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Royal Agricultural University (Funding)

Volume 602: debated on Thursday 26 November 2015

Motion made, and Question proposed, That this House do now adjourn.—(Simon Kirby.)

I am grateful to you, Madam Deputy Speaker, for giving me the opportunity to raise this important topic so that I can highlight the inequity and inappropriateness of, and real damage caused by, a decision made by the Higher Education Funding Council for England with respect to the Royal Agricultural University, Cirencester, which is based in my constituency and of which I am an alumnus.

I thank my hon. Friend the Minister for Skills for being here tonight. In his previous guise as Planning Minister, he and I did successful and fruitful business. I hope that tonight’s debate will be equally fruitful. I am particularly grateful to him for being here since this debate is not a matter of his ministerial responsibility. He is standing in for my hon. Friend the Minister for Universities and Science.

HEFCE has deemed that the RAU is no longer eligible even to apply for specific funding based on its role as a specialist higher education institution. In the next few minutes, I want to outline the extreme damage that that will do to the institution in my constituency. The impact on the institution will be substantial and potentially highly damaging. It will lead to the precipitous loss of £1.45 million per annum in 2016-17 and subsequently, which is more than 56% of its grant funding from the funding council. That represents 50% more than the RAU’s current surplus, which was just over £1 million last year. If the cut takes place, it will throw the university into deficit, with inevitable impacts on its staffing, investment, student facilities and services. For obvious reasons it would be inappropriate for me to comment any further on that tonight, but it is safe to say that the impact of this funding decision on what the RAU is able to do could be catastrophic. A 56% reduction will be huge, and will undoubtedly have a massive impact on the world-class teaching that it delivers. The knock-on effect on the teaching of agribusiness around the world will be significant.

The Government have been looking for diversification in the higher education sector, to provide students with opportunities that are different from the traditional, academic university route. The RAU provides a different option for school leavers to develop skills in agribusiness and other agricultural sectors. The cut may well lead to a reduction in the diversity of higher education opportunities in this country.

That is compounded by the different decision that the funding council has made for comparable and competitor institutions, which may continue to apply for specialist funding. I will name them—they are Harper Adams University and Writtle College. The RAU will therefore have to compete against those rivals on a potentially very different funding basis, which will make attracting students to courses provided by the RAU very challenging.

To give a bit of history, the RAU is the oldest specialist agricultural college in the English-speaking world, having been established in 1845. Initially a private college, it entered the public sector as a university college in 2001 and became a full university in 2013 under the changes that the coalition Government introduced. It has a strong and long-standing national and international reputation. Indeed, I have personally been involved in furthering its formal links with three Chinese universities—Shandong Agricultural University in east China and the China Agricultural University and Tsinghua University in Beijing. It also has formal and informal links with many other educational institutions across the world.

Since the RAU has been in the public sector it has, like a number of prestigious specialist institutions, received institution specific funding—ISF—from HEFCE in recognition of the particular costs associated with providing facilities for such specialist education. The university provides higher education in agriculture and food, land management and agribusiness to an increasing number of students. Numbers have more than doubled since it entered the public sector and now stand at about 1,200. Applications rose again last year, as they have done over a number of years, and in 2014 the RAU was the third highest performing UK university for student employability, with more than 98% of its graduates entering the workplace. This year it was named by The Sunday Times as the university of the year for student retention. Employability and retention are two of the key criteria that the Government set in their recent Green Paper as measures of teaching excellence.

This year, HEFCE reviewed the criteria for eligibility to apply for ISF. Eligibility now rests on the percentage of students at an institution studying the defined speciality. The percentage chosen by HEFCE was an arbitrary 60%, and the consequences were pointed out by the RAU during HEFCE’s consultation. Eligibility of students for the relevant speciality is based on the coding of courses offered—something that was dictated to the RAU by HEFCE when the RAU joined the public sector in 2003. On this basis, HEFCE has deemed the clearly specialist RAU to be ineligible for ISF, while immediately comparable and competitor institutions are allowed by HEFCE to code their students differently and to remain eligible for consideration. The RAU is being put at a disadvantage compared with its competitors simply because its similar range of courses is required by HEFCE to use different HESA—Higher Education Statistics Agency—codes. This seems to be an anti-competitive and oppressive decision by HEFCE, and one that is counter to Government policy.

