Motion made, and Question proposed, That this House do now adjourn.—(Greg Hands.)
I am delighted to have secured this Adjournment debate, which will enable me to raise the case of my constituent, Mr Damien Shannon, who has been refused a place at St Hugh’s college, Oxford as he is unable to meet its financial requirements. It will also allow me to make some more general points about the growing importance of postgraduate education for individuals, the economy and social mobility.
Mr Shannon lives in Salford. He is an intelligent and thoughtful young man. He has sought to pursue his education in the past few years despite his difficult financial circumstances. Damien obtained a good degree in history and politics through the Open university, and then wished to undertake a one-year MSc course. He applied to St Hugh’s college, Oxford, and was absolutely delighted when he was offered a place for October 2012. However, that place was contingent on him being able to fulfil the financial requirements of the college, as well as meeting its standards, and this was where the difficulties began.
Damien has no financial support from his family. The fees for the one-year taught MSc course were £10,000, and he managed to secure a career development loan from the Co-operative bank to meet that requirement. As the Minister knows, there is no student loan scheme for postgraduate education, a subject I will return to later when I have specific questions for him to answer.
Damien had passed the academic test and had raised the funds to pay for his fees. Then came the fatal blow. The college required a guarantee that Damien had immediate access to £13,000, which the college deemed necessary to meet his living costs during his period of study. First, it said his rent would be £516.66 a month, which it claimed was the cost of renting a reasonable sized room in shared accommodation at market rates in the private rental market. That figure bears no correlation to Oxford city council’s local housing allowance figure, which is currently £342.98 for a room in shared accommodation. However, the £516.66 figure is enforced regardless of the rent an applicant actually has to pay.
Secondly, the college stipulated that an applicant should have £56.73 a week for food. That is almost the entire sum that someone under 25 on jobseeker’s allowance receives per week to meet all their non-rental living costs. The college figure is based on the requirement to eat a certain number of meals in college. Now, Damien has told me that he is perfectly confident that he could cater for less, and indeed does so now, but he was never given the chance to do so.
I congratulate my right hon. Friend on bringing this matter to the House. Does she not agree that the basis of our democracy must be that it is for students to determine how much they have got to survive on once they get on to the course? It is not for the university to determine that. If the university is concerned, it should be reaching out to help students from poorer backgrounds, not putting them off and hindering them in this way.
I agree entirely. It is the responsibility of students to be aware of their own personal affairs. In this case, we are talking about postgraduate students—some of the most intelligent people in the country. If they are not capable of sorting out what they need to pay for their rent and their food, I do not see that it is the place of a college to interfere to that degree in private life. I also believe that it is for universities to support people in these circumstances. I have made inquiries at Oxford and at other universities. Of all the scholarships that are available, none are means-tested, so they are not available or targeted at people from poorer backgrounds. That needs to change. I had a conversation with Oxford university this afternoon and there might be a bit of progress, which I will tell the Minister about in due course.
The third issue—if hon. Members thought it could not get any worse, it does—is that the college requires £1,050 per annum for utilities and £2,700 for clothes, books and socialising. Oxford university has one of three copyright libraries in the UK—it contains a copy of every book that has ever been published—so I am not sure why there is a need for money to buy books. As for clothes and socialising—this relates to the point my right hon. Friend the Member for Tottenham (Mr Lammy) raised—how is it right for the college to dictate such matters to postgraduate students, who are some of the brightest people in the country?
Finally—this does concern me—the college refuses to allow income from part-time earnings to fill the gap. It says that postgraduate study at Oxford is too demanding, yet it employs its own graduates as junior deans, junior welfare officers and teaching assistants. How can it be that other part-time work—perhaps a couple of hours in a pub in the evening or a Saturday morning job—would detract from someone concentrating on their studies, while formal work as a teaching assistant, junior dean or welfare officer does not? I do not believe that doing a couple of hours’ part-time work would be devastating to the demanding programme of study at Oxford.
I spoke yesterday to Universities UK, which told me that other universities allow part-time work, as many students would otherwise find it impossible to pursue postgraduate studies. I understand that Oxford’s own figures, in its most recent report analysing postgraduate studies, show that some 47% of applicants who were offered places on academic merit have been unable to take up those offers because of their inability to raise the necessary funds. Therefore, nearly half of all those students are unable to take the next steps in their education simply because they do not have enough money in the bank.
I contacted Oxford and St Hugh’s college to listen to their views before this debate. I have not received a written response, despite sending a lengthy letter, but this afternoon I had a rather disappointing conversation with the pro-vice-chancellor for education at Oxford. In seeking to justify the financial guarantee that is required, she told me that other universities have a greater drop-out rate, as students discover that they are unable to manage financially. To some extent, by requiring a guarantee that nearly half the applicants are unable to meet, Oxford effectively reduces its exposure to risk. Its retention figures are bound to be better because half the students, recognising that they are unable to meet the financial requirements, do not take up their courses and are therefore not at risk of dropping out.
