Higher Education Bill

HL Deb 25 May 2004 vol 661 cc1243-98

5.50 p.m.

Baroness Ashton of Upholland

My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

Moved, That the House do now again resolve itself into Committee.—(Baroness Ashton of Upholland.)

On Question, Motion agreed to.

House in Committee accordingly.

[The DEPUTY CHAIRMAN OF COMMITTEES (Lord Haskel) in the Chair.]

Clause 31 [Contents of plans]:

Baroness Warwick of Undercliffe moved Amendment No. 85A: Page 14, line 27, at end insert— ( ) No part of any plan shall be required to be framed by reference to particular courses of study, save as provided for in subsection (1).

The noble Baroness said: I have discussed this amendment at length with Ministers and officials. Initially, my objection was to the phrase "each qualifying course" in Clause 31(1). I could not see why that was necessary. Institutions will already be restricted in what they can charge—first, by the requirements to reach an access agreement, and secondly, by the statutory limits. I am not convinced that that third restriction is necessary. After all, universities will have to tell their students what they are to be charged for the entire duration of their courses, and will also, presumably, have to give the Student Loans Company the same information.

Nevertheless, my principle objection to the phrase "each qualifying course" is the implication that OFFA will involve itself in institutions' widening participation activities at the level of each individual course. That could lead to an unacceptable level of micro-management and, potentially, could have a destructive effect on individual courses. My understanding is that OFFA will be interested in widening participation efforts generally, and not at the level of each individual course. My amendment would ensure that OFFA cannot require institutions to frame their plans by reference to particular courses of study.

I can think of examples where institutions run excellent programmes to promote access which are subject specific. Many will want to draw attention to these programmes in their plans. However, should OFFA be able to require an institution with an excellent summer school that focuses on sciences to include details of how it will attract a wide range of students to study art history as well?

I remind the Committee that there are about 42,000 higher education courses, plus an even greater number of modules. Micro-management of the type that I have outlined could unleash a monster of bureaucracy. Perhaps more worryingly, it could distort efforts to widen participation. It could be highly counterproductive if certain courses or subjects were to be singled out over other courses or subjects. Given the scope for influence by the Secretary of State, it could also open the way to political interference in higher education.

I end by reminding the Committee that there are many other factors affecting widening participation which are outside a university's control. There may be subjects where, for a variety of reasons, applications are more common from one group in society than another. Where those reasons are to do with finance, there is much the Government—together with the universities—might be able to do. But where the reasons are cultural or historical, it would be wrong to assume that universities can necessarily change that, although there may indeed be innovative ways to encourage a broader range of applications. I beg to move.

Baroness Ashton of Upholland

I am grateful to the noble Baroness, Lady Warwick, for moving this amendment. It is not necessary to have the amendment on the face of the Bill—for reasons that I will outline—but it raises an important subject. I am glad of the opportunity to put the Government's position on record.

As the noble Baroness indicated, her concern is that regulations might force the director to require plans to include measures for particular courses. The noble Baroness gave the example of art history. It could be that it might have to provide bursaries specifically for courses in law. I assure the Committee that it is absolutely not our intention to require plans to operate in this way.

Your Lordships will have seen from the draft regulations which we have made available that nothing in these regulations or in the Bill requires institutions to frame their access plans by reference to individual courses. However, institutions are free, as the noble Baroness indicated, to do so if they wish. I remind the Committee that, as a result of the government Amendments Nos. 110 and 111, these amendments will be made through an affirmative resolution procedure, offering the Committee a chance for detailed scrutiny of any changes.

I assure noble Lords that our intention is not for the director or the regulations to require plans to set out access arrangements for each course. The plan will cover the whole institution; institutions will set their own milestones of progress. Some institutions may wish to draw the director's attention to access for a particular course or group of courses—that is up to the institution; it will not be a requirement.

I entirely understand why the noble Baroness has tabled this amendment. I agree wholeheartedly that the director should not micro-manage—I think that was the noble Baroness's word—and that will certainly not be part of his remit. Having given that reassurance that we do not intend to require institutions to specify the access measures in their plans on a course-by-course basis, I hope that the noble Baroness will withdraw her amendment.

Baroness Carnegy of Lour

It has been quite difficult during the Committee stage to know when Universities UK is asking the Government to change something, and when it is simply supporting the Government. The problem is in not understanding the nature of its arrangement—this rather cosy relationship—with the Government. I do not know whether there was a deal or not about the Bill; it has been very difficult for Members of the Committee to read the tea leaves.

The amendment is very important. I am amazed that the Government are not accepting it. We talked about how OFFA will gradually see its role extending. It would be very easy to begin to argue that courses attract certain types of students and that if you want to widen access you design courses to attract them. Then OFFA might begin saying to universities, "You should do this, that and the other". It is essential that OFFA has absolutely nothing to do with the nature of courses. I am very surprised that the Government find the amendment completely unnecessary. Have they got no fear that OFFA will try to extend its remit?

Baroness Ashton of Upholland

I hoped that I had made the Government's position perfectly clear. I am sorry that the noble Baroness, Lady Carnegy, has not understood that. We are debating the issue raised by the noble Baroness, Lady Warwick. I do not know what the noble Baroness, Lady Carnegy, is referring to by "cosy relationship". It is the job of all governments to talk to the organisations which represent the institutions most affected by any legislation. I am quite sure that if the noble Baroness's party were in government it would be doing exactly the same—that is well and truly understood as a procedure. There is nothing cosy about that.

I assure noble Lords that I understand from my right honourable friend Alan Johnson that conversations have been tough and, as one would expect, extremely important in their deliberations. There is nothing that we have put forward—neither in the Bill nor in the regulations—that would attempt to micro-manage in the way that my noble friend indicated; nor do we intend to. It is a question of how best we can recognise that fact. We have made it plain that it will not be in the regulations.

In our view, not everything is appropriate to be on the face of the Bill that requires strong commitments from government. Any changes that are brought forward on any aspect would be by affirmative resolution in your Lordships' House and in another place. We believe that that is the best way to approach this subject. Our commitment is absolute. I hope that the noble Baroness will reflect and understand that I say that wholeheartedly. Our commitment is absolute to what my noble friend Lady Warwick indicated should be the case.

6 p.m.

Baroness Blackstone

I support what the Minister said. She has given the Committee a very firm reassurance about the Government's intentions. It is a very good thing that the noble Baroness, Lady Warwick, representing Universities UK, tabled this amendment as we now have the reassurance that is needed.

Baroness Carnegy of Lour

We do not always have to accept the assurances of government. The Minister is absolutely straightforward with the Committee and I am a deep admirer of hers. I believe what she says. However, it is a question of what should be in the Bill for the future. I am very surprised as I thought that the Government would accept the amendment, but, evidently, that is not the case and we have to leave it there.

Baroness Warwick of Undercliffe

I am grateful to the Minister for the way in which she responded to the amendment and to the concerns that have been expressed on behalf of universities. It is something about which we have been enormously concerned. The noble Baroness, Lady Carnegy, reinforced that although I hope she will not mind if I say that the strong arguments that we have had with the Government have been extremely robust. I certainly did not feel that they were cosy. We pressed the Government extremely hard on behalf of universities, as I hope noble Lords would expect. I shall read very carefully what the Minister said. I am grateful to her; her response certainly sounded very reassuring. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 86 not moved.]

Lord Puttnam moved Amendment No. 86A: Page 14, line 38, after "assistance" insert "and advice

The noble Lord said: In moving Amendment No. 86A, I wish to speak also to Amendment No. 87A. both of which are probing amendments designed to allow the Government time to reflect and bring forward their own proposals for ensuring the availability of high-quality debt management advice for students. This should apply not only to those taking the decision to incur the debt involved in pursuing university education, but also during their university years and, almost more importantly, after they have graduated and are confronting the issue of repayment.

This issue was raised by a number of noble Lords during the Bill's Second Reading, most particularly by the right reverend Prelate the Bishop of Portsmouth, under the broad rubric of debt education. The basic premise of these two amendments is simple. The Government are requiring young and, indeed, not so young people to incur debt in exchange for an adequate level of further and higher education. This principle would appear to have been accepted, albeit reluctantly and with many caveats. However, it remains profoundly true that many young people and their parents are extremely wary of the concept. and somewhat confused about what the debts might involve. To that end, in my judgment and that of others, the Government owe an inescapable duty of care in doing all they can to alleviate that problem.

While it may prove possible to pass this duty of care on to the relevant education institutions, I believe the Government should accept that they must remain the default provider of such quality advice. For that reason it seems to me there is an overwhelming argument in favour of a national helpline as well as advice that is always available on a web based resource. In the best of all possible worlds the high street banks might get together to provide such a service through the British Bankers' Association or some similar body, but it would require a real commitment for that to happen—a commitment from the Government and an acknowledgement that this is not a trivial issue. It may well be that 10 years from now people will become adjusted to the idea of managing their tuition fees, but certainly during the coming few years many students and their families will need all the help that the Government and, indeed, the institutions can provide. I beg to move.

Baroness Sharp of Guildford

I should like from these Benches to give our support to the amendment. It is extremely important that students are well provided with financial advice. As we know, many of them will take on very substantial debts as a result of the new arrangements. I am always surprised at how ignorant very many people are about financial arrangements and what they are letting themselves in for. It is important that they are able to get hold of independent advice which is not tied up with anyone's particular interest. There is a great danger that a number of financial advisers will get in on the act and may not provide advice that is necessarily in the best interests of students. It is therefore very important that there is some kind of independent advice line.

Baroness Seccombe

The idea of the noble Lord, Lord Puttnam, of involving banks—after all, they are usually the main lenders of money—seems to be excellent. However, at this stage I do not see why it is important to have the measure on the face of the Bill. It is up to the individual student to ensure that they manage their finances accordingly. They should do so perhaps by getting advice from the National Union of Students that has bodies which advise on these matters, but certainly the student advisers in the banks must be a real resource upon which they can call.

Baroness Perry of Southwark

I should like very much to support the noble Lord, Lord Puttnam, in what he said in addressing the amendment. I believe that most universities provide financial advice to students, and so they should. In my relatively small Cambridge college of fewer than 300 students one member of the finance department held a clinic for four hours every week. It usually ran to six or seven hours. Students got into frightful messes.

Young people get into terrible miseries with their financial affairs and need help not only on how to manage their affairs but also on the various ways of finding additional funding; many such ways do exist. Having a measure on the face of the Bill that encourages universities to do what I believe the majority already do would be a major step forward.

Lord Sutherland of Houndwood

I support the amendment. My experience of student life is that very often when academic problems present themselves behind them lie financial problems. That certainly is the case for some of the poorer students but not only those students. It makes good sense to tackle the matter as early in the system as possible.

Lord Dearing

I do not know whether it is necessary or desirable to include the measure on the face of the Bill, but I am clear that students will benefit from this kind of advice. I think particularly in terms of retention rates. One of the reasons for early drop out is financial problems. If that can be spotted early and the student knows that someone can help, we shall have higher retention.

Baroness Blackstone

I, too, support the amendment. I say to the noble Baroness, Lady Seccombe, that she is being a little unrealistic about the behaviour of many 18 year-olds. Many of them are not terribly experienced in handling money or, indeed, in understanding the nature of the debt that they are taking on. The advice that we are discussing should be provided by all universities. I would hope that they would all do so on a voluntary basis, but I suspect that there may he cases where that is not necessarily happening. I believe that the vast majority of universities would accept that the requirement that they should provide this advice is very reasonable.

Baroness Ashton of Upholland

I am grateful to all noble Lords who have spoken on this very important issue. It is considered important not only in your Lordships' House but more generally. I am grateful to my noble friend for raising it. It gives us the opportunity to reflect on what is already being provided in terms of support for students, as my noble friend Lady Blackstone and other noble Lords have indicated is the case, and to consider what further support might appropriately be given.

I agree with the concept of the importance of financial information. That is why we have said that access plans should cover financial assistance and financial information. We believe that those go hand in hand and in a sense complement each other. The amendment refers to financial "advice" whereas the Bill refers to "information".

As noble Lords have indicated, there is concern that students should be given financial advice, particularly in the light of what the noble Lord, Lord Sutherland, said about financial problems, particularly debt, lying behind academic problems. However, the noble Lord will not be surprised to hear me say that what we are proposing within our changes for student support is not traditional debt but contingent repayments. That is a very different proposition to the credit card debt that young people often appear to be invited to take out through a loan or whatever.

However, the term "advice" inevitably suggests something much wider than we have in mind. I want to explain what we envisage by financial information. We want to ensure that students receive information and support from a variety of sources. Rather than thinking that they cannot go to university—that is in a sense where we began our discussions about addressing students' needs—they need to understand what is available to them—support through education authorities, institutional financial support and so on. Students with a disability, and those with children, need to understand that additional support is available. Of course, we need to make sure that those who have already started their course also know about it. It is about demystifying student finance and understanding the difference between the perception and reality of the proposals before your Lordships' House, and of understanding what is available. That is a critical part of it.

I say to my noble friend Lord Puttnam that the Government are already helping students in this area. I accept that the Government have a role to play in this. We have a website which gives information to parents, students, advisers and administrators on the range of support available. The "Aim Higher" portal provides information about what and where to study, how to apply, what it will cost and so forth. As has already been indicated, the National Union of Students is developing an easy-to-use guide on higher education, which helps people navigate their way to the wide range of information available, prompting students to ask the right questions.

Some institutions, as my noble friend said, have already developed quite innovative ways of ensuring that students find out about support. I can think of one that was brought to my attention, Edge Hill College of Higher Education, which has a computer-based interactive budget sheet that helps students understand and get an image of their finances, so they can see what position they are actually in. There are lots of good ideas, and this is really important.

Many institutions provide debt advice, ensuring that vulnerable students are given thorough, targeted advice by trained individuals. Many of these are members of the National Association of Student Money Advisors, an important body. This is especially important in terms of credit card advice, or other financial complications. The advice is highly valuable. It is good practice, and we hope that institutions will learn from each other in carrying it out. There is nothing in the Bill which discourages that activity, and neither would we want there to be.

Debt advisers have to be licensed by the Office of Fair Trading, as must institutions which offer these services to their students, and I hesitate to place a regulatory burden on institutions in respect of this. There is nothing to stop an institution from including debt advice as part of its access plan, but I do not think it right to force that upon institutions. I think that is too great a burden, although I accept this work is important.

There are technical difficulties with my noble friend's Amendment No. 87A. I am not going to go into those. I think the noble Lord is probing to see where we want to go. I am concerned that we are not unreasonable in the demands we make on institutions. Some may well provide services to their graduates, but to place a legal obligation on them seems onerous. There is no cut off point when their obligations to graduates cease, and it could be indefinite, which I am sure is not my noble friend's intention.

