It’s wonderful to be here at Nottingham University, where my late father-in-law was Vice Chancellor and where my wife recalls living in Highfield House and doing her A Levels at the local technical college.
Above all, it’s an honour to deliver a lecture in memory of Ron Dearing, the Chancellor of this university from 1993 to 2001. He was sent for by governments of all colours when they had a problem that needed solving. He straddled the divides which are so pernicious in British education: between the vocational and the academic; between higher education and business. The last time I met him, he had come round to talk about university technical colleges - a great cause he pursued with Ken Baker, which is now coming to fruition under this Government.
Ron did a huge amount that is still at the heart of what my department does. He was a pioneer of inward investment on Tyneside in the 1970s, and this Prime Minister works harder than any I have known to bring investment to Britain. He was Chairman of the Post Office in the 1980s and this Coalition is at last sorting out its finances and giving it a secure future. He was self-effacing to a fault. It is said he would actually drive his personal chauffeur to and from work. I can’t quite decide if this is evidence of saintliness or public sector waste.
The Dearing report on higher education was, of course, a major piece of work. Indeed, the history of higher education in this country might have been different if his report had been implemented by Labour when he delivered it in July 1997. For it was the first official report to recommend income-contingent loans. There had been loans to cover living costs but they were mortgage-style and repayment amounts didn’t adjust to income, and there were no tuition fees with loans. The Blair Government shelved much of Dearing’s report by introducing up-front fees with no loans to cover them. They abolished maintenance grants too. As we contemplate student protests today, it’s just worth remembering what the previous Government introduced over a decade ago. Imagine the reaction if we were to propose that today.
Six years later, the old administration moved closer to what Dearing had proposed all along. The Dearing report also argued that “Government [should] shift the balance of funding, in a planned way, away from block grant towards a system in which funding follows the student”. Even Lord Browne couldn’t have put it better. And, like Lord Browne, Dearing insisted on the need for students to receive better information and advice in order to pick the right course for them at the right university.
So his report set out the rationale for much of what the Coalition Government is now doing, including the substantial and continuing Exchequer subsidy for student loans.
Today I want to focus on another of Ron’s concerns - the links between going to university and social mobility.
Social mobility is at the heart of the Government’s agenda. That is why Michael Gove is reforming our schools, why Iain Duncan Smith is making work pay for everyone, why Nick Clegg will shortly publish a cross-government social mobility strategy setting out our plans.
Universities must be part of this. Today, I want to discuss how they can help improve social mobility without compromising their academic integrity. Let me be clear: the primary role of universities is to enrich our knowledge and understanding. That is the fundamental value of teaching and research. We will not compromise on that. You don’t usually become an academic to raise the national growth rate or to improve social mobility. But if universities are true to their academic mission, these other goals can be achieved as well.
One reason why they complement each other is that to achieve the highest academic standards, universities must have access to the very best pools of talent. We do not expect them to educate people who do not have the potential to benefit from a particular course at a particular institution. That would be of no benefit to either individuals or institutions. But equally we do want them to find people with the greatest academic potential, even if that’s been hidden by poor quality schooling. That is why universities have always assessed future academic potential, not just past academic achievement. Prior attainment does matter in enabling a student to benefit from a course, but it isn’t - and has never been - the whole story.
This is all the more topical now because, as increased graduate contributions come on stream, we should ensure people are not put off from applying to university. That is why we have just announced further details of the National Scholarship Programme. By 2014, up to 100,000 students a year from disadvantaged backgrounds could be awarded a scholarship - including the matched funding element - worth at least £3,000. It could come in various forms. It could be a fee waiver. Some students tell us they’re worried about costs of accommodation or materials for their course, so it could help to cover them as well.
Dearing himself pointed out that, while participation was increasing, there was nevertheless a substantial gap between different socio-economic groups. And it wasn’t a new problem then.
Fifty years ago, the Robbins report of 1963 noted that “the able boy from a small grammar school and a home with no tradition of higher education may not find it easy to make his quality apparent at interview”. Robbins called on Oxbridge - dependent, like other universities, on public funds - to do more. Oxford responded with the Franks review of 1966. Franks was the man governments used to turn to before Ron Dearing. His report bemoaned the fact that “Oxford is not yet receiving applications from candidates coming from these [maintained] schools on the scale that the number of prospective university entrants would warrant. This is not healthy.” There was, Franks insisted, “no incompatibility between the aims of social justice, in the sense of equality of opportunity, and the effective competition for talent which is proper to Oxford or any other university.” That is the best possible summary of the Coalition’s approach.
