My Lords, I thank the noble Lord, Lord Giddens, for initiating this debate. However, I cannot share what I thought was the general pessimism of his contribution. I am the Chancellor of Teesside University and we have to make this new regime work. We cannot afford closures or failures. We have to keep widening access and raising aspirations because the people of our region have a right and a need to continue to grow and develop.
We should absolutely be focusing on ensuring that higher education is funded sustainably; that is, delivering a quality student experience and increasing social mobility. However, there are genuine concerns about mechanisms being proposed that could have very real consequences for universities such as Teesside that are playing the critical role I have already mentioned. It is of concern to me, as it obviously is to my noble friend Lady Howells, that the "core plus margin" approach might have the unintended consequence of forcing many full-time students away from areas of need and the provision of their choice in high-demand, high-quality institutions, towards provision elsewhere.
We are all aware that there are many complex reasons why students choose the university they wish to go to, yet we are in danger of introducing mechanisms that will vastly restrict this choice through moving numbers to places where there is no evidence of demand. I am conscious of this point particularly in my own area, where Teesside University is the only independent higher education institution in the conurbation. A reallocation of 8 per cent of places leaves nowhere for those qualified students to study. I would add that in areas where moving home to go to university is not an option for many potential students, including many mature students and women returning to study, I worry deeply about this aspect of government policy.
In my Teesside area, we have an excellent further education sector in the context of a partnership with five excellent colleges. It is a partnership of exceptional strength and mutual respect, with a successful track record of providing ladders of opportunity to people across the community served by my university. It is a partnership in which my own university has invested significant sums in building higher education centres on the premises of all the five colleges, and my great concern is that because of the average fee restrictions such partnerships could be undermined in respect of the founding universities, which have striven to create a genuinely rounded higher education experience in a purpose-built-environment but now will be unable to bid for additional full-time student numbers. I would like the Minister to look at that issue very carefully. I do not believe that that is a consequence is desired by Ministers, and it is certainly not desired by the principals of the colleges to which I have referred. I would welcome clarification in this regard.
Both Houses have given consent to the new funding regime but my own experience and that of my university is very much that prospective students, their parents and advisers do not yet fully understand that this being free at the point of entry, with enhanced student support and a progressive repayment regime, means that higher education should still be for all those who are qualified to enter. It is my fear therefore that student recruitment in 2012 might not be a realistic indication of the long-term recruitment pattern of a university. I strongly encourage Ministers to ask the HEFCE to maintain student number controls for 2013 at the level set for 2012 so that short-term shortfalls in student participation can be recovered without major and damaging turbulence in the higher education sector.
It is also my expectation that changes in support funding for full-time students will result in a step change in the take-up of part-time and distance learning study opportunities. I hope that the Minister will recognise that significant clarity is yet to be brought to the long-term funding that will support such a crucial part of our higher education landscape.
I want to emphasis that the continued success of universities, such as Teesside University, in areas of high unemployment is essential, not just for the education of young people and returning learners but also for the economy of the region. In the 10 years since I looked at education with any kind of a serious eye, it has changed dramatically, beyond my expectations. Middlesbrough was a steel town, a shipyard town and full of factories. Now, there are no factories left. In the middle of the town there is now a university, and it is the university that people look not just for education but for employment.
As the university becomes successful, student numbers will grow and it will get a worldwide reputation. In 2010, it won the award for the best university in the country, against all comers, including, let me say, the Russell group. As it does that, it becomes a focal point for innovation, excellence and jobs growth. We must really understand the importance of these universities for the future. It is about higher education but also about something much more in terms of the economy, jobs and the future of the people who live and work in those regions. I hope that the Minister and her colleagues in the other place will take these things into careful consideration.