I am interested in what my noble friend Lord Puttnam has said about the role of other institutions, not least the banks. What feels like a very long time ago, I was working with the National Association of Citizens Advice Bureaux in developing the debt cancellation by, I think, the National Westminster Bank, and I helped to broker the work that they did. I understand the relevance and importance of this, and many banks provide support and advice in any event. I am sure that they will continue to deliberate on how best we might add to what we already provide, and talk to business and others about what more we can do.

I am not sure a national helpline is within my gift to offer my noble friend at this stage, but the point he makes about the responsibility of government, continually to look at the support we give on the websites and elsewhere, is absolutely right. But I hope—on the basis of understanding that we do not want to make this a burden on institutions, while recognising good practice and wishing to promote it—he will be able to withdraw his amendment.

6.15 p.m.

Baroness Warwick of Undercliffe

Can my noble friend confirm that bursaries provided by institutions to their students—including those which OFFA will require them to provide—will not be taken into account when those students apply for means-tested benefits? Could the Minister further confirm that the combined higher education grant, totalling £2,700, will also be disregarded by the Department for Work and Pensions in assessing eligibility for benefits?

Baroness Ashton of Upholland

I shall respond to that point, which is tangential. My noble friend gave me notice that she planned to raise the point so that I could have the relevant information before me. We are looking actively at this with the Department for Work and Pensions. Members of the Committee will know that only a small proportion of students receive benefits, but they are the most vulnerable groups—lone parents and those with disabilities.

Fees support and targeted support are not set against benefits, but support for living costs could be taken into account. We have reached an understanding for new students in 2004–05 that the higher education grant will not be taken into account in assessing entitlement to means-tested benefits. We are working closely with the Department for Work and Pensions to ensure that students receive real benefit from the grant and bursary and to reach agreement about the arrangements in a similar way.

The Lord Bishop of St Albans

I apologise to the Committee for being absent at the beginning of the debate. I want to speak in support of the amendment. At Second Reading, the noble Lord, Lord Puttnam, spoke of the important role that the House has in highlighting the possible unintended consequences of the legislation before it. He referred to the Secretary of State's clear statement that social equity lies at the heart of the proposals for change. Yet we cannot deny the historic aversion to debt among many people. That aversion may have a negative effect on entry levels, particularly in economically vulnerable areas.

As the right reverend Prelate the Bishop of Portsmouth and others on these Benches have made clear, we share the concerns of the noble Lord, Lord Puttnam, about debt aversion and I am pleased to support his amendment. In the Second Reading debate, the right reverend Prelate the Bishop of Portsmouth said that people might well be put off by the prospect of finding themselves at graduation owing substantial amounts of money. He said, perhaps people need to be educated for debt".—[Official Report, 19/4/04; col. 42.] Vital though financial assistance is for everyone to participate fully in higher education in the future, there is a need for a kind of support which goes well beyond pounds and pence. The amendment underlines that. We are calling not simply for assistance, but also for advice.

The point is well made that our students will not incur a debt in the traditional sense of the word because, if necessary, after 25 years that "debt" will be written off while the benefit of receiving higher education will remain. The fact remains that many people will perceive it as a debt being incurred and some may not enter or remain in higher education for that reason.

Therefore, in stressing the need for personal support that includes advice as well as money or information, the amendment draws attention to two important issues. First, the work already carried out by many universities in offering financial advice and support to their students. That clearly needs to be available to everyone. Secondly, the important truth that the purposes of higher education are far more than economic ones. They go beyond individual personal fulfilment in serving the needs of the economy, important though those are, and they extend to promoting the common good.

The right reverend Prelates the Bishop of Portsmouth and the Bishop of Manchester and others have suggested that the purposes of higher education must include promoting the spiritual, moral and cultural well-being of individuals and society. And so, too, the issue here is not just about money but about the well-being of the community of students—and, indeed, graduates, as the noble Lord's next amendment makes clear.

The Minister, in responding to comments made at Second Reading by several noble Lords about values and purposes, made clear that people should read the UNESCO normative statement on higher education, which the Government signed in 1998. Our attention having been drawn to it in Article 1—which concerns the mission to educate, to train and to undertake research—we were pleased to discover that the very first core mission and value is: to educate highly-qualified graduates and responsible citizens able to meet the needs of all sectors of human society". Citizenship, as many young people in our schools are learning, is about responsibility, community and the common good. If we as a nation are to expect our students to be responsible citizens, able to meet the needs of all sectors of human society, then we must make certain that we take our responsibilities seriously in meeting their needs as best we can during their progress through higher education. Surely that should include offering not just money and information about financial assistance, but actually advice on how to cope with the new financial realities that face students in higher education in our country today.

Baroness Sharp of Guildford

I refer to the answer that the Minister gave to the amendment of the noble Lord, Lord Puttnam. She made the distinction between advice and financial assistance. As I understand it, the argument she was making was that there is no need to add advice to the words already in the Bill because to do so would involve the complication that it would mean advice regulated under the DTI—official debt advice that would have to be regulated. I find this slightly surprising because the citizens advice bureaux do provide, as she rightly pointed out, extensive debt advice. I did not think they came under the DTI's regulatory scheme—but I may be wrong here. Can the Minister advise on this? There does seem to be a distinction between advice and just assistance. Therefore, the noble Lord, Lord Puttnam, and the right reverend Prelate are right to ask that there should be advice as well as just assistance.

Baroness Ashton of Upholland

I will attempt to answer, but not surprisingly I do not know about the citizens advice bureaux. I will find out and of course make sure that I pass that to the noble Baroness. I was saying that we have lots of institutions who already provide advice, and many of them are members of the National Association of Student Money Advisors. My understanding is that if we were to move forward in the way proposed in this amendment we would be requiring those who offer advice to be licensed by the Office of Fair Trading. I am sure that is the result of the way in which this is framed, but again I shall make sure that I give chapter and verse on that to the noble Baroness.

These are important issues. The question is whether the amendment represents the most appropriate way to proceed, and I remain unconvinced that we should regulate in this way. I have already said that universities can put forward what they wish in terms of access plans.

I say to the right reverend Prelate that I have responded at length to the amendment. I will not go over it all again, for the benefit of other noble Lords. I have made clear what the Government are already doing. We have discussed some of the good practice followed by institutions. I have already said that we will continue to look at what more the Government might be able to do, and I am grateful for the right reverend Prelate's comments.

Lord Puttnam

I thank all those Members of your Lordship's House who have supported this amendment. I picked up three or four words that I would like to stress once more. The underlying purpose of this Bill is social equity, to get people into universities who in the past, for one reason or another, may have been able in terms of their intellectual capacity but have not made the move. That includes their parents. I point out to the noble Baroness, Lady Seccombe, that we are talking about a sum of money which for many people in this country is the equivalent of the cost of their parents' house. These are not small sums—for many people these are terrifying sums.

I will of course listen to what the Government come back with, and I am sure they will come back with something. However, the words I want to stress are "high quality". I want the bar high, not a situation where there is a race to the bottom by the institutions and the Government because of cost. I want very high quality advice, however the Government wish to define advice. Also, the Government must acknowledge that they must be the default provider. It is the Government who have brought tuition fees into being, therefore the Government must be the default provider in ensuring the social equity they seek is arrived at as a result of the Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 87 to 91 not moved.]

Clause 31 agreed to.

Clause 32 [Approval of plans]:

[Amendments Nos. 92 and 92A not moved.]

Clause 32 agreed to.

Clause 33 [Duration of plans]:

[Amendments Nos. 93 and 93A not moved.]

Clause 33 agreed to.

Clause 34 [Variation of plans]:

[Amendment No. 93B not moved.]

On Question, Whether Clause 34 shall stand part of the Bill?

Baroness Perry of Southwark

My Lords, I wish to object to Clauses 34 to 36 standing part of the Bill. These three clauses together go to the very heart of what we mean by interference by the Secretary of State in academic freedom. The Secretary of State is taking powers in this Bill to concern himself or herself with the details of the existing plans and with the enforcement of those plans by various kinds of penalties. It becomes quite clear in Section 35(2) that the Secretary of State is going to be pulling the strings in terms of the way in which the Director of Fair Access performs her or his job and exercises her or his powers.

I should make it clear that we have no objection whatever to the Secretary of State taking powers in relation to the requirements under Clause 23(1)(a). Quite clearly, where universities are setting their fees within financial restrictions, it is right and proper for the Government to be involved. We object to the involvement of the Secretary of State in the plans, the way plans are treated, the way regulations for making the plans are made and the way penalties for departing from the plans are also made by regulations. Although we have been told many times by the Minister that the Director of Fair Access will be at arm's length from the Secretary of State, it is quite impossible to believe that in the terms of these clauses. Clause 36 deals with Wales of course, in which it is not the Secretary of State who is named but the Welsh Assembly.

In none of these clauses is there any hope of preserving the academic freedom of universities. As I have said, this House has a very proud tradition of protecting academic freedom, of laying the boundaries to it. I do not believe that the amendments which the noble Baroness, Lady Warwick, put forward—and the Government accepted—go nearly far enough. As long as these clauses are on the face of the Bill. I believe academic freedom is under genuine threat. I beg to move.

6.30 p.m.

Baroness Ashton of Upholland

I am always sorry when I find myself in disagreement with the noble Baroness, Lady Perry, for whom I have enormous respect, not least for her work in the field of education, which is ongoing and ever-continuing. However, I disagree with her fundamentally about the role of the Director of Fair Access, and it is where we part company.

I pay tribute to the excellent work carried out by many of our higher education institutions and to much of the work that goes on outside the higher education sector in promoting and supporting the best and brightest of our students, wherever they come from. That work enables students to achieve the kind of high-quality university education from which many of your Lordships have benefited and which we all recognise to be an important part of the development of individuals and of our economy. It also enables this nation to develop its work within the wider world. It is within that context that we look to what this office can contribute.

We have taken a step towards what I think many institutions consider to be the right direction in terms of the variability of fees so that institutions feel able, to a large extent, to control the financing that comes from that. We believe that that is right, but we also consider it to be right and responsible for government to ensure that, along the way, there are no unintended consequences, about which noble Lords other than the noble Baroness, Lady Perry, are concerned, as well as those in another place and organisations and individuals outside Westminster.

The clause is about putting together a framework that we believe will do the very best by our institutions and will also help and support our students. We believe that the critical independence of the Director of Fair Access will enable those institutions to work closely with HEFCE, as we have outlined. As I know the noble Baroness has sought through some of her amendments, the director will be as much an adviser as anything else. He will develop that relationship and help to support more work so that students from whatever background, as I said, can benefit from university education if they are able to achieve the right levels of academic ability.

I believe that the clause is an important part of the Bill. The Bill cannot continue on its way if the clause is taken out of it. The clause is part and parcel of what the Government believe must happen in order to combine what we offer our institutions with what we offer our students.

I shall not go through all the different parts of the clause because, as the noble Baroness said, I think that this is an issue of principle. If I can persuade her of the importance of the clause between now and other stages of the Bill, I shall certainly endeavour to do so. I value her opinions greatly and I shall want to try to persuade her that what we have done in respect of the issue of independence and also by accepting the amendments—not only of my noble friend but also of the noble Lord, Lord Dearing—relating to admissions and academic freedom is critical. I want to make her as comfortable as I possibly can about the role and independence of the office. We consider that to be important and that is why the clause should remain part of the Bill.

Baroness Seccombe

My noble friend Lady Perry has expressed very strongly her views on the amendments. We support her wholeheartedly and want to express our grave concerns about the powers of the Director of Fair Access.

Baroness Carnegy of Lour

Can the noble Baroness tell someone like me, who is outside the system but who is very concerned about the academic freedom of the universities and about the powers of OFFA, how she can say that OFFA is independent in view of Clause 35(2)? That subsection states that the Secretary of State may, by regulations, lay down the matters to which the director must have regard in exercising his powers, the procedure to be followed, and the financial requirements that may be specified in the sanctions.

It seems to me that—in this respect, at least—it is wrong to stand up and say that OFFA is independent: OFFA is the creature of the Secretary of State. I think that the Government should admit that and be honest with the universities, the public and the students. OFFA is not independent; there is no question about that. That is at the heart of the Bill. The noble Baroness is right: this is what the Bill seems to be all about. But it concerns me very much and I know that it concerns many universities, although, apart from my noble friend, at present they find it difficult to say so.

Lord Brooke of Sutton Mandeville

I have not previously cast the Minister in the role of Sisyphus but, not only in the debates that we had a day or so ago but also on this occasion, I have found her seeking to push a substantial mound of stone uphill only for those of us who are watching to see it roll back again. I remember a debate that we had at an earlier stage in which I said that I was more than partially reassured by the words which the Minister had uttered. I do not think that on that occasion she had cast her eyes forward to the clauses that we are now considering. However, having been partially reassured, I then become more than partially unreassured by the clauses that we have in front of us today.

Twenty years ago, I sat in a quite exceptionally lengthy conclave with the late, great Sir Keith Joseph. My noble friend Lady Perry was present at those meetings in another capacity. We spent hours and hours, as anyone would have expected the late, great Sir Keith Joseph to do, discussing the independence of universities in the context of the issue of tenure, which we were addressing. I should like to feel that, within the Department for Education and Skills, the same kind of concern about the independence of universities had been exercised in debates which were just as long before those in the department came forward with this clause. I certainly join my noble friend Lady Perry in saying that all my anxieties have been re-aroused by the way in which these clauses are phrased.

Baroness Sharp of Guildford

We on these Benches also have some sympathy with the views expressed by the noble Baroness, Lady Perry. It seems to me that the Minister was saying that there was no dispute about there being a Director of Fair Access, about the fact that the director should have plans or that plans should be submitted. Within the context of the series of amendments put forward by the noble Baroness, Lady Perry, which frequently had the names of the noble Lords, Lord Forsyth and Lord Sutherland, attached to them, there is no dispute about the fact that there should be access plans and that universities should prepare those plans and submit them to the director. Rather sensibly, the suggestion is that they should form part of the universities' overall strategic planning provisions.

Clause 35 is far more primitive. Admittedly, that is perhaps the stick with which the Government seek to make effective what they want to do, but it seems to me to be an unnecessarily strong stick and subsection (2) gives very wide powers to the Secretary of State to act as he sees fit. As I said, I share some of the doubts that have been cast about whether that is really necessary.

Lord Renfrew of Kaimsthorn

I support the point made by my noble friend Lady Perry and other noble Lords who have spoken. I remember debates in this House a decade ago when matters of academic freedom were hotly contested. A number of us who were then supporters of the government of the day found it necessary to oppose that government on one or two matters when it seemed that academic freedom was being infringed.

