My Lords, this report has been long awaited and I do not doubt that the Minister is quite relieved that he is at last able to tell us about it. We owe a debt of gratitude to Philip Augar and his team for the amount of work that they have put into it. It makes some really welcome recommendations on further education and skills, as the noble Lord, Lord Bassam, set out. Successive Governments have neglected the importance of colleges and lifelong learning, so this change of emphasis is to be commended.
Over the last 10 years colleges have had to deal with an average funding cut of 30%, while costs have increased dramatically. Further education is the only part of the education budget to have had year-on-year cuts since 2010. Funding for adult education has had a cut of 62%; in the last 10 years, we have seen total enrolments for adults drop from 5.1 million to 1.9 million; funding for students aged 16 to 18 has been cut by 8% in real terms since 2010; and colleges have been tasked with the new T-levels, which may or may not turn out to be an improvement on the well-respected vocational qualifications which are around at the moment.
We note that Augar’s proposed lifelong learning loan allowance is restricted to a limited range of courses. Mature students may not want to take out a loan late in their careers and this funding model may not work for those who have financial constraints, such as a mortgage or children. Taking out a loan is unlikely to be the most effective way of triggering a revolution in lifelong learning. Will the Minister consider expanding it to cover a wider range of education and training, and to provide grants rather than loans so that no one is unable to afford the education they need to advance their careers? Giving everyone, no matter their age, the right to a free level 3 qualification—equivalent to A-levels—will ensure that no one is denied the basic skills they need to advance their career.
We welcome the recommendation that:
“The unit funding … for economically valuable adult education courses should be increased”.
I still think it sad that the general interest programmes which colleges used to provide have gone. They were a valuable source of social mobility and improved health and well-being. They encouraged adults into learning for the fun of it. I taught French and Spanish classes way back when to people who were inveterate learners, and all the better for it, but those days of happy free learning have—alas—gone.
The capital investment of at least £1 billion is well overdue, as is the recommendation that:
“Investment in the FE workforce should be a priority, allowing improvements in recruitment and retention, drawing in more expertise from industry, and strengthening professional development”.
The FE workforce has been underpaid for far too long.
As was mentioned, anyone who does not have an undergraduate degree will be entitled to a lifelong learning loan allowance. This will allow them to receive tuition fee and maintenance loans for any level 4, 5 or 6 course. It is welcome that the ELQ rules that prevent students receiving public funding for a course at the same or lower level than one they already possess should be abolished for levels 4 to 6. This rule has prevented many people retraining for fresh opportunities.
On apprenticeships, we should also like to see more emphasis on the Richard review recommendations:
“An apprentice must be new to the job or job role”,
and that the,
“upskilling of the adult workforce … should not be bundled with apprenticeships”.
The apprenticeship levy seems to be having the reverse effect of encouraging adult upskilling at the expense of new entrants to the workforce.
It is good that universities offering degree-level courses at level 6 should award an interim qualification to students who complete their first one or two years, allowing those who drop out to still have a certificate to show for their efforts. This might in time encourage credit accumulation and transfer to enable them to take their part-qualification on in the future. This has been on the cards for years and has never found a market. Will the Government encourage a new push for credit accumulation and transfer between colleges and universities?
With many good things in these parts of the review, we do have questions over the university proposals, as the noble Lord, Lord Bassam, set out. We regret that the review has been undermined by a shoddy, regressive change to student loans, which we rather suspect has been influenced by No. 10. How much less will students now repay? This is, of course, a trick question. Graduates will now pay their loans back earlier and for 10 years longer. Most new graduates will pay about £15 a month more than under the current system. Bringing maintenance grants back will ensure that students from the poorest homes do not have the most to repay. Augar’s proposal for student loans for higher further education learners is a good start but it is not radical enough. As our economy changes rapidly, everyone will need to retrain and upskill throughout their lives.
I have some questions for the Minister. First, does he agree that the Government must compensate universities in full if the tuition fees cut goes ahead? We hear that teaching grants should be increased to reflect the loss of funding to universities that a cut in tuition fees will bring. However, the grants should be allocated to reflect the cost of teaching the subject and the subject’s social and economic value. Where will subjects such as ancient history sit and will pure research become a thing of the past? If the funding is not made up, universities will doubtless cut their widening participation budgets and drop subjects that are too expensive to teach; I do not include ancient history in that group. Secondly, will the Government curb the sky-high interest rates put on loans after people graduate? The Government make a great deal from middle-income graduates because the interest rates bear no relation to the cost of government borrowing. Thirdly, given the crisis in NHS recruitment, will the Government bring back nurses’ bursaries?
We probably need to go further. As Martin Lewis has argued, for most graduates, the current system works a bit like a graduate tax, so why not turn it into one? All the frightening language about “fees”, “loans” and “debt” disappears overnight. Students from wealthier families, who bypass the system by paying tuition fees up front, instead pay their fair share. The system becomes more progressive and most graduates would pay a little less. There are, of course, problems with a graduate tax too. We would want to review the proposals to see what impact it would have on widening participation and on universities’ budgets. However, it seems that the Conservatives have encouraged Philip Augar to put a catchy headline on reduced fees above the truth. Does the Secretary of State realise that Augar’s positive recommendations for further education have been undermined by these regressive proposals for student loans? Has the Treasury approved an increase in teaching grants to cover the tuition fees cut? If not, the Prime Minister will have achieved the impossible: charging seven in 10 students more to go to university, but paying universities less to teach them.
Our party would be keen to create personal education and skills accounts, giving every adult over 25 the opportunity to learn for free wherever they want, whenever they want, with careers guidance in place to support them along the way. Good careers guidance is key to much of the benefit in these proposals. The more people enjoy learning and the more they learn, the more ready they are to learn more, which in the long term benefits our economy, making it easier for employers to find the higher-skilled and more creative people they will increasingly need as technology develops. We hope that the Government will support the FE proposals to the hilt, but look again at the changes to tuition fees which may well disadvantage those the Government most want to help.