Education and Culture Committee

Meeting date: Tuesday, November 29, 2011

Official Report 516KB pdf

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Subordinate Legislation

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Student Fees (Specification) (Scotland) Order 2011 [Draft]

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Education (Fees) (Scotland) Regulations 2011 (SSI 2011/389)

We will now take evidence from the Cabinet Secretary for Education and Lifelong Learning, Mike Russell. I welcome the cabinet secretary to the committee. I also welcome Ann McVie, from the higher education and learner support division, and Neil MacLeod, from the legal services directorate, both from the Scottish Government. I invite the cabinet secretary to make some opening remarks.

I apologise for being slightly late. If I were to show you pictures of the flooding that I have seen this morning in the west of Scotland, I am sure that they would amaze you all. I am glad that I am only slightly late—thank you for your forbearance. Thank you also for giving me the opportunity to answer any questions that you may have on policy relating to the draft Student Fees (Specification) (Scotland) Order 2011 and the Education (Fees) (Scotland) Regulations 2011.

The order will set tuition fees for higher-level courses of education for full-time students who start their courses in 2012-13, but institutions will not have to charge tuition fees at the levels set by the order to any student who does not have a relevant connection with Scotland or who is not an excepted student within the meaning of the regulations. In general, non-UK European Union nationals who live in the EU will be excepted students in that context. The regulations also provide for certain other categories of excepted student. Generally speaking, the net result of the order and the regulations will be that fees that are set by the order will not apply to students who normally live in part of the UK other than Scotland—what we term rest-of-UK students.

You are familiar with the contents of the instruments. You know that, as a result of a decision of the UK Government, university tuition fees in England will rise to a ceiling of £9,000 a year in 2012-13. That has been the subject of much media attention and a lot of justifiable outrage, and it may—on the basis of the latest, very provisional figures from UCAS—be depressing the number of applications to universities north and south of the border. The devolved Administrations in the UK have had to move quickly to develop tuition fee policies to best serve their students and their institutions. It is worth noting that each of the devolved Administrations has responded with policies that mean that students from other parts of the UK will pay more than students who normally live in its area of responsibility.

In Scotland, we pride ourselves on our commitment to ensuring free access to higher education. We will not compromise on that because of decisions that have been made elsewhere in the UK, which, in my opinion, are flawed. Neither can we allow institutions to be inundated with applications from students who usually live in England but can no longer afford to study there.

The new annual fees in England are up to five times the current fee for rest-of-UK students who study in Scotland. If we were to do nothing, the deluge of applications could be unmanageable. Let me put it into perspective. If only 10 per cent of the English students who studied in English universities in 2009-10 decided that it was much cheaper to come to Scotland to study, that would amount to about 37,000 students: more than half of the entire student group in Scotland. We simply could not allow that to happen.

Regrettably, my primary priority must therefore be to protect places at Scottish universities for Scottish students by taking action to maintain the current level of cross-border flow. We also need to give our universities the opportunity to compete for students from other parts of the UK on an equal basis with their counterparts elsewhere in the UK. The task has been a difficult one: to deliver a new policy to allow us to keep on providing free access to higher education for eligible Scottish students; to preserve much-needed places for those students; and to develop a solution that can be enforced in 2012-13.

I want to say a word or two about the consultation, which is quite crucial. We have considered the best way forward and have spoken to representatives from throughout the sector. We undertook a public consultation exercise on the draft order and, as part of that, we have had regular meetings with a range of bodies, including NUS Scotland. One of our main stakeholders—Universities Scotland, from which you heard this morning—agrees with the decision that I ultimately took, while the other does not. There has been a variation of opinion. I know that some are opposed to what they see as introducing a market for higher education, and I fully understand that. I know that some have suggested that a better approach would simply be to increase the fee for all full-time undergraduates—students who live in Scotland as well as those from the rest of the UK—which is what was done before. Some have suggested that, in the context of the approach that we are taking, the cap is too high.

Let me touch on each of those points, because they are vitally important. First, in order to increase fees for all full-time undergraduates, we would require a fundamental change in the way in which we fund our universities, requiring a transfer of over £500 million from the Scottish funding council to the Student Awards Agency Scotland to cover the cost of the increased student tuition fees. That would double the size of SAAS’s budget, give rise to a number of severe governance issues for it and reduce the ability of the funding council to use its funding levers to drive the wider reforms that we are pursuing under our post-16 reform programme.

