Lifelong Learning (Higher Education Fee Limits) Bill

Baroness Wilcox of Newport Excerpts

2nd reading
Monday 19th June 2023 Lords Chamber

[Baroness Wilcox of Newport (Lab)]

My Lords, this is an important addition to the education portfolio of legislation presented to this House by the Government, and from the outset I state the Labour Party’s support for the financial funding for students as evidenced in this legislation. I thank the Minister for introducing the Bill with clarity and in such detail.

We look forward to hearing the maiden speeches in this debate from the noble Lord, Lord Sewell, and the right reverend Prelate the Bishop of Sheffield, both of whom I am sure will continue to contribute thoughtfully and sincerely to the future work of this House.

This Bill follows on from the Skills and Post-16 Education Act 2022, which I had the pleasure of working on from the Opposition Front Bench alongside my noble friend Lord Watson. We sought to make changes as we took that Bill through the House; I am looking forward to my noble friend’s contribution in this debate on the latest Bill, as we continue to try to make changes to this primary legislation.

The main issue with the Bill is the lack of detail. It is an incredibly short Bill to deal with the significant issue of the decline of lifelong learning and, as it stands, it will mean a lack of clarity for the industry. The Bill introduces the next set of changes to primary legislation required to enable the LLE to be introduced from 2025. It would amend the Higher Education and Research Act 2017 to allow Ministers to set credit-based fee limits for some modules and courses, and the framework for how those limits will be set. It will also provide powers for Ministers to determine which courses have credit-based fees and to set the parameters of the new system via secondary legislation.

As stated, we support the introduction of the LLE and the credit-based method to determine fees. That could make a real difference in helping adults to access flexible lifelong learning, thereby beginning to address the decline that the sector has experienced over some time in England. Notwithstanding that positive statement, we believe that the legislation could be significantly improved, and today is the beginning of how we set our case out in that respect.

The number of adults aged 21 or over accessing higher-level skills courses has fallen dramatically since 2009-10, and participation is now significantly lower in England than in the rest of the UK. As with much legislation presented by this Government, it appears that the integral features of how the LLE and the credit-based method will work in practice are left to secondary legislation. Yet again, more detail needs to be included on the face of the Bill to ensure that it will be effective in boosting lifelong learning. We need greater clarity on the concepts at the centre of the Bill; we need a definition of credits and what the minimum and maximum yearly credits will be, for example.

It is essential to reverse this decline in accessing higher education. That requires a funding and regulatory system which supports and encourages lifelong learning. The LLE could be transformative in revitalising flexible higher education and reversing the sharp decline in the number of adult learners. It could also incentivise alternative, flexible pathways that support people to access learning throughout life. However, its detailed design will be key in determining how it works in practice.

I will ask the Minister a range of questions that the slender content of the Bill raises but does not answer. What is the strategic vision for modular funding within the LLE, and is the intention for most modules of designated courses ultimately to be eligible for funding? Will per-credit fee limits be set at different levels depending on whether a course is full time or part time, face to face or distance learning, or be based on the subject or level of study? Will all students be included in the LLE from 2025, or will transitional arrangements be put in place as part of a phased implementation? How will the design details of the LLE, including those on ELQ rules and residual entitlements for those who already have higher education qualifications, work in practice? Will providers continue to receive support from the part-time student premium to help with the additional costs associated with flexible part-time study? It is vital to ensure that this flexibility is considered.

No doubt the Minister is expecting me to comment on what we do in Wales, and I would hate to disappoint her. While I will leave it to other noble Lords to comment in more detail, I note that the current, progressive system of student finance we have in Wales means that Welsh undergraduate students have less to repay, on average, than their English peers, as we continue to provide non-repayable grants. They also receive a guaranteed level of maintenance support, irrespective of income.

Currently, part-time students studying face to face are entitled to maintenance support. However, the vast majority of part-time distance learning students are not. The introduction of the LLE could be a real opportunity to make this important change. Introducing maintenance support makes a difference. We have seen this with the introduction in 2018-19 of such support for part-time and distance learning students in Wales. It illustrates the significant potential impact on demand for part-time learning from extending maintenance support.

Maintenance support is crucial to learners from disadvantaged backgrounds to prevent further hurdles. Otherwise, many adults will be unable to take up these opportunities and it would prevent these people transforming their life chances and being part of the skilled workforce that employers and our economy need.