One of the most frustrating aspects of this is that HEFCE has decided not only to withdraw the funding but to prevent the RAU from even applying for it. Naturally, ISF funding remains a decision-making process. The RAU would be more than happy to bid for funds in this competitive process, but it has been denied the opportunity to do so. Entirely ruling out the RAU from this process from the beginning seems contrary to all the rules of natural justice.

In the updated grant letter to HEFCE on 21 July this year, my right hon. Friend the Secretary of State for Business, Innovation and Skills wrote:

“I would like you (HEFCE) to do this (manage the reduction on overall HEFCE grant) in ways that protect as far as possible high cost subjects…widening participation…and small and specialist institutions”.

He also specifically instructed HEFCE to

“ensure that no institution faces a disproportionate reduction in their HEFCE allocation”.

I put to my hon. Friend the Minister that this is totally contrary to what my right hon. Friend had said.

The decision by the board of HEFCE to change the criteria will, as I said, result in a reduction in grant funding to the RAU of some £1.45 million, or over 56%. I believe that the person on the Clapham omnibus would surely recognise the RAU as a small and specialist institution, and 56% as a disproportionate reduction in its HEFCE allocation. That same person would also wonder at a decision that endangered a specialist institution in the field of agriculture, food, land and environmental management at a time when food security and the environment feature so high on the Government’s agenda, not only in this country but internationally. Removing the funding will have potentially very significant consequences for agricultural education in this country.

I appreciate that HEFCE is an arm’s length body and that Ministers should not usually intervene on individual decisions. However, I believe that the Minister has a role to play in this situation. Government, after all, set the parameters of what they wish to achieve for higher education and provide HEFCE with the funds to do so. When the organisation then makes a decision that is so unfair and that will have such far-reaching effects on an individual institution, and on the realisation of Government ambitions, I would have thought that the Minister would want to intervene. Indeed, the work of the RAU also contributes to the Government’s international development aims, by helping some of the poorest countries in the world, such as those in Africa, to grow their own food.

The RAU has made a much-appreciated effort to make agriculture one of the key British exporting industries, with the aim of getting British food exported around the world. This cut will make that function much more difficult.

HEFCE has offered to discuss what transitional funding might be available. Although that may be better than nothing and may alleviate things in the short term, it does not detract from the fundamental unfairness that undermines the principles of this decision and its long-term implications.

I understand that my hon. Friend the Minister for Universities and Science will visit the RAU in the near future. I will be pleased to accompany him, to show him the important role the institution plays in preparing students for the increasingly important work in agricultural production, the food supply chain and the management of the land on which we all rely. When he visits, I hope we will be able to reassure the university that this Government and their funding council, HEFCE, are committed to ensuring that the work of the last 170 years, which is literally being harvested in the UK and around the world, will continue to be supported in a fair and appropriate way.

I thank my hon. Friend the Minister for Skills for listening to me, and I thank you, Madam Deputy Speaker, for giving me this opportunity.

It is a pleasure to answer this debate on behalf of the Government. My hon. Friend the Member for The Cotswolds (Geoffrey Clifton-Brown) cares passionately about the subject, and rightly so, because the Royal Agricultural University is a fine, ancient and distinguished institution. It is an adornment to his constituency and he is one of its former pupils, so he is right to represent it as passionately as he does.

I know that my hon. Friend will agree that the United Kingdom’s university sector is one of the glories of our education system. It is respected and admired around the world. It has within it ancient and modern institutions, very large universities and very small specialist universities. It is not the size of an institution that determines its repute, but its quality, and the quality of the RAU is undisputed. It is admired and known around the world. There are farmers in Africa and estate managers in south America who will share stories of what they learned when they were at the Royal Agricultural University. My hon. Friend is therefore absolutely right to say that this is an institution that deserves the full support of everyone in Government who is involved in supporting higher education.

