make the best of their university studies. I should think that partially-repayable grants have much to be said for them in this respect. Surely the idea adopted by some universities of giving students a combination of more than one discipline is right. I do not think, except that for future academics, the old idea of a three year course on economics was sensible. Such a course today should be combined with management studies for most students.

I should like to talk about university education from two other somewhat related angles. I think people believe that just as important as acquiring information is teaching the student to think and training him to have the logical approach. This in a previous generation was why classics was the preferred discipline. In those days even to have challenged this view would have been almost unthinkable. I really think that we might look back to that because surely we may have been wrong to some degree but not completely wrong in that assumption. In outside life judgment and common sense is what matters. I should be surprised if a student discussing in a paper, for example, different economic views and stating that some of them were misguided, giving good reasons, would do very well in that exam. But that is what should be the approach to a thinking student.

My second point is that, alas!, education as a whole has not made people more reasonable in a political sense. Even with highly educated people we still have the unfortunate fact that the more closely an issue is balanced, the more unreasonable do the protagonists on either side become. Yet it should be possible to correct this to some extent by higher education, given under some suitable academic title. In essence, the first step would be to lay all relevant factors on the table, as we usually do in this House on a Second Reading debate. Then, and only then, should the factors be weighed by bringing in experience and emotion. But it is essential to know the reasons for these weightings. I suggest starting students with some issues from history which now have little emotional impact and leading on gradually to present-day emotional topics. Unfortunately, the all-too-frequent approach is almost the reverse; people decide first what they think and then selectively look round for evidence to support their views.

I now return to funding. In this time of national difficulty it surely must not depend on historic precedents and "Buggins's turn". Invidious though it may be, those concerned must have the courage to give the money to those universities which are fulfilling our needs. I know just a little about my local university, the University of Surrey. I have reason to believe that it is, to a major degree, producing what is now wanted. Some others are still adhering to the old shibboleths and are not. But when it comes to funding from the UGC, the progressives have to bear the same cuts as the reactionaries. Only by selective action will the aims of good, modern, higher education and technical college education be achieved because there is still a strongly established tradition against necessary change.

8.20 p.m.

Lord McIntosh of Haringey

My Lords, when he ceased to be Minister of Health, Mr. Enoch Powell wrote a very wise little book called Medicine and Politics, a book which has been very much neglected and under-rated, partly, I think, because librarians and booksellers do not know whether to file it under "Medicine" or under "Politics". But the lesson that Mr. Powell drew from his experience as Minister of Health was that Ministers ought not to spend too much time in a certain department for fear of becoming institutionalised, and, above all, that those who come professionally from the discipline which the department has to control on the whole make poorer Ministers than those who do not. In other words, that doctors should not be Ministers of Health, that teachers or university professors ought not to be Ministers of Education and, I suppose, although this has not been too much of a problem in this country, generals ought not to be Ministers of Defence.

I suspect that this lies behind a lot of Lord Annan's thinking and, if that is the case, then I agree with him. If war is too important a matter to be left to generals, then there is certainly a case (and the noble Lord has made it effectively) that higher education—and I use "higher education" in the OECD sense to cover universities and polytechnics and, indeed, the voluntary sector to which the right reverend Prelate has referred—is too important a matter to be left entirely to those who work in it.

There has been this evening in this debate which was so ably opened by the noble Lord, Lord Annan, and in which there have been so many well informed and authoritative speeches, a tendency to criticise the Robbins Committee for its effect on higher education in the 20-odd years since Robbins reported. I am not sure that that criticism is fully justified. Robbins said: There is no risk that within the next 20 years"— that is, up until now— the growth in the proportion of young people with the qualifications and aptitudes suitable for entry to higher education will be restrained by a shortage of potential ability". That was a view which was not all that widely shared when the Robbins Committee took that view. Mr. Kingsley Amis, among others, took a very different view, and I do not think that any Member of this House could deny that that view has been borne out 100 per cent. The need for increased higher education, the willingness of more students to come forward for higher education, the continuing abilities of those students who do come forward for higher education, cannot be doubted. We are still barely beginning to scratch the surface of the ultimate demand for higher education from those who have been underrepresented in it in the past. We still have under-representation of students of working class parents; we still have under-representation of women in our universities and in higher education and, above all, we have barely started to scratch the surface of the latent demand for higher education from mature students, from those who have been so conspicuously successfully benefiting from the Open University. In looking at that situation, I say from this Dispatch Box that no solution of the sort proposed by the noble Lord, Lord Annan, is rejected in advance. I share with the noble Lord, Lord Beloff, a sympathy for the radical analysis of the problems of higher education rather than the more conservative analysis.

