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Words: Paul Waugh and Daniel Bond
Photos: Paul Heartfield
Liam Byrne’s desk is groaning under the weight of a tottering, Jenga-like tower of books. From Jenny Uglow’s The Lunar Men to tomes on the life of Matthew Boulton, the twin themes are Birmingham’s industrial roots and Britain’s scientific innovators. Characteristically, the Shadow Higher Education Minister is braining up, not dumbing down. The hefty reading list is ostensibly research for Byrne’s new book on 10 great British entrepreneurs, due out after the election. But it’s also informing his wider thinking on Labour’s policies to boost the ‘knowledge economy’ in the 21st century and avoid the low-skill, low-wage threat facing much of the West.
“We’ve been doing this invention stuff for a long time,” he says. “We’ve been burying our scientists with our sovereigns since the death of Isaac Newton in 1727. Boulton helped make Britain great. When Bill Gates went to the Science Museum, the only thing he wanted to look at was James Watt’s lab. We are a country that is brilliant at science, innovation and enterprise, and that’s actually how we will work our way out of this hole we are in right now.”
Having been handed his current brief by Ed Miliband last year, Byrne’s mission has since been to draft science and higher education policy to help Britons win the jobs of the future. He says he’s been “bowled over” by the science community’s response to his green paper on science and technology, and a white paper is due in “the next couple of months”. This summer, he and Miliband unveiled a plan for ‘technical degrees’ – new high-status qualifications aimed at putting vocational subjects on an equal footing with traditional academic ones.
On higher education, the main clue to policy lies in another mini-book on Byrne’s groaning table. His own Robbins Rebooted pamphlet is a review of how to move on more than 50 years after the landmark Robbins Report paved the way for a huge expansion of universities.
But with just seven months to go till the General Election, Labour still lacks a policy on tuition fees and university funding. In 2011, Miliband talked of cutting tuition fees from £9,000 to £6,000. Back in March, the Labour leader revealed the party would be making a “radical offer”, leading to speculation he was paving the way for a major move towards a graduate tax. But while many expected a high-profile unveiling of the policy at conference, Byrne says an announcement was never on the table, particularly at a time when the university system’s finances are so uncertain.
“We’ve got to see the Chancellor’s figures,” he says. “[George] Osborne announced a big expansion of university places and said it would be paid for by selling the loan book. In July, Vince Cable then says he’s decided not to sell the loan book. So what on earth is going on? Nobody knows; it’s a mystery. That’s never going to be cleared up until the Autumn Statement. So we’re not going to play fantasy finances with Britain’s universities, because that’s what this government gave us. And look where it’s got us.”
He says an announcement on fees will come “when it’s ready”, explaining: “I know that’s a really simple answer, but the Lib Dems were punished so badly for lying and breaking their word, and we’re just not going to make that mistake. We’re not going to go off half-cocked on university finances – we’re going to get this absolutely right.”
He does hint, however, that the party has set out “a direction of travel” towards lower fees. “We’d love to bring the cost down. But students and their parents, as well as the university community, will ask us how we’re going to pay for it. So until we’ve dotted every ‘i’ and crossed every ‘t’…”
Byrne says it’s clear a Conservative government after 2015 would increase fees further, as part of their wider plans to allow universities to buy up students’ loan debts. The plan has been publicly championed by former universities minister David Willetts, but his successor, Greg Clark, has refused to be drawn on Conservative policy post-2015. “I think David Willetts wanted to do it, and I think that’s one of the reasons he’s no longer the minister,” Byrne says. “Greg Clark has tried to dead-ball this and basically smother it as an argument. But look – the truth is, that’s what they would do if they were in office.”
Shortly after taking over in this role, Byrne said Labour’s “long-term” aim was for a graduate tax, with a cut in fees expected as a stop on the way. Is that still the case? “We’re going to nail that down for the manifesto,” he replies, pointing out that he has been an advocate of a graduate tax since his days as leader of the Manchester Students’ Union in the early 1990s.
“We became the first students’ union in the country to publish proposals and an argument for a graduate tax, so I’ve long been a supporter of the idea. Turning it into action is complex, especially when your debt-to-GDP ratio is nearly 80%. So this is an idea with many virtues, but actually what people want is a plan.”
Lib Dem election coordinator Lord Ashdown has recently sounded more bullish about his party’s chances of winning back a large chunk of that student vote, and even said in an interview that students approach him to express their gratitude for the new £9,000 fee system introduced by the Coalition. Byrne laughs off the claims and says while he is an “admirer” of the former Lib Dem leader, on this occasion Ashdown is simply “out of touch”.