Under the last Labour Government, the number of UK undergraduates rose from 1.3 million in 1997-98 to 1.6 million in 2009-10. This delivered a slightly more than proportionate increase in participation by people from poorer backgrounds. And this happened even when fees and loans were being introduced - one reason why my party changed our approach, as our fears about the 2004 reforms that brought in the current system proved unfounded.
However, the last Government didn’t do so well on access to our more selective, research-intensive universities. As Martin Harris has highlighted:
“[T]he likelihood of those from the lowest participation areas participating in HE has increased by 30 per cent over the last five years alone and by 50 per cent over the last 15 years. Importantly, the gap between the participation rates of the most advantaged and the most disadvantaged areas has been narrowing, both in proportional terms and percentage point terms, since the mid 2000s. … This significant narrowing of the gap has not occurred at the expense of fewer young people from advantaged areas entering higher education. …
“However, the gap in participation rates between the most and least disadvantaged remains significant: the participation rate of the most advantaged 20 per cent of young people is 57 per cent compared with a participation rate of 19 per cent for the least advantaged 20 per cent of young people.”
But then Harris turns to the real challenge:
“[W]hile there have been substantial increases in participation among the least advantaged 40 per cent of young people across higher education overall compared to the mid-1990s, the participation rate among the same group of young people at the top third of selective universities has remained almost flat over the same period. Furthermore, increases in the participation rate of the most advantaged over the same period have led to relative differences in participation at these institutions increasing: the most advantaged 20 per cent of the young population were around six times more likely to attend [them] in the mid-1990s but this increased to around seven times more likely by the mid-2000s.”
This matters. One reason why it matters is that - in the current scheme of things at least - our research-intensive universities effectively staff the top of most of our leading professions. They are the places from which you get recruited into the best-paid jobs. Research from the Cabinet Office that Alan Milburn drew on found that seven out of the top 10 graduate recruiters targeted just 20 of the UK’s 169 HEIs. I’m delighted that Alan Milburn has agreed to review Coalition policy in this area, in which he’s built up real expertise.
In turn, the same research found that people coming into the professions were more likely to have parents with incomes way above the average than a generation earlier. Take one profession, chosen at random - journalism. Where journalists and broadcasters born in 1958 typically grew up in families with an income around 5.5 per cent above that of the average family, it had risen to 42.4 per cent for the generation born in 1970. That is why the previous Government had to concede in 2008 that “Broadly, social mobility is no greater or less since 1970”. I believe we can do better than that.
This is the challenge that drives the Deputy Prime Minister’s review of social mobility, on which I serve and which will report shortly. It is also why Vince Cable and I have written to the Office for Fair Access (OFFA) explaining what universities have to do to broaden access if they want to charge a graduate contribution of more than £6,000.
Our letter does not introduce quotas - not one iota of a quota, in fact. That is not what Vince or I envisage at all. Not only would quotas be undesirable - they would be illegal.
The 1992 Further and Higher Education Act made it clear that universities control admissions, not the Government - by preventing the Secretary of State from interfering by setting conditions for HEFCE grants. Labour followed suit with the 2004 Higher Education Act, which preserves the freedom of universities “to determine the criteria for the admission of students and apply those criteria in particular cases” and requires the Director of Fair Access to respect the autonomy of institutions with regard to admission of students.
Our letter to OFFA mentions indicators such as personal social background, school background and neighbourhood evidence - but it is universities themselves who will select their own measures of performance and will set out, in access agreements agreed with OFFA, the progress that they can be expected to make over time.
Of course, universities make their own judgements on admissions, based on individual merit. However, in an era of transparency and legal challenge, they need to be more open about the criteria they are using. That is why we have said in our letter to OFFA that universities’ measures of performance have to be “fair, transparent, and evidence-based”.