The case that my constituent has brought to my attention relates to his application to St Hugh’s college, but this afternoon I talked generally to the pro-vice-chancellor for education, who talked to me about the whole of the Oxford system, so as far as I am aware the problem applies across the piece.
The pro-vice-chancellor also explained to me that poorer students who could not raise the funds could go off to work for a couple of years—she gave me an example—and save up the money for their courses. So, those with £21,000 up front can come straight away and get on their postgraduate courses—and possibly have access to better jobs and the wage premium that is available—but those who do not have £21,000 have to go away to work and save up. That seems to be unfair and discriminatory on the grounds of income.
The pro-vice-chancellor also told me that Oxford had raised £30 million in order to be able to support graduate students. I am absolutely delighted about that, but again, so far none of that money has been directed towards students from poorer backgrounds, which is absolutely essential. She obviously wants a national system of postgraduate student loans, but I have said clearly that, in the absence of a national system, it is not good enough for universities simply to wait for that to happen. If the university has £30 million, it is vital that some of it should be targeted towards people in circumstances such as those faced by my constituent Mr Shannon. I am therefore pleased that the pro-vice-chancellor has said that the university will look at what it can do with the significant sums that it has been able to raise.
I do not want for one moment to put off people from poorer backgrounds from applying to our best universities. I am a trustee of the Social Mobility Foundation, which does excellent work on encouraging young people to aim high—indeed, to aim for the very best. I want our young people to be at the best institutions. I know that work has been done over the last few years to try to widen access to undergraduate degrees, but postgraduate qualifications are becoming increasingly expected if people are to access to some of our professions. That is why I am so exercised about this situation.
That brings me to the wider impact on social mobility. Alan Milburn, who has been appointed as the independent reviewer of social mobility, produced a report in October last year, in which he said:
“Increasingly, some jobs require a postgraduate qualification, and it is one of the routes into numerous professions such as journalism, accountancy and academia. The lifetime earnings of an individual who has completed a master’s degree are 9% higher than someone who has a bachelor’s degree.”
That provides clear evidence of the wage premium. He continued:
“The current system is not working. While foreign students are flocking to join our graduate courses, our own students are not joining them in sufficient numbers. In particular, those without independent means struggle to pay their course fees and to cover their living expenses while studying. That is bad both for national income and for social mobility, as those who are unable to pay are excluded…Lack of access to postgraduate study is in danger of becoming a social mobility time bomb.”
He recommends that we need better data. I think everyone is agreed on that; we do not have sufficient data on the background and socio-economic position of postgraduate students. He also recommends very clearly that
“the Government should consider introducing a loan system for funding postgraduate students. To start this process, the Government should commission an independent report, building on the principles of the Browne Review, to come up with proposals”
for such a loan system.
Alan Milburn is not the only one to raise these issues, as we recently had an independent inquiry by the Higher Education Commission. It looked closely at the issue and took evidence from many witnesses. It says:
“We need to improve access…Postgraduate education is ‘the new frontier of widening participation’—with prospective students currently barred from study if they cannot afford fees or access sufficient credit. There are a number of fields and professions where postgraduate qualifications are becoming a de facto requirement for employment.”
It also backed the idea of student loans, and asked for a taskforce to report by December this year. This debate is becoming much more widespread than ever before. There are a number of people getting first degrees, but in order to distinguish themselves, it is almost a requirement nowadays to have a postgraduate qualification.
I have some specific questions for the Minister. First, I ask him to take a view, and I have no idea whether he will on this subject, and say whether he agrees that the financial guarantee relating to living costs—not to tuition costs, because those have to be paid—and in particular the bar imposed by the university on taking earnings from part-time work into account is unfair and discriminates against those without access to significant funds. If he does agree, what action can he take to try to challenge this requirement and secure its removal?
Secondly, will he make some inquiries to the Charity Commission? I have written to it to ask whether such a requirement is in breach of the public benefit requirements contained in the Charities Act 2011. More generally, will he explain why there is no student loan scheme in place for postgraduate study, and does he accept that postgraduate qualifications are now sought by employers in many professions, that they provide a gateway to better-paid jobs and are therefore a crucial element in promoting social mobility? As I say, the Higher Education Commission has recommended this taskforce, so I hope the Minister is able to tell me that he accepts the recommendation, that he will get on with the taskforce and will come up with a scheme to enable people to have access.
