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Higher Education and Research Bill - Committee (6th Day)

Part of the debate – in the House of Lords at 5:30 pm on 25th January 2017.

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Photo of Viscount Younger of Leckie Viscount Younger of Leckie Lord in Waiting (HM Household) (Whip), Lords Spokesperson (Department for Education) (Higher Education) 5:30 pm, 25th January 2017

My Lords, I thank the noble Baronesses, Lady Brown and Lady Wolf, and others for laying this amendment as it gives me the opportunity to clarify the role of the Competition and Markets Authority in the higher education sector. I say at the outset that I understand that the CMA is content that there is no conflict between the two organisations. The Government share that view.

In summary, the CMA is not a sector regulator but an enforcer of both competition and consumer protection law across the UK economy. It also has a number of other investigatory-type functions across the economy, including investigating mergers and conducting market studies and investigations, so I shall say a little more about competition and consumer enforcement in particular.

Enforcing competition law is a specialist activity requiring particular economic and legal expertise. Enforcement cases require substantial input of specific skills over a sometimes protracted period of time. The OfS will not have these and it would be unnecessary and expensive to replicate them. Placing a duty on the OfS to encourage competition between higher education providers in the interests of students and employers is a very different matter to enforcing competition law. We believe that there is no conflict between these two different responsibilities. Arguably, giving the OfS additional competition enforcement powers would risk distracting it from its important regulatory duties, or would possibly create conflicts of interest.

To answer concerns that encouraging competition would be at the expense of collaboration, there should be no conflict between providers collaborating and the OfS’s duty to have regard to the need to encourage competition where that competition is in the interest of students and employers. We are wholly supportive, as is the CMA, of collaboration and innovation where they are in the interest of students.

I turn now to the enforcement of consumer protection law carried out by the CMA and other such enforcers such as trading standards. Students can have consumer rights and, as such, are protected under law. As outlined in our White Paper, we want the OfS to be a consumer-focused market regulator putting students’ interests at its heart. This includes looking after their consumer rights, ensuring the right information is available for them at the right time and making sure they have a route of redress should something go wrong. Compliance with consumer law is important not only in protecting students, but in maintaining student and public confidence in the higher education sector. I know that higher education institutes have been working hard on meeting their consumer rights obligations. I remind noble Lords that the CMA operates extremely effectively alongside a wide range of sector regulators such as Ofcom, Ofgem and Ofwat. I am grateful for the continued involvement of the CMA in preparatory work to establish the OfS. Its experience is valued tremendously. With that short explanation I invite the noble Baroness, Lady Wolf, to withdraw her amendment.