Furthermore, an extension to distance learning students would help mitigate the current cost of living pressures facing distance learners, which are beginning to impact on mature students. For working students, there is also the concern that employers would reduce their own staff training obligations as expectations of individuals funding their own training would arise as an unintended consequence.

In conclusion, there is a positive element to the Bill that we welcome. But, as it progresses through your Lordships’ House, we will bring amendments to cover the points I have raised and to try to ensure that greater substance and practicality are put into the Bill and thus lessen the subsequent need for further secondary legislation.

Lifelong Learning (Higher Education Fee Limits) Bill

Baroness Wilcox of Newport Excerpts

Report stage
Tuesday 5th September 2023 Lords Chamber

[Baroness Garden of Frognal (LD)]

Amendment 1 proposes the widely accepted requirement that the learning hours associated with credit must be consistent with sector-wide standards. It would be beneficial to have 10 hours written in the Bill in order to cement its definition, because that would mean that no new definition could be introduced or imposed at a later date for the purposes of setting fee limits.

We continue to express concern that the lack of detail in the Bill could mean that in the future the policy could significantly change from the intentions of the current Government, and there is little constraint against decisions made by the Secretary of State—often a “here today, gone tomorrow” Minister—but I recognise that on Report we are unlikely to be able to change the powers of the Secretary of State.

Amendment 2 proposes the insertion of a new clause to review the provisions in the Act. Businesses are reporting having difficulty recruiting employees with the relevant skills. In August 2022, the Federation of Small Businesses found that 80% of small firms faced difficulties recruiting applicants with suitable skills in the previous 12 months. The Recruitment and Employment Confederation estimates that if labour shortages are not addressed, the UK economy will be £39 billion worse off each year from 2024.

Despite the rising population, many employers are facing skills gaps. Some 28,300 London employers report that not all their employees have the right skills for the job. Almost a quarter—23%—of all vacancies in London are due to a lack of applicants with the right skills, while almost half of firms—42%—are not confident that they will be able to recruit people with the higher-level skills their organisation needs over the next five years. It is possible that many of the migrants waiting to be processed will have the skills that the country urgently needs, so when will the Home Office speed up the processing so that we can see if that is the case?

We are not convinced that the introduction of the lifelong loan entitlement will help to plug the gaps. The Liberal Democrats have called for grants, rather than loans, to encourage adult reskilling, concerned that many adults will be reluctant to take on debt for their further training. Will the LLE allow people to upskill effectively? Will they want to take out loans to upskill? It will be important for the Government to review the impact of the provisions of the Bill to assess whether these measures alleviate the skills shortages.

I am not my party’s expert on sharia finance, but I am aware of the Islamic belief that benefiting from lending money by charging interest or repaying more than the initial amount borrowed—riba—is forbidden. The investments made by loan companies, which might be in industries such as gambling or alcohol, are also considered problematic. For these reasons, Muslim students are deterred from taking out student loans from the Student Loans Company to cover the tuition fees and living costs associated with higher education. Research has shown this can act as a barrier to higher education for Muslims or cause financial hardship for those who do choose to study at university.

The UK Government first proposed a student finance product consistent with Muslim beliefs about interest-bearing loans in 2013. The Higher Education Research Act 2017 allows the Government to introduce such a product, but it has yet to do so. The issue has been raised in Parliament a number of times, with the delay described as shameful by my noble friend Lord Sharkey, who is indeed an expert on sharia finance.

In March 2023, in their response to the consultation on the lifelong loan entitlement, the Government said that a sharia-compliant alternative student finance product would not be available as part of the launch of the LLE in England in 2025. In July 2023, the Government said that they remain committed to delivering alternative student finance as soon as possible after 2025. Can the Minister say why the Government have yet to do this? It would be useful to understand their thinking behind the delays and whether they could explain how the introduction of the LLE would impact those who require sharia-compliant loans.

The other part of the amendment calls for a review before the end of 2026, and preferably earlier. I have also added my name to Amendment 4, which Labour will introduce. I look forward to the Minister’s response, and I beg to move.

[Baroness Wilcox of Newport (Lab)]

My Lords, I rise to speak to Amendment 4, which would require the Secretary of State to publish a review of the lifelong loan entitlement before bringing in further regulations on fee limits. I welcome the Minister's comments in Committee, and I fully understand her feedback about what information will accompany further regulations as these changes are rolled out.

