Graduate Endowment Abolition (Scotland) Bill: Stage 1
Good morning. The first item of business is a debate on motion S3M-964, in the name of Fiona Hyslop, that the Parliament agrees to the general principles of the Graduate Endowment Abolition (Scotland) Bill.
I begin by thanking the people who have been involved in the bill's process so far: the members of the Education, Lifelong Learning and Culture Committee, the Finance Committee and all those who provided oral and written evidence. I also thank the organisations and individuals who took the time to respond to the consultation on the bill during the summer.
Although I am grateful to the Education, Lifelong Learning and Culture Committee for its efforts in producing the report, it has disappointed many members who are present today and it has sorely let down 50,000 Scottish students and their hard-working families. The committee's conclusion, on the casting vote of the convener, means that it has rejected the general principles of the bill and voted to keep the graduate endowment fee.
This Government believes in a return to free education, in which access to education is based on ability to learn, not on ability to pay, so it is sad to see beneficiaries of free education being so desperate to keep it from the next generation. Two thirds of students cannot afford the graduate endowment fee and so simply add it to their student debt. Despite the fact that debt, and the fear of debt, is known to be a barrier that prevents people from going to university, the Labour and Conservative members of the committee failed to see the obvious link.
I am grateful to the cabinet secretary for giving way.
If student debt is so important to the Scottish National Party, and as it promised in its manifesto to wipe out student debt, where are the Government's proposals to do just that, and fulfil its obligations to Scotland's students?
Today, Parliament can vote to wipe out £2,000 of graduate debt for many of our students. Members think that it is right and proper for us to tackle some of our wider graduate debt issues—we have some agreement among the other parties that we should abolish the graduate endowment fee—but if Parliament and the committee vote against this proposal, would not it be rather difficult to progress with some of the other proposals?
The bill is intended to fulfil our manifesto commitment to abolish the graduate endowment fee and it is the first step in tackling the problem of student and graduate debt. Currently, the average student leaves university with a student loan debt of around £11,000. Removal of the unfair fee will help some students, and relieve others of the financial pressures that face graduates as they start their working lives, but some MSPs want to keep them held back at a time when those young people want to get on with their lives.
The committee suggested that there is no clear evidence that abolition of the graduate endowment fee will, in itself, widen access, but the policy memorandum clearly states that the measure is a "first step" in our plans, and it will contribute to our overall aims of widening access.
We will reduce debt through our proposals to abolish the graduate endowment fee and to reintroduce student grants to replace loans, starting with the £500 grant for part-time students—a £38 million package that was announced earlier this month, which will benefit 20,000 students.
The SNP very often talks about Ireland and the Celtic tiger. The cabinet secretary will be aware that in 1996, the Irish Government abolished student tuition fees. Is she aware that Professor Patrick Clancy of University College Dublin says that there has, despite the abolition of tuition fees, been no improvement in working-class participation in higher education and that in some deprived areas of Dublin participation rates have in fact fallen? Is she aware that Irish heads of universities and the funding council there met this week to consider some form of graduate contribution?
If she wants to tackle deprivation, Rhona Brankin should read the Organisation for Economic Co-operation and Development report—sustained levels of poverty have not been relieved by the previous Government or, indeed, by 10 years of Labour rule. Perhaps she might want to look at that.
The original intention of the Education (Graduate Endowment and Student Support) (Scotland) Act 2001 was to widen access. The committee may believe that there is no evidence that abolishing the fee will widen access, but it could not find any evidence that the graduate endowment fee in itself actually achieved its policy intention.
Will the cabinet secretary take an intervention?
I want to move on.
From the evidence that we have, it is clear that there has been at best minimal progress in widening access in the past four years. Between 2002 and 2006, entrants to higher education from Scotland's most deprived areas increased by just 1 per cent. That is not just my view: it is shared by the overwhelming majority of people who responded to our consultation and to the committee's call for evidence. We have years of evidence that the status quo is not working, weeks of evidence that the fee should be scrapped, and widespread support for that from consultees. A casting vote has undermined all that.
Before the election, the Labour Party set out in its manifesto its opposition to top-up tuition fees. In seeking to apply graduate endowment income to university funding, as the Labour members of the committee suggest, they are asking us to implement top-up tuition fees by the back door.
In May 1999, along with 13 other student presidents, Richard Baker told The Herald:
"in answer to the simple question, ‘Are you in favour of the early abolition of tuition fees?' we can speak with one, resounding voice. The answer is ‘Yes'."
It now seems that Mr Baker—who is cosily ensconced on Labour's front bench—and his colleagues support top-up tuition fees.
That is nonsense. The graduate endowment is about student support and not about tuition fees, as the cabinet secretary knows. Why will she not accept that addressing student hardship would be far better done by increasing student bursaries? The bill will do nothing to tackle student debt. The way to address that is by increasing bursaries, which the cabinet secretary is not proposing.
I look forward to Labour's support for the SNP Government's budget bill, which includes provision for increasing grants and student support.
The fee has proved to be an extremely inefficient way of providing funds. It has not raised the predicted levels of income and, as much of the graduate endowment fee is added to student loans, the taxpayer loses about a third of the income. Given Labour's record in government, it does not surprise me that Labour members are happy with a situation in which so much money is, in effect, frittered away. However, I am surprised that Conservative members do not realise that a two-thirds return for the taxpayer is not good value for money. Should we not cut out the middleman and fund student support directly?
