Higher Education Fees

Roberta Blackman-Woods Excerpts

Thursday 9th December 2010 Commons Chamber

[Mr Blunkett]

rose—

[Roberta Blackman-Woods (City of Durham) (Lab)]

Will the hon. Lady give way?

[Anna Soubry]

Forgive me, no. Time is so short that Opposition Members may well say that they want to hear less of me, not more.

I feel that there should be considerably more honesty, notably from Labour Members, about the legacy they left us. That legacy is not just in relation to the deficit, because 45% of youngsters leaving school now go into higher education. I pose this question: has that actually been to the benefit of them and the nation? There is a really good argument that we have had an over-expansion of higher education that has devalued degrees and falsely raised the expectations of young people of my daughters’ generation. It has also led to an undervaluing of the skills, ability and achievements of those who have not gone into higher education. That is why I am so proud that this Government have increased the number of apprenticeships by up to 75,000.

--- Later in debate ---

[Damian Hinds]

I am sorry, but because of the time I cannot.

It is sometimes difficult when people of our age have conversations with teenagers about university tuition, because it is startlingly obvious that we had an incredibly generous deal. That deal, however, was always based on such education being available to a relatively small number of people, and we were just the beneficiaries.

In the year I was born, 414,000 people were in full-time higher education; when I went to university, the number was 660,000; and now, it is 1.3 million. When we experience changes of that magnitude, we must fundamentally rethink how we pay for such things. Members from all parts of the House agree on that fundamental point, as they do on pension reform and on long-term care.

There has been another major change over those 40 years: real household income per head is 2.5 times what it was in 1970. That does not come from nothing; it comes from economic growth, an increased number of higher, value-added jobs and, most of all, growth in the professional and managerial classes, which is enabled by more people participating in higher education. We need those trends to continue, because never again will we make T-shirts cheaper than China. We need wider participation in higher education to thrive, and we need to excel in the necessary markets: advanced manufacturing, pharmaceuticals, financial services and, indeed, education itself.

The global market for higher education is growing at 7% compound per annum. This country is uniquely well placed to take advantage of that, first, because of the gift—literally, the gift—of the English language, and, secondly, because of the marvellous higher education brand names in England and, I must say, Scotland, Wales and Northern Ireland. To thrive in that market, however, our universities need to be properly funded, and top universities have long complained that, even with the Government contribution—

[Roberta Blackman-Woods (City of Durham) (Lab)]

Will the hon. Gentleman give way?

[Damian Hinds]

I cannot, because of the time.

Top universities have long complained that, even with the Government’s contribution and the fees, they were underfunded and could not cover their costs. Incidentally, the cost also applies to EU students. There were 61,000 such enrolments last year, a number that is growing fast, and they are also partly subsidised by the British taxpayer. The right hon. Member for Southampton, Itchen (Mr Denham) made light of the following point, but universities have used non-EU students as a cash cow to plug the funding gap, and that is not sustainable in a competitive, global market. Universities must be funded properly and sustainably.

It is true that, in higher education, there are what economists call both private returns and social returns— in other words, matters of social benefit—but all the studies say that the private returns outweigh the social returns, so it is fair that the students, over time, bear much of the cost.

With the package before us, with variable fees, requirements—rightly—to widen access and the higher £21,000 repayment threshold, we can continue to increase the number of young people accessing university, with all the benefits that that brings, and gear up the UK to take advantage of that key global growth market.