Let me begin by adding my words of congratulation to the new Minister on his appointment. I do so warmly and for two reasons. The first is the cause of the vacancy—the deserved promotion of his predecessor. I am delighted that my recommendation that he should be promoted to the Cabinet, which I made on the record in the House some months ago, did not blight his chances. He engaged admirably with both Government and Opposition Members and thoroughly deserved his elevation. The second reason is that I enjoyed the exchanges I had with the new Minister when we both had responsibility for the Transport portfolio. He is a thoroughly nice and decent person and, like his predecessor, he is one of those Ministers who genuinely engages with the points made to him. I wish him well in his new job.
I do not doubt for a moment the passion or sincerity of Mr. Willis, who opened this debate in his characteristically robust fashion. He clearly genuinely cares for the future of higher education and for the life chances of our students. I hope that he would accept that he does not have a monopoly on concern over such issues. We may, and do, differ on the best means of securing our objectives, but we all wish to see a stronger financial position for our universities and an affordable pathway ahead for our students.
All three parties have now set out their policies for funding higher education. We all acknowledge that our universities are badly underfunded and have been for many years, both before and since 1997. We all agree that unless that is reversed major damage will be done to this country's academic and economic standing, that universities therefore need a substantial annual extra injection of cash, and that that should be found in ways that ensure fair and equitable access to higher education, but there are important differences between us, too.
The Government believe that the way forward is to impose top-up fees. That is a clear and open breach of Labour's 2001 manifesto, which stated:
"We will not introduce 'top-up' fees and have legislated to prevent them."
Well, now they have legislated to bring them in. The Government's plans do not make sense for taxpayers, who will have to pay out £1.1 billion extra every year in order to give universities an extra £900 million a year, for students, who will face far higher debts under Labour's plans than under either of the other two alternatives, or for universities, which will face political control of their income, the creation of the widely loathed university access regulator, and no guarantee at all that Labour's second version of fees will be additional to, rather than a substitute for, existing grant. After all, Labour's first version of fees was clawed back in its entirety by the Treasury.
There is an intellectual argument for unrestricted fees and a genuine market mechanism, and that is what some vice-chancellors and others would like to see.
That is not what the Government legislation offers—indeed, Ministers have specifically ruled it out. Many of those who most enthusiastically support fees do so because they want, and hope, to see fees of not £3,000 a year but £5,000, £10,000 or even £15,000. Ministers cite some of those who hold that view in support of their case for fees, but then they turn round and tell their Back Benchers that, of course, there is no question of fees rising above £3,000 a year for many years. Somebody somewhere is being badly deceived.
Then there are the Liberal Democrat proposals. They agree with us that there should be no fees but believe that more money for universities should be provided by raising income tax, at a time when every other G7 country is cutting it. While the rest of the world is following the UK's example of the 1980s and realises that lower tax rates, especially at the top, generate more revenue, increased investment and stronger competitiveness, the Lib Dems want to return to the days of the 1960s and 1970s when Chancellors revelled in asserting that the rich should be squeezed until the pips squeak. As both Abraham Lincoln and John Kennedy recognised, we do not make the poor rich by making the rich poor.
Furthermore, as we have already heard, Lib Dem plans would leave universities wholly and solely dependent for their income on the good will of the Treasury. Universities would have no independent revenue stream, no insulation against the ups and downs of the economic cycle, and no protection when funding higher education becomes a less fashionable cause than it is today.
Both Labour and Lib Dem plans conceal an unhealthy obsession with class. The Lib Dems want to wallop the rich through taxes, and Labour believes there are too many middle-class people at our top universities. Only Conservatives believe that working hard and doing well are not sins for which people's children should be punished.