§ 7.32 p.m.
§ The Minister of State, Department for Education and Employment (Baroness Blackstone) rose to move, That the draft regulations laid before the House on 17th July be approved [42nd Report from the Joint Committee].
§ The noble Baroness said: My Lords, I beg to move the Motion standing in my name on the Order Paper. With the leave of the House, I shall speak to both Motions.
§ My purpose today is to seek your Lordships' approval for the Education (Student Support) Regulations in respect of England and Wales and the Education (Student Loans) (Scotland) Regulations in respect of Scotland which will give effect to our proposals for making income contingent loans to students entering higher education from 1998–99. With the agreement of the House, this debate covers both sets of regulations. There is virtually no difference between them other than the dates of the academic year and one small difference in drafting, which has an identical legal effect. Otherwise, the two sets of regulations are identical. Parallel regulations for Northern Ireland will be made shortly, and they will also be the same. The two sets of regulations under consideration tonight were tabled on 17th July and have been looked at by the Joint Committee on Statutory Instruments.
§ This House has had a series of lively and interesting debates over these proposals. I believe today is not the time to go over all that ground again. I emphasise that these regulations cover the making of loans and are nothing to do with tuition fees. I hope that we will not be diverted by that issue again today.
§ The regulations relate to the academic year 1998–99 which is essentially a transitional year. New students will still be able to receive a maintenance grant, albeit at a reduced rate, but will be compensated by having access to a larger loan. The maximum full-year loan for a student studying in London will be £3,145. Existing students and those falling within the gap year and A-level/Highers appellants schemes will continue to receive a 50 per cent. grant and a 50 per cent. mortgage-style loan. Regulations covering the loan rates for these students were laid on 10th July.
§ We will make a commencement order to bring into effect Section 44(2) and part of Schedule 4 to the Teaching and Higher Education Act once the regulations now before the House are made. This order will repeal the existing student loans legislation; namely, the Student Loans Acts of 1990, 1996 and 1998. However, as I outlined to the House in some detail earlier this year, savings provisions will ensure that those Acts continue in force in relation to second and third-year students and certain others for as long as they are required. Mortgage-style loans will therefore be available for as long as there are students still entitled to them.1265
§ These regulations provide for the payment of new loans and do not cover the collection of repayments. Repayment provisions will be dealt with in another set of regulations to be made early next year. I know that some of my noble friends and noble Lords opposite have expressed concern about that, but I do not believe that there is any need to have such regulations ready now. They will be principally of interest to employers and those involved in the collection arrangements. They will be available over a year before any students begin repaying their loans. The regulations before us provide that no students will have to begin repaying before 6th April in the year 2000. Repayment regulations will require a great deal of further detailed preparatory technical work and we intend to consult employers about those details.
§ We have already provided students with information on the proposed repayment arrangements and we will be issuing all students taking out an income contingent loan with a detailed booklet explaining the Government's proposals on repayment of the new loans so that they are fully aware of how the loans are to be repayed. That will be more useful to students than a set of complex, highly technical regulations which normally only lawyers are able to follow.
§ I turn to the main provisions of the regulations before us. They deal with eligibility; amounts of loans for 1998–99; the application process; arrangements for paying loans in instalments; and the new hardship loans.
§ While the new loans will offer different and more flexible repayment arrangements, the eligibility criteria and the actual application process will be very similar to the current scheme. Loans will be available for all full-time designated courses, as defined in Schedule 2 to the regulations. In addition, we shall designate all part-time courses of initial teacher training for loans. For 1998–99, loans will be limited to those aged under 50 on the first day of the course, but as the Secretary of State has already announced, loans will be extended to those aged under 55 on the first day of their course—including those who start in 1998–99—from 1999/2000 onwards, where they plan to enter the labour market after graduation. I believe this is a welcome extension which will be of real benefit to those wishing to retrain or develop new skills at this stage of their lives.
§ Applications for new loans will be made as now, through the student's college, once they have enrolled on the course. The administration of the new and the existing schemes has been kept broadly similar to minimise the impact both on colleges and the Student Loans Company in advance of the much bigger changes planned for student support in 1999–2000. The application process is almost the same as for existing loans and colleges and universities are familiar with it. We have shown the draft regulations to representative organisations such as the Committee of Vice-Chancellors and the Standing Conference of Principals in Scotland and they have indicated that they are content.