“What most young people and students and sixth formers say to me is today’s labour market is so grim we face Hobson’s choice – as in, no choice at all. ‘If we don’t go to university, we don’t stand a hope in hell of getting a decent job in the years to come. We’re forced into this system which means we won’t pay back our debts until we’re in our 50s, and we still only stand a 50/50 chance of getting a graduate job.’ That isn’t a proposition that people are organising street parties for,” he says.
“This is a forced choice, not a free choice. So for many people, they would love an ‘earn-while-you-learn’ route to get a degree. That’s why technical degrees will be our priority for expansion, because we want to radically expand the ways in which people can get to a degree, which is still the key to unlocking a middle-class lifestyle in this country.”
But it’s not just the Government’s funding model which is holding back Britain’s university sector, Byrne continues. The Coalition’s net migration cap, and the negative publicity around it, is doing “catastrophic” damage, he warns. “Universities are now sitting on a sea of debt, borrowing is up £2bn, you’ve got £80bn of debt write-off programmes into the student finance system – and now you’re cutting universities off from the world’s best talent,” he says, describing a trip to India earlier this year as “one of the most shocking experiences” of his career.
“I spoke with a group of a couple of hundred Indian students at one of the best colleges at Delhi University, and I was just horrified at the number of questions that came from students saying: ‘Why do you not want us to come to Britain to study anymore?’ It’s really threatening the strength of British universities, and it’s something they should be ashamed of. It’s going to take a long time to fix.”
With countries like Canada and Australia looking to take advantage and relaxing their rules on student visas, Byrne fears ministers are aware of the vital need to change, but have found themselves “trapped by their own rhetoric” on migration. Last week’s by-elections in Clacton and Heywood and Middleton proved just how potent a weapon immigration has become for Ukip. Byrne, who first squeezed into Parliament on a by-election majority of just 460 votes (in Birmingham Hodge Hill in 2004), knows more than most how tight such contests can be.
He says he had “huge admiration” for Labour’s organisation in Heywood and that the NHS message worked well during the campaign, but the big issue was immigration. “People want to hear more from Labour about issues like immigration,” he says. “And our policy is actually in the right place on immigration, because it’s very easy to win an argument about immigration on the doorstep. I think we can quite safely put it higher up the list of things that we prioritise in some of our messaging.
“You need to talk about stronger controls, you need to talk about the obligations on people who want to make Britain their home, and third, you make a tougher argument about enforcing the rules on employers who try and use immigration to undercut British workers.”
Just as important, he says, is that Britons of all races tend to agree. This summer he embarked on a fact-finding exercise with voters from each part of his constituency, using town hall meetings, local polling and other research. “What’s interesting is that this is not one group of voters who think this, but all voters. I serve one of the most diverse communities in Britain, and all of our work revealed how people from all backgrounds are basically in the same place on this. The Pakistani, Somali, Bangladeshi communities as well as the white working-class community basically all said the same thing. This is not an issue that Labour needs to be afraid of. This is not a divisive issue; this is an issue around which we can build common cause for the future.”
All the groups agreed that properly managed migration could be a good thing. “People in this country respect hard work, and they respect people who want to work hard and advance their families and in so doing build a better, stronger country. And so people recognise that instinct in people who’ve moved hundreds or thousands of miles to build a better life. We respect hard work and enterprise and energy in this country.
“People want a realistic conversation; people are sophisticated on this question and I’ve known that from my days as Immigration Minister. Actually, many of the immigration reforms I drove through – bringing in a points system, developing earned citizenship, creating the UK Border Agency – these were ideas not made up by me; they drew heavily on the conversations I had had in the multi-ethnic community that is my constituency.
“There’s a new consensus in Britain about immigration reform; Labour needs to be the standard-bearer for that consensus. It’s an issue on which Labour can win and on which Labour needs to be self-confident, and it’s an issue which people expect political leaders to lead a conversation on.”
With the Rochester and Strood by-election coming up, he says “the dynamics are similar to a lot of others of our seats”, with the cost-of-living crisis, NHS worries and immigration all featuring. “But crucially, they want to know where their kids are going to work,” he adds, which brings us back to his own programme for better-paid jobs. “There’s a big market for an optimistic, bullish account of how Britain builds a bigger knowledge economy and prosecutes this race to the top.”
But in seats in Kent and Essex, like Rochester and Clacton, isn’t there a danger that Labour is just not visible anymore? “I grew up in Harlow in Essex,” he smiles. “You can take the boy out of Essex, but not the Essex out of the boy! I wear red socks now rather than white socks…”
“When I go back to see my dad in Harlow, Labour is very visible – we’ve got great candidates like Suzy Stride who are really doing the business on the doorstep. My impression is we are fighting those seats hard.”