Indeed, it is questionable whether the funding council would be able to continue to fulfil even its statutory duties if the money available to it was to be reduced by around 50 per cent. Moreover, setting new higher tuition fees for all full-time undergraduate students would have unintended consequences for Scottish students who are not entitled to tuition fee support from SAAS, such as students who choose to do a second undergraduate degree.

In giving Scottish universities the flexibility to set their own fees, I have been persuaded by the arguments put forward by Universities Scotland that they should be given the flexibility that allows them to compete fairly; that is against a background of uneven patterns of demand for Scottish higher education between and across nations, subjects and institutions, and of where there are comparable degree subject programmes of equivalent length in Scotland and the rest of the UK. Of course, there is the potential for entry into the second year, not to mention a range of fee levels.

That complex environment explains why I came reluctantly in the end to the decision to allow fees to be charged and a cap to be set at £9,000, matching the upper limit in England and Wales. I know that the committee has already taken evidence this morning on the issue of average fees, but the average fee level in Scotland is at around £6,840 before taking account of fee waivers, bursaries and other forms of student support. That compares with the average fee in England of £8,509. In addition, the NUS has suggested that we legislate to require universities to provide enhanced support measures. We have given a lot of thought to those suggestions, but I do not think that a quota system, which has been suggested, would be the best way forward. However, I think that we need to legislate for better access, and I propose to do that in a coming bill in a form that has never been done before in Scotland and which would be much stronger than what exists south of the border.

We have come to our conclusion after a great deal of thought. I would much rather not charge fees to anyone, but I do not have that option within the budgetary constraints. Therefore, I have come to what I think is the least-bad option. I hope that the committee will support it in a responsible way in order to allow Scottish higher education to move forward.

Thank you for your opening statement. I now invite members to indicate whether they have any questions or points of a technical nature that they wish to put to the cabinet secretary and his officials.

Good morning, cabinet secretary. The NUS put it to us that the most important thing for it was to get a guarantee about widening access. Can you give us some idea of the principles—I stress that it is the principles, because I am sure that you have not got the detail yet—of the legislation, to ensure that that guarantee can be given?

The basic principle of access would have to be that studying for higher education in Scotland is based on ability and that there is no deterrent on the basis of poverty or any other disadvantage. I pay tribute to the previous Administration in so far as there has been steady, if unspectacular, progress on that issue for more than a decade. We need to ensure that there is a fairness in the process and that all those who are capable of and qualified to study get the chance to do so. We also need to build aspiration to study. I have often said—in debates in the chamber and elsewhere—that one of the most important drivers in that regard involves not the university doors but the school gate, and possibly even the primary school gate, because that is the stage at which educational aspirations are built. We need to do a great deal about that.

I am currently consulting on legislation. Your ideas on widening access would be as welcome as anyone’s. I hope that we can put in place further measures to improve access.

Various people, including the NUS, have suggested that, as happens south of the border, a certain percentage of the additional income that is generated from the rest-of-UK fees could be put back into widening access. Are you considering that?

I am willing to consider that suggestion seriously. I think that the universities would argue that they are already doing that, through their bursary packages. However, I do not reject the suggestion out of hand. I am quite sure, knowing the NUS and its efficient representation, that that thought will come winging to me in its submission, to which I look forward. I do not reject anything in that regard.

The NUS has slightly different ideas from Universities Scotland, which feels that it would be preferable to have a variable system of charging the fees, which would allow the individual institutions to decide what to put back in. How will you try to negotiate between those two different views?

We have a situation that will apply over the next period. We needed to put that situation in place for 2012-13. However, we intend to legislate next year. The situation that will pertain in perpetuity, in so far as anything is in perpetuity, will be decided next year. It might be the one that is in place at the moment or it might be another one, following debate around other and possibly better ideas. I am not ruling out changing the current situation. However, last year I gave universities a guarantee, which members know about, that we would ensure that they were not disadvantaged. In order to do so, we had to get an arrangement in place as soon as possible. As you know, the £9,000 cap is voluntary, but the universities have observed it. Indeed, the average fee is considerably lower than that.

I would like to find a better means of operating. If one can be found, I am open to it.