§ There are one or two differences to draw to your Lordships' attention. First, we have decided that all new loans should be paid in instalments to help students to 1266 manage their finances better throughout the year. Students will of course still be able to apply at any time and for as much as they want. But if they do not take the maximum entitlement first time, they will now have a second opportunity to top that up.
§ Secondly, we are introducing a provision which will allow a student to be absent for up to 60 days if they are ill but continue to receive instalments during that time. A further discretion will enable payments to be made even if the student is absent for longer than this or if the absence is for other reasons such as caring duties if the college considers that the student could suffer hardship as a result. I hope that noble Lords will welcome these measures which go some way to ensuring that students in this unfortunate position—students who become seriously ill—are not left without financial support.
§ I said at the beginning that these regulations do not cover repayment arrangements, beyond providing that no repayments will be due before 6th April 2000. However, they do prescribe the rate of interest which the loans will attract, which is linked, as for the current scheme, to the rate of inflation. Borrowers will pay no more in real terms that they borrow. The interest rate for 1998–99 will be 3.5 per cent. based on the March retail prices index.
§ I turn now to hardship loans. Noble Lords will recall that as part of our programme to target support to those most in need, we announced our intention to introduce a discretionary loan of up to £250. The regulations we are debating cover the arrangements for paying and administering these loans. New students will be able to apply once in each academic year for an amount between £100 and £250 provided they have already applied for their maximum student loan. The hardship loan will be added to the student loan and repaid at the end of the course on exactly the same basis. It will be for universities and colleges to determine whether a student should receive a hardship loan taking into account students' individual circumstances. We will leave it to the institutions to set their own criteria, except that we believe the main test should be exceptional financial hardship such that the student might be unable to continue their course for the rest of the year and would therefore have to drop out.
§ Hardship loans will be paid by the Student Loans Company directly into students' bank accounts and we shall set it a target of seven days to make such payments. I know that colleges and universities have been anxious for information about this new loan and have been asking for further advice. The department will issue guidance before the start of term in the annual eligibility guide which will describe in detail how the new scheme should work and in particular will suggest what criteria colleges may wish to use when allocating hardship loan funds.
§ I should perhaps remind the House that these loans have been made available in addition to the access funds, where resources have been doubled for next year. Our advice will be that in general students should apply for a hardship loan before receiving any payment from the access funds, but again we will leave it to the 1267 discretion of the higher education institutions to decide which form of support is more appropriate for a particular student's individual circumstances.
§ I end by saying how much I value the excellent work which student loan administrators do in ensuring that students can apply for loans, often acting as financial advisers for students in difficulty.
§ Noble Lords will no doubt have noticed that the regulations do not mention the role of higher education institutions in the application process, nor do they set out any duties for colleges and universities. This is because the primary legislation places the duty on the Secretary of State. It does, however, allow him to transfer functions to other bodies—and he intends to do so—to universities and colleges with eligible students by way of a separate determination. I recognise that having to administer two systems and deal with hardship loan applications will place an added burden on administrators in universities and colleges next year. We have tried to keep their role to a minimum and they will of course benefit from 1999–2000 onwards by having much of their work in determining eligibility for student loans taken over by the local education authorities, the Awards Agency in Scotland and the education and library boards in Northern Ireland.
§ However, I am able to tell the House that we are making a small increase in the fee paid to institutions for each eligibility certificate they process—both for mortgage-style and for income contingent loans—from £4 to £4.50. This is the first increase for over five years. That is in line with inflation. We have also decided that for every income contingent loan processed we will also pay a further £1 in recognition of the work involved in assessing hardship loan applications, where there will inevitably be some unsuccessful applications. We believe that is fairer than just paying colleges for successful hardship loan applications.
§ As I explained earlier, the arrangements which these two sets of regulations cover are identical in purpose. They make transitional provisions for loans to new students in 1998–99, and are a crucial first step towards the implementation of our new student support system which we will have fully in place by 1999–2000. I hope that my opening remarks have been helpful in explaining some of the detail. I commend the two sets of regulations to the House.