Byrne makes clear that for him, the personal is the political. His mother Ruth, who died from cancer at the age of just 52, sparked his lifelong interest in science: she was a biologist and then a teacher at the Harlow comprehensive he attended. And it was Labour’s own modernisation under Harold Wilson in the 1960s that gave his and other families in the south the opportunities they seized. The parallels with today are obvious, Byrne says.
“Labour was worried about deindustrialisation and worried about the loss of its traditional working-class base; it was looking for a way to develop its offer to technical and scientific workers in the south-east of England.”
Wilson’s famous 1963 speech on the “white heat of the technological revolution” presaged a government that symbolised change. “Labour then wins the election because it epitomises this sense of change, but crucially a sense of optimism about how Britain can build a bigger knowledge economy that offers new jobs for people but also new ladders for people,” he recounts. “In office, Wilson delivers the Robbins revolution, creates scientific advisers, puts science centre stage, he creates that revolution in social mobility which meant that my parents crept into the middle class at the end of the ‘60s.
“So Labour has done this before. And my argument is that this is a ‘white heat’ moment, where we need to sweep out that sense of fear that people feel about the future and replace it with a sense of bullish optimism about how this incredible, inventive country can win once again.”
BYRNE ON… THE STUDENT VOTE
“Labour is the natural party of students and students’ parents. We’re determined, and I’m determined, to give them an offer that moves their vote to us.”
BYRNE ON… JAGUAR LAND ROVER
“For many people they would love an ‘earn-while-you-learn’ route. But Jaguar Land Rover is now more competitive to get into than Oxford.”
BYRNE ON… IMMIGRATION
“Labour is in the right place on the argument; people want us to make a bit more noise about it. It is a vote winner, no question.”
BYRNE ON… WILSON’S ‘WHITE HEAT’ SPEECH
“He has a blank sheet of paper the night before, writes through the night, finishes it at dawn…and then goes and delivers this knockout speech.”
Words: Paul Waugh
Photos: Paul Heartfield
“To Turbo Fizzle…best wishes…Charles”.
Greg Clark is holding a signed photo of a Space Shuttle astronaut and beaming at the personal dedication. But the portrait from Commander Charles Bolden has not revealed a mysterious new nickname for the Minister for Higher Education. “My seven-year-old son has taken on an identity for himself, he’s created this character,” he laughs. “I got Charles to sign it for him.”
Meeting Bolden, who now heads NASA, is just part of the day job for one of the busiest members of the Government. And since Clark’s promotion in this year’s reshuffle, those day jobs are growing in number.
His full title, Minister for Universities, Science and Cities, carries a pretty hefty range of cross-government responsibilities. Working with both BIS and the Cabinet Office, he occupies an office in the Treasury. For good measure, he’s also Minister for Space (hence breakfast today with a former astronaut) and Minister for the Met Office.
“It’s the most fantastic portfolio in Government,” he says. “When it was announced, one of my colleagues said ‘ah yes, you are the Minister for the 21st Century’. I think there’s something in that. This is about our future.”
Future funding of higher education has, of course, been one of the most contentious issues in British politics since the Lib Dems’ infamous tuition fees pledge in 2010. Clark is swift to pay tribute to his predecessor for grasping the nettle. “David Willetts is one of my closest friends in politics; in fact, he was the man who signed my application form to be a Conservative candidate,” he says.
“He was kind enough to ring me up within an hour of my being appointed to say that if there was anyone he could nominate to take over from him, it would be me. Which I was incredibly touched by, because David’s reputation is formidable and justifiably so. He worked hard and deployed his famous two brains as well as his personal charm and ability to see people’s point of view to design a higher education system that is now the envy of the world.”
But Clark is less generous about his opposite number, Liam Byrne. “It’s an indication of the chaos and unpreparedness of Labour for government that seven months before the election there is a void where there should be a higher education policy,” he says. “They are still messing around with disastrous notions without any degree of rigour or commitment on one of the most important areas of public policy. It tells you all you need to know about why they are unfit to govern.”
Referring to Ed Miliband’s speech in 2011 floating the idea of cutting tuition fees from £9,000 to £6,000, the minister is scathing. “It’s quite a long time to do the sums and to work out that this would mean a £3bn black hole, which would be a disaster for the public finances, it would be a disaster for the universities’ finances, it would be a disaster for students in this country.”
Clark, who went to a state school in his home town of Middlesbrough before going on to Cambridge and the LSE, says wider access is crucial. “When I went to university, only a handful of people from my background made it to higher education. One of the things I am absolutely passionate about is increasing the access to university for people whose backgrounds previously kept them away from university.”
