Clause 8 - None

Sale of Student Loans Bill – in a Public Bill Committee at 5:30 pm on 4 December 2007.

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Question proposed, That the clause stand part of the Bill.

Photo of John Hayes John Hayes Shadow Minister (14-19 Reform and Apprenticeships)

This clause would, in effect, extend the power of the Welsh Assembly to administer these matters. That may be a slightly clumsy way of putting it, but I think that is its gist. For the purposes of the record, can we have an assurance of what that would mean in practice? Presumably, it means that the Welsh Assembly might take a different view about when to sell, what to sell and how to sell the loan book. Also, what estimate have the Government made of the incompatibilities that that situation could produce?

Photo of Sarah Teather Sarah Teather Shadow Secretary of State

I asked a question this morning during the pre-legislative scrutiny and the Minister said that the proceeds from any sales would come straight back into the Treasury. It is not clear to me what benefit—if any—there is to the Welsh Assembly in enacting any of these powers.

Photo of John Hayes John Hayes Shadow Minister (14-19 Reform and Apprenticeships)

That invites another question, about the proceeds from the sales generally, but it is a very good point. We are not for a moment suggesting that the proceeds of the sale should be hypothecated, because that would be a spending commitment and if I were to make that I would be on the carpet, even though the Opposition Whip has briefly left the room. However, the hon. Lady is right that there is an issue about the receipts of the sale. That raises the question why the Welsh Assembly was included. More especially, there is an issue about the compatibility of any policy that might be enacted in Wales that was at odds with what was done here. Given that an immense number of students from Wales study in England and students from England study in Wales, it would seem to be in all our interests to ensure that policy is consistent and coherent. Has the Minister made any assessment of that? In offering that assessment to the Committee, will he address the pertinent point raised by the hon. Lady?

Photo of Bill Rammell Bill Rammell Minister of State (Lifelong Learning, Further and Higher Education), Department for Innovation, Universities and Skills 5:45, 4 December 2007

Let me set out the general framework, and then I shall respond to those two points. As responsibility for student loans in Wales was devolved to Welsh Ministers back in 2006, it is important that the provisions apply equally to Wales. Any decision on the future sale of the Welsh loan book needs to be made in Wales by Welsh Ministers. Clause 8 gives Welsh Ministers the power to do that in the way that they have requested. Welsh Ministers are keen to ensure that maximum value for money is achieved for Welsh student loans and the powers are in place so that we can ensure that they do so. The Bill will enable them to decide when they deem it appropriate to use the powers, bearing in mind the relevant economic and value-for-money considerations—exactly the same value-for-money considerations that govern our decisions in England.

In accordance with the new devolution settlement agreed in 2006, the Bill will confer executive powers on Welsh Ministers to sell loans for which they are already responsible, mirroring the powers that it gives the Secretary of State for loans for which he is responsible. Those mirror powers are appropriate in these circumstances, as it is clear that that is what Welsh Ministers require. The clause confers on Welsh Ministers functions of an executive nature; it does not give them the power to make that legislation.

Let me pick up on the points that have been made. The first was about the difference of treatment that we may end up with between Wales and England. The responsibility is devolved. Part of the settlement of devolution is that the Welsh Assembly is allowed and empowered, in areas for which it has responsibility, to make decisions that may be different from those in England. In terms of the scale of things, the sums of money are relatively small, as Wales represents £1.1 billion of the £18.1 billion total student loan book. On whether there is an incentive for Welsh Ministers to undertake the step because money comes back to the Consolidated Fund and not the Welsh block, the money coming back to Government will give the Government as a whole greater flexibility in determining its spending priorities. Welsh Ministers cannot have the money directly attributed to their block but, as a DIUS Minister, I cannot have that money directly attributed to DIUS. Nevertheless, I am delighted and delirious to be taking the Bill forward.

Photo of Sarah Teather Sarah Teather Shadow Secretary of State

It is, however, rather odd. The Minister is a Minister in the Westminster Government. It is odd for Welsh Ministers to make a decision that will have an effect only on the books here and that will have no obvious direct impact on their budgets. Is he aware of any discussions between the Treasury and Welsh Ministers about whether that will have any impact on that budget?

Photo of Bill Rammell Bill Rammell Minister of State (Lifelong Learning, Further and Higher Education), Department for Innovation, Universities and Skills

Just as I do not comment on discussions that I and the Secretary of State have with Treasury Ministers, it is not appropriate and would not be right for me to comment on any discussions that may or may not take place between members of the Welsh Assembly Government and the Treasury.

The fundamental principle governing sales in both England and Wales is that they will enable the transfer of risk and an income stream that enables us to make choices about where that money should be spent. That was the principle on which we had cross-party support for the Bill on Second Reading. I hope that we can maintain that support in Committee.

Question put and agreed to.

Clause 8 ordered to stand part of the Bill.

Clauses 9 to 13 ordered to stand part of the Bill.

Question proposed, That the Chairman do report the Bill, as amended, to the House.

Photo of Bill Rammell Bill Rammell Minister of State (Lifelong Learning, Further and Higher Education), Department for Innovation, Universities and Skills

Thank you, Miss Begg, for presiding over the Committee smoothly, efficiently and effectively. I congratulate all Committee members on the good-humoured nature of the discussion. A number of hon. Members commented on the fact that this might be a Finance Bill rather than an education Bill. I do not believe that that is the case. It is appropriate that education spokespersons lead this discussion. Important points of principle have been at stake that will bring real benefits to the Government. Through the mechanisms that we put in place, we can protect the graduate interest.

Photo of John Hayes John Hayes Shadow Minister (14-19 Reform and Apprenticeships)

I endorse and amplify the thanks to you, Miss Begg. You have shown remarkable indulgence to  Committee members, which has allowed us to debate these issues, even though our consideration has been concertinaed.

I have a couple of points to make, however. First, we learned a great deal this morning, but I wonder whether it would be better in the future—I make no criticism of today’s proceedings—to have a gap between the evidence-taking sessions and subsequent consideration of Bills. My second point is that we look forward to further consideration of the legislation and perhaps to tabling one or two amendments on Report, as we were encouraged to do by the Minister, when we can explore matters in even greater detail.

It is always a pleasure to serve in Committees opposite the Minister and with such an immensely sagacious group of colleagues. I thank all hon. Members.

Photo of Sarah Teather Sarah Teather Shadow Secretary of State

I, too, thank you, Miss Begg, for the way in which you have chaired this Committee. I found it a very useful debate, particularly this morning’s session. I hope that this innovation in Public Bill Committees will be taken up by all Members.

I would like to add to the point made by the hon. Member for South Holland and The Deepings. It would be useful to have a gap between sessions, because this morning’s opportunity to question witnesses changed the way in which I thought about the Bill. It was a good example of the way in which Members on both sides can contribute and ask pertinent questions. The Committee was able to move forward considerably from the point at which we started this morning.

Photo of Anne Begg Anne Begg Labour, Aberdeen South

I add my thanks to Committee members. This was the first Public Bill Committee that I have chaired. I thought that this morning’s session was extremely useful—I think that all Members did.

Question put and agreed to.

Bill, as amended, to be reported.

Committee rose at seven minutes to Six o’clock.