§ Moved, That the draft regulations laid before the House on 17th July be approved [42nd Report from the Joint Committee].—(Baroness Blackstone.)
§ 7.45 p.m.
§ Baroness Blatch
My Lords, I am grateful to the noble Baroness for explaining the two documents before us tonight. Perhaps I may say from the outset that the Department for Education and Employment, formerly the Department of Education and Science, has notoriously been very bad at producing regulations and orders. I do not believe I have ever seen one come out of the DfEE that does not suffer from manuscript amendments. This document is no exception.
1268 On one page there is an unreadable and indecipherable change. That is on page 7, paragraph 8(2). The particular change there is completely obliterated in my copy and I have tested a number of copies in the office. If the Scottish Office can not only produce an absolutely identical document with no manuscript changes at all, and produce it in a manner which is much more readable and in a typeface which lends itself to being easily read. I think that my criticism of the DfEE is one that carries force.
The noble Baroness says that the regulations have nothing to do with tuition fees. It is no intention of mine tonight to bring up the subject of tuition fees, except to say that my understanding is that loan facilities have been extended to some students to cover tuition fees. The term starts very shortly, in a matter of weeks. If there is a loan facility that is extended to cover tuition fees, when will we see the regulations which will cover that? It seems to me to be important that the students know about it.
The noble Baroness says that we will not see the repayment regulations until next year. I made the point, and it is worth repeating, that that is unfortunate. The regulations will confirm the repayment arrangements. As the noble Baroness has said, leaflets, which I am sure will be helpful to students, will be produced in advance of the regulations. They will be much more readable, more digestible and less complex. However, I have to say to the Minister that whatever they say, and however much they resort to lay language, they have to be based on the regulations which are approved by Parliament. It is Parliament that gives authority for those regulations, not glossy pictures and cartoon balloons talking to students about what Parliament may approve next spring. Not a mention has been made of means-testing overseas students. I am not sure when we shall see some reference to that in regulations.
When will the students see the money in the bank? When the noble Baroness talked us through the draft statutory instruments, she referred to applications being made by students when they actually go to university. A good many of us have had children in that position. Many students will be required to produce considerable sums of money in advance for their accommodation on their very first day in college. Given that students will have no grants on which to rely, they will have to find large sums of money ahead of making an application.
According to the regulations, the Secretary of State is bound to pay an instalment of the loan to a student within 30 days. Therefore, if the application is made when the student arrives at university and the Secretary of State makes sure that the loan is paid within 30 days, the student will already be one month into the course and that will be too late for many students.
Paragraph 5(4)(i) of the regulations on page 5, refers to students making certain whether they were, on the first day of the course, ordinarily resident, for the purposes of the regulations, in England, Wales, Scotland and Northern Ireland. First, is there an official definition of "ordinarily resident"? If so, upper case letters should have been used or the term should have been singled out as an official term. If there is no definition other 1269 than being resident for the first day of the course, does that mean, for example, that a student resident for the first day of the course in Scotland could come under the Scottish regulations for loans for the fourth year?
Later, in the same section dealing with the certificate of eligibility, there is reference to the process which must be undertaken in order to secure a loan. First, the student must seek a certificate of eligibility which seems to take some time. Again, I believe about one month passes between the start and the end of that process. Only after receiving a certificate of eligibility will a student receive an application form. The process then starts all over again. If I read page 6 correctly, which deals with the application for the loan, it seems that students must supply almost the same information all over again. If the certificate of eligibility has secured a student's bank's or building society code, age, date on which the course starts and so on, why is it necessary to undergo all that again? In today's technological age, is there not a system whereby that information could be passed down the line, in view of the fact that that certificate of eligibility is an extremely important document and a prerequisite in applying for the loan?
Arrangements for payment have not been referred to. I may be out of order on this, and, if I am, perhaps the Minister will tell me. However, as regards the arrangements for paying sums of money over to the universities for tuition fees, again, we are a matter of weeks away from the beginning of the year but we do not yet know what sort of money students will be expected to have; at what stage in the academic year they will be expected to pay; and whether they will pay in one sum for the year, monthly, termly or half-yearly. I understand that that is a matter to be decided by the universities and colleges. Will any criterion be applied? Will it just be bad luck for a student who arrives at a college which expects him to pay in advance six months' tuition fees? I make no apology for raising that matter and I accept that it may be out of order. However, I wish to place that on record because that question is exercising many students at this time.