It has been suggested that, if the rest-of-UK student body were to decline as a result of their having to pay higher fees, that could have implications for the demand for places by other students, which might have an implication for entrants and widening access. Do you accept or refute those concerns?

There are an awful lot of unintended consequences that will arise as a result of a policy that I think is wrong. I make that absolutely clear. It is entirely up to the UK Government to have whatever policy it wishes, but I disagree with it. It is entirely diametrically opposed to my view of higher education. I think that it is possible that there will be a range of difficulties.

The UCAS figures are provisional. Last year, the final figures were rather different from the provisional figures. However, I think that a concern is arising across higher education that the noise and publicity around this issue has depressed applications. If that is the case, it is immensely regrettable.

To follow up Liz Smith’s questions, could you make it absolutely clear that you are saying that the issue of rest-of-UK students will come into the legislation that will be developed on widening access?

Absolutely. I am open to thoughts on that issue. We needed to put in place a solution and we have done so. We rejected a number of solutions that were suggested, including a tempting suggestion that we should vary the arrangement that was previously in place by simply raising the fee of £1,825 or whatever to some acceptable figure—the difficulties that would be involved in doing that were such that it would pervert the entire system.

The decision that was made in Westminster has, inevitably, had an effect on each of the devolved Administrations. I do not want our policy on higher education to be set, in perpetuity, in reaction to what I regard as a flawed policy. Had I changed the approach of funding universities through the funding council and given a massive increase in funding for SAAS, that would have changed the entire basis of administering higher education in Scotland to its detriment. We have taken the decisions and we want support for the legislation that will allow us to implement them. However, of course I am open to discussing whether there are better approaches.

11:30

One concern that has been raised with me is that, at present, rest-of-UK fees are in essence regulated only by an agreement with the universities. Was that situation in any way avoidable?

The difficulty was that we would require primary legislation to set the cap and we had no opportunity to do that within the timescale. However, I have no reason to doubt the word of the university principals that they will observe the cap. The First Minister has made clear his wish that a couple of them had shown greater restraint, and I agree with him. However, despite that, nobody has breached the cap.

Another concern about the cap and the issue of restraint is that there is a lack of clarity. Universities rushed to set their fees between 27 August and 3 October. At that stage, each of them announced clearly how much it would charge, yet the same clarity has been absent in relation to bursaries. Universities Scotland has presented aggregate figures for all the institutions, but there is nothing to allow greater scrutiny of the behaviour of individual institutions and of whether they have shown restraint. Are you concerned about that?

I certainly want institutions to be entirely transparent about bursaries and the allocation of funds. I will ask them to be transparent and, if they are not, I will regard that as a matter to be considered for legislation. We should remember that a governance review is taking place. The universities are in no doubt about my view that there must be the highest degree of transparency in all their operations.

I do not want to anticipate resistance on the point, as I do not think that there is any. We should remember that the timetable was set externally by decisions of the current UK Government and the previous one, which set up the Browne review. There has been a dynamic to which we have been forced to respond. The difficult thing has been to preserve what we wanted to do while responding to that. That is difficult, but we are endeavouring to do it.

At the start of the process, the cabinet secretary called for restraint. There is disappointment among committee members that some university principals have not shown the restraint that was sought. Is there a case for a regulator similar to the Office for Fair Access to regulate fee levels and bursary systems?

We do not know whether the Office for Fair Access will be effective. I see no sign at present that it will be effective, as fee levels in England are higher than even the fees that have been set in Scotland. I will continue to consider whether further action is required. I have expressed my opinion on two universities in particular—we know which ones they are—as has the First Minister. I would have liked them to have behaved more responsibly, but they chose not to. We do not live in a perfect world. We live in a world in which universities and others have freedom of action. Universities are autonomous institutions, but they can be judged and they are open to criticism if they do things that you do not like.

Can the Government give assurances that universities will not be tempted to overrecruit rest-of-UK students to benefit financially?

Yes, there are strong assurances on that. There is a double lock of some sort on that. The first lock relates to the overall number of students. We know the number of students that we want to be educated in Scotland and that is our priority. The universities know that, too. In addition, they know that we would look closely at any university that appeared to be overrecruiting students beyond what we think is its capability. The Scottish funding council knows universities very well.