My hon. Friend also knows, however, that one of the key ingredients in the creation of a university sector that is as admired as ours is its independence, by which I mean not just the independence of the individual institutions, but that of the funding council that grants them public money. He was right to recognise that it is, therefore, a very important principle that Ministers do not intervene in the individual decisions that HEFCE makes about specific grants to specific institutions. Nevertheless, he is also right to say that Ministers do have a role in setting the policies and giving guidance and advice to HEFCE, through grant letters, on how it should make those decisions about funding for individual institutions.

My hon. Friend was right to quote what my right hon. Friend the Secretary of State wrote to HEFCE in July 2015, but I will repeat it. He asked it to protect as far as possible the funding for a range of things, including “small and specialist institutions”. Whether or not it meets the criteria of the new formula, the Royal Agricultural University is unquestionably both small and specialist, and it is very important that it is treated fairly.

I hope that my hon. Friend will forgive me for pointing out that although the proposed withdrawal of the grant would represent a very significant drop—he cited a figure of 56%—in the funding of the Royal Agricultural University, it is important for the House to understand and for the record to show that, as a percentage of its overall income, the fall will be 8%. That is significant, and no institution wants to lose 8% of its income—it certainly does not want to lose it if it does not believe that it is being treated fairly—but, to put that into context, it is important that the House understands that it is losing not 56% of its total income under the proposal, but 56% of its grant funding.

Nevertheless, my hon. Friend is absolutely right to argue that it is important that there is a level playing field and that HEFCE does everything it can to ensure that similar institutions offering similar courses are treated—shall I say?—similarly, and that no institution is singled out. Although, as I am not the Minister with responsibility for this subject, I am certainly not sufficiently expert to judge on the question of the coding of particular courses, I think it is very important for HEFCE—and HEFCE will itself want everybody to believe this—to be scrupulously fair in its decision and that no perversities arising from historical decisions about coding and the like have led to its decision. He is right to point to natural justice as an important set of principles that any institution doling out the public’s money on behalf of the public should very much take to heart.

I wanted to quarrel with just one thing that my hon. Friend said. He seemed to think that the man or woman on the Clapham omnibus would have a view. I have to say that Clapham is not perhaps a place in which people have a close and intense understanding of the important work done by the Royal Agricultural University. I can assure him, however, that in the Grantham omnibus or the Stamford omnibus—or, indeed, in those in the constituency of my Parliamentary Private Secretary, my hon. Friend the Member for Newton Abbot (Anne Marie Morris), in Devon—there is a great deal of familiarity with its work and a great deal of sympathy for his arguments.

I will conclude by taking this opportunity at the Dispatch Box—not as the responsible Minister, but on behalf of my hon. Friend the Minister for Universities and Science—simply to ask HEFCE to do all it can to ensure that no institution faces a disproportionate funding reduction and to avoid any threats in the short term to institutional viability. In asking it to do so, we do not seek to interfere in its independence or require it to make a different decision from the one it has set out, but simply to ensure that the principles of natural justice are indeed adhered to.

I am very grateful to my hon. Friend for what he is saying. He is being very helpful. May I take it from what he is saying that, as a result of this debate, he would expect HEFCE to enter into further discussions with the RAU authorities to see how the coding of the courses works and whether the 60% figure on which it made this arbitrary decision can be reviewed?

I understand that HEFCE is already having discussions with the university about the consequences and implications of the funding cut. I am sure that those will continue and provide an opportunity for all parties to review whether the decision was taken on the basis of a fair assessment of the respective institutions’ activities. Those discussions will also allow the parties to reflect on whether removing 56% of anything is proportionate, when compared with other examples.

I do not want to go further than that because it is ultimately for HEFCE to make these determinations. However, I know that, as a fine institution at the heart of one of the world’s greatest university sectors, it will want everyone always to see that it is fair and impartial and that it does everything it can to support quality institutions.

It seems to me and to the RAU, my constituent institution, that ruling it out of the bidding process altogether is completely unfair. Nobody would object if it could make a bid and put forward a case comparable to those of its rival institutions, but not to allow it even to make the case is pretty unreasonable and contrary to all the rules of natural justice.

My hon. Friend has made that point eloquently. I would not want to comment on the processes that led up to the decision, but it is important that justice is done and that it is seen to be done. I know that he will go on fighting vigorously for this institution until he is satisfied that that is the case.

Question put and agreed to.

House adjourned.