I listened very carefully to what Lord Annan was saying and I confess to having doubts about a number of his individual solutions. For example, he talked about the possibility of having centres of excellence and higher pay within those centres of excellence. I thought that the noble Lord, Lord Flowers, made a very effective point against that when he said that excellence in higher education is a dynamic and not a static matter and that the quality of research in a particular institution may vary from decade to decade. If you were to institutionalise centres of excellence, you might well find yourself fossilising the locations in which first-class work is done rather than finding opportunities for it to be done in newer institutions.

The noble Lord, Lord Annan, spoke about the need for liberal-studies colleges, both arts and science, and the need for two-year polytechnic courses. Of course, Anthony Crosland envisaged exactly that kind of thing when he was setting up the polytechnics. It was the idea that polytechnics would provide a possibility for movement, for example, from HND courses to CNAA degree courses, on the one hand, and, on the other hand, from full-time HND courses if that were more appropriate, to part-time HNC courses. What has been unfortunate is that the polytechnics themselves have become fossilised in a sort of crypto-university mould and that they have sought to emulate the universities rather than to develop the skills that they might have had, in Crosland's mind, of forming the basis of more comprehensive higher education.

A number of noble Lords, including my noble friend Lady White, have referred to the difficulties of breaking the mould as between polytechnics and universities. I am conscious that there have been experiments in this area not only in Wales but, for example, in Ulster where the new University of Ulster at Coleraine has merged with Ulster Polytechnic; but the result has been almost entirely a university rather than a polytechnic and certainly not an effectively new institution.

The noble Lord, Lord Annan, referred to the extravagance of our staff-student ratios and compared those with other countries. I think that it should be borne in mind that the countries which have poorer staff-student ratios, first of all, may not necessarily benefit from it but, secondly, that they have these staff-student ratios in an atmosphere of very much more open access and, therefore, a higher level of drop-out at the end of the first or second year. It is possible to be much more miserly about staff-student ratios in the first year if you know that you are going to have a sort out after that time. Therefore, I am not sure that his analogy is really valid.

As far as the issue of funding for research is concerned, a number of noble Lords spoke on that point. I do not think that there is any disagreement about it. Whether the alternative funding to that from the UGC is to come from the private sector, as Lord Beloff would wish, or whether it is to come from the research councils, as has been described by Lord Hunter; or whether it is to come—too much so in my view, as is the case with scientific funding at the moment—from the defence and military sector: from wherever research funding is to come, there can be no dispute (I would suggest) that the wider the variety of sources, the greater the strength of the funded institutions and the greater the possibility that first-class research will be funded at the expense of others.

The noble Lord, Lord Annan, referred to the inflexibility of our student grant system, as if somehow we were being extravagant about student grants. I would remind him that, in effect, student grants in real terms have gone down dramatically over recent years. It is a tribute to students' restraint that their enormous demonstration last week was carried out peacefully. It is a criticism of our sense of priorities that the newspapers and the television paid hardly any attention to it. One could be forgiven for drawing the conclusion that they only pay attention if there is actually going to be disruption and riot rather than an effective peaceful demonstration of the kind that we had.

But there have been dramatic changes in student grants, to the disadvantage of students, which have not in fact been recognised. And when the noble Lord, Lord Annan, refers to having a narrower range of subjects, I wonder whether he really wants to go away from the concept which I have always understood to be essential to that of universities—that universities are a lot of people learning different subjects, studying different subjects and doing research in different subjects together. I am sure that we would not wish to give that up, any more than we have had to in recent years; and certainly not as much as I am sure that we are going to have to in years to come, with the continuing decline in university funding.