He says “one of the best moments so far in this job” came on A-level results day, when he was at the UCAS centre in Cheltenham as it emerged that record numbers of people were going to university this year. “Half a million young people for the first time; that’s a 4% increase. But there was a big increase, 8%, from people in the most disadvantaged neighbourhoods in the country. That’s a massive leap forward.
“The gap in the best-off and worst-off areas is narrower than it has been before and a big part of that has been the requirement to have access agreements which are funded from the fees. It’s about £750m for access courses, for outreach, for doing what is clearly successful in getting kids from poorer backgrounds into university. That would be lost entirely and it would be a slap in the face for the kind of kids I grew up with.
“So, to scrap that social progress is an appalling thing for Labour to toy with, let alone fiscal irresponsibility – from the man who left the note saying there was no money left. Now he’s toying vaguely with opening another £3bn black hole.”
Clark goes further, suggesting Miliband and Byrne would be repeating the mistakes of François Hollande. “This has shades of the French government. You have got serious reforms which have been undertaken seriously which, after all, have followed directly the approach recommended in a considered, cross-party way. The Browne commission, set up by the previous government to do this in a dispassionate, rigorous way, was followed through.”
Always happiest when he has a graph or a bar chart to hand, Clark then produces a slide from a recent presentation by the OECD’s head of education, Andreas Schleicher. It states: “The UK is one of the few countries that have figured out a sustainable approach to higher education finance.” Clark says that verdict makes clear that the Coalition has created “a system that commands international respect”.
Still, at the recent Liberal Democrat party conference Vince Cable warned that there may be trouble ahead if a Tory-only government goes ahead with its £7bn worth of extra tax cuts. The Business Secretary said that would inevitably mean a hike in tuition fees beyond £9,000.
Clark says the fears are unfounded. “That cap of £9,000 covers the cost of tuition across the board in most universities…I’m confident that we have got it right.” So he doesn’t see higher education affected by the spending pressures that would accompany new tax cuts? “No, to the contrary. I think there is a great recognition right across the Government that investing in higher education and research is how we make our living in the future,” he replies.
“It was George Osborne as Chancellor who took the cap off student places. That was an historic moment. The Robbins Report is 50 years old and its chief recommendation was that universities should be open to all. Successive governments have nodded towards that principle, but they haven’t implemented it because there’s always been a cap on student numbers.
“Even in the difficult economic times we’ve had, a Conservative chancellor has actually made Robbins a reality and made it possible to say now, truthfully, that any student who is qualified to go to university will get a place.” But can he envisage putting up the fees cap again at some point in the future? “I see no persuasive case for increasing fees. The fees are at the right level.”
Another area where Cable has been scathing recently is on the Tory net migration target and the impact it has had on attracting overseas students. Again, Clark has a graph to hand, this time showing that the number of foreign students at UK universities rose by 4.6% in the year to June 2014 and is up 8% since June 2012. He has another bar chart showing that the UK is now second only to the US in attracting overseas students and that America’s numbers are dropping. “The US share is declining; we are increasing and are going on increasing. It is within our grasp to be the world’s leading destination for overseas students. That is something that I very much want to promote.”
Clark recently met the Indian High Commissioner to discuss further university links, and is due to visit the country. “I’m going to India to spread the word to make sure people there and around the world know what a fantastic place this is to study.
“The policy that is required is that there should be no cap on overseas student numbers at UK universities, and there isn’t. It’s extremely important that people understand that. That’s the policy that bites, as it were. That’s what people need to understand.”
Labour has now vowed to remove students from the migration figures. Does Clark defend their inclusion in the overall target? “It’s not a choice of the Government – there’s an internationally agreed definition of what is immigration. I’m proud that we are a government that hasn’t played around with statistical definitions. That was the definition we inherited. It would be wrong to tinker with definitions. Quite rightly, people would be critical of that.”
Clark also wants to ensure the Government does more on widening access to postgraduate places at university. The coming Autumn Statement will have more details on how to get more postgrads from poorer backgrounds, he says. “It’s a cross-government approach, so I and my officials and Treasury officials are looking at the options. It’s not straightforward – these things aren’t – but we have a shared ambition to put the possibility of postgraduate education on a footing that makes it more widely available for the good of the country as well as individuals.” Will there be a new pot of cash? “We will share our thinking at the Autumn Statement. But we want to do it in a serious way.”
David Willetts fought hard to protect science spending over the last few years, despite the wider cuts. Like ‘two brains’ Willetts, ‘three briefs’ Clark says science is just as important to him as his universities and cities roles. He will unveil the UK’s new, 10-year Science and Innovation Strategy alongside the Autumn Statement. “I hope that this will be something that commands attention and respect across all parties and none. The Chancellor has a demonstrated track record on science previously as well.