The references to hardship in the regulations are fairly scant in terms of how this will be managed by the universities. The section on it is very thin; it gives very little information about how a student will qualify and what will be the criteria used to judge what is hardship. I imagine that a student who simply spends money too quickly will not qualify. Every student with full loan facilities and/or partial loan facilities but deemed to be funded by the better-off parents will start with the same money for the same courses in the same colleges and universities. Therefore, how will a student qualify for a hardship loan? What criteria will be used? Are the criteria to be established nationally so that there will be some consistency of application of this policy across the board, or will the matter be dealt with on a college-by-college basis, in which case a student may be lucky or unlucky, depending on the way in which a particular college operates?
The timescales are particularly worrying. If a student applied for certification of eligibility today, he would barely receive his loan by the first date of term. If that process does not start until the students arrive at 1270 university, they will not see the money in the bank until well into the autumn term. That will be much too late for many students.
The noble Baroness referred to access funds and the fact that they have doubled. I remind the noble Baroness that so too has the number of students who will be able to draw down the access funds. I wonder whether the number of students means that the sum of money available per student in terms of drawing down on the access funds is the same or better.
Finally, I deal with the increased payment made to universities for administration. The noble Baroness said quite rightly that it keeps pace with inflation. That is all it does. It does not reflect the extra administrative burden which will be placed on universities, which will be considerable. Universities are not only dealing with loans and the administration of them but also with the administration of tuition fees too. I wonder whether an extra sum of money will be paid on top of that which will reflect both inflation and the administrative burden.
§ Baroness Maddock
My Lords, we have already debated those matters at great length. When we were dealing with the Bill before it became an Act, some of us were rather hazy about what would be in the regulations. To be fair to the Minister, it is much as was forecast when we looked at the Bill.
Like the noble Baroness, Lady Blatch, I am rather worried about the timing for students. It will be tight. We always knew that. I hope that, for the sake of the students, it all goes smoothly.
I am extremely grateful to the Minister for her explanation and I welcome in particular the understanding of the problems of those who become sick while undertaking their courses and those who have particular caring responsibilities. The Minister talked about hardship funds and how they would be dealt with and referred also to the cost of administration. When she winds up, perhaps she will tell us whether the money that is to be given for the increase in administration will be top-sliced from money which might be going to universities in any event. I should be grateful for that information.
I wish to comment on four matters. The first is the payment of loans by instalments. Under the regulations, that will be three instalments. For most students, that is probably satisfactory. It seems a shame that there is not the opportunity for some students to have the money in a lump sum at the beginning. That is particularly relevant for mature students who perhaps have quite high outgoings. That is one issue that has been raised by the National Union of Students.
Similarly, the National Union of Students raises the point that the regulations will, as the Minister explained, allow two loan applications to be made in a full year. It would seem more logical to allow students to make three applications in line with the fact that three instalments are to be made. That seems logical.
Many people are very pleased, especially those of us on these Benches, that the Government have recognised the importance of lifelong learning and have indicated that they will eventually extend the loans to those aged 1271 55. Of course, it will initially be limited to those under the age of 50. It would be pleasant if we could really believe in lifelong learning and, at some stage, ensure that age is no bar to receiving a loan for further education purposes.
Perhaps I may take this opportunity to talk, once again, about those who are part-time students. On the whole, these loans are only available to students on full-time courses. I hope that it will not be too long before the Government can extend such facilities to part-time students, as is possible under the legislation. However, I welcome the fact that part-time students who are undergoing teacher training courses will be eligible for loans. That is a most important point.
Like the noble Baroness, Lady Blatch, I, too, am concerned that we have not as yet received details on collection arrangements. We debated this at some length during the passage of the legislation. I do not think that it is satisfactory just to have it in simple language. It is a legal requirement, and I have not changed my view in that respect. It is the Government's duty to produce the information as fast as they possibly can.