To those who think that, rather than forgo £17 million of income, we should direct the money to universities, I say that the 2001 act made it clear that the income should be used for student support. If any minister was to state—as I am being asked to do—that they were willing to apply the money to support universities, they would leave themselves open to judicial review. What the Conservatives and the Labour Party suggest is an up-front transfer from existing student support to university funding under the 2001 act. Let us be clear that that is not a competent option that is available to Parliament.
Will the cabinet secretary give way?
I have already given way to the member.
As David McLetchie pointed out on 31 January 2001, when Parliament debated the bill that introduced the endowment,
"it is a sly tax of dubious technical competence."—[Official Report, 31 January 2001; c 766.]
If a charity lost 31p in the pound in administration and other charges, we would all ask questions, but apparently we do not do that in the case of the flawed graduate endowment fee.
The nature of the income from the graduate endowment means that it cannot be baselined or treated as guaranteed funding. Not only is it far simpler to fund student support direct from the Scottish budget and not from graduates, it is also more efficient for the taxpayer and more transparent.
Jeremy Purvis and others seek assurances in law that student support will be paid. I refer them to part 4 of schedule 2 to the Budget (Scotland) Act 2007, in which the provision of student support funding from the graduate endowment income is set out, as it has been set out in law each year since 2005—hundreds of millions of pounds and not just the £17 million for student support. However, I am open to considering how we can give effect to the Liberal Democrats' amendment, which seeks to place on Scottish ministers a statutory duty to provide wider student support.
Why are the Conservatives sticking to the flawed and unfair graduate endowment fee? I find that surprising, given that they opposed the scheme when it was introduced. On 31 January 2001, David McLetchie said:
"Whatever it is called, the Executive has simply substituted one tax on learning for another. No amount of sophistry, euphemism or weasel words can disguise the fact that the so-called endowment is, purely and simply, a tax … We are opposed to this bill".
Annabel Goldie said:
"The truth is that in the bill, we have a penal tax. It is a thorn, which pricks and draws blood. That is why, in principle, the Conservatives cannot support the bill; it would be patent dishonesty to do so."—[Official Report, 31 January 2001; c 756-7, 766.]
The graduate endowment will be more than an electoral thorn in the Conservatives' side if they vote to keep it today.
The cabinet secretary talks about "weasel words". Were they not weasel words that promised all graduates that the SNP would wipe out their loan repayments, when it will not do that in government?
Let us be clear: Labour is not supporting us even to abolish £2,000 of debt, let alone to service £11,000 of debt.
Most important, what do the universities and students say? In written evidence to the Education, Lifelong Learning and Culture Committee, Universities Scotland said:
"Universities Scotland supports the abolition of the graduate endowment fee, which will benefit the majority of our full-time undergraduate students."
Giving evidence to the committee, the president of the National Union of Students, James Alexander, said:
"We welcome the bill as being the start of a host of measures. It will make education completely free for students in Scotland—we believe that education is a right. People should not be barred access to education because of financial burdens and debt. The bill is a positive step towards making education accessible for people from all backgrounds and all walks of life".—[Official Report, Education, Lifelong Learning and Culture Committee, 14 November 2007; c 306.]
In presenting the bill, we have made a compelling argument why abolishing the graduate endowment fee will provide a number of benefits for Scotland, including for 50,000 students and graduates. Graduates from summer this year will benefit if Parliament votes to abolish the graduate endowment fee. Their families and the Scottish taxpayer will also benefit.
It is clear that some members of the Education, Lifelong Learning and Culture Committee have not been convinced of the arguments and continue to cling to the wreckage of a failed policy. It has failed students by not achieving its stated aim of widening access, it has failed the taxpayer by proving to be worst value for the public purse and it has failed our graduates by placing an unnecessary financial burden on them when they leave university.
Those who vote to keep the unwanted and unfair graduate endowment fee—the ghost of Government past—will be the Scrooge of Christmas present for students and their families. Some 10,000 students who graduated this year are waiting to see whether Labour and the Conservatives will vote to make them pay a fee of almost £2,300 when we have the chance to scrap it. Some 40,000 others in our universities are waiting and watching—we will remind them time and again of how members vote today.
I challenge any of those who oppose the bill to defend the graduate endowment fee, which has been flawed since its introduction.
On the day when Parliament can vote to abolish both bridge tolls and fees for students, I move,
That the Parliament agrees to the general principles of the Graduate Endowment Abolition (Scotland) Bill.
Only the SNP could make the ghost of Christmas future seem more threatening than the ghost of Christmas past.
In 1999, the Liberal Democrats were committed to ending tuition fees in Scotland and, subsequently with Labour, we legislated to abolish tuition fees—up front or back end—for Scotland-domiciled students who attend Scottish universities for their first degree. Since the legislation came into force, nearly 200,000 Scottish students entering Scottish institutions have not paid the English-style tuition fees. The average fee in England now is approximately £7,000 per academic year. On completion of a non-science three-year degree in England, a graduate is likely to have about £18,000 of tuition debt. The equivalent for an eligible Scottish graduate is zero. For a medical degree in England, the graduate tuition debt now stands at £45,000. In Scotland for an eligible graduate the figure is zero. The legislation, which was introduced by the Liberal Democrats and endorsed by Parliament, has meant that in Scotland there is more than £4 billion less debt for graduates—that is £4 billion less personal debt in the Scottish economy.
Liberal Democrats have always argued that tuition should be free, and we have always understood that living costs are a major factor in students' accumulation of debt by the time they graduate. We have argued consistently, with a record of action, for provision of financial support to students from the poorest backgrounds. An illustration of our approach is the package that was brought in six years ago. The devolved Government reintroduced student grants of £2,000 per year—members might recall that that was four times the level that the SNP proposed in its 1999 manifesto. As we know, the Cubie committee argued for changes in how students were supported and the graduate endowment, as it became known, was established to provide support for students from poorer backgrounds—[Interruption.]