To speak bluntly, no university will want to dilute its product. I have heard university principals say that. Let us not talk down Scottish universities. We have a unique situation in Scotland, with five of the world’s top 200 universities in our boundaries. We have more world-class universities per head of population than any other country on the planet. We have something exceptional here and the guardians of that are the university principals and courts. They will not wish to dilute the product in any way. Indeed, their competitiveness is based on it. We have eight universities in the top 400. We have an exceptional brand that the university principals and courts will not want to dilute. Recently, I was in Malaysia with Heriot-Watt University, which signed a deal to set up a university in the new Malaysian capital of Putrajaya. It got that deal because of its worldwide reputation and the worldwide reputation of Scottish universities. Therefore, I am pretty confident that what you describe will not happen.

I am not in any way talking down Scottish universities—indeed, I very much agree that we have world-class universities—but the reputational damage that has been done to them as a result of some of the fees that principals have set has been referred to this morning. There has also been talk about the confusion over the variation in fee levels and the lack of clarity about bursary support. Is there a case for the Government to consider more regulation and show greater direction?

If you would like to make that case in the governance review and in a submission on the post-16 paper, I would be very willing to look at it, but we must be careful about reputational damage. Scottish universities have a very high, worldwide reputation. Simply because one or two universities make decisions with which we disagree and we all express our disagreement, we should not talk up reputational damage. We have to be confident that Scottish universities will behave fairly to all people. If we see evidence that they are not behaving fairly to some, we should say so.

Earlier, we talked about access. There was a lot of focus on access for students from the rest of the UK, but I think that there is still considerable scope to improve access for students within Scotland and that we may find that easier to do through building links between universities and their immediate communities.

I absolutely agree. The subject of access can be divided in many ways. You have worked hard on the issue of disabled access to further education, for example. The barriers to access to higher education have to be overcome in many different ways. Those barriers—whether they are socioeconomic, disability or other barriers—certainly still exist in Scotland, and we should work hard to bring them down. Of course, the effort that I would like to see through legislation will apply to Scottish students, but a further barrier to fair access arises through fees, and we should address that, too.

Can you give us any more details about the legislation on fair access that you are going to introduce?

We are still consulting on that, and I stress my openness to discussing the matter. I am having a lively and active discussion with a range of bodies, and we are getting in lots of interesting information. There are pretty good practices elsewhere that we can look at, and there can be tangibles. I am not saying that this will be in the legislation, but we could say that we will have a target that we will seek to increase year on year for different groups, or we could say—the two are not mutually contradictory—“Let’s put a lot of effort and time into encouraging young people to aspire to higher education.” I have previously given the example of the KIPP—knowledge is power programme—schools in America, which are focused on that. Therefore, there is a range of issues, and we will look at many things. We do not have a monopoly of wisdom.

What is the likely timescale for the conclusion of the consultation and the Government’s response?

The consultation closes on 23 December. I hope to move to draft legislation some time in the spring of next year.

We had an interesting session with NUS Scotland and Universities Scotland this morning as you were hacking your way through floods and pestilence—I flew down from Orkney this morning and, believe me, it is no more pleasant being up in a plane in this weather.

It was clear earlier that there has been a lot of collaboration between NUS Scotland and Universities Scotland to develop figures on what is happening, but we kept coming back to a fundamental disagreement over whether there is a lack of clarity and transparency at the institutional level. You have reiterated your concern that, in a limited number of cases, principals have not necessarily acted with the restraint that you advocated prior to the summer. Does that not make the case for an independent arbiter to provide reassurance to students and protection to the reputation of universities? The Office for Fair Access is able to do what you, by your own admission, have not been able to do and can levy sanctions against those that do not deliver on their access and outcome agreements. Is that not something that is lacking in the Scottish system today and would be beneficial?

I disagree with you about the Office for Fair Access, as we see no evidence yet that it is operating effectively. However, I accept that we can look at a longer-term solution. I do not know whether that is a solution, but let us recognise why we are here. We had a limited period to put into place a solution that would work for Scottish universities, given the situation south of the border. That is what we have done and without primary legislation. We are now looking at the longer-term solution of primary legislation that will cover all post-16 education. I am open to looking at that if you Liberal Democrats wish to make a submission on the need for it. I certainly do not reject it out of hand, but I am sceptical about the operation of the Office for Fair Access.