I shall be very interested to hear what the Minister says in reply to the question posed by my noble friend Lady Carnegy. It is very difficult to see this provision in Clause 35(2) as other than interventionist. It states: The Secretary of State may by regulations make provision…as to the matters to which the Director must, or may not, have regard in exercising his powers". Nor is there any safeguard with regard to timing. If, at some moment, the Secretary of State finds that he is dissatisfied by a specific decision of the director, it seems to me that he may at once impose regulations, which may well be of a general nature but could apply in a specific case and could be brought to bear in a specific case.

So it is difficult to see how the clause is other than one that invites intervention by the Secretary of State in the working of the director and therefore virtually invites him to intervene in specific matters in specific universities and thereby clearly to undermine academic freedom. I shall be most interested to hear the Minister's reply to my noble friend's question.

Lord Dearing

If the requirements are to have substance then there must be some consequence if they are not met. I should think that that is what Clause 35(1) is about. If we have the one then it is arguable there should be the other. As to the regulating power, as one who sat in desks where the telephone was in contact with the department, I would much rather see what was coming my way in public in a regulation than via a word over the phone or a letter and persuasion. Then it is in the open and the Secretary of State can be held accountable for his doings.

Baroness Carnegy of Lour

The noble Lord, Lord Dearing, may be content with the whole thing, but does he agree that OFFA is independent?

Lord Dearing

It is essentially independent but that does not mean that the Secretary of State should not be able to pronounce in a public way—for example, when the noble Baroness, Lady Perry, proposed that OFFA should have a role in training, I suggested that it might be desirable for the Secretary of State to cool the ardour of an over-zealous trainer.

Baroness Ashton of Upholland

I shall try to address a couple of the important points raised. I would say to the noble Baroness, Lady Carnegy, that there is nothing dishonest in anything that I say in Committee or indeed in the Government's intentions. The noble Baroness may disagree with me, which is completely acceptable—I regard her very warmly—but it is not dishonesty, which is a different proposition.

We say that the director is independent and rightly so. There is a regulatory framework. We think it is important, when we set up anything, that it is clear what the office we are describing is meant to do and that, as the noble Lord, Lord Dearing said, we set out clearly the consequences.

We expect that the relationship between the Director of Fair Access and the institutions will be a positive experience for everyone. We recognise, as I said in my opening remarks, the invaluable work that institutions are doing to ensure that students who have the abilities apply to them. I pay tribute to them as I have already done. But we think it is important to set it up in this way and that the way we have created it—particularly with the amendments that we have accepted—has expressed even more firmly in the Bill our commitment to independence and academic freedom.

We want to make sure, as I have repeatedly said—and I hope that the matter has been put to rest by our acceptance of the amendment—that this is about applications and not admissions. If I had the classical education that I clearly should have done to deal with the always wonderful literary allusions that begin the contributions of the noble Lord, Lord Brooke, perhaps I would have been able to come up with something wittier than I am able to at this point. It is sad but true that my education does not run to that extent.

We have tried to be clear about the independent role. It is not about the Secretary of State dictating. It is about affirmative resolutions, which are a critical part of ensuring transparency and clarity of view. Although the noble Baroness, Lady Perry, may disagree with us, which is her prerogative from her experience, we believe that this is a critical part of making sure that we can move forward in a positive way in our desire to develop our higher education sector and support it as best we can.

Baroness Perry of Southwark

I am grateful to the many noble Lords who have supported the thought behind the clause stand part debate. I am sorry that the Minister and I seem bound to disagree over this part of the Bill. We have no disagreement on variable fees and over the importance of OFFA. I have never moved any amendment that suggested that OFFA should disappear, much though it might be nice if it did.

6.45 p.m.

I recognise that it is important to have some guarantee that the hugely increased burden on students is not used as a way of keeping students from poorer families out of higher education. I am most sorry about the tone of the Bill, which is encapsulated in these and earlier clauses, that the universities are simply not to be trusted and OFFA has to be given punitive powers in order to make them comply. I do not see things that way and I do not believe that that is the way universities behave.

There is undoubtedly a great deal to be learned about the best way to go about increasing applications from under-represented groups and so on, and I would like to see OFFA engaging with that. I do not like the interference and the encroachment on academic freedom that runs throughout the Bill and we shall have to continue to disagree.

Clause 34 agreed to.

Clause 35 [Enforcement of plans: England]

[Amendments Nos. 94 to 99 not moved.]

Lord Butler of Brockwell moved Amendment No. 99A: Page 16, line 19, at end insert— provided that an institution shall not be regarded as failing to comply with the requirement if it has taken all reasonable steps to comply.

The noble Lord said: The noble Lord said: In moving the amendment I declare an interest as head of a college at Oxford University. This is the only amendment to the Bill with which I have troubled your Lordships and the Government. I hope that on those grounds alone it may attract some sympathy and support. Its purpose is to write into the Bill an assurance that has been offered both by the Minister in earlier debates and by the Minister for higher education in another place.

It says that when the Director of Fair Access is considering whether to penalise an institution for failing to comply, the institution should not be regarded as failing to comply if it has taken all reasonable steps to do so. The purpose is to remove a fear on the part of institutions that in a situation when they have done everything that they promised to do in the plan agreed with the director to provide fair access, nevertheless they could be penalised because the social mix of the students they admit comes out in a particular way.

Assurances have been given by the Government that that is not their intention. In the debate on not constraining the freedom of universities over admissions, the Minister said: In talking to the universities, in particular, we have been very clear that this is about inputs and not outputs… We recognise that some of the work that they do may have no impact on what happens in an individual institution, but it might have a broader impact on a group of universities as the university sector works with students… That is why we are very clear that the director should recognise that this is about inputs and not about outputs". —[Official Report, 17/5/04, col. 617.]

The Minister for Higher Education for another place was even more explicit in Committee. He said: It is not a matter of the access regulator saying, 'Well, you've done everything you said you would do, but your social class mix has not changed, therefore you will be punished"'.—[Official Report, Commons Standing Committee H, 2/5/04; col. 384.]

These are the most explicit assurances that have been given by Ministers. They are extremely welcome, but I think it would greatly improve the Bill and certainly reduce anxieties on this account if they could be written on to the face of the Bill as a constraint on the director to penalise institutions of higher education in these circumstances. That is the purpose of the amendment. I beg to move.

Baroness O'Neill of Bengarve

This is ultimately a very simple point about OFFA and I hope very much that it may be one that the Minister is able to support. We have been assured, as the noble Lord, Lord Butler, reminded us, that the task of OFFA is access not admissions. However, "access" is a word not without ambiguities. Those of us who support the amendment believe that without it, it remains unclear whether fines can be levied on institutions that do not succeed in increasing the proportions of under-represented groups despite their best efforts on access activities.

We have to acknowledge that the social composition of the student body of a university is a function of many things other than the admissions process and admissions policies. In particular, it is a function of student choice and student preparation as well as institutional policy.

Students may choose where they go to study because they want to live at home or because they want to live not at home; because they want to live in a big city with all its excitement or because they want to live in a more remote area of the country which perhaps they never enjoyed before; because they want a large, international research institution as the atmosphere in which they do their undergraduate work or because they want somewhere smaller, cosier and more intimate; because they want a place that has a high proportion of vocational courses and a certain atmosphere of vocational seriousness or because they want a place that is steeped in scientific work. All those are very reasonable things for students to want, but given the diversity of preparation of different groups of students, they are not all matters that can be simply adjusted by a given university.

I believe that certain subjects in higher education institutions may have great difficulty in increasing the proportion of their students that come from underrepresented groups. More generally, because this is the way the Bill is framed, certain subjects will have a very hard time increasing their proportion of underrepresented groups. It is not the number of people who universities can recruit—particularly into the physical sciences, engineering and mathematics, and there may be rather fewer mature students who have had the preparation, as just an example, that makes it possible for them to do those degrees—it is simply a question of the combination of preparation and student choice and its impact on institutional success.

We do not want to repeat the weary road of the United States when it engaged in affirmative action and matters ended up before the courts because it was interpreted by some institutions as requiring them to admit in a way that was not solely dependent on the qualification, merit, aspiration and potential of the young person. I believe that universities should not he liable to sanctions for matters that are beyond their control.

Lord Forsyth of Drumlean

I very much hope that the Minister will be able to accept the amendment moved by the noble Lord, Lord Butler of Brockwell, which seems to me eminently sensible. Also, it has the merit of enshrining on the face of the Bill commitments that were made in the other place. I also think—I was a little disappointed by the Minister's response to the previous debate—that the amendment guides the Bill in the right direction on the role that OFFA should play, if we have to have it. It should not be a kind of authoritarian organisation taking a view but an organisation which encourages best practice and encourages people to do their best. The amendment would provide a welcome balance, which I would have thought would place the role of OFFA on a much better basis with the institutions. If OFFA is not able to establish a good relationship with those institutions, both will fail in their purpose.

Lord Sutherland of Houndwood

I speak in support of the amendment but note that Amendment No. 103, tabled in my name, has been grouped with this one and I am quite content to speak to that too.

I support Amendment No. 99A for two reasons, which have been clearly articulated. First, as has been said many times in the debate on the Bill in both places, not all is in the control of universities. That principle being accepted, we must assume that universities will take all reasonable steps. Secondly, sometimes reasonable steps are not simply taken by one university for the benefit of that university, but by a group of universities in a particular location—a city, for example. To my knowledge it is quite a regular event that a group of universities will together put on access courses and early courses in the summer. Students will be attracted to those courses in the hope that they will go to one of the universities sponsoring a course but not necessarily any particular one. In that case, one has half a dozen universities taking very reasonable steps. The beneficiary may be one or two universities. That is an additional reason for focusing on the quality of the steps taken rather than hinting at the outcomes.

Amendment No. 103, grouped with this amendment, calls for an appeal mechanism. The Minister has assured us today that she wants to make us as comfortable as she possibly can with Clauses 34, 35 and 36. An appropriate appeal mechanism would make me much more comfortable, though I still have some questions on Clause 35.

When I first read the Bill I assumed that the absence of an appeal procedure against the decisions of the director of OFFA was an oversight, caused by so much excitement being created about other aspects of the Bill. However, I suspect not. The principle for an appeal mechanism is very clear. It is a matter of justice being done and being seen to be done. If there is no appeal mechanism against the judgment of what may be effectively one individual which could cause serious financial difficulties for universities—I shall comment on those shortly—we are failing to ensure that justice is being done and being seen to be done.

The detailed specifications in the amendment for illustrative purposes clearly would need further discussion and consideration if the principle of the amendment were accepted. Not least, for example, we would have to consider how it applied in Wales, to which the amendment does not refer. However, I should be happy to have comment and advice on the nature of the appeal mechanism and, indeed, on the way it might best be carried out and by whom.

It might be argued—indeed, I have heard hints of both in the course of our discussions over the past week and a half—that there is always the option for judicial review. That is one possibility. Often it is hinted that we, whoever "we" are, are really quite gentle and kind in our intentions and that we do not want to legislate for possible failure on the part of universities and therefore for all the panoply and traditional burdens of appeal mechanisms, that is to say not always assuming the worst. But today we have heard talk of the importance of there being consequences, and consequences being seen to be real consequences. Indeed, I am sure that if we look at last Thursday's Hansard, the Minister used those words in a very specific and clearly directed way; that is, that universities must be aware that there will be consequences of this whole process.

If there are to be consequences, clearly, having reassurances that an appeal mechanism is not necessary is inadequate. There is a stick here, and if there is one, we want to be sure that it is used only and properly according to the rules that everyone understands, which surely include the right of appeal.

7 p.m.

There is the power to fine universities substantial sums of money and a power to prevent universities levying any additional or top-up fees. The whole point of the Bill is that the universities need that money. So I believe that there is significant power in the Bill requiring a proper mechanism to ensure that any judgments exercising that power are legitimate and well framed.

Judicial review is a backstop. But we all know that it is expensive and time-consuming. The costs involved for institutions putting something through judicial review will be very high indeed. In every way it is burdensome—except perhaps for those who are professionally employed to put cases.

There is an issue here. I do not think that judicial review is adequate. For example, in the RAE where judicial review is available, and where issues are taken very seriously, to my knowledge it has been used once in 18 years. That is not an endorsement of the correctness of every judgment made by RAE panels over those 18 years, it is simply that the candle is not worth the effort that would be involved. The difference between the regulator for OFFA and the RAE is that the director of OFFA can fine universities for money which they have otherwise legitimately earned, and in the case of the RAE it is a question of additional money being allocated. So I put the case as fundamentally an expression of what natural justice requires, that there be some form of appeal against the decisions of potentially one individual.

Lord MacGregor of Pulham Market

I wish to speak particularly to Amendment No. 103, to which I have attached my name, but I also support Amendment No. 99A. Indeed, in our debate immediately after dinner on the last occasion when we debated these matters, I expressed some concern that the amendment the Government put forward, and which was agreed, did not go far enough. It is a thin dividing line between access and admissions. I can well see that a regulator or a government that does not think that the admissions process is delivering what they hope from the access arrangements might cross that dividing line. So I support Amendment No. 99A.

However, I want particularly to talk to Amendment No. 103 and from the point of view of being a member of your Lordships' Select Committee on the Constitution, which recently produced a report—The Regulatory State: Ensuring its Accountability. That is very relevant to our debate on Amendment No. 103. My noble friend Lord Norton of Louth, who was present earlier, as chairman of that committee I am sure would wish to have spoken—and I hope would speak in the same vein, but he had to chair another committee.

The point is that the director is a regulator. The committee spent many months looking at the major regulators and listening to the providers, those regulated, consumer groups and so on. Our report is based on a huge amount of detailed evidence of the experience of regulators. The focus of that evidence was exactly this issue; that strong complaints were being made where a regulator was in existence and an appeal system was not available. The Government accept that because increasingly when regulators are established, or there are changes made to regulators, an appeal system of some sort is put in place.

It was also very clear that it was not considered fair or appropriate that the appeal process should be within the organisation itself. It is vital that it is independent and external.

I very much agree with the noble Lord, Lord Sutherland, that judicial review is not sufficient and is not a response to this amendment. Let us be frank; judicial review is fundamentally about process and not about substance or the merits of the case. The issue that may well appear here is that it will be an issue of substance or merits and not process. That, too, came out very clearly from the evidence we took.

Much of what I would wish to say is in Chapter 11 of our report. In view of the hour, I shall not read it. But there is no doubt that it was regarded as one of the most important chapters in our report and is why I feel so strongly on this.

In the clause stand part debate, the Minister said that she hoped and believed that the experience will be a positive one. What if it is not? Suppose some universities believe they have been unfairly treated? As the noble Lord, Lord Sutherland, pointed out, the penalties and sanctions in the Bill may be rarely applied, but where they are they could be very formidable—and formidable in their effect on the individual institution. It is therefore important that there is an external appeal system. Let us face it, a great deal of power will exist in the hands of the director. That is why the independent appeal system is so important.