Damien Shannon walked into my constituency surgery just 10 days ago. Until that moment, I had no idea that Oxford university, and possibly others, was operating a system of selection of postgraduate students based not on academic merit alone, but on wealth and having immediate access to cash funds for rent, food, dining in college, clothes and for socialising. By its own admission, almost half the students who have the academic ability to pursue their studies are unable to take up their places because they simply do not have the money required. In my view, that is simply wrong. Not only does it crush the hopes and ambitions of these students who cannot afford to study at some of our best universities, it deprives our country and our economy of some of the brightest and best minds we could have. It is unfair and short-sighted.
There is much talk about widening participation, of fair access, of encouraging social mobility and of using the talents of everyone, but I am afraid that as long as rules like this apply, postgraduate education will continue to be the preserve of those who have money behind them. Those who do not will be unable to contribute to the knowledge and prosperity of our country. We need a proper system of financial support and loans for postgraduate education; otherwise, those with talent and ability will remain excluded from our system and will not be able to achieve their potential and to succeed.
I urge the Minister to have the courage to tackle this unfairness head on, and to demonstrate his personal commitment to fairness and social mobility. I have high expectations of him, as I have of many young people in my constituency. I know that those young people have skills and talent. Damien is an extremely talented young man, but at present he is not able to pursue the course that he wants to pursue and make the contribution that I know he is capable of making. I hope that the Minister will have some encouraging and optimistic words not just for Damien, but for the hundreds, indeed thousands, of students who are in a similar position throughout the country.
I congratulate the right hon. Member for Salford and Eccles (Hazel Blears) on raising this issue. Let me immediately agree with her that it involves some very important wider issues, to which I shall turn shortly. I hope she will appreciate, however, that although she has spoken about her constituent Damien Shannon in conditions of parliamentary privilege—and I have read about him in the newspapers as well—a legal case is pending as a result of a dispute between him and the Oxford college concerned. It would be difficult for me to take up some of the specifics to which she referred, not just because there is to be a court hearing but because of a wider issue, namely the autonomy of our universities. That autonomy was most recently embodied in legislation passed by the last Government, which made clear that it was not for Parliament—or Government—to instruct universities on their admission policies. It is therefore hard for me to discuss the specific case of this individual and this university.
I do, however, completely understand the wider issues raised by the right hon. Lady. Let me begin by making it clear that postgraduate education is becoming far more important. There is an increasing range of jobs for which a postgraduate qualification is expected, and Alan Milburn was right to describe that as a growing challenge in the area of social mobility and the spreading of opportunity.
I began my career as a civil servant, entering the Treasury as a former undergraduate with a single degree, but most people who join the Treasury now probably have a postgraduate qualification. I am not sure that it has made the conduct of economic policy any better, but that is beside the point. The qualification levels among people entering those jobs and, indeed, many of the professions has changed in a generation, and that is the background to the wider debate about postgraduate qualifications.
I have followed the arguments about these matters very closely. In fact, in the past two and a half years we have hardly changed Government funding for postgraduate study. Notwithstanding all the controversy about our changes to undergraduate finance and despite the wider need for public expenditure control, we have been able—along with the Higher Education Funding Council—to sustain, broadly, past levels of funding for postgraduate education. HEFCE’s allocation for taught postgraduate provision is being maintained at about £135 million and it will provide about £235 million for postgraduate research degree supervision support, while the research councils will spend about £340 million on postgraduate research provision.
I occasionally read about reductions in support for postgraduate provision. In tough times we have been able to maintain that support, but because postgraduate qualifications are becoming increasingly important, the salience and significance of the debate about access to them becomes ever greater. That is why the right hon. Lady has raised the issue this evening, and, as I have said, I accept her point—and Alan Milburn’s point—that we must not erect a new barrier to the spread of opportunity.
I understand the limitations on what the Minister can say about the individual case, but is he at all concerned that 47% of people who apply to Oxford are unable to take up their places, despite having the academic qualifications, simply because they cannot raise the money up front?
I would be concerned if any people who had the ability to benefit from education at any level were not able to take that opportunity. I have just heard the figure that the right hon. Lady cites, having not previously been aware of it. Successive Governments have not been able to extend a general financial support to postgraduate students. I do not want to get into discussing cases of individual universities, but Oxford university argues that it understands the need for more scholarship support so that people are not debarred from postgraduate study at Oxford by financial pressures. My understanding is that in only the most recent few months it has raised £30 million in extra support. I heard, as I am sure hat the administration governing bodies at Oxford will have done, the right hon. Lady’s points about the case for scholarships linked to need and financial circumstances. However, successive Governments have so far not been able to offer a general Exchequer support for postgraduate students. No Government have even been able to offer a means-tested maintenance grant for these students. It is very hard for any Government to go straight into that.