“We have not only a protected cash budget for research but actually an increasing budget for capital in science… [In] the Science and Innovation Strategy, one of the functions of that is to allocate what is a growing capital budget.”
A former head of policy for the Tory party, Clark is proud of his reputation as a wonk’s wonk. “I’m relishing working on this strategy,” he says. “Whatever the briefs I’ve had, I’ve always enjoyed getting to grips with the fundamentals of policy. In opposition, I wrote the energy white paper that led to the party changing its policy on nuclear power from being against it to in favour of it; I wrote a report on decentralisation that has resulted in the devolution proposals that now have real momentum. The planning reforms that were made, I wrote personally the National Planning Policy Framework. So the opportunity to work with our best scientists within government and without is something that I’m hugely enjoying.”
Shortly after this interview with The House, Clark had a meeting with the Government’s Chief Scientific Adviser, Sir Mark Walport, to discuss just that. The minister says that among the strategy’s key themes will be more collaboration, a faster pace on some research and getting more women and ethnic minorities into leadership positions in higher education.
“Increasingly, the best scientific work is done between different institutions working together, often between different disciplines working together, and sometimes – as in the case of CERN and others – different countries working together. So we want to reflect and ensure the importance of that,” he says.
“The second thing is pace. While you need long-term stability in major research programmes and the infrastructure, there’s a huge imperative to get new discoveries making a difference to people’s lives as quickly as possible, so I want to make sure our arrangements have the agility and the alacrity we need. Graphene [a new research centre was opened after the Government mobilised to help the Manchester team who discovered it] is a good example of that.”
Thirdly, he says he wants more universities acting like “talent scouts” for women and ethnic minorities. “It’s not sufficient just to be, as it were, without prejudice and make sure that the advertisement says that all applicants are to be considered. Sometimes you need to roll up your sleeves and go out and find people and say: ‘You will be brilliant at this, why don’t you apply for this?’ If you have a personal approach, you can make a real difference.”
As for his three portfolios of universities, science and cities, just how does he do it? “They complement each other fantastically well,” he replies. He already knows many university vice-chancellors because they have been involved in supporting bids for City Deals. On a recent tour of the West Country, he signed two new regional growth deals at university campuses and opened the new Space Weather Operations Centre (tasked with detecting solar storms) at the Met Office HQ. The trip underlined the importance of the UK’s science base, but also how growth is driven by a sense of local place.
“It was prescient of the Prime Minister, if that doesn’t sound presumptuous, to see the increasing connections between place and science and education. After all, universities are among the few institutions that are synonymous with place. The connection between places and their universities can be and is incredibly important.”
He may not be a Space Shuttle commander, but Greg Clark wants to boldly go where no minister has gone before, delivering real localism while boosting our science and innovation. Between now and May, he’s certainly hoping he can cross that final frontier.
CLARK ON… RAISING TUITION FEES
“People in future generations will invest the Coalition with credit. It took a difficult decision but the right one and we are seeing the benefits of it.”
CLARK ON… UNIVERSITIES
“We have record numbers of poor people going to university… In the world rankings, four of the top six universities were in the UK. They are one of our proudest national assets.”
CLARK ON…UNIVERSITY WOMEN/BME LEADERS
“They don’t have the representation of the most talented women and people from ethnic minorities that reflects the contribution they are making.”
CLARK ON… OVERSEAS STUDENTS
“It’s one of our biggest export earners. And in terms of the cultural ties and affinity and affection for the UK which it engenders, it lasts a lifetime.”
Douglas Carswell is a fan of Oliver Cromwell’s early work. The Conservative Member for Clacton – sorry, the Ukip Member for Clacton – admires the insurgent leader of the parliamentary forces in the English Civil War to such an extent that he quoted him approvingly in The Plan, his 2008 treatise on how Britain might be saved in a mere 12 months. All that was required, apparently, was a programme of radical decentralisation designed by Carswell and his friend Dan Hannan, the Conservative MEP.
“I find the country bleeding, nay, almost dying,” Cromwell told MPs in 1644. “The people are dissatisfied in every corner of the nation, all men laying at our doors the non-performance of those things that had been promised.”
In The Plan, Carswell used that quote to draw a parallel with the anger felt in the early 21st century at the alleged failures of Westminster. Radical change was required in the 1640s to address popular concerns, and it is needed now, he suggested.
Carswell was certainly prescient. During the six years since he and Hannan published their radical manifesto, the pace of deterioration in the reputation of Parliament has, if anything, accelerated markedly. The financial crisis, in which Westminster was judged complicit, was followed by the expenses crisis and a deep recession, all of which further eroded trust in established institutions.