Given the situation that we were in, the solution that we have now has been arrived at with some difficulty, but it has been arrived at. I want to see greater attention to detail about what the universities are offering and I will press them on that, but we now need to look at a longer-term solution.

Would you suggest that the actions of one or two institutions and principals in not picking up on the very clear steer that you and the First Minister gave prior to the summer have made it inevitable that, whatever longer-term solution is put in place, ministers will have to have more sanctions available?

That option is on the table. I am not saying that it is more likely. I do not agree with what they did; they know that I do not agree with what they did—I am not somebody, as you know, who tends to hide what I think. I think that there should have been greater restraint, but I do not necessarily think that that means that every institution would be affected. I am willing to discuss and consider the issue and I would genuinely welcome an input into it, but I have not come to a conclusion. Indeed, once there is a conclusion, I suspect that this is the committee that will deal with the legislation and we can rehearse the argument in detail again.

We took some evidence about the future stability of the £9,000. I am not surprised that Robin Parker, while reiterating his opposition to tuition fees, would like to have seen it at a lower level. Alastair Sim said that it would be a change of policy down south that would drive a request for uplift in that figure, whether inflationary or otherwise. What is the Government position on that stability?

It illustrates the difficulty that we are in, that some reaction to this flawed policy south of the border will still be required. As far as I am concerned, £9,000 is the absolute limit. That is not to say that things will not change south of the border, but you could postulate another set of changes south of the border, which is that the system may not sustain that figure. You could look at the economic pressure that people are under; there would be a real detrimental effect on higher education and you might find the policy unravelling.

I do not have a crystal ball; all that I am able to say at this stage is that we have set that as a voluntary level for the coming year, I do so with reluctance and we want to ensure that it is observed. The universities may approach us with a mechanism for uprate; I would be very reluctant to anticipate higher levels, but we should discuss that in the committee and in the legislative process.

I have a lot of scepticism about what will happen now south of the border. I talked about how setting a fee would have disrupted the levers of change; that is precisely what has happened south of the border with regard to the teaching grant. The system is very difficult to steer in terms of flexibility and openness and that may have a strong detrimental effect. There is also a growing body of research evidence—for example, from America—into the damaging effects of monetarisation, and there is a growing move in Germany, for example, towards the idea that higher education should be, if not free, then very competitive, in order to encourage access. Not for the first time, the UK Government may be behind the curve in international thinking; it may also be doing things in an imitative way that will damage its own students.

11:45

I would not want Robin Parker’s views to be misrepresented, cabinet secretary, not least because he is in your camera shot. His point is that, although the UCAS figures that we saw yesterday are very preliminary, we will have a better sense of the regimes both north and south of the border come January and he was holding out at least some hope that, if the approach is found to be having a detrimental effect on numbers, the Government has not closed its mind to reducing the cap on fees allowed north of the border. Are you able to offer Mr Parker any comfort in that regard?

We would have to see what the situation was. I point out as gently as I can to Mr Parker as well as to you, Mr McArthur, that we are talking about 14 per cent of Scottish students. I would be concerned if the overall publicity on this started to affect the 83 per cent of Scotland-domiciled students, who might be thinking that there was some problem in going to university because of the fees to be charged. I have said before in the chamber and say again now that it is important to send out the clear message that, for 83 per cent of students at Scottish universities, no fees will be charged. We made that decision. Whatever position the political parties take now, only one political party present this morning dissented from that view at the time. We should do everything possible to make that position clear.

It is very difficult to tell from the UCAS figures whether there has been a diminution—after all, we have seen variations before—but if there is such a diminution both north and south of the border we will need to look at the matter and take steps, particularly as it might well affect those who are most distanced from education. However, I will look first at the 83 per cent to see what we can do to encourage them and tell them the truth about what is available.

I see that Mr Parker is smiling wryly. I guess that that is as much as we are going to get on this matter.

Perhaps I should get a mirror.

Be careful what you wish for, cabinet secretary.

Indeed.

I think that I will stop that exchange there and move on to Jenny Marra.

I understand that the NUS talked up the unintended consequences of the domicile arrangements; instead of talking them down, you listened to the students’ arguments and gave them the concession in the regulations. I believe that that has been very helpful. However, students are now talking up the very serious and important issue of widening access to rest-of-UK as well as Scottish students. Would you consider putting the rest-of-UK widening access agenda in the legislation that you will introduce in the spring?