We are now at the initial stage of these new arrangements. In a sense, they will be interim regulations. I hope, therefore, that the Government will look most carefully at what actually happens on the ground. My experience of legislation made in Westminster is that, so very often, what happens on the ground does not filter through to those of us who are making the legislation and those who are administering it. For the sake of students, I hope that the process will be looked at and scrutinised very closely so that anything that goes wrong and which causes unnecessary hardship to students will be put right next year.
We are talking about a big change for students. It is very difficult for them to get their minds round such matters, although I know that much information has been supplied in that respect. Indeed, I believe that local authorities have, on the whole, done a sterling job in advising students on what will happen, even though they did not know the nature of the regulations. I admit that the Government have played their part in the process. However, at the end of the day, the proof of the pudding will be in the eating. Indeed, I hope that the eating will be heavily scrutinised so that it will be an even better meal for our students next year.
§ 8 p.m.
§ Lord Davies of Oldham
My Lords, I have a few brief comments to make. Before I begin I should declare an interest as chair of the Further Education Funding Council. Obviously, I am concerned about these regulations in terms of the impact upon students in higher education. Most of the institutional references that I make during the course of my remarks will overwhelmingly relate to universities because the issues clearly impact upon them rather more than on colleges.
However, I shall begin by being slightly more generous than the two previous speakers have been in their contributions. We should recognise the advantages to be derived from the increase in the fee to the 1272 institutions for the administration of the loan. Over a number of years, I recall that universities have pointed out just how uneconomic, as far as they are concerned, the actual contributions from government to institutional finances have been; indeed, how inadequate they have been in relation to the cost of administration. Therefore, it is a welcome sign that the Government have recognised the difficulties and that there has been a significant increase in the fee payable to institutions, although I have no doubt at all that that will be regarded by some as falling somewhat short of the costs involved.
The only area in which I should like to emphasise real difficulties is one where the Government have been most constructive. The concept of the hardship loan is very welcome. We all know that we must pay real attention to the dangers of students dropping out of courses because of problems associated with finance. It seems to me that the issue here is just how efficient it is necessary for the administration to be in response to such problems. Looking at the document, it seems to me that students must be able to identify that they are in danger of dropping out unless they receive additional support. By definition, that identifies a student as being in a somewhat parlous state and it means that such an application would need to be processed very rapidly so as to enable the student to sustain himself on a course.
As we all know, the final term of the academic year is a time when students are likely to be facing examinations and academic tests which will determine whether or not they will be able to sustain themselves on the course in terms of their academic competence. Therefore, the issue of hardship bites in at the most difficult part of the educational process so far as concerns students. I hope that I heard my noble friend the Minister correctly and that real attention will be paid to the rapidity with which these decisions are made. We all know that a delay at such a stage would place a student in a quite invidious situation.
In the expectation of some reassurances on that front, perhaps I may say how much I welcome the improvement in the position which is represented by this structure as regards students. I hope that the challenges which have been made from the other side of the House—indeed, proper queries about the way in which things should be administered—are set against the general background where it is recognised that improvement lies ahead of us so far as concerns students in higher education.
§ Baroness Blackstone
My Lords, I should like to thank all those who have contributed to this short debate. I am especially grateful to my noble friend Lord Davies for welcoming the hardship loans, which I believe are an important way to help those students who get into serious financial difficulty. Perhaps I should, first, deal with the issue of hardship loans. The noble Baroness, Lady Blatch, wanted to know what the criteria for awarding a hardship loan would be. As I said in my introductory remarks, the Government believe that it is for higher education institutions to decide who should have hardship loans. They are in the best position to judge the circumstances of individual students.
1273 It is certainly the case that we would expect those institutions to take into account taxpayers' commitments and that students who come along with sob stories, which really cannot be sustained under investigation, should not be given additional support. However, at the same time, there will be many students who, through no fault of their own, may have got themselves into a position where they are in serious financial difficulty and are in danger of dropping out of a course. Occasionally, it may be the case that a student has made a mistake in terms of the kind of accommodation that he thought he would be able to afford and he may need advice and help in securing accommodation, which is not as expensive, so that he can actually survive for the rest of the year.