Order. We do not need conversations in the chamber.
The payment was not connected with university funding and has never been linked with the cost of student tuition. Only now do the Labour Party and Conservatives want to change that approach.
The Liberal Democrats are disingenuous. We seek, by retaining the graduate endowment, to retain the essential link between the endowment and student support. In addition, we will seek hugely to increase student support. What is wrong with that?
Not only does the Labour Party want to spend the money twice, which would be a feat in itself, but—[Interruption.] I hope that the member will listen to my answer to her question. The Education, Lifelong Learning and Culture Committee's recommendations, which were decided on a Labour vote, included a clear statement that the Labour Party and Conservatives want to use some of the money that is raised through the graduate endowment to fund universities. Indeed, the committee referred in its stage 1 report to investing the money in
"more funding directly for universities",
although that is prohibited under the law. That is a proposal for a graduate poll tax.
Will the member give way?
I will do so later if I have time. Rhona Brankin will recall that the graduate endowment was part of a package. The previous Labour and Liberal Democrat Administration can take credit not only for removing a considerable amount of graduate debt but for reintroducing grants. Although the SNP has attacked the previous Administration's record, the biggest single move towards removal of the burden of debt for graduates in Scotland and adoption of a progressive approach to funding poorer students was brought in during the first session of Parliament.
In 2003 it was too soon to see whether the policy that led to the introduction of the graduate endowment had been effective, so no change was proposed. By 2007 it was possible to review the policy and to ascertain whether its aims had been realised. When the Education (Graduate Endowment and Student Support) (Scotland) Act 2001 came into force, the age participation index in Scotland was 51.5 per cent, which meant that—taken as a proportion of the number of 17-year-olds—more than half of Scots under 21 went to university. The most recent age participation index, in 2005-06, is 47.1 per cent, but that is a 1 per cent increase on the previous year's index, which represents approximately 650 students.
A change in the number of students leaving school and entering employment, or a minor shift in the number of school leavers who take a gap year, will have an impact on the age participation rate. The age participation index is a blunt tool with which to determine Government policy, but the Government used it as a key argument for introducing the bill. Witnesses, including Government officials and Universities Scotland, told the committee that there are a number of reasons why the age participation rate changes and said that it is not possible to detect a trend.
The evidence that the Government led was in a poor state of readiness and was poorly presented, which was disappointing. It was also inconsistent with the Government's position. Last year Fiona Hyslop said that an SNP Government would dump student debt. The SNP said that it would write off all student debt, which is a millstone round the neck of the Scottish economy. It argued that the graduate endowment is a critical part of that drain on the economy. While the SNP was making those arguments, graduate employment—which had been of concern to the SNP—was increasing at a record rate. The figures that the Government released in October show a 3 per cent increase in graduate employment on 2003-04.
Given that the member seems to be accepting that the introduction of the graduate endowment was a mistake, will the Liberal Democrats apologise for it?
Murdo Fraser should be clear that the graduate endowment was part of an overall package, the aim of which was to widen access to university. As the cabinet secretary said, there is no evidence that the policy either widened access or did harm in that regard.
When the cabinet secretary gave evidence to the committee she argued that access was the key issue. That is a valid concern, which is more in tune with the original aim of the Education (Graduate Endowment and Student Support) (Scotland) Bill. As I said, the figures that the Government presented to the committee on the number of young people from more deprived backgrounds who go on to higher education show a 1 per cent increase. That is too small a change to discern whether the graduate endowment policy has been a major failure or a major success. However, in its policy memorandum, the Government was surer of itself. Paragraph 12 of the policy memorandum states boldly:
"The policy's failure to contribute to widening access is also clear."
A 1 per cent increase in the number of students from poorer backgrounds who access higher education might not be a huge improvement, but one could hardly say that it is a clear failure.
There are many reasons why young people who leave school or who begin higher national programmes at school age and who proceed to college and university might be put off studying. The Association of Scotland's Colleges gave powerful evidence on the concerns about living costs that many higher education students at colleges face. As the Government knows, those students do not pay the graduate endowment. The issues are living costs and the need for additional support to cover students' study-time costs.
That is why our amendment focuses on two crucial areas for student support and access, one of which is a statutory duty to provide student support. Such a statutory duty exists in this year's Budget (Scotland) Bill only because of the Education (Graduate Endowment and Student Support) (Scotland) Act 2001, which states that budget proposals that are made to Parliament must contain proposals for student support. If that provision is removed from section 2 of the 2001 act, as the Government proposes to do in the Graduate Endowment Abolition (Scotland) Bill, the requirement on the budget bill to provide student support will be removed, too.
Bearing it in mind that the Government provides hundreds of millions of pounds of student support, does Jeremy Purvis have any doubt that this Government—or any future Government—would support students? How important to Mr Purvis is the £17 million that is associated with the graduate endowment? I have said that we will look at his proposals.
It is quite clear that the Liberal Democrats believe that there should be a statutory duty on Scottish ministers to provide student support. I would have thought that there is a need for debate about that. There is such a duty at the moment: we want it to continue once the budget bill has been passed.
If we remove the ring fencing that the 2001 act put in place, whereby the graduate endowment revenue is to be used for student support, and instead seek to use it for university funding, we will be putting in place a graduate tax.
The committee's report makes no link between endowment payments and tuition costs. Such retention would free much-needed funds in other parts of the budget for some of those priorities.
