asked Her Majesty’s Government:
Whether they have assessed the implications for students from England and Wales of the recently announced policy by the Scottish Executive on the funding of Scottish students at Scottish universities.
My Lords, the recent Scottish announcement will not affect the position of students from England and Wales, who will continue to pay fees if studying in Scotland. There is no strong evidence of differences in fee regimes either encouraging more English students to study in Scotland or deterring Scottish students from studying in England. University applications in England are up 6 per cent on last year to their highest ever rates. The proportion of applicants from lower socio-economic groups is also up.
My Lords, as this may be the last occasion on which the Minister answers education Questions under the ancien regime, may I express the hope, if it does not damn his chances, that he will be there under the new regime? On Scotland, does he not agree that, while Alex Salmond of course has the right to give Scottish students free education at Scottish universities, this freebie is paid for by English taxpayers? Would it not be fairer to reduce the annual grant that is given to Scotland? The cost could be hundreds of millions of pounds, because Alex Salmond also wants to replace loans by grants and to write off student debt. Would it not be more sensible to cut the annual grant that goes to Scotland each year under the discredited Barnett formula? Surely it is unacceptable for the constituents of an English MP to pay for this, when Gordon Brown’s constituents pay exactly nothing.
My Lords, the warm best wishes of the noble Lord are of course designed to boost my career prospects enormously, and I am very grateful to him. On the Barnett formula, I feel that a conversation is needed across the Chamber. However, I understand from my briefing that there is something called the “Barnett squeeze”. I am not sure whether this is a meeting of rather unpleasant dimensions between the new First Minister in Scotland and my noble friend Lord Barnett, but it has the effect of narrowing the differential between funding in England and funding in Scotland, which may, over a long period, meet the noble Lord’s concerns. However, in respect of the decision taken on university funding, the cost of the change that the Scottish Executive have made will have to be met by the Scottish Executive; it is not met by United Kingdom taxpayers. The Scottish Executive have a block grant; they now have to find offsetting savings from elsewhere to carry through the policy that they have announced.
My Lords, does my noble friend accept that the noble Lord, Lord Baker, makes a strong case for a review of the Barnett formula, for which I have been pressing for a very long time? As my noble friend will understand, I am more than happy for there to be a Mark II, provided that it is based on need. Will he join me in pressing Ministers and others to allow a review to ensure that in future the Barnett formula is based on need?
My Lords, I simply have to draw my noble friend’s observations to the attention of the Chancellor of the Exchequer.
My Lords, will the Minister confirm that, under present regulations, all EU students have the right when they attend English universities to interest-free, up-front loans, repayable on an income-contingent basis after they have graduated? Does the same principle apply to Scottish students? Could it be withdrawn?
I believe so, my Lords, but I shall confirm that in writing to the noble Baroness.
My Lords, how can the Minister say that there is not a problem for English students when Scottish students will have free higher education in Scotland as a result of this change, as will French students and German students? Students from every other part of the European Union will have free higher education, but English and Welsh students will have to pay up to £2,700 per year in fees. This is simply not fair. The base funding is 20 per cent higher in Scotland than in England, so my noble friend’s point applies. Is this not the moment for the Chancellor of the Exchequer to speak for England and to declare that English students attending Scottish universities will have their fees paid, with the money being deducted from the Scottish block?
No, my Lords. The noble Lord is simply out of sympathy with the concept of devolution—that may be the understatement of the afternoon. The fact is that we have a Scottish Parliament. The Executive, alas, are no longer controlled by own party, but they have a perfect right to take decisions of this kind.
My Lords, I declare an interest as the president of the University of Wales, Aberystwyth, and the chairman of its executive council. Perhaps I may raise a question that is probably even more fundamental than that raised by the noble Lord, Lord Baker. The average student in institutions of higher education in England has expended on him or her about £1,500 more per annum than is expended on the average Welsh student. Given that such funds come overwhelmingly from public sources, is not this a morally indefensible situation?
My Lords, I am not in a position to confirm the figures given by the noble Lord, but I shall certainly seek to do so. However, differences in funding between different parts of the United Kingdom are based on historic decisions.
My Lords, is it not the case that top-up fees in English universities went through only as a result of the votes of Labour MPs from Scottish constituencies? Is this not yet another indication that the West Lothian question will need to be addressed?
My Lords, my understanding is that the leader of the noble Lord’s party now supports our policy, so I assume that, if this decision were to come back to the House of Commons, it would be carried by an overwhelming majority on both sides of the House.
My Lords, is not the Minister entirely missing the point? The point is not about devolution, but about the fact that Scotland gets so much more money per head than England as a result of the Barnett formula. The Scottish Executive are able to do what they have just done because they are getting so much more money from the United Kingdom taxpayer.
My Lords, but the point still holds. They will have to find an offsetting saving from elsewhere. They do not get any additional sum of money from the UK taxpayer as a result of having taken this decision.
My Lords, the Minister said that applications to universities in England have gone up by 6 per cent and indicated that they have also gone up from the lower socio-economic groups. Will he give the percentage by which applications from that group has gone up?
My Lords, I will let the noble Baroness know the precise percentages by socio-economic group, but applications have gone up across all socio-economic groups. Students from poorer families benefit from grants of up to £2,700 a year, which this Government introduced as part of the higher education reforms. They benefit also from bursaries typically of up to £1,000 in universities and colleges, which were made possible by the introduction of the additional fees and the requirement that a substantial proportion of them, running this year at £300 million out a total of £1.35 billion, must be put into the provision of bursaries and other support for poorer students. Therefore, as a result of the changes that we brought about two years ago, there is a better deal for poorer students than there has been since the changes in the student finance regime more than 10 years ago. That is helping to encourage more of them to go on to university.
My Lords—
My Lords, it is the turn of this side.
My Lords, can the Minister tell the House what the position is of students from Northern Ireland attending Scottish universities?
My Lords, they, too, pay fees.
My Lords, will the Minister now address himself to the point that was made by my noble friend Lord Forsyth? German students, French students and Estonian students do not have to pay; English students do. Is England not a part of the European Union?
My Lords, the issue still holds: this is a decision for the Scottish Executive and the Scottish Parliament to take if they wish to have a different policy within the United Kingdom. It is an effect of devolution.