I shall try to deal with the various questions which were put to me by both the noble Baroness, Lady Blatch, and the noble Baroness, Lady Maddock. The noble Baroness, Lady Blatch, began by pointing out that there is a manuscript amendment on page 7 of the document. I believe she particularly mentioned page 7, which she said was indecipherable. All I can do is apologise to her. In my particular version there is no manuscript amendment on that page. However, I shall do my best to ensure that another version of the document is passed on to her where all the amendments in manuscript form are clear and legible. That was a fair and reasonable point for the noble Baroness to make.
The noble Baroness, Lady Blatch, also asked about the loans facility to cover tuition fees. There is no loans facility to cover tuition fees. Loans are entirely for maintenance.
The noble Baroness also suggested it was important that regulations on repayments should be produced as soon as possible. We shall do that but as I explained earlier there are complex technical issues that need to be sorted out with employers. I am sure the noble Baroness will agree it is important that employers are consulted, as they will be responsible for providing information to the Inland Revenue on the collection mechanism. I certainly hope that we shall not produce guidance for students that is full of cartoon "balloons". I hope that the guidance will be clear and readily comprehensible to all students.
The noble Baroness also asked about the means testing of overseas students. Overseas students are, of course, not eligible for loans. Therefore that is not entirely relevant to today's regulations. In any case the Government covered the means testing of overseas students in the mandatory award regulations that were made earlier in the summer in May.
I turn to the issue of when students will have access to their loans. The noble Baroness suggested that students may be left without any money at all in the first 30 days because the regulations prescribe a time limit of 30 days. That is the maximum time which should be required to pay loans, allowing for delays if the information provided by students is incomplete. We intend to set the Student Loans Company a target of paying new loans. My officials are in the process—
§ Baroness Blatch
My Lords, I am grateful to the noble Baroness for giving way. There are two delays. 1274 The certificate of eligibility has to be secured first, which takes some time. Secondly, the 30 days begins only when the application has been made and it cannot be made until the Secretary of State has made arrangements for an application certificate to be issued.
I refer to tuition fees and no loan facility being extended. As regards a parent with a son or daughter going to university this autumn who perhaps qualifies to pay only £500 of tuition fees—therefore the parent is on a modest income—who is expected to find the £500: the student, who has no money whatsoever and no income whatsoever, or the parent, who has no residual income left? If it is the parent who is expected to find the money, the Government cannot keep stating in leaflets—as they do—that parents will not be expected to find one extra penny when their young daughters and sons go to university.
§ Baroness Blackstone
My Lords, students whose parents have been means tested will this coming year—if their parents are eligible because their income is sufficiently low—continue to receive a grant. Some 25 per cent. of their maintenance will be covered by grant. That will be paid when the student arrives at university, just as it is now. Therefore there is no problem in terms of students not having any funding. It is important that I make this point clear. I shall refer first to maintenance and then discuss fees. However, I think we should leave the fee issue out of this because it has nothing to do with these regulations. As regards maintenance, students will continue to have access to a grant during 1998–99 which covers 25 per cent. of their maintenance, because this is a transitional year. The students therefore will receive that before they start their courses. I hope I have made that clear.
The noble Baroness asked about the certificate of eligibility. In devising this scheme we made it absolutely clear from the beginning that the payment of admission—I am sorry, I cannot find my correct note on the certificate of eligibility. I shall return to that matter in a moment. As regards the payment of tuition fees to universities, that is not part of these regulations. That is a matter that concerns the quite different issue of fees. However, it is for universities to collect the fees. I believe that they will benefit considerably—as we have already announced in the comprehensive spending review—from this new scheme. I remind the noble Baroness that universities already collect fees for a whole variety of different kinds of students: postgraduate students, part time students and students from overseas. They are used to doing that. From my own experience I know that universities are well able to undertake that task.
The noble Baroness, and I believe the noble Baroness, Lady Maddock, asked whether universities are being adequately rewarded for the work they undertake in collecting fees, in providing hardship funds and in increased access fund payments. The government of the noble Baroness, Lady Blatch, did not increase the funding available to universities for taking on these tasks for a whole five years. We have increased the funding. Our increase is slightly greater than inflation 1275 over that period. We are also paying an additional £1 per application—not per payment—of hardship funds. I believe the universities accept that that is reasonable.