Let me take the right hon. Lady through some of the wider arguments. First, like her, I have read the report by the Higher Education Commission—I have read several recent reports. I do not think I am breaking any confidence by saying that I recall being shadow Secretary of State, discussing this issue with the then Secretary of State, Lord Mandelson, as he now is, and urging that the terms of reference for the Browne review be drawn so broadly as to include postgraduate provision—I remember proposing that to him. The terms of reference for Browne would have made it possible for Browne to make proposals for postgraduate provision, but Browne rather ducked the issue. He focused on these very old proposals on undergraduate provision, and all he said on postgraduates was that the situation needed to be monitored. We of course came into government and received the conclusions from the report, which the previous Government had commissioned. By and large—not perfectly—we acted on those provisions, including by asking Adrian Smith, who was then a senior official in the Department for Business, Innovation and Skills and is now at HEFCE, to monitor what is happening to postgraduate education. This matter was covered by the terms of reference for the inquiry that Labour set up and we have complied with the proposals from that report on monitoring the situation, but Browne was not able to crack the wider problem.
And of course one of the rewards of going from government into opposition is that people can call for proposals that they were never able to afford or deliver while they were in government, so it works both ways.
I am open-minded on this issue. I accept that there are genuine concerns about social mobility, as expressed by Alan Milburn and others. I can see postgraduate qualifications becoming increasingly important. I am following with great interest the debate that has been launched with several different reports—the Higher Education Commission report is one but I want to touch on several others, too—on how our financing system could be changed to assist people into postgraduate provision.
Does the Minister recognise the urgency of the issue, given the changing nature of our economy? Students now need postgraduate education far more than previously and are also unlikely to have the money. At the same time, the sector has become truly global. As my right hon. Friend the Member for Salford and Eccles (Hazel Blears) has shown, the feeling is that institutions such as Oxford are more keen to take overseas students with the cash than local British students. The figures show that British students are losing out in these circumstances. That is why we need to grasp the problem, although I recognise that that is difficult.
I agree with the right hon. Gentleman, who has experience of this area in government, about the importance of the global issue. I appreciate that both right hon. Members have rightly focused on the wider social mobility issue and neither has tried to claim that the changes to undergraduate finance are the problem. Of course, the monthly and annual repayments of student loans for undergraduates will fall under our new arrangements, so that is not the issue. Regardless of what is happening in undergraduate education, the debate is much more about social mobility and the changing economic scene.
I welcome the interventions from several groups of experts. We have had the Higher Education Commission report that has been mentioned and an ingenious proposal from Tim Leunig of the CentreForum. Even the NUS, which in other contexts is against the loan and repayment scheme, has called for a postgraduate loan scheme, which is what I think the right hon. Lady was calling for. There are risks as well as attractions in that approach, and the biggest single risk is that as soon as we had a general public expenditure programme or loans scheme, the Treasury would immediately become interested in how many people were eligible, controlling postgraduate numbers and setting new conditions. It would be a great pity if this open and diverse sector found itself with a highly regulated loan scheme that constrained its growth.
I do not accept and have not been persuaded at this stage that a Government-funded loan scheme is the answer, but I am happy to consider that proposal and others if people make them.
The Minister has said that he values the openness and diversity of the postgraduate sector. How diverse can it be when the requirement is to have £21,000 cash immediately available to pay up front? Is that not an issue that narrows the sector through selection by wealth rather than academic merit?
I fully understand that we cannot afford the sheer waste of talent if people who can benefit from any level of education do not participate. As well as the fairness argument, there is an efficiency argument and when fairness and efficiency point the same way, it leads to a clear recognition on both sides of the House of what must be done.
We have now had the opportunity offered by the Browne report, which led simply to a proposal on monitoring, which HEFCE is doing. We have also had several interesting proposals from outside bodies. Only this afternoon, I spent two hours at HEFCE at a seminar on postgraduate finance that it organised to go through the possible options. Of course, I realise that some of the proposals are for loan schemes and there are other ideas, too. I want more career development loans to be taken up and I follow the figures with great interest, as I am keen to see whether there are barriers to people taking up such loans. I am not commenting on the specific case that was mentioned, and I do not know whether that option was investigated, but it is an important way of getting support and I welcome it.
I am also very interested in whether universities, by fundraising and using links to alumni, can find ways of delivering needs-blind admissions to their postgraduate courses. This is a very good moment for the right hon. Lady to have called this debate as there are a range of ideas out there. All I can undertake is that I will carry on considering them. If anything looks to me to be well targeted and affordable at a time when public money is tight, I undertake to consider it very sympathetically. As yet, no idea has been proposed that meets all those criteria and we must be wary of extending the hand of Treasury control to postgraduate education, a sector that has hitherto not experienced that.
The only other point I want to make in the limited time that is left is to stress that we will explore proposals made in the studies involving employers, universities and banks. We are keen to have those conversations and I am absolutely—
House adjourned without Question put (Standing Order No. 9(7)).