It is disappointing that I must refer another Labour member back to the Labour proposal in the committee report, which the Labour Party ensured was agreed to. Paragraph 70 of the report says that the funding required to abolish the graduate endowment would be better used for
"more funding directly for universities".
That represents a change from the current statutory position.
That is additional money.
Rhona Brankin says from a sedentary position that it is additional money, but it is not when the Labour Party says that the money from the graduate endowment should be used to fund the universities. That would amount to a non-progressive graduate tax—in effect, it would be a graduate poll tax.
The Government has not been clear in its position on wiping out student debt. On 13 September, Adam Ingram said:
"Our position was always that we would stand in the shoes of students and service the debt. Obviously, we will have to push forward with our negotiations with the Treasury on the issue of removing the debt altogether."—[Official Report, 13 September 2007; c 1684.]
Only a few weeks later, John Swinney said that there was
"insufficient parliamentary support for student debt servicing or for moving from loans to grants".—[Official Report, 14 November 2007; c 3325.]
There has been an indication that all the parties would provide time to have that debate in Parliament, so the Government should introduce its proposals for wiping out all student debt. Let us test them in Parliament. If the Government can propose expenditure on a national conversation and on a referendum bill, for which there is clearly no majority in Parliament, it can keep its promise to students.
You should close now, please.
The NUS has argued consistently that the bill should be one part of an overall package, but scant information has been provided on the overall package. I fear that the bill will be the only measure that the Government will introduce. We will support it, but we want it to be better. We think that it should have formed part of an overall package, to give our students hope for the future and our universities a secure funding settlement so that they can retain their competitiveness.
I move amendment S3M-964.1, to insert at end,
"and, in so doing, calls for a statutory duty on Scottish Ministers to provide student support and provision made thereunder to be improved for existing and future students and further calls for more research into the barriers to accessing further and higher education to be undertaken."
I welcome the opportunity to speak on behalf of the Education, Lifelong Learning and Culture Committee in the stage 1 debate on the Government's Graduate Endowment Abolition (Scotland) Bill. I thank all the witnesses who provided the committee with written and oral evidence and I thank the committee clerks for their assistance with the committee's stage 1 considerations. As the convener of the committee, I will focus my contribution on the evidence that the committee received and explain why the committee has recommended to the Parliament that the general principles of the bill should not be approved.
The Scottish Government has clearly stated that the purpose of the bill is to widen access to higher education and remove barriers that discourage potential students, particularly those from Scotland's most deprived communities, from entering further education. I am sure that that objective is shared by everyone in the chamber. We all aspire to a Scotland in which every individual has the opportunity to reach their full potential, and in which access to education is based on ability to learn and not on ability to pay. In that context, the committee fully supported the intention of the bill and its objective of removing barriers to higher education. However, the committee did not agree that the abolition of the graduate endowment was the best way of making progress on that vital issue. The committee believes that that policy initiative is based more on ensuring that the Government can tick off an ill-conceived manifesto commitment than on sound research and evidence that it would support young people in obtaining a higher education. Indeed, the Scottish Government's officials told the committee that no alternatives had been considered prior to the introduction of the legislation.
The committee received 25 written submissions in response to its call for evidence and it took oral evidence on the bill over three meetings. Although the majority of those who made submissions said that they had no objection to the abolition of the graduate endowment, many also said that they had serious concerns about what the bill fails to do. The bill fails to do anything to support part-time students; it fails to support students financially while at university; and it fails to address the issue of widening access and getting more students, particularly those from deprived communities, into education. As members will see from the committee's stage 1 report on the bill, we concluded that there was insufficient evidence to demonstrate that the abolition of the graduate endowment would contribute to the aspiration of widening access. There is no hard evidence that the graduate endowment has had a significant impact on participation in higher education. In fact, as Jeremy Purvis highlighted, there has been a slight increase. The number of entrants to higher education has remained largely static since the endowment was introduced.
The original policy intention of the graduate endowment fee was to widen access. The member is admitting that it has completely failed. If it is not achieving its intention, and it is resulting in £2,300 of debt for half of our graduates, why keep it?
Student numbers have not reduced, so we cannot say that the graduate endowment has failed. In fact, the percentage of entrants to higher education from deprived areas has risen slightly from 14 per cent in 2002-03 to 15 per cent in 2005-06. Those are the Government's own statistics, as stated in the policy memorandum. To suggest that the policy has failed is a nonsense. That view was shared by many who gave evidence to the committee, such as the Scottish Further and Higher Education Funding Council, which said that it was
"not aware of any clear evidence that the GE itself has been a barrier to access."
The British Medical Association Scotland said that it feared that the abolition of the fee
"will do little to address the issue of widening access to courses such as medicine".
The Royal Society of Edinburgh said:
"A more targeted approach would be preferable".
Karen Whitefield will recall that the Cubie report recommended that the level of income at which the graduate endowment would be paid was £24,000. Will Karen Whitefield respond to the proposition that setting the level of payment at nearly half that amount has contributed considerably to student resistance to the graduate endowment and is one of the reasons why we want to get rid of it now?
If Mr Harper had read the committee's report, he would know that we recommended that there should be a wide-ranging review of support for students. The point that the committee is making today is that the bill does nothing to support students while they are at university; instead, it helps people in employment who are earning money.
Although the intention of the bill is to remove barriers to accessing higher education, there is no evidence that abolishing the graduate endowment would achieve that goal. Some committee members believe that if the cabinet secretary is really committed to widening access, she could take other, more significant measures, such as increasing funding for student bursaries. Unfortunately, the bill concentrates on just one issue and fails to consider the wider picture.
