My Lords, I congratulate my noble friend Lord Soley on securing this debate and introducing it so ably. I cannot measure up to the list of interests that the right reverend Prelate declared, but I declare an interest as former director of the London School of Economics and formerly a professor in Cambridge for quite a few years.
The issues facing universities are extraordinarily complex. They show in one particular institutional setting the scale of the task the country has taken on following the referendum. So far there is no Brexit, simply a decision to leave the European Union. If the Government have a plan, only they know what it is. The wider economic implications at this point are, therefore, to my mind imponderable.
My first main point is that those responsible for running our universities must engage in scenario thinking that runs well beyond higher education. For better or worse—and in my eyes it is certainly worse—this Government have decided to turn universities into commercial organisations, driven by consumer choice. They will be as vulnerable to a downturn in the economy as any other form of business enterprise.
Moreover, from this juncture onwards there will not be a stable external environment against which universities will operate within the wider framework of the EU. The other member states, and those who run their universities, will be taking reactive decisions well before any concrete deal is reached between Britain and the rest of the European Union. This includes students and potential students, researchers and other staff, as well as those actually in charge of higher education institutions. The Government can try to give guarantees and smooth out anxieties, but everyone can see that those guarantees will be vulnerable should there be a wider deterioration in the UK’s economic situation. What appears to be the Government’s position—that nothing will change up to the point at which the UK actually leaves the EU—seems to me naive in the extreme.
All of this will take place against the backdrop of the higher education Bill, due to come before the Lords shortly. It loads up universities with a tangle of new bureaucratic rules, supposedly in the interests of improving teaching standards, and introduces a further set of uncertainties to join the much more wide-ranging ones created by Brexit. This clumsy Bill is the last thing universities need at the moment and, when the time comes, I hope that other noble Lords will join me in opposing large chunks of it.
The Government can and are seeking to introduce at least some guarantees that existing structures will remain in place for the time being. However, they cannot control what overseas Governments and institutions think, and they will be proactive. Research reported by Times Higher Education indicates that there are already visible consequences. Researchers spoken to indicated that applications to Horizon 2020 for funding had already been thrown into doubt, as continental colleagues worried about the impact of including British researchers in their project applications.
The response that it will be business as usual until the UK actually leaves the EU will not do, for the reasons I have already stressed. Both the Government and university leaders will have to think more imaginatively to blunt the reputational effects of impending Brexit, as well as the real losses in student recruitment and research capacity likely to take place. Of course, there is always the banal response that the UK will open itself up to the wider world as it turns away from the rest of the EU. But proximity is often important in research collaboration; and so is an established and regularly funded way of stimulating and backing research projects.
At this point, we just do not know what kind of deal the UK will be able to do with the 27 other EU nations. There is a huge difference between staying in the single market, which is surely impossible if EU migration is to be curtailed, and opting for a limited trade deal. In the second case, the UK will definitely be an outsider in Europe, peering in. Universities may have become like businesses, but they cannot react with the speed that orthodox companies do to changing economic fortunes. Beyond limited financial guarantees, how will the Government help universities to plan ahead?
I agree very much with what the noble Lord, Lord Willetts, said. Some structure must be in place—not a temporary consultation, but an enduring structure linking government with universities to plan ahead in a macro context, not just the context of the university system itself.