With all respect to the noble Lord, Lord Annan, I do not think the suggestions he is making are absolutely fundamental to the problem. I do not think that the innovations, however welcome they may be at the University of Buckingham—and, much more important in my view, at the Open University—are really at the heart of the problem that the noble Lord is describing.

We do have a problem of the management of universities. It is not just a matter of the people who are doing the management or even a matter purely of the funding, although of course management, at a time of cuts, as a number of speakers have pointed out, is extraordinarily more difficult than management in an expanding economy or even management in a steady state. I suggest the problem is one of our society not setting adequately objectives for higher education, saying what role higher education should play in our society, deciding who should set the objectives and how they should be set. The way in which I suggest that we should be thinking about those objectives is higher education as an investment in our society—and by that I do not simply mean an investment in terms of the potential in the job market: I mean investment in our society in the widest sense, in our culture as well as our economy.

My Lords, I recognise the time, but I believe there is still a moment or two to spare before the Minister has to respond. If we recognise the definition of the role of the universities more clearly than we do, then we can effectively demand of the universities that they think again about access, qualifications for entry, credit transfer, the flexibility of their structure and about the entitlement to higher education throughout life.

Finally, I think it must be said that the Government's Green Paper on Higher Education into the 1990s fulfils none of those criteria. It does not set adequate targets for universities; it does not do anything other than cause the continuous misery, which a number of your Lordships have described, in particular universities because it is not attempting to say what should happen in higher education. It is descriptive rather than anything else. Robert Graves in his poem, Non Cogent Astra, said: Prediction is no alternative to forethought". I believe the Government's Green Paper is a prediction rather than a providing of forethought, and I believe that the noble Lord, Lord Annan, deserves some effective responses from the Government at the end of this debate.

8.34 p.m.

The Earl of Swinton

My Lords, I am grateful to the noble Lord, Lord Annan, for giving us a further opportunity to debate higher education matters. I am also grateful to the noble Lord for recognising that our system of higher education has to learn to operate on less generous levels of provision than it would like and that this will require change. But I am not sure that the noble Lord has given enough credit for the change that has taken place or that is being pursued.

A number of specific questions have been raised by the noble Lord and I should like now to try to deal briefly with them before coming to the core of my own remarks. Also, of course, I shall try in the course of my remarks to respond to points raised by other speakers. However, my time is fairly rationed and if I miss out any points that have been made I will of course read Hansard and write to the noble Lords concerned.

First, I do not think that the terms of reference of the committee of the noble Lord, Lord Croham, extend to the kind of wholesale reshaping of our higher education systems that the noble Lord went on to advocate. But I am sure that the noble Lord, Lord Croham, will have noted the underlying concerns of the noble Lord, Lord Annan, that there should be adequate machinery to secure the implementation of desirable change. I do not intend to deal in detail with the cornucopia of suggestions tumbled out by the noble Lord, many of which are referred to in the Government's Green Paper on higher education. For example, my right honourable friend has considerable sympathy with the idea that the pay arrangements in higher education should perhaps reflect to a greater extent the differential supply of, and demand for, academic expertise.

I was delighted to hear from my noble friend Lord Beloff that the experiment he had carried on in the University of Buckingham in degrees in two years had been successful. The Government are keen to test the feasibility of two-year degree courses, and they have invited the advisory bodies to consider with the universities and the CNAA the mounting of a limited experiment. The proposition is that a two-year honours degree might become a prestigious route for the most able students. But that is a far cry from a general change to a two-year degree. The case for that has not been made, and the Government have no plans to pursue it.

The Green Paper also encourages fund raising by institutions and has confirmed that increases in income from outside sources will not lead to reductions in government funding for universities. I very much agree with my noble friend Lord Beloff and indeed with the noble and learned Lord, Lord Wilberforce, in what they said about the importance of financial independence of universities. The Green Paper explicitly recognises that greater financial independence could bring greater flexibility.