As the cabinet secretary highlighted this morning, the policy memorandum accompanying the bill claims that the graduate endowment has failed to achieve its goals. Yet when the committee asked her Government officials to support that claim, not only were they ill prepared, they were unable to provide that evidence. Fiona Hyslop also suggested this morning that using graduate endowment income to support students from deprived communities in higher education in the form of bursaries would somehow fritter away Scotland's resources. If that is frittering away resources, that is the kind of frittering in which we should invest. Although abolishing the graduate endowment would slightly reduce the debt on graduation, the committee found no evidence that its abolition would achieve the Government's aim of widening access.
Financial concerns are not always the main barrier to students from Scotland's most deprived communities going to university. If we want to open the doors of higher education to more Scots, we need a serious review of the barriers that continue to restrict access, so that we can ensure that higher education is accessible to all sections of our communities.
Scrapping the graduate endowment would cost the Government an estimated £17 million a year, about which my colleague Elaine Murray will say more. Surely that £17 million would be better invested in measures to widen access and extend the support that is available to the poorest students through the current bursary system. The Government has given a commitment that the abolition of the endowment will have no effect on the amount of student support that is available. The fact is that income from the graduate endowment was to be channelled back into student support funding and bursaries. That concern is shared by NUS Scotland and other student bodies. I ask the minister to explain how she will ensure that those resources are still channelled to where they are most needed. Will she give a commitment today that the scrapping of the endowment will have no impact on student support payments?
Removing the graduate endowment would do nothing to tackle the most pressing issue for most students and potential students, which is financial hardship while they are at university. It would do nothing to widen access or support students during their studies. Recent Government statistics show that just over 12 per cent of people from the most deprived areas enter higher education compared with 53 per cent of people from the least deprived communities. It is my and the committee's belief that measures to widen access to students from deprived areas should be a priority and that the bill will do nothing for Scotland's students who are at university right now. Students, especially those from our most deprived communities, require funding. Indeed, the minister cited those two examples when she appeared before the committee. However, the committee failed to see how the proposal before us would do anything to ensure that such individuals are given support, encouragement and opportunities to access the higher education that they need and deserve.
Will the member make it clear that she is speaking for half of the committee? The other half does not agree with her.
I am well aware of the committee's decision-making process.
We must ensure that all Scotland's young people, whatever their background, are given the chance to realise their potential.
Finally, a major concern of mine and that of the committee is that abolishing the graduate endowment will further widen the gap between support for full-time and part-time students. Although full-time courses will be free, the majority of part-time students will continue to pay tuition fees. That is unfair and unjust and, at a time when we are placing so much emphasis on investment in skills and lifelong learning, it penalises those who want to undertake part-time study.
I believe that, as the bill fails in its purpose, it should not be approved by Parliament. The Government has produced no real evidence to convince us that abolishing the graduate endowment would contribute in any way to widening access. Students need financial support and assistance most during their course, not afterwards, so it would be much better to invest the estimated £17 million annual cost of this proposal in measures to widen access and improve student funding mechanisms such as student bursaries and the young students bursary.
On that basis, I ask Parliament not to support the bill's general principles.
On a point of order, Presiding Officer. Is it in order for a committee convener to represent what is, in fact, the decision taken by the committee on her casting vote as the committee's views? She is certainly not representing the views of the committee, half of whose members did not agree with her.
That is a matter for the committee to determine.
I point out that, as we are oversubscribed for this debate, we must have very tight timekeeping from now on.
We have heard repeated claims this morning that abolishing the graduate endowment will improve access to higher education and tackle student hardship. We believe that those claims are not accurate and, indeed, that the cabinet secretary has failed miserably to produce persuasive evidence to support the bill's principles.
As Universities Scotland has recognised, Scotland's record in bringing in students from underrepresented areas is 50 per cent higher than that of the rest of the UK. The age participation index shows that, since 2001, overall participation rates have risen. Given that the bill introducing the graduate endowment was passed in 2001, the case for abolishing it because it impedes access is hardly watertight.
We need to make it quite clear that, under the previous Administration, participation in education fell from 51 per cent to 47 per cent. There are fewer people in total going to university now than there were when the previous Administration came into power. Surely that is a fall by anyone's measure.
I repeat that, according to the age participation index, participation rates have risen since 2001. Indeed, in a recent parliamentary answer to me, the cabinet secretary acknowledged that the number of students entering higher education from the 20 per cent most deprived areas is rising. We in the Labour Party want the number to rise even more, but we do not share the Government's simplistic view that abolishing the graduate endowment will automatically increase access to higher education. Indeed, as Karen Whitefield has pointed out, the Scottish Further and Higher Education Funding Council told the committee that it is not aware of any clear evidence that the graduate endowment itself has been a barrier to access.
There is just no evidence to suggest that the graduate endowment militates against increased access. Indeed, only half of students pay the endowment, and only when they have graduated. In effect, abolishing the endowment does not tackle problems of access and student poverty. Students from poorer backgrounds do not pay it and have access to student bursaries during their period of study.
The reality is that, by abolishing the graduate endowment, the Government is abolishing its requirement to support students from poorer backgrounds. Of course, the NUS recognised that in concerns that it raised with the committee.
Labour believes that the endowment should be retained for those who can afford to pay, with the extra funding used to create an expanded system of support for students from less well-off backgrounds. Potentially, we could raise bursaries of up to £1,000 for the least well-off students which, Jeremy, would provide them with extra support while they were studying for degrees. That is social justice—which, of course, is something that the SNP does not believe in.
I note the member's concern for the views of the NUS. However, she will concede that the NUS wants her to vote for the bill.
I listen and talk regularly to the NUS, so I can tell you that what is of most concern to the NUS is that you have dumped your £1.9 billion commitment to getting rid of student debt.
