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Higher Education

I disagree with my hon. Friend about the evidence from overseas. This debate raged long and hard during our proceedings on the Higher Education Act 2004. In some countries where higher fees have been introduced, there has been an increase in applications. On his core point about what we will do about the cap after 2009, we have made it clear that we will not move until we have seen the first full three years of operation of the new system. There will then be an independent commission. I say, both to those who advocate lifting the gap and to those who say that we should scrap fees now, that both those approaches are premature, because we need to see the full operation of the first three years of the new system. The role of the Office for Fair Access has been significant in helping to smooth the passage of the new system. The introduction of access agreements through which universities can commit publicly to what they will offer students from poorer backgrounds out of the additional income generated from fees has been an important step forward. In the Higher Education Act 2004, we legislated to ensure that a university must have an access agreement approved by OFFA if it wishes to charge more than the basic fee. The introduction of variable fees was an incredibly difficult decision to take, but the Government had the courage to take it, and as I have said, we are being proved right. I welcome the fact that the Conservative party has shifted its ground on that issue. If I look long and hard, even some Liberal Democrats appear to be shifting their ground—[Interruption.] Maybe not the ones who are present today. In my experience, different groups of Liberal Democrats come up with different conclusions. Nevertheless, the pamphlet that was produced before Christmas by the Lib Dem think-tank, which fundamentally endorsed the Government’s approach on a post-graduation repayment system, was very significant. The time has come for those who criticised the concept of OFFA and the bursaries regime in 2004 to move on from that position. OFFA has been an important success. All the institutions that have chosen to set fees above the basic level have successfully completed an access agreement. I take this opportunity to pay the fullest of tributes to Martin Harris and his team for the outcome that they have secured and for how they have gone about it. As a result, access agreements are in place and forecast to deliver in excess of £300 million per year in bursaries to students. I have no doubt that the right to additional fee income for universities must go hand in hand with a social and moral responsibility to students from less advantaged backgrounds. Universities have demonstrated their genuine commitment to that principle through the extent and generosity of the bursary schemes and additional outreach commitments in their access agreements. At this juncture, I should refer to the concerns that have been raised about a potential underspend on bursaries in some universities. I have been monitoring that situation very closely. The overall scale of underspend has been exaggerated in some reports. In several universities, including a significant number in the Russell group, the projections are that there will be no underspend at all. Forecasts of spend inevitably carry with them some uncertainty, especially in the first year of an entirely new bursary scheme, and some universities set a high figure for reasons of prudent financial management. I am not in the business of unfairly or unjustly criticising people. OFFA will monitor expenditure and performance annually, and we will have a full picture of year 1 after the relevant monitoring information has been collected this summer. At the same time, universities should be doing all they can to ensure that students get the support to which they are entitled. In recent weeks, several vice-chancellors have explicitly said to me that they intend to invest any underspend in their original bursary estimates on other measures to improve social inclusion. One of them told me:"““The money for bursaries is ‘budgeted out’. If it cannot be spent on bursaries, then it will go to support other widening participation projects.””" That is heartening. I would urge all universities forecasting a genuine underspend on bursaries to take that approach.