Higher Education Bill

Part of the debate – in the House of Lords at 5:09 pm on 14th June 2004.

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Photo of Baroness Ashton of Upholland Baroness Ashton of Upholland Parliamentary Under-Secretary (Sure Start, Early Years and Childcare), Department for Education and Skills, Parliamentary Under-Secretary (Sure Start, Early Years and Childcare), Department for Work and Pensions, Parliamentary Under-Secretary (Department for Work and Pensions) (Sure Start, Early Years and Childcare) (also Department for Education and Science), Parliamentary Under-Secretary (Department for Education and Skills) (Sure Start, Early Years and Childcare) (also Department for Work and Pensions) 5:09 pm, 14th June 2004

My Lords, the National Childcare Strategy is working precisely to support children and child care in lots of different locations. Of course, we supply support for people who have children, to enable them to take part in education. As I have already said, the question of age and grants available does not apply: the grants are available regardless of age.

It is critical that we get the information that we need and make the decisions based on that information. On that basis, I would ask that Amendment No. 55 be withdrawn.

As regards Amendment No. 54, institutions have always been free to determine the level at which to charge for part-time courses. That unregulated market is working well. We have no desire to interfere with it. If we were to regulate part-time fees, we would be imposing new restrictions on institutions where there have never been restrictions before. A cap might be imposed on fees that are less than some institutions currently charge and employers or students currently pay. That would have a dramatic effect on the income of those institutions: some might stop running the courses. Equally, if we set the cap higher, there might be an upward drift in fees charged. We do not believe that that is the right way to go or that we should regulate. I hope that my noble friend will not press her amendment.

I turn now to institutional funding and the review. Noble Lords have mostly talked about the Open University and Birkbeck, but I think that they are also interested in this issue in more general terms. We are very aware of the concerns that some institutions have expressed—particularly those with a high number of part-time students—about the funding for part-time students in the light of our proposals.

Last autumn, the Higher Education Funding Council for England consulted the sector about proposed changes to its teaching funding methodology. That consultation, and the responses to it, led to some changes to the way that the funding for part-time students will be calculated for the 2004–05 academic year. I understand that allocations have been announced. For the longer term, HEFCE has commenced a comprehensive review.

Following debates in your Lordships' House at Second Reading and in Committee, we have had further discussions with HEFCE regarding the scope of its review of the funding methodology. In particular, we have pressed it to ensure that the review is conducted and that proposals are developed as quickly as possible with full consultation with the sector. That consultation needs to take account of the position of those institutions with a strong interest in part-time issues. That does not refer simply to the Open University and Birkbeck, although, of course, they are very important players. We have also asked for an assurance that changes flowing from the review will be implemented at the earliest opportunity.

I am pleased to say that HEFCE has responded very positively and has confirmed that part-time issues, far from being an add-on to the review, will form an important and integral part of it. Its starting point will be to consider whether in the future it makes sense to continue the full-time/part-time distinction at all and how to develop a better approach that is consistent with more flexible learning.

HEFCE has also confirmed that its fundamental review, which is now under way, will involve extensive consultation with the sector on the issues that are to be addressed. Its expectation is that in summer 2005, it will be in a position to consult on the principles of the new system with a view to finalising proposals for a new model in early 2006, which would be before the introduction of variable fees. Those recommendations can then be implemented in a phased way as soon as the associated financial information systems can be developed.

Therefore, before variable fees are introduced, universities will know the funding regime and the broad implications for the sector. Of course, that does not address the very specific issue of the implications of variable fees for those institutions with predominantly part-time students. Here again, HEFCE proposes further consultation with the sector on the detail of what will be the transitional arrangements pending the introduction of the new funding method. It has explained that using its current funding formulas, if it did so happen that full-time tuition fees increased at a greater rate than part-time fees, there would be a natural rebalancing of government funds in favour of part-time courses. It has also agreed to consider the special cases that both institutions—the Open University and Birkbeck—have made regarding their funding, with a view to the HEFCE board coming to a decision in the autumn.