We on the Labour benches believe in social justice, which, of course, the SNP Government does not. It talks a lot about the link between deprivation and low attainment, but it fails consistently to target precious resources where they would make the most difference in tackling disadvantage. Of course, SNP members and ministers will not mention it, but the elephant in the room for them today is the massive lie that the SNP told about writing off student debt. Students and their parents were simply conned into voting for the SNP on the basis of a £1.9 billion promise that the party promptly dropped as soon as it was elected.
Will the member take an intervention?
No, I will not. I can tell you that that simply will not wash.
On a point of order, Presiding Officer. Surely the member should address her speech to you. We have heard her say "Jeremy" and "you" and I am getting very confused about who she is talking to.
The matter is one for me to determine. However, I do not disagree with the point. I would be grateful to members if they would speak through the chair.
I am delighted to do that, Presiding Officer.
Attacking other parties for voting to support increased funding for poorer students does not get the SNP Government off the hook for failing to dump the remaining 95 per cent of the debt, as it promised to do.
Of course, the Government has also broken its promise to university principals that abolishing the graduate endowment would not impact on university funding. Is it just a coincidence that, at the same time that it seeks to abolish the graduate endowment, the Government has produced a £5 million cut in university funding? Having taken £17 million a year of ring-fenced moneys out of the budget by seeking to abolish the graduate endowment, it has failed to find any new funding for student bursaries.
Will the member give way?
No, I will not. In fact, the Liberal Democrats should be trying to decide on their position. Nicol Stephen said:
"we have accepted the Cubie recommendation that graduates should make a contribution … so that future generations of disadvantaged students can benefit."—[Official Report, 31 January 2001; c 734.]
I often ask what the Liberal Democrats stand for.
In evidence to the committee, Universities Scotland said that it could not separate the issues of student support and university funding. It said that if student support comes out of the Scottish block, funding will not be available for other purposes.
One minute.
It is eight years to the day since the Cubie committee reported. Despite Fiona Hyslop's selective quoting of Andrew Cubie, he continues to believe fundamentally that a graduate contribution should be made. I know that he is extremely concerned that no new money has been found to replace the income that the Government has foregone from the graduate endowment.
Scottish universities have just received an appalling settlement, which has met with universal criticism from universities, students and Opposition politicians. The universities know that they will see a real-terms cut of £5 million next year and that thereafter they will receive a flatlining budget. That is simply not good enough.
We on the Labour benches believe passionately in the importance of world-class universities to the Scottish economy and to Scottish students. That is why the previous Government put record amounts of funding into our universities. The Labour Party believes in social justice. We want to create opportunities for students from less well-off backgrounds and for those who come from communities such as mine in Midlothian where there is no tradition of going to university.
Given the flight of unskilled jobs to lower-wage economies, we know that our economy demands an ever-better-qualified workforce. If we are to compete in a global economy, our universities must continue to be among the best in the world.
You must close now.
The current poor funding settlement is causing Scottish university principals to talk about a developing funding gap between Scottish and English universities.
In conclusion, the bill does nothing to address hardship while students are studying. In opposing the general principles of the bill, Labour members will vote instead for the retention of a statutory duty to provide student support and for a large increase in support for students who are most in need.
You must close.
We have also concluded that the time is right for a rigorous independent study into the future funding of Scottish universities and the associated issues of student support and increasing access. The future of our universities is too important to be left to chance.
Today, Scotland's universities face a real threat to their future. I am sure that I do not need to remind members of the important role that those historic institutions play. For centuries, Scotland has been renowned for excellence in education. A previous Conservative Government massively expanded student numbers at our universities and created many more institutions. Today, they are not only providers of high-quality education for people from the United Kingdom and large numbers from overseas but, increasingly, drivers of economic growth.
At the same time, our universities face an unprecedented threat to their future. As we know, English universities have additional income from top-up tuition fees of £3,000 per student per year. In 2009, the £3,000 per year cap may well be lifted. There is concern in Scottish universities that there is a growing competitive gap between our institutions and those down south. What a pity that the SNP Government's response to that concern has been to deliver a dismal financial settlement for Scottish universities, which have been given a real-terms cut in funding in the next financial year. However, rather than spend money on supporting our universities, the SNP today proposes to cut £17 million per year from the education budget and use it to abolish the graduate endowment. The Scottish Conservatives cannot support that proposal.
When did the Tories start taking down the poster that I have here, which says:
"We will abolish tuition fees for all Scottish students at UK universities … Do something about it. Vote Scottish Conservative"?
It is the height of cheek for Mr Neil to lecture anyone about broken promises when the SNP stood on a manifesto promise of wiping out student debt that it has no intention of delivering. The Scottish Conservatives are no friends of the graduate endowment, which was introduced by the Liberal Democrats and the Labour Party, but politics and government are about hard choices. The Scottish Government's budget is finite and, given a choice of extra funding for our universities and more student support or abolishing the graduate endowment and making our graduates even better off than their English counterparts—who are already burdened with £3,000 per year in top-up tuition fees—our priority is to increase university funding and improve student support right here, right now. That is the choice that we make.
Will Murdo Fraser confirm whether he wants part—or, indeed, all—of the funds that are raised from the graduate endowment to go directly to universities? Is that the Conservatives' position? His party has been saying for many years that the graduate endowment is a tuition fee in Scotland. It is not, but that is how the Conservatives have campaigned. They now have an opportunity to get rid of the tuition fee that they have sought to get rid of for eight years.
