Higher Education (Basic Amount) (England) Regulations 2010

My Lords, it is wonderful to be so welcome. I noticed the declaration of interests that the noble Lord, Lord Triesman, made at the beginning of his somewhat lengthy speech, although it was none the worse for that. My noble friend Lady Shephard described him as having a silky tongue. I had better declare another interest in that I was one of those higher education Ministers who saw him, and I declare the interest that I greatly enjoyed the lunch that he gave me some 13 or so years ago. I am not sure that I ever declared it at the time but it was a very useful meeting, as he explained to me just how many members of his union were in both Houses. I think he claimed that he had more than any other trade union leader in the history of trade union leaders having members in this House. I listened with interest to the somewhat lengthy speech of the noble Lord, Lord Triesman, but I heard no coherent argument in it whatever. It was a mere rant, with no solution put forward by the party that got us into the mess that my noble friend Lady Shephard described. He claims that there is no evidence and that there was no consultation, but does he not think that the report produced by the noble Lord, Lord Browne, and commissioned by the Government of whom he has been a member, provided just that? In that report there is evidence, and in the production of that report there was a great deal of consultation. A great number of points have been made during this debate and I want to deal with some of them in order to knock the myths that are growing up. The first one—addressed, first, by the right reverend Prelate the Bishop of Lincoln but brought back to us again and again—is the idea that the poorest will be deterred. The right reverend Prelate referred to the removal of the education maintenance allowance for 17 and 18 year-olds. I understand that the removal of the EMA was examined in a report by the party opposite when it was in government. The report showed that some 90 per cent of the money was being wasted, and it was not encouraging the children involved to stay on at school, as they would have stayed on anyway. I think that my right honourable friend did exactly the right thing in suggesting that that money could be moved and made better use of. In terms of the poorest being deterred, many of us made that argument when student fees were introduced. It started, as the noble Baroness, Lady Blackstone, said, in 1998 and was then enhanced by the 2004 Act. On both occasions we saw an increase in those from less well-off homes going into higher education, and I do not see any reason why that should not happen again. We will certainly continue to examine what happens after these changes come into force. The next point—put forward by the noble Baroness, Lady Blackstone, and the noble Lord, Lord Krebs—is that our decision to increase the upper cap to £9,000 is purely a political choice and that we have made it for no other reason than we want to save money. I must make it clear that in their Pre-Budget Report of 2009 the previous Government identified some £600 million of cuts to higher education and science to be made by 2012-13. The department responsible for universities, BIS, was not protected in Labour’s public expenditure plans, so it is hard to see what protection a Labour Government would have produced over the spending review period if they had not been able to cut departments’ budgets by some 25 per cent, which is exactly what we have done. That deficit exists—we inherited it—and the Government are responsible for the interests of all taxpayers in meeting it. At a time of real financial hardship, we believe it is right to make cuts across public spending, but we do not believe that it is right to ask those on low incomes to pay additional taxes to prop up an unaffordable university funding system from which they do not benefit directly. Obviously there is a benefit to all of society—I accept that—but there is a greater benefit for the individuals going to university and I do not think that we can get away from that. The second point that I want to address is the idea put forward—again, by the noble Baroness, Lady Blackstone—that the new system will not save any money. She quoted the Institute for Fiscal Studies and the Higher Education Policy Institute, which have both questioned whether the policy will save money in the end. I say to the noble Baroness that our proposals contribute directly to paying down the deficit because they replace grants with loans, of which about 70 per cent are expected to be repaid in due course by those on higher earnings. We are reducing the direct funding of universities via the teaching grant—