We have brought this amendment back to further raise the point about ensuring that students, the sector and Parliament are given clear information on the details of the LLE as soon as possible. Throughout the passage of this Bill, we have raised concerns, often after input from those in the higher education sector, that so little about the LLE in terms of course provision, maintenance, credits, transfers, and further rollout of modular study at other levels is confirmed in any meaningful detail.

I am none the less grateful that, following Committee, the Minister outlined further details of the LLE that relate to this Bill in a letter. However, as we know, this huge shift in higher education policy goes further than fee limits. We all want this change to work, but for that to happen the sector will need much more clarity than has been provided through this very narrow Bill.

The accounting officer assessment for the LLE states:

“The main feasibility risk of LLE is meeting the 2025 delivery timescale”.


Is the Minister still confident that the department will be able to deliver on time, particularly in the light of current pressures arising from the major emergency that the department is currently dealing with in school buildings across the UK?

My next question follows on naturally: what is in place if this timescale turns out to be unworkable? There are a great many sector stakeholders—as well as the students themselves, of course—who will need clearly communicated timelines. Amendment 1 from the noble Baroness, Lady Garden, puts in the Bill the number of hours that constitute a credit. We understand why she tabled that amendment: it is important that the sector is given clarity and control over the definition of working hours and that it is consistent with the QAA’s higher education credit framework. As she noted, her concern is about the lack of detail. This is one of many areas in which the higher and further education sectors still have questions about how a credit will be defined.

The concept of a credit in education terms will also be completely alien to the general public, and there is a risk that employers simply do not understand its value. The Government need to think about how this can be communicated. We do not believe that putting a number in the Bill at this point would be beneficial. However, we would like a commitment from the Government that they will not seek to amend the value of a credit and will be led by the sector’s understanding of it.

On Amendment 2, I am glad that the Minister has outlined the Government’s plans to ensure sharia-compliant loans in writing; we look forward to receiving further engagement on this issue as the LLE progresses. But, as the noble Baroness, Lady Garden, pointed out, there is a distinct problem with skills gaps—a lack of applicants with the right skills. The economy cannot move forward appropriately with skills shortages.

[Lord Willetts (Con)]

My Lords, the amendments reflect widespread cross-party support for the Bill and its principles; they are not intended to destroy the Bill in any way. I see the case for the Bill, which of course I warmly welcome, as opening up new possibilities. We genuinely do not know the circumstances in which people may take them up and we do not know whether debt aversion is much more of an issue among mature learners than among young people aged 18 or 19; we will find out only if we give this a try. Similarly, we do not know how much suppressed demand there is for level 4 or level 5 qualifications because of the way in which loans are currently structured; we will find out only if we give this a try. So this is definitely worth going forward with.

I have three brief comments on the amendments. First, one of the temptations we have in this House— I have occasionally succumbed to it myself—is to try to determine the details of policy through primary legislation. That is one of the risks in Amendment 1, with its specification of the definition of “one credit”. Of course, it is an important and interesting area but, as we are embarking on a journey with a new and more flexible system, trying to put that into primary legislation would inhibit necessary policy flexibility—a point that I think the noble Baroness, Lady Wilcox, referred to.

Secondly, I agree with the point made by the noble Baroness, Lady Garden, on sharia-compliant loans. We have been at this for 10 years now, and it really is time that a scheme such as this were available and in force. There were initially some tricky problems, but I think that the long work that the department has done over the years has resolved them. My understanding is that the technical and theological issues have been addressed. I know that the Minister herself is keen to get on with this, so anything that she can say to the House about her commitment to that timescale would be very welcome.

Finally, on Amendment 4, I am proud to say that I am acting as the spokesman for the noble Baroness, Lady Wolf. She very much regrets that she cannot be with us; she briefly appeared, but I think she had to catch a plane to Lithuania. In many ways, she is the intellectual origins of the Bill. I know that her spirit is that she wants to get on with it. Her concern about this amendment—which I completely understand and support—is that requiring another review before we can get on with things will slow down the pace still further. I think that the mood across this House is that we want to get on with it; we do not want reasons for further delay. I fear that Amendment 4 would constitute another obstacle to this potentially important and significant innovation in policy, which I warmly support.