The crucial test has to be academic merit - both prior attainment and future potential. Universities have long been interested in this. One report, from more than 50 years ago, found that, in 1955, 55 per cent of male Cambridge entrants were from independent schools, 10 per cent from direct grant schools and 25 per cent from grammar schools. But in Part II of the Tripos, 4 per cent of all public school boys, compared with 6 per cent of all direct grant boys and 8 per cent of all grammar school boys, got Firsts. When it came to third-class degrees, the figures were 27, 20 and 19 per cent respectively.
Two recent papers consider specific universities - Oxford and Bristol - and use a rich data set to assess university recruitment. They look at how you would do university admissions if you were trying to equalise the chances of getting a First or 2:i. For Oxford, Ogg, Zimdars and Heath have found that “the same average GCSE grades for a private school and a state school student do not mean the same thing; they do not represent the same potential to achieve a first-class degree at Oxford”. Hoare and Johnston have shown that Bristol university students educated at independent schools perform better in their A Levels than those who had attended state schools - but they were significantly less likely to get a first-class degree and more likely to get a 2:ii or worse.
This could be telling us something really rather optimistic about our universities. It suggests that when children from less academic schools arrive at some of our leading universities, they then outperform and have a better chance of a top degree. We can’t be certain about this, but it’s exactly the kind of thing that universities can consider - after all, they are supposed to be measuring academic potential not simply admitting applicants for doing well at A Level.
Now I want to consider one other challenge to this line of argument. We’re told that universities cannot be expected to make up for the problems in our schools.
Why pick on universities, so the argument goes, when it is the schools that need sorting out - or early years, for that matter? In fact, I sometimes think, after many years involved in education policy, that just about every stage in the education system wants to trace their problems to the previous stage. The logical conclusion of this is that we have no chance as a society until all expectant mothers are playing Mozart and French language tapes to their babies in the womb.
The reality is that social mobility is very much a shared responsibility. Over the past decade or so, a good deal of stress has been placed on early years development - and rightly so - but it’s far from a complete solution. The challenge is to get the balance of educational investment right across the whole life cycle. James Heckman himself, the academic most closely associated with the early years argument, has asserted that “early investments must be followed by later investments if maximum value is to be realized”. In other words, if early years create potential, adolescence and adulthood realize that potential.
We can also learn from neuroscience. I’m a layman here but I am fascinated by the research into the nature and implications of brain plasticity conducted by teams at UCL and elsewhere. It challenges some of the cruder ideas that your brain is completely shaped by your early experiences.
Young children obviously have a vast capacity to learn, but that’s by indiscriminate absorption - the way children pick up language. The prefrontal cortex - essential for higher forms of reasoning and for self-control - continues to develop throughout adolescence and beyond. This is what we need to learn in a more structured way. An adult cannot absorb a new language like an infant, but because an adult can grasp grammatical rules and syntax, he possesses ways of thinking which mean he can learn very efficiently. It is factually wrong that the brain’s capacity for change tails off dramatically and unalterably beyond early childhood. I hope to return to this whole subject in a later speech.
The best way to think about social mobility is in terms of a virtuous circle. A good way to improve the early years experience of children is for them to encounter parents or nursery teachers who themselves benefited from a university education. We really need to think about effectiveness of interventions and their cost across all stages of the educational life cycle.
Under the previous Government - as assessed by the OECD last September - total UK expenditure, both public and private, on pre-primary to tertiary education was 5.8 per cent of GDP against a population weighted OECD total of 6.2 per cent. Broken down, the UK spent:
- 0.3% on pre-primary, against the OECD average of 0.4%
- 2.8% on primary and lower secondary, against the OECD average of 2.5%
- 1.5% on upper secondary education, against the OECD average of 1.1%
- 1.3% of GDP on all tertiary education, against the OECD average of 2.0%.
There’s no right answer for levels of HE funding. The crucial challenge is that it’s sustainable and progressive - and that’s what we are achieving with our reforms.
It’s important that our interventions at each stage of this process are equally effective. The ministerial group, under Nick Clegg, is looking at social mobility across the life cycle.
Our graduate contributions are a way of bringing more money into higher education. Indeed, our recent grant letter to HEFCE outlined how, by the end of this Parliament, universities could have 10 per cent more cash for teaching than they do now, financed out of loans and graduate contributions. There’s not many parts of the public or private sector that can even imagine that. And our modelling assumes an average graduate contribution of £7,500 from 2012-13. That’s why we have said that charging £9,000 should be exceptional.