The traditional players in the Commons were never going to be immune from the effects of this transformation, and so it is proving as the party system fragments. Carswell is now a Ukip MP after resigning his seat and thumping his old party in a by-election. After that result in Clacton and Labour’s narrow escape in Heywood and Middleton, both of the major parties find their assumptions about the next general election being stress-tested.
With only seven months to go, Labour risks leaking core votes to Ukip and the Tories fear that large numbers of their former voters are, for now, unmoved by warnings that voting for Farage means putting Ed Miliband in No 10. The Lib Dems are melting down and the SNP in Scotland is surging after the referendum.
Carswell – who now grins almost as much as Nigel Farage – is loving all this, of course. Like any revolutionary he enjoys chaos and disruption, believing it to be a sign that the old system is dying and something better is about to emerge.
The creative destruction which he believes is necessary in economics is being applied to the electoral map of the UK. In this way, Carswell has long been a radical rather than a conventional Tory. Typically, Tories tend to be interested at least to some degree in order, stability and evolutionary change rather than unpredictable upheaval.
But will Carswell and Farage’s revolution end any more happily than that of the 1640s? They are united in wanting the UK out of the European Union, although the Ukip surge could easily alienate undecided voters on that question by tarnishing Euroscepticism as noisy, screechy populism. That approach seems to appeal to anywhere between 10-20% of a deeply disaffected electorate, which is only enough to cause chaos in 2015 but not to build a winning majority for a ‘better off out’ position.
For now, Carswell and Farage are singing the same tune, although those who know this usually independent-minded MP are amused to see him ‘taking the line’ faithfully from his leader and so far parroting a holding position on policies such as immigration, where the pair have very different instincts. Carswell is a huge enthusiast for immigration, while Farage is not.
The Ukip leader is also notoriously intolerant of internal rivals while Carswell is – as David Cameron knows – difficult to please and pretty much unbiddable if he gets fixed on an idea. In the end, Carswell regards even the regicidal Cromwell as being insufficiently radical. Cromwell, who became a practitioner of power politics, outflanked the Levellers who wanted to go further towards full democracy. Carswell thinks that when he got into power he was a big letdown.
Iain Martin is a political commentator
From: David Willetts
Sent: 09 October 2014 11:42
Going to university is a fantastic experience and worthwhile in its own right. But young people are also considering what their job prospects might be. I think we agree that this is legitimate and understandable. At the moment universities have little incentive to focus on this. And currently legislation actually forbids the Student Loans Company from giving them information to universities about their graduates, even with the graduate’s consent.
If universities actually held some of the outstanding student debt they would have an incentive to boost the earnings of their graduates. They would want to stay in touch with their graduates who were out of work and help them to refresh their skills and get back into work. No university would be forced to do this, but I think they should have the option when the stock of student debt is being sold.
The critics say this penalises courses or universities where graduates earn less. I value the wide range of different courses that are studied, including of course the humanities and social sciences. I also recognise that universities that take more students from tougher backgrounds will find it harder to get them into well paid jobs. The point is that the debt of those students can be bought at a lower price as the assumption may be that they will earn less. But then the incentives are to invest in and help those graduates so they earn more and pay back more. It is improvement on current performance that matters, not where you started.
The biggest gainers from this policy would be students and graduates, and so I hope that as someone who cares about their interests you will support it.
Very best wishes
From: Wes Streeting
Sent: 13 October 2014 09:00
You’re absolutely right that students are concerned about their employment prospects after graduation. I have been concerned for some time that universities – and the Government – are selling degrees on the promise of greater financial reward in the workplace without sufficient support to help students to plan for their future careers.
Your plan has some superficial appeal, not just because it would incentivise universities to focus on employability in the way you describe, but I’m worried that your proposal also creates some dangerous incentives with detrimental consequences. It would reward universities that take ‘low-risk students’ – those from wealthier backgrounds who already dominate our elite universities. These students are more likely to graduate into higher paid jobs and are more likely to repay their debts. Conversely, it would penalise those universities that are most successful in recruiting students from working class and other non-traditional backgrounds. These students benefit from higher education, but they are more likely to study locally and more likely to go into lower paid jobs. Higher education is an important engine for our economy, but it should also be an engine for social mobility.
Finally, higher education is about so much more than cashing in a degree for higher earnings. While some will go on to lucrative roles in the highest paid professions, many graduates choose to follow their dreams in lower paid roles, particularly in the public and voluntary sectors. Graduates and universities shouldn’t be penalised for this.
