Higher Education

My Lords, I am delighted to speak in this important debate and I am grateful to the noble Lord, Lord Luce, for providing the opportunity to do so. As he said, higher education is one of this country’s great success stories. To his list of successes, I would add that we punch above our weight in measures of research impact and that our universities are major wealth creators, generating about £46 billion a year for the economy. At this point, I declare my interest as chief executive of Universities UK. This opportunity to cast our minds 15 years or so ahead allows us to reflect on the role that we want our universities to play beyond the purely economic. We are entitled to hope that our universities will provide some of the answers to the grand challenges that we are likely to face in the next half century. I am thinking particularly of climate change. The speed and scale of likely change mean that now, more than ever, we need first-class minds to push forward the limits of our understanding of the geopolitical, social, economic and health-related consequences of global warming. There are other unstoppable changes to which our universities will be at the forefront of helping us to adapt. Let us think about the healthcare implications of our ageing population and about the need for the coming generations to be part of the workforce for much longer. Demographic projections suggest that between 2011 and 2020 the number of full-time students will drop by 6 per cent across the UK. That is 70,000 students. On the other hand, there will be an increase in the older age groups from which most part-time students are drawn. This is a great opportunity for universities, as they are committed to helping more than 40 per cent of adults to attain skills to graduate level and above. This aim will almost certainly be achieved only through retraining that is delivered part time. Therefore, the Government will need to look again at whether provision for part-time students, which is at present much lower than that for full-time students, is adequate to meet this challenge. That brings me to a further challenge. Public funding remains vital to the health of our universities. We have been grateful to the Government for restoring stability to the sector after years of underfunding. Together with the introduction of variable fees, this has been done by maintaining the unit of public funding in real terms. I urge the Minister to confirm today that this will continue beyond the current spending review. Without this commitment, any other promises will ring hollow. We need continuing public investment to maintain our international competitiveness. Although we lead the field in many areas, the UK lags behind many countries in spending on higher education. As the noble Lord, Lord Patten, reminded us, we spend 1.1 per cent of GDP, whereas the US spends 2.9 per cent, while countries as diverse as China and New Zealand are rapidly increasing their own investment. There is no doubt that these challenges will be better met if the sector can work closely with the Government on shared aims. For example, we have already been trying to ensure that, for the future, the new visa system invites in the best students and staff, rather than putting up barriers that send them elsewhere. Consultation of this sort is vital for making change run smoothly. The university sector has a long-established, key role in promoting and helping to deliver public policy objectives. As has been mentioned, when such consultation does not happen—there was the recent withdrawal of funding for students with equal and lower qualifications and the Foreign and Commonwealth Office withdrew funding for Commonwealth scholarships —institutions are left able only to advise the Government on unanticipated consequences. I hope that the Minister will agree that, working as partners in a climate of mutual respect and collaboration, with a shared vision of the future that focuses on ensuring that all those who want to benefit from higher education can do so, universities and government can deal together with whatever lies ahead. I end by reinforcing the points that the noble Lord, Lord Luce, made about autonomy. This long-established autonomy has enabled our universities to flourish, to the huge benefit of students, our communities and the economy. I trust that all parts of the House will concur that continued autonomy is vital if universities are to deliver solutions for the future.