We recommended in our report a regulation appeal tribunal for all those regulated areas that do not yet have an appeal system. I do not think that that would be appropriate in this case, and, indeed, one is not in existence. One will have to await the Government's response on that recommendation. In this case it is a specific area; it is a specialist, non-economic, non-competition area and therefore a different type of appeal system needs to be established.

The noble Lord, Lord Sutherland, referred to the costs to universities. I think it is very important that any appeal process should avoid heavy costs. I believe that is why he inserted a 12-week timetable within the appeal process, which I think is entirely right. The details, as he said, may not be exactly right. I am concerned about the membership of whatever appeal process is set up because it is vital that that appeal system is seen to be totally independent. But these are details which can be sorted out between now and Report. I believe the principle is very important, and I hope that the Government will accept it.

Lord Renfrew of Kaimsthorn

I should like to ask the Minister a question in supporting these very necessary amendments, which I hope we shall see on the face of the Bill, whether or not we do so this evening. I am a little pessimistic about the work of the Director of Fair Access. I see that he can work with university departments to encourage them to produce plans with which he is content.

I do not understand how the director will form a judgment at the end of the day on whether the plans have been successful. What criteria does the director employ in judging whether his project is successful? I am extremely pessimistic about the whole enterprise. I do not want to go too far off the point, but if we are to have these top-up fees, which many of us warmly support, essentially they are to be paid by loans, which, as we heard in the earlier debate, is debt that students may be very concerned about. It seems to me that it will be a difficult project for the Director of Fair Access to encourage a more favourable social class mix—to use the phrase which the noble Lord, Lord Butler of Brockwell, quoted from the Minister for Higher Education.

So I think it is very possible that there will be cases where the Director of Fair Access will find that his project is not succeeding. In fact I predict that there will be many such cases. I fear that there will also be cases where he does not realise or is not willing to accept that that is a product of the Sisyphean quality of the enterprise, but when he may feel it must he a defect in the plans. So I am very concerned that the director may feel that sometimes the problem lies in the plan rather than in the project—about which l am pessimistic. That is why I find these very necessary safeguards. I shall certainly be very interested to hear from the Minister how she imagines the Director of Fair Access is going to evaluate the suitability of plans and whether the plans are in fact working.

Baroness Warwick of Undercliffe

I support the amendments. In view of the lateness of the hour I shall be extremely brief. As the noble Lord, Lord Butler, said, the Minister for Higher Education when pressed on this matter in Standing Committee in another place said that in such a situation no institution would be penalised. I cannot think of any reason why the Government should not accept that.

The amendment of the noble Lord, Lord Sutherland, also has my support. I hope that in practice institutions and OFFA will be able to negotiate together and settle their differences. However, we must be ready for a worst-case scenario in which an institution and OFFA are not able to agree. I do not want to rehearse the arguments that have been made particularly about judicial review. An independent appeal mechanism, like the one that is proposed in the amendment, would be a valuable addition to the system.

Baroness Sharp of Guildford

We on these Benches also support the two amendments. In relation to the first amendment, in our earlier debate on the clause as a whole, we talked about how punitive Clause 35 is. To some extent, the amendment proposed by the noble Lord, Lord Butler, helps to ameliorate the punitive nature of the clause. I endorse the arguments put forward by noble Lords about the need for an independent appeal mechanism. It seems absurd that we should have to go to judicial review on such issues. An appeal mechanism within the framework of the system is far more satisfactory.

Baroness Blackstone

I am afraid that I shall add a little note of dissent to the debate. I am reluctant to do so because I understand the motives behind both of the amendments. However, I shall focus on the amendment that relates to appeals. I assume that my noble friend will support or accept the amendment tabled by the noble Lord, Lord Butler of Brockwell, but I do not know that she will. If she does, that will be a very substantial concession and it will lead to questions that were put very pertinently by the noble Lord, Lord Renfrew.

I am at a loss to understand quite how the Director of Fair Access will decide whether the plans that a university has made to promote access are working if he or she is not allowed to look at the outcome. If a university provides all kind of access arrangements, runs summer schools and gets more applications from a wider range of students, that is all well and good. But if it does not accept a wider range of students, that is a problem.

However, if the Government accept the amendment tabled by the noble Lord, Lord Butler of Brockwell, I cannot see how the Director of Fair Access can then pursue a situation where, in spite of all the different attempts to comply with the "reasonable steps" that have been made, there is still no change in behaviour when it comes to looking more favourably at applicants from state schools or social classes that are currently under-represented.

Let us suppose that a university is looking at a state school student who has three A grades at A-level and that student is still not accepted because there is another student from an independent school who has also got three A grades but appears to be much more fluent and articulate at interview. We know that that sort of thing happens. We have all been involved in making those kinds of difficult decisions.

However, my real concern is the proposal for an appeal system that was made by the noble Lord, Lord Sutherland, which has been widely supported. If we are to go down that road, we must be very much clearer than we have been so far in this debate about the grounds of appeal. Otherwise, why should not any university automatically appeal if it gets a judgment that goes against it? As a vice-chancellor, I would certainly do that. We must be much clearer about the processes and the costs.

I am not very happy about the proposal in the amendment that there should be a panel of three people; that is, one person proposed by the Secretary of State, one proposed by Universities UK and a senior judge. If I were to be proposed by Universities UK—heaven forbid, I am sure that I never will be—I would feel, in a sense of tribal loyalty, that I would have to support my colleagues who were appealing. As currently proposed, the whole mechanism is flawed. We should not go down this road without a lot more thought about the costs and effects and what the actual sensible process of introducing an appeals procedure should involve.

7.15 p.m.

Baroness Howe of Idlicote

I was very much encouraged by what the noble Baroness, Lady Blackstone, said earlier when she indicated that perhaps the amendment moved by my noble friend Lord Butler of Brockwell would be accepted. I certainly want to support that amendment for all the eminently sensible reasons that have been given, which merely make it clear that all reasonable steps had been complied with, the penalty would not be enforced.

I see the point about appeals. Perhaps that amendment will have to be redrawn. I was extremely surprised to hear the noble Baroness, Lady Blackstone, make those comments. Surely, the judgment will have already been accepted by the director of OFFA. If the outcome is not quite what is expected, there should be some method by which a test of reasonableness is employed.

Baroness Carnegy of Lour

The noble Baroness, Lady Blackstone, seemed to think that if the amendment put forward by the noble Lord, Lord Butler, was accepted, that would make everything all right. But, again, it is a subjective judgment whether "all reasonable steps to comply" have been taken. It is wrong that a university might lose the ability to raise its fees, which are so crucial, or be fined £500,000 on a subjective judgment, even if the amendment put forward by the noble Lord, Lord Butler, is in place.

The noble Baroness thinks that everyone will appeal. I expect that would be true if the amendment is as simple as Amendment No. 103A tabled by my noble friend. But if the amendment is more precise, it would be quite possible to put that in. I cannot see how the system can operate without some sort of appeals system. If the Government are not prepared to accept this, I hope that the Committee will make that decision and that it will stand. Otherwise, the system will be grossly unfair. I should have thought that the noble Baroness, Lady Blackstone, would be feeling herself suffering already for the lack of appeal.

Baroness Blackstone

I should like to respond to the noble Baroness, Lady Carnegy. I very much hope that if we have OFFA, it will not be just subjective and will make its judgments on the basis of all the objective evidence that the Director of Fair Access will be collecting.

Lord MacGregor of Pulham Market

If we suppose that the director feels that the institution has not "taken all reasonable steps" and the institution feels that it has, is it not right to have a right of appeal on that point and have an independent judgment, which is not one made within the organisation itself?

Baroness Blackstone

I like to think that if the Director of Fair Access is doing his or her job properly, he or she will make only very considered judgments. I hope that universities will not be over-defensive about the work of OFFA and will try to respond in a positive way in the spirit of being given a view about an objective outside organisation about what that university is doing. We should not be over-defensive about this.

Perhaps I may come back to the issue of the RAE, which was appropriately mentioned by the noble Lord, Lord Sutherland. There is not an appeal mechanism there. Judgments are made as far as possible on an objective basis. Those judgments may sometimes involve some subjectivity. Certainly, very often universities are extremely disappointed with those judgments and they do not agree with them. But they accept them.

The universities lose a great deal of money if they have a big department in, say, the sciences which moves down a grade. They lose even more money if they move down two grades. So the same principle operates there. It has been operating for a very long time. It is widely accepted by the universities, although individual decisions are taken that they may not like. They do not resort to an appeal system. If they did, we would never have a system of selectivity in allocating research funding that would work. It would be clogged up with endless appeals. That is my slight concern about moving down this route in relation to the work of OFFA.

Lord Sutherland of Houndwood

The difference between the RAE and the office and director of OFFA is that the director of OFFA has the capacity to take money from universities already legitimately earned or received by them through the process approved by the funding council. The RAE allocates additional cash on a basis that even its most ardent supporters—and, on the whole, I support it—would not say was objectively right in every case. It is additional cash, not the basic cash from which a deduction is made.

Secondly, I should like to pose a question to the noble Baroness, Lady Blackstone—still, I hope, my noble friend. If the Minister will allow another classical allusion, even Homer nodded. Is it not possible that the director of OFFA might impose a very serious sanction—no top-up fees for you?

Lord Forsyth of Drumlean

I intervene very briefly. I did not speak to Amendment No. 103, which I support, although I have some concerns about the composition of the appeal panel. However, that is a detail—the issues of the appeal itself and the right of appeal are fundamental, for the reasons that my noble friend Lord MacGregor has spelt out. For those noble Lords who have not read the report of the Select Committee on the Constitution, the appeal to the regulator's decision is a very important question.

We owe the noble Baroness, Lady Blackstone, a great debt. Her speech has been very revealing, because it shows what the agenda is. As I listened to her speak, it seemed imperative that the Government accept both these amendments. She highlighted the dangers inherent in the role of OFFA in moving from requiring universities to do everything in their power to encourage wider access to looking at the outcome and then penalising them for not achieving that result. The effect of that would be to interfere in the university's admissions decisions. The noble Baroness shakes her head, but she asked why the director should not be able to look at the outcome. The outcome is not in the hands of the universities unless the director requires that they alter their admissions arrangements in order to get the director's pre-ordained view of what the admissions should be.

There should be a right of appeal on the grounds of natural justice and of ensuring that the Government's assurances that the director of OFFA will not seek to target individual institutions in respect of their admissions policy but will instead seek to encourage good practice in achieving wider access. For both these reasons, it becomes even more important that the Government accede to a right of appeal in this way. The noble Baroness—whether intentionally or not, I do not Know—has, in arguing the contrary case, underlined the reasons why it is imperative that this is done.

Baroness Blackstone

I do not want to prolong the debate for too long but I was trying to respond to the very pertinent question of the noble Lord, Lord Renfrew. Perhaps my noble friend the Minister will respond to this point, because I am not absolutely clear about exactly how OFFA will judge what is working. Presumably there is an expectation that OFFA should be able to do that. I am unclear about how that will work, particularly if the amendment of the noble Lord, Lord Butler, is accepted. I am not opposed to his amendment, but I am puzzled as to how we will make the system operate effectively.

Lord Brooke of Sutton Mandeville

When, some time ago, by a gesture of the hand, I indicated to the noble Baroness, Lady Blackstone, that I hoped that she would speak rather than myself, I did not realise that I would be letting in another seven speeches after hers. I do not begrudge it for a moment—it was quite clearly the right thing to do because her speech occasioned a whole series of subsequent sallies. I am happy for another reason that that should have occurred and that I should find myself, even now, following after her directly.

If I am right in recalling that the definition of an act of God in Blackstone's law dictionary—and I bow to the noble Baroness—is an act which no reasonable man would expect God to commit, then by an inverse logic it seems that the amendment of the noble Lord, Lord Butler, is an act of God condition, which is good for everybody.

I understand what underlies the remarks of the noble Baroness, Lady Blackstone, on Amendment No. 103. The amendment of the noble Lord, Lord Sutherland, supported by my noble friend Lord MacGregor, with a powerful argument in terms of the examination of the regulator by the Constitution Committee, is freestanding. It is not conditional upon the amendment of the noble Lord, Lord Butler. I would regard it as an aid to the Sisyphean task to which I referred earlier.

I apologise to the Minister for having used an allusion with which she was not familiar. Fifteen years ago, when I was on the budget council of the European Union, I worked out that classical literature was the only thing which the 12 countries had in common and therefore I could use it throughout. I apologise if, 15 years later, the habit is still with me. However, I can explain, in a very brief parenthesis, that it is a classical version of snakes and ladders.

My final point goes back to what my noble friend Lord Forsyth said on the last amendment, which relates to trust. I have said before in your Lordships' House that it is my experience that people behave in the way they are treated. The Government are running a risk, if they demonstrate overtly that they do not trust the universities, that the universities might start behaving in a less trustworthy way. Frankly, just as the amendment of the noble Lord, Lord Butler, is good for everybody, any development of untrustworthiness would be bad for everybody.

Baroness Ashton of Upholland

This has been a long and very interesting debate and I am grateful to all Members of the Committee who have spoken. I shall try to keep my comments as brief and pertinent as possible.

The noble Lord, Lord Butler, has raised a very important question. In principle, I am wholly in agreement with him and therefore with all other Members of the Committee who have spoken on this. We have made it clear that we want institutions to include their own milestones for widening access in their plans. We want them to be ambitious in that, for their own institutions, but we cannot have a situation in which the director might impose a sanction on an institution for failing to meet a milestone due to circumstances beyond its control.

The noble Lord, Lord Renfrew, in particular, was interested to know how the director would examine whether institutions had been successful. I refer back to what my right honourable friend Alan Johnson said about inputs, not outputs. In the access plans, we know that institutions have very clear and well worked out propositions for their outreach activities, the kind of financial information they are offering and the bursary schemes that some universities have already proposed. It will be about a recognition that they have done what they said they would.

If the institutions said that they would run summer schools, they will have run them. If they said that they would run outreach programmes, they will be able to show that they have. If they are offering bursaries, they will be able to demonstrate that they have done so. It is a question of input, not output. It is very important to understand that that is what the Director of Fair Access will be looking for.

We have said in our draft guidance that an institution's failure to meet milestones should not, in itself, be grounds for any sanction. It is right that the director must make fair and reasonable decisions and must justify them. This is a general point of law and whether or not we write the amendment into the Bill, these are basic principles that cover any administrative decision. Were the director to ignore these wilfully, I believe that any application for judicial review of his decision would be bound to succeed.

Lord Forsyth of Drumlean

I am most grateful to the Minister. Surely she is not arguing that it would be a legitimate use of scarce funds which are provided for an educational purpose to embark upon a judicial review in order to resolve these matters. Would it not be more sensible to protect the interest by having an appeal procedure?