I return to the issue of the eligibility certificate and application form in one document. They are completed at the same time. One part is sent to the Student Loans Company by the college or university and the second part by the student. The regulations simply separate out the information to be provided on both parts of the form. There should be no delay caused by having to complete both forms as they are done at exactly the same time at the same interview.
The noble Baroness also asked whether there was a definition of ordinary residence. There is no such definition in the legislation but the phrase has a long-established meaning. It has been used in the existing student loans scheme. There have been cases in the courts which have clarified what I believe is now a pretty well understood definition. The noble Baroness also asked what happens to a student who moves from where he or she is ordinarily resident to attend a course. Regulation 2(2) provides that if a student moves from, say, Scotland or Northern Ireland to England, he will be treated as ordinarily resident in the place where he has moved from.
I turn to the points raised by the noble Baroness, Lady Maddock. She was concerned about the payment of loans by instalment, particularly as regards mature students. I have a great deal of sympathy for mature students but I think they, like younger students, will need to receive support throughout the academic year. I do not think it would be particularly helpful to them to have all the money up front rather than at the beginning of each term. That will allow them to make payments—if they have to make any—at the beginning of each term. The noble Baroness also asked about the cost of administration to the university. I think I have covered that. She also asked whether the—
§ Baroness Maddock
My Lords, I thank the Minister for giving way. With respect, she did not cover the point that I raised. Is the money being provided to help with administration costs in universities, extra money, or is it top-sliced from other money in the higher education budget?
§ Baroness Blackstone
My Lords, the extra money that is being provided to support universities in carrying out the administration of the scheme is extra money for the universities. It will be covered by the additional money provided under the Comprehensive Spending Review.
The noble Baroness asked that anything that might go wrong should be put right. I very much hope that matters will not go wrong and that the introduction of the new loans scheme will go smoothly. We shall monitor very carefully the scheme's introduction. Where there are problems, we shall do our very best to iron them out, and do so as soon as we possibly can.
§ Baroness Blatch
My Lords, before the noble Baroness sits down, the answer given in relation to the 1276 eligibility form is not consistent with the regulation. I should be glad if the noble Baroness would clarify what she has just said.
Subparagraph (7) of paragraph 5 states:If the Secretary of State is satisfied that the particulars in the eligibility form are correct and that the student is an eligible student he shall certify those matters to the best of his knowledge and belief and also certify the amount of loan for maintenance to which he considers the student is entitled".The regulation goes on to state:The Secretary of State shall issue to each student whose eligibility he has certified an application form"—so the forms are not dealt with at the same time—which identifies the particular certificate of eligibility".Paragraph 6(1) states that an eligible student—in other words has to secure eligibility first—shall apply for a loan for maintenance".That is wholly inconsistent with the answer given by the noble Baroness.
§ Baroness Blackstone
My Lords, I can only repeat what I said. The application forms are completed at the same time. One is passed to the Student Loans Company by the college or university, and I understand that the second, the function of certifying, will be exercised by the higher education institution. I hope that that helps the noble Baroness in explaining the system.
Of course we must avoid a system in which we ask students to do things that make the process unduly complex and difficult. I assure the noble Baroness that that is not the case. Students will all receive access to their loans within the time specified and there will be no delays. That is a requirement that we are making on the Student Loans Company. It will be given targets that it must achieve. There should be no delay whatsoever caused by having to complete both forms, which I am advised have to be completed at the same time.
§ Baroness Blatch
My Lords, this is legislation that we are passing. Secondary legislation is as important and pertinent as the primary legislation itself. It states that the application form will be delivered to the student when eligibility has been secured. That means that one follows the other; the forms are not simultaneously filled in by the student. The student does not receive an application form until he or she has secured eligibility and a certificate to prove it.
§ Baroness Blackstone
My Lords, as I have said, the university or college to which a student goes will, as soon as the student registers, issue a certificate of eligibility. The student can then fill in the form—which will give the student plenty of time; it will be done more or less simultaneously—to acquire a loan within the 30 days which are stipulated in the regulations. I commend the regulations to the House.
§ On Question, Motion agreed to.