The Liberal Democrats' hypocrisy knows no bounds. They introduced the graduate endowment in the first place, but they try to lecture us on the position that we are taking. We are dealing with the lesser of two evils and, given the dismal financial settlement that the cabinet secretary has delivered to Scottish universities, we reluctantly have to say that now is not the time to scrap the graduate endowment.
The SNP could not even make a convincing case for the bill in front of the Education, Lifelong Learning and Culture Committee. The SNP Government stated that abolishing the graduate endowment would reduce the fear of debt and widen access to higher education. However, as Karen Whitefield said, it was not able to provide the committee with any convincing evidence in support of those claims.
Will Murdo Fraser give way?
I will not at the moment because I have already taken two interventions and need to make some progress.
The Government produced no compelling evidence that the graduate endowment is a barrier to access. It has simply failed to make the policy case for the bill. If this is the quality of the bills and policy memoranda that the cabinet secretary and her colleagues will introduce over the next three and a half years, heaven help us.
As Rhona Brankin said, we have heard nothing today from the SNP about its promise to write off student debt. The SNP could not have been clearer in the run-up to the election: it would replace student loans with student grants and outstanding debts would be written off. Eight and a half months into the SNP regime, where is the legislation to enact that promise? Where are the detailed proposals and the costings? The SNP has nothing to say on the issue. It is yet another SNP broken promise and a betrayal of Scotland's students.
What a pity it is to see the Liberal Democrats propping up the SNP this morning in a ghastly alliance. Christmas may be coming, but the graduate endowment was not, of course, the outcome of a virgin birth. There was no immaculate conception here. It was the product, rather, of an unholy coupling between Labour and the Liberal Democrats. How sad, and how surprising, to see the Liberal Democrats today seeking to disown their own bastard child. I thought that the Liberal Democrats were supposed to be a party of compassion and committed to removing the stigma of illegitimacy. Even with Christmas round the corner, the Liberal Democrats are voting to eradicate their own offspring. Even King Herod did not kill his own first-born. Even he would be appalled at the callous bloodlust of Nicol Stephen.
Over the past few weeks, Nicol Stephen and others in the Liberal Democrats have made a great deal of noise about the poor funding settlement for Scottish universities. The universities should be given the full £168 million that they asked for, Nicol and his friends have said. However, rather than support a proposal from us to put more money into universities and student support, they will vote with the SNP to take money out of the education budget. It is now perfectly clear that everything that the Liberal Democrats have said about higher education funding over the past few weeks has been empty posturing; when it came to the crunch, they had no intention of doing anything to support our universities. Liberal Democrats will today be dismayed to see their party doing the SNP's dirty work for it and voting through this abolition.
Although we in the Scottish Conservatives have no love for the graduate endowment, which is a measure that was introduced by the Liberal Democrats and their Labour colleagues when they were in government, we must decide today on the lesser of two evils. We cannot allow Scottish universities to be further damaged by the funding cut that is proposed by the SNP Government. For that reason, we will, with a heavy heart, vote against the bill today, and I urge others to join us.
We now move to the open part of the debate. I ask for tight six-minute speeches.
We need to return to the basis of the debate, which is about abolishing the graduate endowment fee. There seems to be a tramline effect at present: there are the people who want to talk about everything else to do with universities, and there is the SNP, which wants to talk about the first increment in removing the barriers to free education. This debate is the start of that road, and I am proud to be speaking in favour of the reintroduction of free education in Scotland, after years of back-door top-up fees imposed by the previous Administration.
It is interesting that, after hearing a weight of evidence at the Education, Lifelong Learning and Culture Committee, which was evenly split, the Liberal Democrats have recognised this opportunity to take a first step towards making a change. No matter what is said in the debate, one of the partners that created the graduate endowment has realised that it was not the right way to go.
If the Graduate Endowment Abolition (Scotland) Bill is passed by Parliament—I certainly hope that it will be—it will remove fees of £2,289 from about 50,000 students. That will help the economy of Scotland, because it will give people a better chance to work and live here. If that is not a good product of a university education, I do not know what is.
A young woman who wrote to me from Argyll said:
"I am currently training to be a primary teacher and have most gratefully received my tuition fees paid in full throughout my course. I hope to graduate in February and intend to teach in Scotland for the majority of my career. Therefore the money paid on my behalf for my tuition fees will be going back into the education of our country.
As I am sure you can imagine, after four and a half years at university, I have very little available cash. While I hope to work during March I do not know where I will find the money to pay Graduate Endowment. There must be a better way.
Please abolish graduate endowment."
She is the kind of person whom we are relying on to come out of our universities and build the economy of Scotland. She is the kind of person who should have given evidence directly to the committee, rather than the vested interests, who have other arguments to make.
Let us remind ourselves that of the 25 submissions, 24 were clearly in favour of getting rid of the graduate endowment. The bill that we are discussing is an important first step.
The member quoted a young student. Did he ask what her views were on a real-terms cut in university funding, which will affect many thousands of students in Scotland?
The assertion that there is a real-terms cut in funding is another part of this tramline debate. I am sorry, but it is quite clear from the figures that this Government has introduced a real-terms increase in funding. Labour members disagree with that, but our figures make it clear that we are telling the truth.
They would say that.
We are the Government; the figures are ours.
So they must be true.
So they must be true. Why not? It would be very bad for the Government to use figures that are not true, for heaven's sake.
We have to acknowledge the inefficiency of the graduate endowment system. The Government has received only £57,000 out of the £26.3 million that has been added to student loans. That is a ridiculous return. I would expect the Conservatives to acknowledge that the system is inefficient and to vote to abolish the graduate endowment.