7.30 p.m.

Baroness Ashton of Upholland

I will come to the appeal process, but I will first finish my remarks about the amendment moved by the noble Lord, Lord Butler.

I am keen to offer further assurances to your Lordships, but I am sorry to tell the noble Lord that there is a technical problem with the amendment. For example, it says that, an institution shall not be regarded as failing to comply with the requirement", placed on it when, under the Bill, a sanction could be deployed only if it had already failed. With his long experience, the noble Lord will know that I cannot accept the amendment as it currently stands if there is a technical problem. I am sorry about that—actually, I am not sorry because that is just the way it is. However, I will discuss the matter with the noble Lord, take this away and look further into what I can do at Report. As I said to the noble Lord, Lord Renfrew, I will make a Peer happy—perhaps a different Peer in this context.

I will not go into any more detail on the matter. I hope that I have answered most of the queries about specifics. On that basis, I hope that noble Lords will not press their amendments.

On the issue of appeal, I am grateful to the noble Lord, Lord MacGregor, for his comments on chapter 11 of the Constitution Committee's report. We thought very hard about whether to introduce an appeals process for decisions. On reflection, we decided that it would be counter-productive to introduce a procedure that was potentially costly, lengthy, complex and of doubtful value.

I want to set out some of the problems that we identified so that noble Lords can reflect on what I have said in this extremely helpful debate. I was genuinely grateful to the noble Lord, Lord Sutherland, for tabling this amendment, which raises many questions that we pondered. As my noble friend said, we began by determining the grounds on which an appeal could be made and whether the panel suggested by the noble Lord—I appreciate that that is one idea, which I shall use as an example—should meet on an ad hoc basis or be a permanent body. We are not sure that we can be clear how the representatives would be chosen to ensure that they had the full support of those involved in the process—whether they can compel witnesses or produce documents or what evidence would be admissible in an appeal of this type.

There is also the question of who would pay the costs of establishing and running the body. It is certainly tempting to believe that a representative of the Secretary of State, a representative of Universities UK and a senior judge could make such important judgments. But again, I fear that the devil is in the detail. As my noble friend Lady Blackstone said, if she were the representative of Universities UK, even if she felt that she had to be collegiate in that sense, there are issues about whether that representative would be seen to be representing the institution's interests. I am not confident, especially in the light of comments made by noble Lords not only in debates on this Bill but more generally, that a nominee of the Secretary of' State would always be seen as wholly impartial. It would therefore be possible that the decision could come down to the voice of the senior judge. Were that the case, no real advantage seems to remain over the established process of judicial review.

Neither am I clear that the proposal would be any more economical or efficient than judicial review. I suspect, from the discussions we have had with institutions, that they would be as likely to hire legal representation before dealing with the appeals panel as they would for an application for judicial review. The cost may not be any less for an appeals procedure.

The question of who should pay for the services of the appeals panel or the administrative support that would inevitably underpin it would be identified in funding. It is possible that institutions would have to bear the cost. Again, that is the type of detail that we tried to wrestle with before we reached our conclusion.

The noble Lord, Lord Sutherland, mentioned a length of time judicial review would take. I appreciate that it is not easy to predict how long it might take. However, I am not sure that it is so easy to predict how long an appeals process would take. It is possible that it may not be either quicker or easier to convene such a panel than it would be to go through the judicial review process. We expect the occasions on which it would be convened would be few and far between, if it was ever called upon at all. Therefore, arranging such panels could take considerable time.

Independent appeals procedures are generally set up if the cases heard are likely to be very technical, or if a very large volume of cases is expected. Decisions of the director are extremely unlikely to be contested on technical grounds. As I said, we expect that if there were any at all, the volume would be minimal. If every higher education institution had an access plan, the total would be fewer than 150, and given the commitment—that we fully recognize—of most institutions to widening access, we do not expect the question of sanctions to arise in many cases. We believe that it is not the best use of resources to set up a bureaucratic structure to oversee such a potentially small number of cases. We went through all the practicalities. Judicial review is a well known, appropriate route of challenge. It could examine whether a director had correctly followed or abused procedure, whether the decision was irrational or unreasonable, or whether the director exceeded his power.

Lord Forsyth of Drumlean

I apologise for interrupting the Minister again, but I would like her to help me. She is arguing that judicial review would not be more costly. How much would a judicial review of a decision by the regulator cost a higher education institution?

Baroness Ashton of Upholland

I apologise to the noble Lord because that figure is usually in my head and it has gone completely. There are well known figures. It may appear as if by magic hut, if it does not, I will certainly write to the noble Lord. However, I asked the same question when I was briefed for this and I know that there is a figure for average costs, but it has gone—too many late nights. If the figure does not appear by magic, it will appear in the noble Lord's hand in some other way. The noble Lord's point is important. We looked at the comparative costing for setting up this procedure, on a regular basis or infrequently, and the cost of judicial review. We have considered the matter very carefully.

We also recognise that the decision of the appeal panel would be final, which would mean that the matter could not be taken to court. Therefore we also have to think about whether that is a challenge under the Human Rights Act or an infringement of Article 6 of the European Convention on Human Rights, which guarantees the right to a fair trial. We grappled with those issues and it may be that the noble Lord, Lord MacGregor, in what I hope will be a conversation post-Report can help us with the thinking of the Constitution Committee because I am sure that it considered these issues.

Those were the types of issue that we looked at. A balance was involved and we felt that judicial review was a better approach for all the reasons I have given. That is the basis on which the Government stand at the moment. However, I am interested in what has been said and conscious that I am not as familiar with what the Constitution Committee said, especially chapter 11, as I would like to be. I will not make any commitment, because I am not in a position to do so, but I want to reflect on this debate. I will read chapter 11 with care and make sure that we have fed that information into our deliberations. I hope that I have given a flavour of the considerations that we had given and that noble Lords will feel reassured that we thought about the matter carefully. We believe that judicial review is the correct response.

I will obtain a figure for average costs. Quite rightly, I have been told that there are a variety of different answers to the noble Lord's question. I will try to do better and I apologise again. Those are our considerations and deliberations in thinking the matter through. On the basis that I would think about what we have said, I hope that noble Lords will feel able to withdraw their amendment and that we can continue the conversation both in and outside your Lordships' House.

Lord Butler of Brockwell

I thank the Minister for that reply. She has indeed made me a happy Peer. I am shamefaced that an amendment that was the product of two heads of the Civil Service and a professor of moral and political philosophy at the University of Cambridge did not pass technical muster. However, I know that parliamentary counsel trumps everything. I will be glad to discuss the matter further with the Minister. I am also extremely grateful to all the noble Lords who have taken part and supported the amendment, especially the noble Lord, Lord Brooke, for the divine benediction that he conferred upon it. I had hoped for the support of the Government but I had not hoped for the support of an even higher authority.

The only thing that makes me unhappy is that I have not been able to be entirely in agreement with the noble Baroness, Lady Blackstone. I really do not think that it is true, certainly speaking for my university and other universities that I know, that universities are approaching this subject in a defensive spirit. On the contrary, everybody I know is very anxious that we should make progress in drawing in youngsters of ability from every background and getting a wider range of applications. I do not think that the noble Baroness need fear on those grounds.

When she asks what the director is to look at, the answer is that director will look at those matters that the universities are required to include in their agreement. The agreement is about the steps that they will take to provide fair access and that is what the director can look at. It really cannot be the case that the director should look at outputs because one cannot say, in the same breath, that universities will have academic freedom about admissions processes but that they will be acceptable only if they have a pre-ordained result. I cannot be so. It would be entirely inconsistent with the assurances that the Government have given if the power to penalise turned on whether a particular pre-ordained result had been achieved.

The noble Baroness, Lady Carnegy, is quite right that even with the director looking at input, he reaches a subjective judgment. That may well be an objection to the position of the director at all. The debate has shown that, if the director is to make a subjective judgment that can involve substantial penalties for universities, that should be constrained on the face of the Bill in the way that my amendment is designed to do. I also support the amendment in the name of the noble Lord, Lord Sutherland, that there should also be a proper appeals machinery. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Sutherland of Houndwood

My Lords—

The Deputy Chairman of Committees (Baroness Turner of Camden)

The amendments are called in seriatim.

[Amendments Nos. 100 to 102 not moved.].

Baroness Warwick of Undercliffe moved Amendment No. 102A: Page 16, line 27, at end insert— ( ) No plan is to be enforced against the relevant institution except as provided for in this section.

The noble Baroness said: In moving Amendment No. 102A I should make it clear that it, and Amendment No. 103A, are probing amendments at this stage. My concern is that institutions ought not to be exposed to additional litigation because of the existence of plans. I am concerned that individual litigants may challenge institutions' compliance with their plans. It seems clear that plans are intended to deal with the efforts of an institution to widen participation generally and are not intended to apply to individual cases.

Noble Lords will be aware that every year there are stories in the press about individual candidates who have not received an offer of a place from his or her first choice of institution. Often these individuals are highly qualified. Often the press stories focus on the background of the individual in question, whether because his background is relatively deprived, or because, for example, he was educated at public school. The cry of "foul" is raised because it seems to the commentators that the student has been discriminated against because of his background. Of course, newspaper journalists are not admissions tutors and we all know that some institutions have to reject literally thousands of highly qualified candidates because places are in such demand.

I am seeking to avoid a situation whereby a student or a potential student could challenge an institution's compliance with its plan on the basis of his or her individual experience. The Minister for Lifelong Learning, Further and Higher Education, Alan Johnson, was helpful on this point in another place, but I hope the Minister can confirm that individuals, whether students, prospective students or persons entirely unconnected with the university, will not be able to take that university to court for failing to comply with the terms of its plan. I beg to move.

7.45 p.m.

Lord Triesman

The noble Baroness, Lady Warwick, raises an interesting issue. I share the concern that she has expressed that the creation of a regulator might generate lawsuits against institutions perceived to have breached their plans. However, I hope that she will feel that she does not need to worry. Some reassurances can be offered.

I know that most institutions are firmly committed to widening participation and expect that they will implement their plans in a very positive way—noble Lords on all sides of the House have made this point. As the noble Baroness, Lady Sharp, reminded us, quite rightly, when we last debated the Bill, vice chancellors are a law-abiding group of people. Indeed, in my experience, they are probably peerless in their willingness to abide by the law. Let me remind your Lordships that these plans are the institution's own, containing the measures that it feels is right for it, within the framework provided by regulations.

If the terms of a plan were breached, the director would be obliged by our regulations to allow an institution the opportunity to put its case before any sanction might be imposed. The Bill provides that, if there were a breach of the plan, access plans in England may be enforced by the director instructing the Higher Education Funding Council for England and/or the Teacher Training Agency to impose a financial sanction on an institution and/or by the director refusing to renew an institution's access plan. These are the only sanctions that the director can apply if institutions breach their access plans. The director will have to comply with provisions contained in regulations about enforcing plans.

Let us focus on the point raised by my noble friend Lady Warwick about students taking action against institutions. Let me make clear, as my right honourable friend the Minister for Lifelong Learning, Further and Higher Education made clear in another place, that the access plan itself, while considerably beneficial to students and being a public document, does not give students, or prospective students, additional legal rights. Enforcing the plan is a matter between the director and the institutions themselves. For those reasons, I confirm my right honourable friend Alan Johnson's position, as I have been asked to do.

I want to reassure noble Lords that the Bill does not disadvantage institutions compared to the current system. Institutions will not be sanctioned twice for the same offence, which I know is a concern for some noble Lords. If, for example, an institution stated in its plan that it would charge £2,000 for a particular course, and then charged £3,000, the director could sanction the institution, resulting in the institution paying back to the students the £1,000 they had each been overcharged. If a student then took the institution to court, the court could not make the institution pay the student again because restitution would already have occurred and the institution could not be penalised twice.

I very much appreciate and understand the need for clarity and transparency in describing how plans will be enforced by the Director of Fair Access in England and by the designated authority in Wales. I believe that the clarity that my noble friend is seeking is provided by the Bill and by the draft regulations, which make it clear that the that process that would be applied if sanctions were ever to be needed will be precisely as I have described it.

I hope that that reassures the Committee and my noble friend Lady Warwick that no sanctions are provided by the Bill and no additional rights arc created by it, except those that it explicitly sets out. I hope that, on that basis, she will feel that she can confidently withdraw the amendment.

Baroness Warwick of Undercliffe

I thank my noble friend for that helpful and comprehensive reply. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 35 agreed to.

Lord Sutherland of Houndwood had given notice of his intention to move Amendment No. 103: After Clause 35, insert the following new clause—

"RIGHT OF APPEAL. (1) There will be a right of appeal against the decision of the Director of Fair Access to Higher Education. (2) The appeal and any supporting evidence must be submitted within twelve weeks of notification of the governing body. (3) The appeal will be heard by a panel of three, one nominated by the Secretary of State, one by Universities UK. and the, third will be a senior judge. (4) The decision of the panel, which may be by majority, and which should be delivered within twelve weeks of the receipt of the appeal, will be final.

The noble Lord said: The matter has clearly been debated fully. I appreciate the comments of noble Lords who spoke in the debate, and I appreciate their interest in the issues, which I still think are fundamental, and particularly the points raised by my noble friend Lord MacGregor.

I thank the Minister for her detailed account of the difficulties. I realised that there were practical problems, which is why I started by saying that there is an issue here of principle. There are a whole series of practical issues about how one might implement that principle. I do not think I have yet been persuaded that the principle is wrong, which means that one begins to look further at the practicalities of how one might deal with the quite legitimate questions put to the House by the noble Baroness, Lady Ashton.

I think, however, that we need to remember why amendments like this are here. They are here because there is a real concern about the powers of the director of OFFA; that is not necessarily to imply a maliciousness or impropriety, but Homer did nod. In that situation, room to come back and ask the question again is very important. Concerns have grown and have been shown in Amendments Nos. 99A and 103; but they have also been shown in the rather more nuclear option, which may well come back, to ask about the overall powers of the director of OFFA, particularly in relation to Clause 34 and thereafter.

I listened with great interest to the noble Baroness, Lady Blackstone. I am well aware that she is a former Minister of higher education. It strengthened my wish to reconsider and perhaps come back with a redrafted amendment.

[Amendment No. 103 not moved.]

Clause 36 [Enforcement of plans: Wales]:

[Amendment No. 103A not moved.]

Clause 36 agreed to.