The general thesis of the noble Lord, Lord Annan, is that whatever the efficiency of the administration of the various aspects of higher education, the universities in particular are, as he said in a debate in your Lordships' House last December, appallingly mismanaged in academic matters because the central agencies, the Secretary of State and the University Grants Committee are able to exercise influence only by applying financial sanctions to the otherwise uncontrolled and uncontrollable activities of a collection of independent workers' co-operatives, which always shy away from bold decisions and seek to protect their own narrow interests. He implies both that bold decisions are necessary and that they can be taken only by some strong central force, be it the Secretary of State for higher education as a whole, the University Grants Committee for the universities or the vice-chancellor, principal or director for the individual institution.

I have a good deal of sympathy with that impatience and I know that my right honourable friend has too; but as well as a-case for change there is also a case for conservation. Nearly everything that is excellent in our institutions of higher education at present is there because of the initiative of institutions or individuals within those institutions. Merely to centralise power does not guarantee change and certainly does not guarantee desirable change. The centralisation of power tends both to gather momentum for itself and to stifle drive and initiative at the periphery.

What we have to seek to achieve, therefore, is a balanced diffusion of power and responsibility, a system of checks and balances in which leadership is exercised by persuasion and consent and not externally imposed by an autocracy. In such a system change may come more slowly but it may stand a better chance of being right and also of being accepted by those whom it affects.

Change is necessary, but the achievement of desirable change depends not so much on changes in structures at the centre as on the quality of leadership within institutions and a determination to make full use of the opportunities to exercise that leadership. In drawing attention, rightly, to the reluctance of the universities to contemplate change, the noble Lord looked back over a period of nearly 20 years and to matters of concern which in various ways have been on the agenda for much of that period, including most of the 13 points of Mrs. Williams. I make them 13 but the noble Lord said there were 14 points and I certainly would not argue about one of Mrs. Williams's points.

At the same time it is important to acknowledge just how much change there has been and how much is currently in train or in prospect, not just in universities but in higher education generally. Widening the focus from the universities there has been a massive change in the public sector of higher education. I am grateful to the right reverend Prelate the Bishop of Ripon for reminding us of the voluntary sector and that it has a part to play. The Green Paper confirms the status and character of the voluntary colleges. Bringing them within the scope of the national advisory body, as has now been achieved, will help to provide the wider planning and advisory framework for which the right reverend Prelate was asking.

In the United Kingdom as a whole, the public sector has grown by about 70,000 since 1979—a growth of over 30 per cent.—to provide about half our higher education and 40 per cent. of our degree work. That growth has contributed to an expansion of the scientific and technological subjects and has been achieved by gains in efficiency and cost effectiveness.

Since 1979, unit costs have fallen by about 18 per cent. Despite the noble Lord's crack about arty-technics, less than 20 per cent. of polytechnic enrolments are in subjects that are not scientific, technological or otherwise vocational. All of that has been achieved partly as a result of the initiative and commitment of individuals and institutions to the provision of opportunities of higher education, and partly as a result of the establishment in England and Wales of national planning arrangements for England in the National Advisory Body for Public Sector Higher Education, and in Wales for the parallel Wales advisory body. Those bodies, which bring together the local and central government partners to the enterprise of public sector higher education now provide for the first time a focus for the integrated planning of the local authority and the grant-aided sectors of higher education.

The creation of such planning and advisory arrangements for the public sector also create for the first time the possibility of more co-ordinated planning as between the universities and the public sector. Neither sector should plan in isolation and the various advisory bodies are now able to consider together both the general strategic questions, such as the expected recruitment of students, and the more detailed questions of the planning of provision in particular subject areas.

I was delighted to hear the noble Baroness, Lady White, mention one of those mergers. She was supported by the noble Lord, Lord McIntosh of Haringey. For the universities, there has not perhaps been the same degree of highly visible change. But re-examination and change has been taking place, and what has been achieved should not be taken for granted. The universities have had to cope with a continuous diminution of resources in conditions of considerable uncertainty. They are currently being asked simultaneously to engage in the most detailed planning exercise on which the UGC has embarked for many years, and to review and overhaul their management and administration at all levels in response to the Jarratt report and to the concerns expressed by the UGC and others.