All the best,
From: David Willetts
Sent: 13 October 2014 12:07
Thanks for your response. I completely agree with you that universities and their students come in all shapes and sizes and a good thing too. It is also a great strength of our system that people study such a wide range of courses. I think you have just misunderstood how my scheme would work.
Of course there will be different repayment rates depending on the course and the university. That will be reflected in the value of the debt. If a university has highly employable graduates it will have to pay more for its debt than a university whose graduates have historically done less well in the jobs market. What really matters is improving on previous expectations – not the absolute performance. So you are not penalised if you have students doing courses with poorer employment prospects: you are rewarded if you do better than market expectations.
We are talking about selling existing debt which has already been accumulated. So you don't gain by changing what or who you teach. To caricature the point, if you close down your sociology department and do more law to improve your employment outcomes then when it comes to buying the loan book for those graduates you will find that the higher employability is reflected in a higher price you pay for that graduate debt. The rewards are only for doing better than is expected for that type of student on that type of course.
Hope that helps.
From: Wes Streeting
Sent: 13 October 2014 18:53
Thanks for sharing the detail. I can see how your proposal seeks, in principle, to mitigate against the risks I spelled out, but I fear you may still see negative consequences in practice.
You note that this scheme would be voluntary. Which universities have both the desire and the capacity to participate in this scheme? The initial response from the majority of the higher education sector seemed at best lukewarm and at worst critical. I think we both know that there are a small handful of universities that are already talking to banks about running their own student loan schemes in order to go private. Beyond those, there is little capacity for universities to invest in student loans in this way. Where there is capacity through budget surpluses or additional borrowing, universities are understandably investing in estates and ICT to cater for students who want more bang for their buck with fees at £9,000.
I worry that those that would have the desire and the capacity to participate would be those academically elite institutions that remain far too socially elite for their own good and the good of the country. Their employability outcomes are generally excellent, but we need a world class higher education system, not simply a handful of world class universities. How would we improve the lot of those students studying on courses that proclaim to be widening participation success stories, but in reality are selling students from disadvantaged backgrounds short by charging full fees for poor graduate outcomes?
All the best,
From: David Willetts
Sent: 14 October 2014 09:24
Thanks for your response. I agree with you that it is a good thing that we have a diverse higher education system with great regional universities and universities focussed on teaching as well as the prestigious research-intensives. You worry that only those prestigious universities will participate in a voluntary scheme. I think that is based on a misunderstanding as I tried to explain in my previous note. But here are two more points.
First you are assuming that universities have to find all the funding themselves. That would be a serious constraint even for the richest universities. But my scheme would be much more flexible than that. A university would find a commercial partner – a pension fund or a bank – who would fund the purchase of that university's student loan book and they would share the gains if the earnings of their graduates could be improved.
Secondly I think you are still not grasping what this could do for social justice. There is no big gain from a university with high earning graduates owning the loan book – most will be repaid anyway and this will be reflected in the price it pays for the loans. The real prize is when a university with low graduate earnings and employment rates has the funding and the incentive to help them. Imagine a university which found that 50% of its graduates were out of the work force or on low pay and invested in refresher courses and return to work programmes to help them. Too many universities lose contact with all but their most affluent graduates when I want them to have a real incentive to help the low earners. This would require a change in the law which at the moment prohibits any information about graduates being passed to universities by the Student Loans Company. Provided the individual consents I think universities should be able to access that information. A university careers service should be for life not just for your years as an undergraduate. In fact I think we should work together on a proposal which we should take to the universities whose graduates don't do so well at present. Imagine designing a programme to help their life chances with the funding and the incentives to make it happen!
From: Wes Streeting
Sent: 15 October 2014 00:15
Thanks for the clarification about the financing arrangements. I still have some concerns about this. Clearly there would need to be incentives for the bank or pension fund involved. I’m not sure that the carrot on offer for the universities you describe would have the same appeal to potential investors. Under existing arrangements, we’re in a position where 45% of student debts will need to be written off, and the Government had to abandon plans to sell off student debt because of over-optimistic assumptions about receipts for the Treasury.
After more than a decade of political knockabout on higher education funding, we need to reach a cross-party consensus about how we fund higher education in the longer term. I fear we’re left with an unsustainable system that fails universities, students and the taxpayer that needs a more fundamental rethink than this debate has allowed.
But your idea is characteristically thoughtful and I hope we continue to benefit from your contributions to debates about higher education beyond your departure from the Commons in May. I think we are agreed that we need to improve outcomes for graduates from the most disadvantaged backgrounds and think creatively about how we incentivise universities to do so and I’d be happy to work with you further on this to achieve the outcomes we both want to see.