Clause 37 [Provision of information]:

Lord Renfrew of Kaimsthorn moved Amendment No. 103B: Page 17, line 15, at end insert— (3) The Director shall publish electronically and make available to the Head Teacher or Principal of every secondary school and sixth form college in the United Kingdom information concerning any plan as specified in section 31 which has been approved by the relevant authority in relation to each qualifying course at every higher education institution in England and Wales. (4) The Director shall ensure that the information published electronically and made available to Head Teachers under subsection (3) above pertaining to each such qualifying course is accompanied by supplementary information concerning the number of students currently undertaking undergraduate or postgraduate instruction or research in the department or school where the qualifying course is taught, as well as details of any recent Teaching Quality Assessment of the undergraduate teaching provided in that department or school and of the most recent grading assigned to that department or school in the Research Assessment Exercise. (5) The Director shall seek information from the Head Teacher or Principal of every secondary school and sixth form college in the United Kingdom concerning the number of students in the school or college who have made application for admission to undergraduate courses to one or more higher education institutions in England or Wales, and concerning the number of such applications made by prospective students in the school who are members of groups which are currently under represented in higher education. (6) The Director shall include in a report published annually as prescribed in Schedule 5 a section which indicates the extent to which secondary schools and sixth form colleges in the United Kingdom have furthered the promotion of higher education and the promotion of equality of opportunity in connection with access by encouraging prospective students including those who are members of groups currently under represented in higher education to make application for admission to institutions of higher education, and specifically in encouraging such prospective students to make application for courses for which qualifying fees as defined in section 23 are payable.

The noble Lord said: As I have listened to the Committee stage of the Bill, and as I read in Hansard the report of last Monday's debates, which I could not attend, I have come to feel that the provisions for access in the Bill, complex and extensive though they are, lack a key ingredient. They give no explicit attention to the situation in the schools and the sixth form colleges from which prospective students apply to the universities of their choice. Indeed, they give no coherent attention to the factors which guide those prospective students in their choice of university—nor, crucially, to the factors which lead pupils in those schools to choose whether to apply for university at all.

Through what seems a kind of myopia of the Government, the question of access is considered only in terms of university departments and courses. Yet every admissions officer in a university or college knows that what counts are the applications. You can admit only those who choose to apply. Most of the imbalances in the intake to our higher education system derive from this factor. Yet it is one which the Bill does little to address. Although it was discussed last Monday, there was a newspaper heading, "Universities snub students", where the discussion revealed that it was the students, by their choice of university in some cases, that were snubbing the universities.

These amendments seek, in a rather minimal way, to embrace the schools and sixth form colleges within the admissions process, where they clearly belong. Indeed, the underlying intention is to involve the pupils themselves in that process. Why are the Director of Fair Access and the universities in this Bill spending all their time in discussion together about "plans" when they should be seeking different ways of encouraging applications from under-represented groups, among others? Why are university departments being judged on their plans and application record when the application record of the schools is being overlooked?

These amendments are very simple in their intention. In essence they require the director to do two things. The first is to set up a good website which will be available to schools. I refer in the amendment to head teachers, but I have in mind also teachers encouraging applications to university, and careers mistresses and masters, and the pupils themselves and their families. That is where all these plans and inducements should be made known, not in some subsequent report to Parliament which the director may be required to offer.

Secondly, I address the question of statistics, which was indeed briefly discussed last week in your Lordships' House. If the director is interested in the success of his access initiatives, he must find out about their reception in the schools. I would like to see schools judged not only on the number of university admissions they achieve, but also on the number of applications they achieve. If we begin to measure the success of the enterprise by the increase in applications made by pupils at schools to the universities, then we are measuring something not adequately addressed in the Bill.

In subsection (4), I suggest that in addition to putting forth the fruits of his labours on the website—that is, the plans—the director should also include the only criteria that we have that really give information about the departments and courses and their qualities in a meaningful way. First we need to see the number of undergraduates and graduate students in the department, since in general there is a correlation between departments which are good at research and those which are good at teaching. Then we need to see the teaching quality assessments, so laboriously gathered, and the research assessment gradings. Those are data which prospective students need to encourage them to think about prospective departments in an informed way.

Let no one suggest to me that this represents any significant expense. A single competent webmaster could set this information on to the website. As soon as plans are agreed, they can go on the site. Where plans are under discussion, the webmaster can look up the TQAs and the RAEs which are already publicly available. We are talking here about one member of the director's staff.

However, subsection (5) is the more important. It will entail a member of the director's staff sending out a questionnaire to schools to seek information about their applications. Subsection (6) requires the director to publish the information gathered. In this subsection I use the Government's own terminology in the Bill—prospective students who are members of groups which arc currently under-represented in higher education. I think that it is up to the Government to clarify what they might mean by that.

One clement is clearly parental income. No doubt, as indicated earlier and last Monday, there are privacy and data protection issues to be addressed here. But if they have not been fully thought out by now, they should have been. For how can universities give consideration to these concepts, with which I am broadly in sympathy, if they do not know exactly what concepts are intended? That may be for the director to define; it is certainly not my responsibility in tabling an amendment. But I do draw attention to the circumstance that we need to see how many school pupils in these groups and what proportion are making application to university. I do not think that there is any way of knowing that unless the information is gathered. That is why, in subsection (6), I use the terminology of the Bill to speak of, the promotion of higher education and the promotion of equality of opportunity in connection with access".

This amendment is intended as a suggestion. I hope that the Minister will see the force of the point being made. I should be very happy to revise the amendment in the light of the Minister's advice. But many noble Lords who have spoken have recognised that the key to access lies in the schools, and not only in the application process and the process of choice, but in the teaching itself.

I think we owe it to the potential success of this Bill to ensure that access questions are not left to the universities and to the director. They belong also in the schools, and in the guidance offered by teachers—who need to be fully informed—and above all in the sentiments and developing choices of the prospective students themselves; that is to say, the pupils in school. I beg to move.

Baroness Ashton of Upholland

The noble Lord will not be surprised to hear that I recognise how important it is that schools and colleges have access to the information their students will need in order to make the right choices in higher education, and that schools and colleges need to play their part in raising the aspirations of their students so that they might make the most of their potential. As the noble Lord, Lord Renfrew, said, we had a good discussion on this. I remember the noble Lord, Lord Baker of Dorking, who is not in his place, talking specifically about the role of aspirational head teachers and teachers in ensuring that students prepare themselves for university life. This is not a case of "either/or" but of "both/and". I will go through the noble Lord's proposals to demonstrate what we are already doing in terms of the role of schools and explain why I do not believe that this amendment is the right way forward.

We have always said that the key to raising participation is raising aspirations and attainment. The 14–19 strategy, which is familiar to your Lordships, through the gifted and talented programme, the Connexions service and Aimhigher, is concerned with forging partnerships between schools, colleges and universities to raise the aspirations of young people.

I accept that the Government need to play a role, and schools and colleges must do so too. Universities also have a role to play. That is what the Bill is about. It is always difficult, when we focus on legislation, not to think that it covers everything that we are trying to do. Of course it is not, and beyond the scope of the Bill there is much work going on regarding schools and sixth-form colleges. I do not think that it would be right for the director to become additionally responsible for what schools and sixth-form colleges do or do not do.

8 p.m.

Turning to the specifics of the amendment, the noble Lord wants the director to make available the plans that have been approved by the relevant authority. I assure noble Lords that all plans will be published. We want institutions to publish their plans in a manner that makes them accessible to students and prospective students; and, therefore, they will be available to head teachers and principles and—I agree with the noble Lord—lmost certainly on a website.

We expect that the director will publish the plans that have been approved, and, although it is early days, we imagine that the director would put that information on a website. I do not believe that it is necessary to legislate for that, but we see a website as being an obvious way for people to gain information.

Subsection (4) of the amendment seeks to ensure that those details are accompanied by supplementary information on student numbers, undergraduates and post-graduates being taught and undertaking research. I agree that prospective students, and the schools and colleges they attend, should have access to information about higher education providers so that they can make those choices. It is important for them to see, if they wish, what assessment has been made of teaching or research at an institution. I assure the noble Lord that measures are already being taken to make information available to prospective students and their schools and colleges.

For example, UCAST mails every school with sixth-forms, or equivalent students with information about the application process, open days and so on. UCAST has decided in principle to have a web-based information service for schools—UCAST Plus—which will provide all kinds of information tailored for schools about higher education and the applications process. Furthermore, Aimhigher provides information about what and where to study, how to apply, what it will cost and so on. And the National Union of Students is developing an easy to use guide about higher education for prospective students to help them navigate their way through the information available.

Regarding information on teaching quality—we, HEFC and the higher education sector are moving towards the quality assurance framework and by the end of this year the first full set of information should be available on the teaching quality information website. That will include information on entry qualifications, progression, completion and employment after graduation, as well as teaching and learning methods and intended learning outcomes. Information on the outcome of the research assessment exercise is available on the HEFC website.

I agree wholeheartedly with the noble Lord that information should be available. However, I believe, from that foray into the different kinds of information available, that we are taking the right steps—and that the information is available in the way that the noble Lord requires. I am very reluctant to place a duty on the director to provide that information. It is important to keep his role focused and clear. Others are able to take on the role of providing information; they are doing so and will do so in future.

Subsection (5) would require the director to seek information from head teachers and principles of secondary schools and sixth-form colleges about the number of students applying for higher education courses, I would urge great caution in this matter. We are seeking to keep bureaucracy in higher education to a minimum and also seeking to reduce it for schools. That is a matter on which the noble Baroness, Lady Blatch, has taken me to task many times. It is important that we are careful about what we ask of schools, not least in the area of data collection. Therefore, I do not think that we should include this duty for the director in the Bill. Schools would not want that.

I note that the amendment places a requirement on the director to seek information but does not place a corresponding requirement to provide it on head teachers and principals. Information on the numbers applying to higher education is already collected by UCAST, broken down by school and education authority. That information would be available to the director.

Subsection (6) puts a requirement to include in the annual report an assessment of the performance of schools and colleges in encouraging applications. Again, it is not appropriate for the director to have a role in assessing the school's performance. There is an inspection framework for schools that is known well to noble Lords through Ofsted. Inspectors are required to report on a range of matters and raising aspirations generally is an integral element of the framework. I doubt very much that schools, or, indeed, Ofsted, would welcome the director taking on a specific role regarding school performance.

I agree that supportive, inspirational teaching is integral to raising aspirations. The Aimhigher road show, which has teachers' packs, has been widely used and highly regarded. Teachers also play a role in the joint planning of aspiration-raising activities, such as study days and visits to institutions, working with universities. We have piloted the Excellent Fellowship Awards, where teachers from schools and colleges have been given the opportunity to spend time in an institution to increase their knowledge and awareness of higher education, which is also important if they are to pass on those messages to students.

I understand this undoubtedly well-intentioned amendment. Schools and colleges are important, but, in the context of the Bill, the director's role is in respect of higher education institutions, which can play their role, as we have discussed in Committee, to ensure that they work with sixth-form colleges and schools. It would not be appropriate to extend to role of the director to schools.

There is much work currently being carried out. The amount of information that is available largely addresses the concerns that the noble Lord has expressed. I do not wish to place additional burdens either on the director or on schools and colleges. I hope that, with the reassurances that I have given the noble Lord, he will withdraw the amendment.

Lord Renfrew of Kaimsthorn

I am grateful to the Minister for her careful reply, although in one part of it she rather misrepresented my amendment, when she said that she did not feel that the director should, become additionally responsible for what schools and sixth-form colleges do or do not do". That was never my suggestion.

Regarding the first part of the amendment and the suggestion that information on plans should be made available to the schools by the director on a website, the Minister has very much reassured me by saying that that is likely to happen.

It seems to me that, as the Minister described the richesse of websites available to schools—they will need to look at the UCAS website, the NUS guide, the TQA information website and the HEFCE website to get the research assessment information—I wonder if there is not a case for making this information available to schools in a more coherent and simple way. It may be that the director is not the best person to do so, but should students have to hunt up five websites—the ones which the Minister iterated—to get rather basic information?

On the other much more substantial point, I realise that it may be an onerous obligation on the director to communicate with all schools, and for the schools to be expected to communicate with him or her. That may indeed not be the best way to do it, but, as far as I can see, no attention has been given in the Bill to monitoring the success of the enterprise. Earlier we discussed monitoring the success of whether individual university courses are succeeding in attracting applications of a particular mix or not—that was very fully discussed in the context of the amendment of the noble Lord, Lord Butler. But we have given very little consideration to monitoring the success of the enterprise in encouraging more applications from schools.

The noble Baroness said, no doubt rightly, that UCAS has some record of that, but that leads us to the very delicate question of monitoring applications from groups under-represented in higher education. Is there any provision for monitoring applications specifically from such pupils? I realise how difficult that is—as was discussed last Monday. How do you manage to get that information without breaking through the privacy which students and their families may reasonably require? But if you are not monitoring the success of encouraging applications to specific courses under the plans, you are not getting the necessary information. I would be grateful if the Minister would say a word about that before I withdraw the amendment.

Baroness Ashton of Upholland

I was trying to indicate that UCAS does have information on, for example, individual schools in applications. That will give us some information on areas where there is a change in the number of students who apply, and areas, for example, where traditionally students have not applied to institutions. Looking at under-representation is an imperfect science. We have overall figures and some details of the number applying to universities. I will set that out properly for the noble Lord to show the different ways we are able to look at that.

Institutions themselves also have information. As the noble Lord, Lord Wilson of Dinton, said, applications to Cambridge were 1 per cent in the north-east. Institutions are well aware geographically and otherwise, but I will set that out properly in order to address the noble Lord's concerns.

Lord Renfrew of Kaimsthorn

I am grateful to the noble Baroness and I look forward to that further information.

In finishing, I would like to emphasise that the Bill explicitly requires university departments to get a better mix of groups which are under-represented in higher education. That is a very worthy objective, but, as far as I can see—and the Minister when she writes to me will perhaps be able to set my mind at rest—there is no initiative to see how that is working in schools. The Minister said that one can see whether an individual school is making more applications—that will come up. There may be some individual schools with a very high frequency of students who are from low-income family backgrounds, or even from a particular ethnic group which might also be a group under-represented in higher education. But unless that is effectively monitored—and I am not sure that it is something that the universities themselves can monitor—I have no idea how at the end of the day we shall have any clear indication of the success or failure of the enterprise in encouraging applications in schools.

In withdrawing my amendment, I highlight a problem that has not been addressed adequately in our debates on the Bill. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 36 agreed to.

Clause 37 agreed to.

Clause 38 [Interpretation of Part 3]:

[Amendments Nos. 104 to 106 not moved.]

Clause 38 agreed to.

Clause 39 agreed to.

8.15 p.m.

Clause 40 [Other amendments of section 22 of Teaching and Higher Education Act 1998]:

Lord MacGregor of Pulham Market moved Amendment No. 106A: Page 18, line 45, at end insert— (1) In subsection (1) after "eligible students" insert "(including British citizens resident in other EU member states)".