There has been a considerable Scottish element in the debate. The noble Earl, Lord Perth, the noble Lord, Lord Mackie of Benshie, and the noble Lord, Lord Tedder have spoken. I forget which of the three it was who mentioned the report of the Scottish Tertiary Education Advisory Council. I think that it was the noble Earl. It is interesting that in Scotland the recent report from the Scottish Tertiary Education Advisory Council has come up with a recommendation for an overarching planning and funding body to co-ordinate provision of higher education in Scotland across the university and non-university sectors.

Higher education in Scotland, indeed the education system as a whole, is different in many respects from that in England and Wales. I do not wish to comment on the recommendation which is at present subject to consultations, beyond acknowledging that it raises a number of complicated issues, because the Scottish universities—although, as the noble Lords have informed us this evening, they are very Scottish—are part of the United Kingdom university system. The Government are studying the report and the STEAC's recommendations carefully. To help in that, my right honourable friend the Secretary of State for Scotland published a report in December last upon which comments have been invited. The consultations will continue until Easter to allow those with an interest to express their views. I strongly suggest that those noble Lords who have shown such an interest in this matter do not hesitate to send their views to my right honourable friend the Secretary of State for Scotland. No decisions will be taken until those views have been received and considered.

The noble Lord, Lord Hunter of Newington, was very concerned about various aspects of research. The Government's funding of science overall has not been ungenerous. The science budget's 6 per cent. growth in real terms over the past few years reflects the seriousness of the Government's commitment to protect science. At the same time, the Government acknowledge that measures of average inflation do not fully reflect all the cost increases affecting research. Notably, they do not reflect increases in the cost of scientific equipment and materials which, as science and technology advance, tend to become more sophisticated, and hence in many cases more expensive.

It is not sensible to suggest that the funds made available to research can go on increasing in real terms year after year. The limit has to be set by reference to national prosperity and what we as a nation can afford. Other countries in the developing world are similarly having to come to terms with that problem.

The noble Lord talked about the need for slack in the funding of research to allow for the unpredictable, and of course we recognise that science is unpredictable. That is why the Government support basic research across the whole range of scientific endeavour; but increased concentration of resources on centres of excellence should improve the access for the generality of scientists to expensive facilities and equipment which are increasingly needed.

It is simply no longer affordable to have fully equipped research laboratories in all fields in all universities up and down the land. Concentration is essential to avoid the available resources being too thinly spread. There is no threat to university autonomy here. However, autonomy does not mean a blank cheque. It has always been for the Government to decide what the country can afford.

The noble Lord also argued for closer links between research councils, other establishments and universities. The desirability of closer collaboration is recognised by the research councils. The Morris report identified the medical research council units, which are invariably located in universities, as particularly successful models that other research councils should adopt. However, it cannot seriously be suggested that existing research councils and other establishments should be physically relocated to put them in closer proximity to universities. That is simply not an economic proposition. There are, however, a number of ways in which the councils can improve the link between their establishments and the universities; for example, by exchanges of personnel and collaborative research projects. I am glad to say that those are being actively pursued.

I do not for a moment want to pretend that all is for the best in the best of all possible worlds. Not all universities are as efficient as they might be in all levels of management and administration. By no means all the relevant messages of management and of accountability have yet been absorbed and accepted by those concerned with the management of the heart of the academic enterprise. But much has been achieved, and an enormous amount of activity is still in progress. The Government are hopeful that yet more can be achieved in ways that will maintain and develop quality and liberate, not stifle, initiative.

In their dealings with higher education, the Government have to recognise that, as Burton Clark has put it, higher education is bottom heavy. I end with a quotation from him: Authoritativeness properly resides far down the line. Along the lower operational levels, it is radically fragmented and diffused, located in dozens, even hundreds of groups and even in the activities of particular individuals. … In the diversity of the system lies its constant attraction and promise. Governance then becomes a word for how we attempt collectively to cope with that diversity: to steer, just a little, the many ways, most of them unplanned, by which the system elaborates itself, thereby exhibiting flexibility in settings of growing uncertainty.

Lord Annan

At this late hour, with a Second Reading before us, I only wish to thank most sincerely those noble Lords who have taken part in the debate, and to thank the noble Earl for his patience and to assure him that by now my desire for Papers has totally evaporated. I beg leave to withdraw my Motion.

Motion for Papers, by leave, withdrawn.