Yes. As I have made clear, I am in no sense dismissing the fact that fees are emerging as a very considerable barrier in addition to the existing difficulties to access that we have been discussing such as socioeconomic status and disability. That is true south of the border and, of course, where they apply for the rest of the UK. That would be part of my agenda and I regard the access issue as applying across the board. Indeed, it applies a lot more widely than you have suggested because I continue to be concerned about our ability to attract the best overseas students. Fees for overseas students are very high, but universities themselves know that and provide bursaries in that respect, particularly for postgraduate activity.

I am glad that you picked up on the domicile arrangements because we wanted to ensure that we got the issue as right as it could be. After all, I am bound to get letters and e-mails about the matter—I am sure that all members get the same—and we need to be as clear as we can be about it.

So the Government’s proposals for its widening access legislation will include arrangements for Scotland, the UK and international students.

I expect that the issue of access will be treated in its widest sense across all students. That is not to say that all measures will be the same; in any case, the fact is that, under the present constitutional settlement, my primary responsibility with my resource must be the 83 per cent of Scotland-domiciled students. However, I remain concerned about the effect of fees on discouraging wider access by rest-of-UK students to Scottish universities and I hope that we will be able to address that issue—at least partly—in anything we bring forward.

Are you giving a commitment that the proposals will include arrangements for widening access for the various categories?

I give a commitment that I believe that it is an issue that will need to be addressed. I will not tie myself down to specific actions at this stage; however, I do not disagree that the issue needs to be addressed within what we do next.

I have one more question on the bursaries issue, which is part of the widening access agenda. You said that you want institutions to be transparent about bursaries and that, if they were not, you would consider making it part of the legislation. Given that you hoped that the principals would show restraint earlier in the year but they have not shown that restraint, would you like to pre-empt them by producing proposals on the bursaries as part of the legislation? I cannot imagine that you have a lot of confidence after what the principals have done.

Not at all. I am a believer in carrots as much as in sticks, and carrots seemed to work with all bar two in the sense that they understood the imperatives. That is not a bad record, although I would have liked all of them to have done it. I will not give a commitment to that, but I am constantly encouraging principals to operate with openness and transparency—I have set up a governance review that is all about that—and I will continue to do so. I do not reject the possibility of what you suggest, but I will not commit us to that on the basis of the experience to date.

It is interesting that you say “bar two”. Those two examples—the University of Edinburgh and the University of St Andrews—are perhaps the most famous universities in Scotland and really set the bar for Scottish universities.

The University of Glasgow would deeply resent that statement.

I am sure that it would.

The University of Dundee, in your constituency, might be upset, too.

Nevertheless, those are two of the most well-known Scottish universities internationally and what they do in terms of their bursary arrangements and widening access is seen in the rest of the UK and internationally. Should they not set an example? Would you not like to encourage them to do so through the legislation?

I constantly encourage good behaviour—that is what I am here for. One could take another view of that, however. A university that sets fees at a level that is regarded as too high may be resented south of the border and other universities with a more reasonable offering but with equal academic clout—we have five universities in the top 200, as I have said—may be advantaged by that. I would not necessarily say that what those universities have done is trumpet their irresponsibility abroad, but they might have disadvantaged themselves.

Those two universities also have the highest proportion of rest-of-UK students.

They do at present, but we do not know the outcome of the changes. That is the trouble with the policy: it is driven by a monetarisation that, I think, most of us disagree with—it is the wrong thing to do—but we do not know the outcome. The pattern of rest-of-UK students might change as a result of the policy. One or two universities have done different things. The University of Glasgow’s offering is very different, and the Robert Gordon University has a varied offering depending on the type of course. It is possible that the pattern will change—I do not know, and neither does anybody. That is one of the difficulties with the policy.

You have talked about your principal obligation being to the 83 per cent of Scotland-domiciled students at Scottish universities. I appreciate that you cannot give us details just now, but if you were to introduce measures to widen access for students from the rest of the UK, where would the funding for that come from?

That is the big difficulty, is it not? As Robin Parker suggested, it could come only from the resource that was contributed by the rest-of-UK students. There might be grounds for saying that, for the general health of the Scottish universities system, we should help that to happen. It is good for Scottish universities to have a mixture of people from elsewhere. The proportion of students from the rest of the UK is currently 14 per cent, and that figure has been fairly constant over a period. I would like to see that figure remain fairly constant, as it is good for our universities. You make a good point, but we would look at the matter in the round.