The noble Lord said: The issue I wish to raise in this amendment was last raised in this House by the late Lady Young on 15 November 1999, but things have moved on a bit since then and I want to press the case again. I am glad that Clause 40 gives me the opportunity to do so.

I say straight away that the amendment may be technically defective. In fact, given that the noble Lord, Lord Butler, with all his experience, discovered that his amendment was technically defective, I am absolutely certain that this one is. However, it is the substance that I want to probe. I realise that the hour is late but I must make the case properly.

I speak as an honorary vice-president of COBISEC; a position that I took on recently. COBISEC is the organisation that brings together the 40 British schools in the European Union as well as schools outside the EU, but it is schools in the EU with which I am concerned tonight. In those 40 schools there are more than 12,000 pupils. They feel very strongly on this issue, as has been made clear to me on various occasions since I have taken an interest in the organisation. All these British schools follow the British curriculum. That curriculum is taught in English by appropriately qualified teachers. The COBISEC schools may join the UK teachers' pension scheme. COBISEC teachers are eligible to qualify as Ofsted inspectors.

The Independent Schools Inspectorate, which is recognised by the Department for Education and Skills and Ofsted as operating in independent schools in the UK, operates also in the COBISEC schools. So in many ways they are British schools in all but location. A large number of parents and pupils are British citizens for obvious reasons but there are many other nationalities as well because of the high regard in which British education is held.

I would have talked about the valuable contribution that these schools make both in propagating British education in the EU and in providing an educational service for parents with families who have to work in the EU, but in view of the hour I shall not develop that and come straight to the substance of the issues.

Clearly, a significant number of the British citizen pupils in these schools want to go on to higher education and naturally many of them wish to go to British universities. The problem is that many find that, unlike all other British pupils, they are ineligible for student loans. I want to take the arguments for and against very quickly. I could go on at length but I shall speak very briefly as I am particularly interested in the Minister's response.

The first point I want to make is that all successful EU applicants to British universities from the EU—both British citizens and others—are now eligible for tuition fees. Indeed, we debated that aspect earlier in Committee. However, student maintenance is regarded as a matter for each individual country. This leads to what to me seems to be a highly anomalous situation—that British citizens are liable for all the tuition fee elements that we are discussing in this Bill but cannot apply for student loans. That is the position in general. It seems to me now, with the further progress on tuition fees, that that situation is anomalous.

Secondly, one of the reasons that they so often cannot get student loans is the application of the three-year residency rule, which has applied to student loans for a considerable period. It always has therefore been the case that a student wanting to take out a student loan and applying to a British university has had to be resident in the UK for the previous three years. But now in this age of high international job mobility, which is regarded by so many as a good thing, is it any longer appropriate to apply that very tight three-year residency rule? I rather doubt it.

That leads me to my third point. Local education authorities may now decide whether individual applicants are eligible under the three-year residency rule for student loans. I am sure that the Minister will say that the department now gives guidance on the three-year residency rule. I am sure that will be part of her answer. But it is still at the discretion of the local education authority. I am told that the regulations are applied haphazardly and inconsistently by local education authorities. Is it fair that even where they come within the application of the three-year residency rule some may be eligible for student loans but others not?

The fourth point is that from the year 2000–01 Armed Forces parents and pupils are exempted from the residency rule because, so it is argued, they are obliged to take up overseas posts. The noble Baroness, Lady Blackstone, who responded as Minister to the relevant debate in 1999, said that, the families of the vast majority of British students being educated abroad choose to live and work abroad".—[Official Report, 15/12/99; col. 298.]

I believe that is no longer correct, but I do not think that it is relevant because the real point is that, given career patterns nowadays, many people who want to play a significant part in their companies find it advantageous—indeed, they may often be required—to work abroad for a considerable period. Given that British companies have to compete globally, and that multinational companies are increasing that pattern for so many people who go into business, commerce or finance, it seems to me that from the point of view of the British economy it is highly desirable that they should do so. It is just as desirable in many cases as people in the Armed Forces operating in overseas posts. I do not see that distinction in the black and white way in which it was put by the noble Baroness, Lady Blackstone. Frankly, it does not seem to be a good reason for excluding the children of British citizens who are working in multinational or American companies abroad. It is no longer possible for many people going into overseas positions to confine themselves to two or three years there. I have, in the last few weeks, met a number of American and British executives who thought they were going abroad for only two to three years, and have stayed there for eight years because their companies wanted them to. So it is an artificial rule to apply.

The fourth point is that it will no doubt be argued that so many of the people who work in the companies are reasonably well paid that their children do not need the student loans. I do not think that is true for so many of the pupils we are talking about.

I take two cases. The teachers in the British schools, who may well have children and are obviously going to be there for more than three years and who want their children to go to university, are not often highly paid. Student loans would be very attractive to their sons and daughters. A particular case was put to me about two weeks ago from the diocese in Europe of the Church of England—I am making this case to show that there arc many people on comparatively low incomes who are caught by this. The diocese in Europe would like to appoint chaplains with families to a number of their chaplaincies within the EU, but educational issues are one of the factors which inhibit the chaplains with school-age children from applying, given that the standard chaplain's stipend is comparatively low. Within this general problem, I understand, there is the specific one that when those chaplains find that their children are coming to the age of university entrance, they discover that they are ineligible for the student loans. This obviously works back through the grapevine, and everyone knows that this is a disadvantage in taking up a job as a chaplain. The bishop who drew this to my attention concluded that, although this is numerically a very small number of people, it certainly affects the ability of the diocese to appoint younger chaplains and those whose families can be a real enhancement to the life of the chaplaincy. It is an issue which is comparatively small, but it seems unfair and is inhibiting people from taking up these jobs.

The fifth argument is one of cost. I speak, as the Minister knows, as a former Chief Secretary. I am sure there is something in the brief—if there has been time to put it together—that says, "The cost is going to be such and-such, and we cannot really afford it". Well, I have been trying to find out how many pupils are likely to be involved in this each year. The British School in the Netherlands is by far the largest, and almost certainly sends the largest number of British students to UK universities. In 2003, it sent 57 students. The guess is that we are talking of between 600 and 700 students—it may even be fewer than that—in any given year. It is not a huge number, and therefore the costs cannot be particularly high. It seems unfair to exclude them, for all the reasons I have given.

The final argument is the legal argument that we are inhibited by EU legislation. On this point, I am advised that there is no requirement to be nondiscriminatory in regard to educational facilities which the British Government might choose to provide to UK nationals residing in other EU countries. I do not want to get into the legal argument tonight, because it is very detailed and technical, but I would certainly be happy to talk to the Minister about this further if that is regarded as one of the biggest obstacles to accepting this amendment.

For all these reasons, I conclude that it is now unfair to exclude British pupils from these British schools from eligibility for student loans; that it is unfair to depend on the whims of local education authorities; and that they should be eligible to apply for student loans through a central unit. I beg to move.

Lord Brooke of Sutton Mandeville

I shall seek to be as telegraphic as my noble friend. For 15 years I was a director of a British school in Switzerland called Ecole St George, founded in 1927 by my godmother, for British families of the League of Nations. We lived through exactly the sort of problems my noble friend Lord MacGregor has been describing, even in those days. I lived in Brussels for two years in the early 70s. I can again comment, even back then, in terms of what my noble friend has said. The staff of the continental headquarters of multinational companies were either from small countries—they all spoke a multitude of languages—or, among those from the larger countries, the only executives who were brought in tended to be from this country. I suppose this is because of our maritime and imperial past, and the habit of living and working outside our own country.

I was not the Minister for Higher Education who introduced full-cost fees for overseas students, but I was effectively the Minister who had to cope with the fallout. I mention in passing that the Commonwealth Education Ministers' conference, which lasted a week, was a rerun of the Battle of Rorke's Drift. I warn the Minister, as the person who had to cope with the consequences, that any Higher Education Minister in a Government that does not pay attention to what my noble friend has said will find themselves having to cope with an enormous amount of subsequent correspondence from families through their Member of Parliament in the United Kingdom. That is exactly what I went through myself.

Baroness Ashton of Upholland

In this amendment, the noble Lord, Lord MacGregor, has clearly raised an important point, and I have done my best to be well briefed. I think the most helpful thing I can do is to go through, with relative speed in view of the hour, the critical points that I have here, and then the noble Lord and I can perhaps have a conversation when he has had a chance to reflect on them. I may be able to address quite a number of the points that he has raised. It is, as the noble Lord has indicated, quite complex and I do not want to do him an injustice. I shall do this briefly.

The noble Lord made the point that it is about residence rather than nationality, which has been the principle of successive governments. Where citizens with settled status meet the residence requirements for the UK, and are on a designated course, they are eligible for a full student support package including maintenance. This is a consequence, as the noble Lord will know, of the 1958 Anderson report, which gave the foundation enshrined in three principles. First, a student should be ordinarily resident. Secondly, they should not have been ordinarily resident solely for the purposes of receiving education. Thirdly, there should be some provision to cover temporary absence from the country. The same principles apply today.

We think the three-year residence requirement introduced in the 1962 Act is a fair minimum requirement, with an exception made where the condition cannot be satisfied because the applicant, or their parents, has been temporarily absent or employed abroad. British nationals may meet the temporary absence provisions dependent on their individual circumstances. EU nationals, including British citizens living in the EU and studying in the UK, are entitled to the same level of support towards their tuition fees as UK residents, provided they have resided in the European economic area or Switzerland throughout the relevant three-year period. Students anywhere in the EU are entitled to this tuition fee support in the country in which they live, but not—as the noble Lord indicated—to support for living costs. As he also indicated, there are exceptions for Armed Forces personnel and their families serving abroad. They are bound by military law to accept overseas postings, and so rightly receive the full package.

The vast majority of British nationals who choose to live and work abroad do so of their own volition, and the noble Lord talked about the issues around that. Where this is short-term, the temporary absence provision will meet their needs and they will be eligible for student support. Where they have effectively emigrated to other countries within the EU, it is right to treat them in the same way as we treat other EU nationals. The current rules are long-standing and clear cut. Where a British national can show their absence abroad has been temporary, they will be entitled to maintenance support under current arrangements. I think that covers the point the noble Lord made about those who go away for a particular time and it is extended. That could still be argued as temporary, as I understand it. The difference is for those who have moved on a clearly permanent basis.

I want to read into the record a particular point about the status of migrant workers because, as I said, it is complex. There are a number of carefully defined exceptions where a student may receive support without satisfying the normal UK residence requirements. In order to comply with European Union legislation to ensure the free movement of workers, European economic area and Swiss nationals who are migrant workers in the UK are generally eligible for support on the same basis as UK students. They are required to have been ordinarily resident in the European economic area or Switzerland for the three years immediately preceding the start of their course. Their spouses, children and stepchildren are also eligible for support if they live with the migrant worker in the UK. This provision also applies to UK nationals and their spouses, children and stepchildren who have been working elsewhere in the European economic area or Switzerland and have returned to take up employment in the UK.

These issues require further discussion with the noble Lord. I have more briefing, which I am inclined to give to the noble Lord rather than spend another 20 minutes reading it out on the Floor of the House, which I do not believe would achieve very much. As I indicated, we stick with the principle concerning residency. But, in view of what I have said already and what I shall write to the noble Lord, I hope that he will be able to withdraw the amendment and continue the discussion.

8.30 p.m.

Lord MacGregor of Pulham Market

I recognise that this is a truncated debate because of the lateness of the hour, and I understand why the Minister did not feel that she could respond to all the points that I made. However, I look forward to discussing them with her because I think that very legitimate issues are involved here. Given how much conditions of employment have changed around the world, there are relevant issues here to explore. I am grateful to the noble Baroness for the way in which she set out her response. I look forward to discussing these issues with her and, on that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 40 agreed to.

Baroness Greengross moved Amendment No. 107: After Clause 40. insert the following new clause—

"ACCESS TO STUDENT LOANS The age of a student may not be included in regulations as an eligibility criterion for access to student loans.

The noble Baroness said: With this amendment, our debate focuses on older people. The new clause has a very simple aim: to stop age being a criterion for access to student loans.

As the Minister knows, the amendment is designed to see whether she can make any further improvements to the Bill to benefit the more mature student. She has been very gracious in discussing with me the difficulties of achieving genuine lifelong training and education, but my view remains that those difficulties are not nearly as great as those faced by the older students themselves.

We touched on some of the issues affecting older learners in our debate on part-time students, and I very much welcome the improvements which benefit them. However, my view is that it would be better to put part-time students, many of whom are older, on a simple pro rata basis for all terms, conditions and benefits associated with education. Equal treatment should also apply to older students. Indeed, the Economic Affairs Select Committee of your Lordships' House, chaired by the noble Lord. Lord Peston, recently concluded that student loans are "blatantly ageist", and I have to say that I agree.

While the focus of the Bill is rightly on younger people's access to education, we must not forget older people altogether. The target to achieve by 2010 a 50 per cent participation level in higher education for people under the age of 30 may mean that wider access to higher education for older people will be neglected. The negative impact of what NIACE called a "Club 18–30" education policy is very marked—indeed, most marked—for people who just happen to be 54 or over. Despite years of paying taxes, they are the ones who are denied access to student loans. That is what the amendment is designed to tackle.

We live—noble Lords are probably tired of my saying this—in a changing society because of rising longevity and falling birth rates, and our education system needs to recognise that. Already almost 1 million people in the UK need, or choose, to work beyond the traditional retirement age and their numbers will increase further. In an ageing society where older people continue to contribute their skills and knowledge to their communities long after retirement, the current position is not only unjust but it is very hard to justify in economic terms.

The Minister deserves credit for proposing age-blind support systems for part-time students, but why cannot those be extended to older learners who wish to study full-time? Older learners are not a tiny minority, but I think that the number who might seek state support to study is likely to be relatively small. NIACE, to which I am very grateful for the information it has given me, tells me that in 2001–02 more than 125,000 full-time students were over the age of 21. That is 29 per cent of all full-time higher education students. Unsurprisingly, 90 per cent of part-time students are over 21. That is a reflection of how education is not any longer the completion of a young person's initial education at the age of 21.

My new clause relates specifically to student loans. As your Lordships will know, the availability of loans was extended in 1999–2000 to students aged between 50 and 54, provided that they could satisfy local officials in writing that their intention was to seek paid employment after graduation. People of 55 and over remain ineligible.

The interpretation of the ruling is left to local authorities and there are no national data available on how uniformly it is interpreted, nor the number of applications that are received, accepted or rejected at this point. It is clear to me that such a rule is arbitrary, unenforceable, unworkable and above all ageist. Why aged 54? A person aged 55 today will on average live more than 25 years longer. That is plenty of time for them to repay a loan and indeed to embark on a new career.