But I am reading a lot of headlines claiming that’s what universities are going to do. Sometimes, the headlines have not matched the actual details: the leaked Cambridge document, for example, proposes an average fee that is hundreds of pounds lower, because of fee waivers for all students from households on less than £42,000. And it’s worth remembering that no university wanting to charge more than £6,000 can yet know what it will charge, for the process of preparing access agreements is only just beginning.
I want to be frank with you: we will all face a problem if the sector tries to cluster at the maximum possible level. We set the maximum level at £9,000 because we think there are some circumstances where fees of this level could be justified. This problem arises partly because the taxpayer is lending the money upfront, on preferential terms, and we expect that one-third of the loans will never be recovered. If graduate contributions end up higher than £7,500, we would reluctantly be forced to find savings from elsewhere in HE.
How each institution sets its prices is a matter for them, not for ministers or even OFFA. So we do not intend to provide a running commentary as universities go about setting their charges, especially as we have now set out our guidance in the OFFA letter. Institutions are rightly coming to their own conclusions about how much to charge but, given the backdrop of rumours, let me make a few initial comments as the process gets underway.
First, making an assumption of a £9,000 charge and working backwards is the wrong place to start. That is why the Browne review began by considering what universities need to deliver high-quality higher education. The answer was that, for the most common types of course, institutions need around £7,000 per student to match current income - or £6,000 once expected efficiencies have been accounted for. That is why we set the basic amount - the point at which an institution does not need to make an access agreement with OFFA - at £6,000. In the 1980s, funding was driven to the lowest possible levels without considering how much you needed to teach students properly. Now, some universities are rushing to £9,000 without thinking about the impact on students.
Secondly, we should remember that nearly 80% of students fall within HEFCE’s Band C or D, the lower levels of teaching grant which covers usual lecture and seminar based courses. For each Band D student, universities currently receive a tuition fee of around £3,300 and a HEFCE T-grant of around £2,750, making around £6,000 in total. In 2012 prices, this would be more like £6,350 - so a charge of £9,000 represents an increase of more than £2,600 - or over 40 per cent - in teaching resource. For students in other HEFCE Bands, the increase would be around 20 per cent. A one-off increase of this size will often be extremely hard for institutions to defend. Indeed, we expect that the current Universities UK review of efficiencies on campus will propose ways that universities can save money.
Thirdly, universities could easily find there are alternative providers who want to come in at a lower price. Further education colleges and others may want to come in significantly below £9,000, so universities should not ignore the competitive challenge that they will face.
Finally, there is already a clear divergence of charges for international students and for postgraduate study.
Of course, we realise that there are pressures on universities’ other income streams too, as changes take effect across the public sector. One of the reasons why we envisaged an average fee of £7,500 in our modelling is that this sort of level strikes the right balance between delivering sufficient resources for a high-quality student experience and protecting the financial interests of graduates and taxpayers.
One thing that universities can do is to set out more clearly students’ rights and responsibilities. We are publishing today the report of the Student Charter Group.
The Group surveyed UUK and Guild HE members and found that 40 per cent of respondents do not have a student charter, agreement or contract currently in place.
Improving student information is a key priority for the Government. Students have a right to know how they will learn, how they will be supported and what they need to do themselves to reach their potential. Let me thank Janet Beer and Aaron Porter for their work on the report, which the Coalition will examine closely.
At a time of significant change in higher education, students have increased expectations of their university experience. I want a system where students have real choice and universities respond to what students need.
We will return to this issue in our forthcoming White Paper but I would urge universities to use the good practice identified in this new report to review the information which they currently provide, and for those without an agreement to use the toolkit the Group have provided to engage with their student unions.
Universities are at the heart of our national life. Indeed, I can do no better than to borrow a quote from Ron Dearing’s foreword to describe higher education’s true value. In 1997, Ron chose to cite the Poet Laureate, John Masefield, who once said that a university “is a place where those who hate ignorance may strive to know, where those who perceive truth may strive to make others see; where seekers and learners alike, banded together in the search for knowledge, will honour thought in all its finer ways, will welcome thinkers in distress or in exile, will uphold ever the dignity of thought and learning and will exact standards in all these things.”
I would only add that we need to ensure that everyone who can benefit from this experience has the opportunity to do so, regardless of background.