Very best wishes,
David Willetts is Conservative MP for Havant and was Universities and Science Minister from 2010-14
Wes Streeting is Labour PPC Ilford North and was President of the NUS, 2008-2010
When I was a wee lad, my dad – who was one of the first to bring his kids to work – brought me and my twin brother Kyle to Parliament. In those days – in the early 70s – Parliament was an all-night affair. I have vivid memories of sitting there very, very late at night in the special strangers’ box under the gallery on the opposition side. Some Members were sleeping; others had their feet up on the benches. My brother followed the honourable members’ example and fell asleep; he was soon snoring. One of the doorkeepers came over and woke him, telling him he couldn’t sleep in Parliament. Kyle pointed at the MPs and said in his defence that they were sleeping. The doorkeeper kindly informed him: “Yes son – they are Members; you are a stranger.” It’s an experience that stuck with me and egged me on to one day try to be a Member of this mother of parliaments.
In 2010, in my first week as the new Member of Parliament for North Antrim, succeeding my father after his 40 years of service, I was walking down the corridor with dad from the library towards the Speaker’s office. We were going to nip down the little staircase and out into New Palace Yard to get to dad’s car. As we walked along, I was brimming with pride to be an MP with my dad, who was about to be elevated to the Lords. I said to him ‘dad, you know until you’re elevated you’re a stranger here and I’m the Member’. We both stopped and had a real laugh. Dad told me it was the first time since his retirement that it had struck him that he was no longer an MP. He had walked that corridor for four decades and was no longer a Member; it was a page-turning moment.
I loved watching my dad perform in Parliament, and it was always a performance. From his maiden speech until his farewell, he made his presence felt. With his commanding stature, powerful voice and eloquent oratory, he made the job look so easy.
I remember in 1985 when he spoke from the upper galleries denouncing the then Prime Minister, Margaret Thatcher, for signing the Anglo-Irish Agreement. It made headlines, and he came home to rapturous applause. I also remember him being ejected for telling John Major during his premiership that he’d uttered falsehoods to the House.
Remarkably, dad always got on well even with his political adversaries and opponents; it was his nature. I share a corridor office today with Nick Hurd. His father, the distinguished Douglas Hurd, had come under dad’s wrath at one time. Some time ago Nick and I shared a laugh about our fathers' run-in.
Something dad has passed on to all his children is a drive to do everything to the full. If you are going to have a sense of humour, make sure it’s outrageous. If you’re going to speak out, be outspoken. And if you’re going to be outspoken, be heard! I suppose that’s what was so attractive about him as a politician – he was both rebellious and clever. He also knew where the limits were and was incredibly self-aware.
The weekend before recess I had been with dad. His condition had deteriorated, and while he had miraculously bounced back in the past, I didn’t think that would be the case now. I carried out my duties in the select committee and asked the Speaker if he would be kind enough to call me early on the Tuesday to question the Northern Ireland Secretary so I could get home early and spend some time with dad.
Mr Speaker was so obliging and very kind. Without fault, anytime I have met John he has always asked after both my father and mother. I got home and spent Wednesday and Thursday with dad. On Friday morning, I kissed him farewell and went to my constituency office. Dad’s advice was always ‘put the people first, look after them and they will look after you’. During my constituency surgery, I got a call from my sister to get home. I spoke to dad on the phone and told him again I loved him. He passed away a short time later, surrounded by my mum and family.
Dad was a great man of faith, and his faith never failed him. It was his life, and it served him in a remarkably peaceful passing. Throughout the last eight months of illness and deterioration, dad never once required as much as a painkiller. That is so comforting to us now.
When I made my maiden speech, nerve-wracking enough as that moment is for any Member, I looked up into the Speaker’s gallery and my father and mother were both sitting there. Now, given that I had to mention the previous Member, it was great to see him. I felt his own pride in his broad, beaming smile as I spoke.
Dad was one of the great parliamentary orators, and one of the few who could really command the House and seize its attention. That’s because he had a cause, a belief and a purpose. When we chatted, he often asked: ‘What are we going to change? What are the things that need to be done?’ He always had a mission. It’s a lesson to anyone in public life to have a purpose – don’t just be a Member for the sake of it.
I believe his legacy after years of championing his cause has been to do the right deal at the right time to achieve a lasting peace in his beloved Ulster.
He has certainly ensured that the combination of weak Unionism and IRA terrorism has not prevailed, and today Unionism is in a strong and dominant position in our country. Last month, as I carried his remains to the open grave and lowered him into his beloved soil of Ulster, I hoped that a seed had been planted afresh in our country, and that this peace will continue to grow and progress.
Ian Paisley Jr is the Democratic Unionist Party MP for North Antrim