Another pressure on students who come here is the number of students coming from the rest of the EU. There will be funded places for Scottish or EU students and the rest-of-UK students will be taken out of the competition for those places. That is helpful because it means that we are not setting Scottish and rest-of-UK students against one another. However, do you foresee a potential pressure from the changes in the system that are being implemented by the UK Government down south, which is raising the fees there to £9,000 for EU students? That will lead to more EU students competing with Scottish students for the limited number of places in Scottish universities.

I am extremely keen to regularise that situation. Discussion continues with the EU on that difficult point. We have had a good hearing, and we are not alone in Europe in being in such a situation—more countries are getting into it.

However, I do not yet have an answer. I want to ensure that the anomaly is resolved between now and next year. That will be very tough to do, but we are trying to do it.

Are you hopeful that a resolution will be found?

Yes—I always travel hopefully.

I want to move on to medical students. We have received a submission from BMA Scotland that reiterates many of the points that NUS Scotland made about having an independent regulator on access, but the issue that leaps out as far as the SSIs are concerned is to do with the fact that medical courses will be subject to the same cap as other courses, which is a departure from the current arrangements, whereby the fee that is allowed for medical courses is a bit higher. I think that that reflects concerns that existed when the Student Fees (Specification) (Scotland) Order 2006 came in that there were particular pressures as regards medical courses and safeguarding the position of Scotland-domiciled students on those courses.

Why have you decided that, this time round, there should be the same cap for medical students as for everyone else?

There are two reasons for that. The first is that medical education is among the most expensive education that is provided in universities, and the real costs of providing it are substantially higher than the fees that are charged. Secondly, to be blunt, we know that there is no shortage of students in medical education. I would like to see better access arrangements—that applies across the board here, as elsewhere—and there are some access arrangements that are remarkably successful in attracting into medicine people who would otherwise not study it.

Just a month ago, I appeared on a platform in Inverness with a young man from West Lothian who was the first person from his family to go to university. He had had no intention of studying medicine and had thought that it was beyond him, but because of the access arrangements that the university—I think that it was the University of Edinburgh—had in place, that had worked extremely well for him. I will encourage the development of such arrangements to take place, but I do not think that there is a justification for making an exception of medicine.

Another issue that I have thought carefully about is veterinary medicine and, in particular, the attraction of Northern Irish students to veterinary medicine courses in Scotland. No veterinary medicine training is provided in Northern Ireland, so it is inevitable that those students will come to Scotland. That creates a difficulty that we need to think about, but I cannot see a resolution of it because veterinary medicine, too, is an extremely expensive course to provide. We do not support it, because it is not our responsibility to do so.

I do not disagree with your points about the cost of delivering medical courses and the demand for them, but does that not serve to create the suspicion that, for example, the University of Edinburgh has set its fees at £9,000 across courses in part, at least, to allow it to cover some of the costs that it is haemorrhaging with regard to medical courses?

Yes, that is the case. Of course universities charge fees in order to offset their costs. University principals will tell you—I did not hear Alastair Sim’s evidence, but I am sure that he would have told you if you had asked him—that even in charging £9,000, they will, in certain circumstances, receive less than they spend. It is a complex area, which would benefit from some independent examination.

My final point is about the deferment of courses. I think that I am right in saying that those students who have places on courses that are due to start before the academic year 2012-13 will be subject to the current fee arrangements, and that they will still be subject to the current fee arrangements if they defer their course prior to the start of the academic year 2012-13. However, medical students who defer their courses appear to be excluded from that arrangement, and it is not clear from the papers that we have been given what the rationale for that might be.

I will take advice on that, if that is the case.

12:00

The provisions on medicine make different arrangements for students who have a relevant connection with Scotland, so that they are treated under the new arrangements rather than the existing arrangements. That is preferable from the student’s point of view, because the tuition fees for Scotland-domiciled students would be £1,820 rather than the higher amount that there is for medicine at the moment. In general, Scotland-domiciled students do not have to cover their tuition fees, but quite a high percentage of students who study medicine are doing a second undergraduate degree, so the legislation is set out in a way that is preferable for students who are not entitled to tuition fee support from the SAAS. I am sorry if my answer was a bit technical. Did it make sense? Perhaps not.