I have to say that the DfES has been fixated on the age of 65 as the age at which a loan must be repaid. I hope that the Minister can explain that to the Committee. I can understand her concerns if the age constraints are removed: the fairness to other borrowers if funds are available to students who are not likely to be able to repay a significant part of the loan; or placing a financial burden on older students who are likely to have lower levels of income once they have retired.

But surely we can allow such older students to judge their own ability to repay a loan. At the end of the day, or even at the end of the student's life, could that loan he repaid from their estate as any other debt would be? NIACE states, Government arguments are circular. It does not have to write-off student loan debt at the age of 65. Relaxing the write-off makes economic sense for the state. If former students earned above the agreed income threshold, they would continue making payments. Those on low incomes would not pay anyway—regardless of their age".

Should we not also seek policy consistency? It is extraordinary that we talk about joined-up government when one department, the DWP, encourages older people of 65 and over to stay longer in the workforce while another, the DfES, says that anyone over 55 cannot access student loans because they will be retired at 65.

Despite what the Minister told me when I raised the issue at starred Questions on 1 March, I believe that the impact of the EU employment directive when it becomes law in this country will force a change. The Government will be challenged in court. It must be better for them to act now than to wait for that.

I conclude by quoting: We want to safeguard a wide range of learning opportunities for pensioners…While strengthening support for skills, training and qualifications which will support our wider economic goals, we want at the same time to ensure the continued availability of learning opportunities for pensioners which give so much benefit and pleasure".

Your Lordships may be surprised to learn that that comes from the DfES's 2003 skills strategy paper, 21st Century Skills: Realising our Potential. I hope that it means what it says. I beg to move.

Baroness Howe of Idlicote

I would very much like to support my noble friend's amendment. I will do so as briefly as possible, but I want to underline two or three points. We are an increasingly active ageing society in the best sense of the word. We have heard that 1 million people work beyond what is regarded as the current retirement age—which is disappearing rapidly—and that number is growing. It is obvious too that we shall have many problems with the EU directive on ageing. The report of the noble Lord, Lord Peston, has been mentioned. Sadly, we have not yet even debated it although it was published months ago.

We then come to the natural justice point. To exclude people on the basis of age from the benefits of a student loan is contrary to natural justice and to the concepts of lifelong learning. We simply cannot have a cut-off in that respect. Frankly, whether the individuals want to re-equip themselves for another career, take further employment or keep their own brains active for as long as possible, there are surely bottom line benefits for the Government. There will be more tax if such individuals return to work after a course. For those who take the route of enjoying a course just for their own benefits to fulfil their ambitions, that is likely to keep them out of hospital and therefore would save costs for the Government and the country as a whole.

For all those reasons, I hope that the Government will rethink the policy. It really does not make sense.

Lord Freyberg

I, too, support the amendment. In my view, lifelong learning should be upheld in practice as well as in principle. As with the youngest students, there are many of more mature years who would not be able to afford university study without the assistance of a preferential rate loan. However, people of more advanced age who put themselves forward and are accepted for a testing academic course are more than likely to be of unusual commitment and vigour. I know from my own experience that the advice and examples of mature students are a great asset to younger students who inevitably have a more limited outlook.

Baroness Sharp of Guildford

My name is attached to the amendment and I should like briefly to support those who have spoken in its favour. Some Members of the Committee may have received recently a pamphlet from an organisation which describes itself as LEAD, Lobby to End Age Discrimination. The pamphlet states that age is not a basis on which to judge a person's worth. It seems to me that that is true both of a person's intrinsic worth to society and of the assets that person may hold.

Baroness Ashton of Upholland

I begin by paying tribute to the noble Baroness, Lady Greengross, for her incredible work, not least in promoting a culture of lifelong learning. I would be worried if noble Lords gained the impression from the contributions to the debate that somehow the Government are opposed to such learning opportunities. I could, but I will not, spend several minutes going through a range of ways in which the Government are keen to support all students of all ages.

We have referred to the fact that mature students are the main beneficiaries of the adult dependants' grant worth £2,280 and to the additional financial assistance that older students are able to get. I do not want noble Lords to go away thinking that there is not a raft of measures we have put in place to try to support students of all ages. I am happy to set those out but feel that time is not on my side.

I want to address the critical question, which is the opportunity to obtain student loans. When we considered whether there should be a cut-off age, we were very aware that 65 is still the age at which the majority of people retire. Ten per cent continue beyond that. We do not want to change that having made the commitment to all of the students who will and do receive student loans that that will be the case. It is important to have a cut-off point. Equally, for people who sadly die, we have made it clear that there will be no carry forward of loans. I think we should continue with that commitment.

It is also worth reminding the Committee that the age limit on the first day of the first academic year of the course is 54. Therefore, students on a typical three-year course will be 57 or 58 when they become liable to repay their loans.

8.45 p.m.

The provision involves significant costs. I understand what noble Lords have said about the noble Lord, Lord Peston, and his committee's report. I understand what the noble Baroness has said about European law. The matter has been tested in the courts. It was determined that as higher education and its funding is a scarce resource it is appropriate for the Secretary of State to be able to make the decisions—albeit in areas where noble Lords do not agree.

The reality is that we rely on our loan system repaying a large proportion of the funding. There are issues around older students being able to repay those loans. I would also say to the noble Baroness, because I understand the issues, that we do not need primary legislation to achieve what she seeks. I am sure she will continue to press the Government and we are very keen to continue that dialogue. It is not that we are unsympathetic, but we are yet again in the art of the possible.

We believe that the package we have created provides a huge amount of support to all our students. We have to make a decision on this aspect, with which I know the noble Baroness will not agree. I ask her to continue that dialogue and we shall continue to listen. Primary legislation is not necessary to achieve what she wants in any event. We are not unsympathetic, and I hope that we can continue to discuss the matter. For the moment, I hope she will feel able to withdraw her amendment.

Baroness Greengross

I thank the Minister. She has given us bad news but also a bit of good news. I am grateful to her for that. I also thank other noble Lords who have supported my amendment.

The disappointment I obviously feel is tempered by the thought that I, with other noble Lords, can return and pursue these ideas and points later. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Freyberg moved Amendment No. 108: After Clause 40, insert the following new clause—

"STUDENT LOANS: POSTGRADUATE COURSES The Secretary of State shall by regulations extend the student loan scheme to postgraduate courses, including part-time courses.

The noble Lord said: This probing amendment concerns a subject which has had little attention in the current education debate, but which I believe should be considered as part of the rethink of further education. It should also feature in the two reviews announced by the Secretary of State. I refer to the general non-availability of postgraduate loans, a situation which should be addressed now that students are to assume greater responsibility for their university funding. If this is not thought through in the next few years, there is likely to be reduced access to postgraduate study for financial rather than academic reasons, and the calibre of academic research in this country is likely to suffer as a result.

Before exploring the matter further, I should like to declare an interest in the subject as I am planning to take up a place on a postgraduate course at University College London. When I went for an interview there, I was surprised to meet a fellow applicant who had been offered a place on the same course for the previous year, but who had been unable to take it up once his application for a research council award had been turned down. He could not tap into any other form of financial support and could not afford to take out a standard bank loan. A career development loan might have been an option—and a helpful one—had he been studying a vocational course, but as a fine arts graduate he would not have been eligible.

Although the number of UK postgraduates has increased impressively in the past few years, and now stands at almost 500,000, according to figures from the Higher Education Statistics Agency, there is no question that the lack of access to funding prevents many people taking up hard-won places. For example, at University College London, around 950 offers of places for postgraduate research are made each year. Yet only about 400 will be taken up. Of those, between 180 and 200 receive research council funding. Of course, not all those who decide not to take up a place do so because of failure to acquire funding, but, equally, a substantial number—probably between 100 and 400—do. Similarly, for taught postgraduate courses at UCL, about 100 to 250 applicants who are turned down for research council awards decide not to take up a postgraduate place for that reason.

That is just one example among many universities at a time when graduates have far lower debts than will be the case in a few years' time. At present, all UK-domiciled undergraduates who meet the residency rules have access to student loans, with preferential rates and deferred payments. But there is no such facility for postgraduates. That will become an increasingly necessary option as the new funding system is implemented because most postgraduates will be considerably more indebted when they start their courses than has previously been the case. That will mean that the only way that many can afford to continue their studies is if they get a preferential loan rate.

It is also worth mentioning that, although the majority of undergraduate courses are for three years in total, the majority of postgraduate courses are for only one or two years. I do not suggest that extending loans to postgraduates will solve funding difficulties for all contemplating a postgraduate course, but the possibility of resorting to one will be a great boon to those with few funding options. I was interested to discover that such an option exists for both undergraduates and postgraduates alike in Sweden.

That is not to say that there are not some helpful funding schemes already available for postgraduates. Those include the research council awards already mentioned, which cover some tuition fees along with a decent-sized maintenance grant. There are other initiatives, such as career development loans, support for those wishing to become teachers, hardship schemes, assessed bursaries for courses in social work, help from the Access to Learning Fund and new academic fellowships for scientists. However, those are chiefly available for those with clear career paths and leave numerous students desperately trying to fund further study.

The statistics bear that out. Research council grants help nearly 13 per cent of postgraduates and the other awards reach a far smaller percentage. One can therefore be extremely able and yet not qualify for funding. That is one reason that such a large proportion of postgraduates are part time, because students are obliged to earn a living to pay the course fees and living costs.

Another point worth mentioning is the fact that, unlike undergraduate courses, there is no cap on postgraduate fees. When fees are high, it is all the more imperative for students to have access to funding at affordable rates. I am aware that what I suggest is not without considerable cost implications, although I would add that, despite my Written Question on the matter, the Government have been unable to put any figure on it, other than saying that it would be hugely expensive. So it would be helpful if the Minister could set the figures before us in due course. I am also aware that the Government already have the power to implement that by regulation.

In conclusion, there are already 1.5 million undergraduates whose loans are being processed by government offices. The number of postgraduates who would seek a loan if it were made available would be far smaller. The apparatus for processing them is already in place. I beg to move.

Baroness Sharp of Guildford

My name is also attached to the amendment, and I should like to speak briefly in its favour. Those of us who have worked in universities are concerned about what some might regard as being one of the unintended consequences of the introduction of fees, which is a reduction in the number of students going on to postgraduate work. One way in which they might be helped is by the introduction of access to preferential loans, as are available to undergraduate students.

As the noble Lord, Lord Freyberg, said, many postgraduate students, especially those at the Masters level, are not funded through research council studentships. For those students, bank and commercial loans are the only available sources of funding. Although one recognises that there should be limits on the availability of such loans, it might be useful for students to have access to loans at a preferential rate up to a certain limit in order to help them through their studies, as the noble Lord indicated.

Lord Triesman

I start by wishing the noble Lord, Lord Freyberg, every success in his new course at University College, London. Perhaps he could tell his new acquaintance, the fine arts graduate, that the establishment of the Arts and Humanities Research Council should be quite a useful adjunct to some of the awards that will be available should this legislation be passed.

I wish to make it clear from the outset that we recognise and value the contribution that postgraduates make to our economy and wider society, and, indeed, to the life of universities. Study at postgraduate level underpins our research base and nurtures the highly skilled workforce that is increasingly in demand if we are to compete internationally.

Postgraduate study can take a variety of forms, including taught higher degrees, research and, increasingly, professional qualifications, and other advanced learning. Perhaps I may make the observation to the noble Lord, Lord Freyberg, that when he asked his Question in this House recently, my noble friend Lady Ashton made the point that it is very hard to estimate the cost of extending student support to postgraduate students. It would depend on the level of support that would be made available. I have just made the point that there is a vast variety of courses with a vast variety of charges. In a sense, there would be a very big element of guesswork, other than to say that the costs would be very substantial.

Learning at this level pays off for the student as well as for society. Research indicates that in the same way that graduates' earnings are on average a good deal higher than those people who are qualified to A-level, workers with higher degrees attract on average a further 17 per cent over the earnings of graduates at first degree level.

The Government's commitment to learning at that level, despite the points that I make about the higher levels of earnings, is evident in the investment that we make in the research base and in the teaching of postgraduate students. Members of the Committee are aware that there have been substantial increases in the science and research budgets for 2005–06 compared with three years previously. We provide around £300 million a year, through the HEFCE block grant, for the teaching and supervision of postgraduates and researchers. Postgraduates can apply, in competition, for awards from research councils and the Arts and Humanities Research Board. The Government are investing additional funds to raise the minimum PhD stipend to £12,000 a year by 2005–06. That is a significant investment in the best postgraduate students.

There is a partnership with high street banks through the career development loans scheme. Seventeen thousand people are approved for loans each year. We estimate that about 5,000 of them are for postgraduate studies. There is further targeted support available to postgraduate students with disabilities through the disabled student's allowance. Currently, more than 1,300 postgraduates receive that statutory support. Postgraduates are also eligible for consideration to the Access to Learning fund, as the noble Lord, Lord Freyberg, indicated. The Government have allocated £7.6 million to institutions from that fund.

Of course, ultimately, some people are turned down. That must be the case because, regretfully, as Ministers are often forced to say, our resources are not limitless. The Government have a responsibility to decide on priorities. The amendment would require us to make postgraduate students eligible for loans with a considerable increase in costs to the public.

If we had Swedish tax levels, perhaps we would match some of the other achievements of Sweden. We might still choose to prioritise other things because there are always other priorities. This can be achieved by regulation but it does not seem to us to be the right balance and does not focus on the right groups at present in higher education, important as postgraduates are.

Bearing all this in mind, I hope that the noble Lord will feel able to withdraw his amendment.

Lord Freyberg

I thank the Minister for his very helpful reply. He gave a full account of the many different funding options available for a selection of postgraduates. However, as he knows, such schemes, admirable though they are, do not reach a huge number of the many postgraduate students who are not caught by those schemes and who deserve support from the Government. In the light of what the Minister has said and what I am sure will be a continuing debate on this matter, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clauses 41 and 42 agreed to.

Clause 43 [Orders and regulations]:

[Amendments Nos. 109 to 109A not moved.]

Baroness Ashton of Upholland moved Amendments Nos. 110 and 111: Page 21, line 16, leave out third "or Page 21, line 17, at end insert "or (c) regulations to which subsection (3A) applies. (3A) A statutory instrument which contains (whether alone or with other provisions) regulations made by the Secretary of State by virtue of section 31(2) or 35(2)(c) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of. each House of Parliament.

On Question, amendments agreed to.

[Amendment No. 111A not moved.]

Clause 43, as amended, agreed to.

Clauses 44 and 45 agreed to.

Schedule 6 agreed to.

Clause 46 agreed to.

Schedule 7 agreed to.

Clause 47 agreed to.

Clause 48 [Commencement]:

[Amendment No. 112 not moved.]

Clause 48 agreed to.

Clauses 49 and 50 agreed to.

House resumed: Bill reported with amendments.