I am happy to write and repeat the explanation, if that would help. I understand it, but I can see that it could do with a second take.

Thank you, that would be helpful, although it is clear that the arrangement is beneficial for the student, which was our point.

Yes, it is.

The NUS made the point in its evidence to us that the Scottish Government has talked about taking action if institutions are benefiting disproportionately from fee income from rest-of-UK domiciled students. Can you define “benefiting disproportionately”?

I am not sure that I can. I would want to see evidence that a university was benefiting disproportionately—charging more than it should charge, on a regular basis. I do not know precisely what that would look like. However, I have a mechanism that can deal with the issue, which is the adjustment of the sums raised so that there is equity across the sector. The SFC grant will take account of the moneys that are being raised and it will be possible to make adjustments, so that anyone who is earning too much money gets less SFC grant.

As I said, the situation is willed upon us and there are things about it that we are just learning. We would have to take into account Liam McArthur’s point about the actual cost of providing a course.

Thank you. As I said to the first panel, most of us agree that we would rather not be here having to discuss the matter. It is unfortunate that we must discuss it, because of circumstances that are beyond our control. I thank the witnesses for the evidence session.

The next item is formal consideration of the Education (Fees) (Scotland) Regulations 2011 (SSI 2011/389). No motion to annul has been lodged. If members have no comment to make, does the committee agree to make no recommendation to the Parliament on the regulations?

Convener, I want to abstain on the issue. I absolutely accept that voters in Scotland made a democratic decision about free higher education. I respect the decision, although I disagree with it. I am not convinced that we have had sufficient information about the instrument or proposed legislation on the issue.

Thank you for putting that on the record. I must still ask the committee whether it agrees to make no recommendation on the instrument.

Members indicated agreement.

The next item is formal consideration of the motion to approve the draft Student Fees (Specification) (Scotland) Order 2011. Scottish Government officials may not participate in the debate, which must last no longer than 90 minutes. I say to members and to the cabinet secretary that I hope that it will not last as long as that; we all have other appointments. I invite the cabinet secretary to speak to and move motion S4M-01315.

The issues have been well ventilated, so I simply move,

That the Education and Culture Committee recommends that the Student Fees (Specification) (Scotland) Order 2011 [draft] be approved.

Thank you. I invite comments from members.

I remain to be convinced that the order provides the right answer, overall, but I accept that action must be taken. After this morning’s evidence I remain concerned about the introduction of a variable fee and the lack of regulation and access arrangements, and I have wider concerns about the £9,000 fee level that has been set. However, I will support the order, which I realise is important if we are to manage cross-border flow and protect student places. I will return to the fee level, the regulator and other issues of concern when primary legislation is being considered.

I, too, still have reservations after hearing the evidence, in relation to the point about transparency of the regime. The cabinet secretary has gone some way to give commitments on access as far as he felt able to do. I will support the order at this stage, but we will return to the issue over the coming year.

I associate myself with Claire Baker’s comments.

If there are no more comments from members, do you want to respond, cabinet secretary?

No, other than to say that we will return to some of the issues when we are considering legislation. I encourage people who are concerned about the issue to make representations during the consultation period.

Thank you. The question is, that motion S4M-01315 be agreed to. Are we agreed?

Members: No.

There will be a division.

For

Adamson, Clare (Central Scotland) (SNP)

Baker, Claire(Mid Scotland and Fife) (Lab)

Biagi, Marco (Edinburgh Central) (SNP)

Marra, Jenny (North East Scotland) (Lab)

Maxwell, Stewart (West Scotland) (SNP

McAlpine, Joan (South Scotland) (SNP)

McArthur, Liam (Orkney Islands) (LD)

Urquhart, Jean (Highlands and Islands) (SNP)

Abstentions

Smith, Liz (Mid Scotland and Fife) (Con)

The result of the division is: For 8, Against 0, Abstentions 1.

Motion agreed to,

That the Education and Culture Committee recommends that the Student Fees (Specification) (Scotland) Order 2011 [draft] be approved.

I thank the cabinet secretary for attending and for making such a valiant attempt to get here through the floods. I should say to Mr McArthur that I am sure that there was no pestilence in the west of Scotland, which is the wonderful region that I represent—I hope you were not talking down my region.

Meeting closed at 12:07.