I return to the philosophy of free education: the ability to learn is far more important than the ability to pay. Does Labour not agree with that statement? Obviously not, because it is opposing this opportunity for us to remove part of the debt that students rack up.
I recently spoke to a young student from America who is doing his PhD here under the fresh talent initiative. He told me that he is saving about £30,000 by studying here rather than in the United States of America. I hope that he will contribute to our economy afterwards, given that he is committed to staying in Scotland. Students here do not have to pay such amounts. We are talking about people choosing to live here. Do we not want to ensure that the youngsters who are born and brought up here have opportunities too? Is the bill not the first step towards making that possible? We still have to deal with 95 per cent of student debt. Surely we have to make this start. We also have to acknowledge that, given the financial settlements under devolution, it is not possible to apply the sums that are required to remove student debt at this stage. Therefore, let us kill the nonsense that that is what the debate is about; the debate is about making a start.
Student presidents from around the country have written to us to ask us to vote for the bill. It would be to the eternal shame of the Labour members who talk about social justice if they deny that the bill has the potential to improve the condition of students. I ask those members to listen to their conscience and support the bill.
I am pleased to be taking part in the debate. I am grateful to the witnesses who gave evidence to the Education, Lifelong Learning and Culture Committee. Of course, the majority said that they would support the abolition of the graduate endowment on the basis that it would reduce student debt. However, it is fair to say that the majority qualified their support by raising the general issue of university funding and the quality of education that is provided to all students. They also said that student debt is not the only issue for people who decide not to pursue a university education, and that the abolition of the graduate endowment would be only a small move in favour of people who are put off going to university by the fear of debt.
We should reflect on why the Education (Graduate Endowment and Student Support) (Scotland) Act 2001 was introduced. The Parliament agreed that we would abolish up-front tuition fees and introduce a graduate endowment fee that would be paid by certain graduates in recognition of the benefits that they receive from their period of higher education. We agreed that the income from the fee would be used to fund improvements in student support, and so it was; the graduate endowment has provided bursaries for less financially secure students.
Will the member take an intervention?
No, not yet.
How can abolishing the graduate endowment deliver the stated intention of the bill? It cannot. That is why I cannot support the general principles of the bill.
In trying to justify the bill, the Scottish Government has given us little, if any, hard evidence to support its case. It has made a general claim that fear of debt is putting off poor students. However, anyone who thinks that reducing debt from an average of £11,000 to £9,000 will make a substantial difference has never been poor. The committee has frequently heard Scottish Government ministers offering the Joseph Rowntree Foundation's research as evidence for their view. However, that research was carried out in 2003, before the start of the graduate endowment.
Today, we have heard that the age participation index figures show a reduction in student numbers. However, the reason why the index has gone down is that the total number of young people has increased.
The Cabinet Secretary for Education and Lifelong Learning was unable to provide clear evidence to persuade the committee to support the bill, which was unusual.
For me, the big question is not simply about increasing the number of young people from poorer backgrounds who attend university; it is also about ensuring that those poorer students for whom university is appropriate—those whose future prospects would be enhanced and who could make a better contribution to the economy if they went to university—are not put off university for any reason. The Liberal Democrat amendment perhaps tries to address that point.
I have said in previous debates that reasons other than cost are to blame for the fact that some people do not go to university. Ambition, aspiration and the views of families and friends are part of the story. However, we do not have the clear evidence to enable us to make decisions about how to combat those deterrents. Perhaps some further research is needed.
As I have said, I will be voting against the general principles of the bill. I recognise that the vote will be close. Should the SNP Government's position be agreed to, perhaps the Liberal Democrat amendment will help. However, I must point out to the Liberal Democrats that it is inconsistent, to say the least, to ask for student support and provision to be improved but not to make any provision for that. In today's debate, I am not permitted to speak about the committee's budget deliberations. However, when the committee publishes its report, people will understand why I think that the Liberal Democrats' call is disingenuous.
Will the member give way?
No, not just now.
We cannot have this debate without passing comment on university funding. We can only wonder about how universities might have responded to the bill had they known how bad the university settlement would be.
Will the member give way?
No, I will not.
The poor funding will have a number of consequences that will affect all students, but they could disproportionately affect poorer students.
To save money, universities could reduce student numbers. Labour promised to lift the cap and increase student numbers. Universities could reduce expensive courses, such as science and engineering courses—the kind of courses that we need to drive the economy. Alternatively, universities could increase the numbers of overseas students to increase income. Although I value the contribution that overseas students make to our learning environment, that has to be balanced against any possible loss of places for students from Scotland.
I want young people to reach their educational potential. The graduate endowment has provided bursaries for some of our poorest students. The loss of £17 million as a result of this bill represents a lost opportunity. I support my colleague Rhona Brankin when she says that that money could be used to provide further bursaries.
The SNP is trying to use the abolition of the graduate endowment to fulfil its manifesto commitment to dump the debt. If the Liberal Democrats vote with the SNP today, they will let the Government off the hook. I am sure that the SNP thought that "dump the debt" was a good soundbite. However, ill-thought-out policies have a habit of returning to bite back. Now, the more frequently used soundbite will be, "the SNP Government dumps the students".
We will be
"insisting on smaller classes, an increase in the number of fully qualified teachers, new schools, maintenance for the poorer children, more free places in Secondary Schools and Scholarships to the University."
That quotation is not from the SNP manifesto but from the Labour manifesto of 1924—a time when the Labour Party was committed to free education.
The member has a good memory.
I wasnae born then.
In 1959, the Labour Party said:
"we shall ensure that any student accepted by a university will receive a really adequate State scholarship."
What a radical idea—the state funding our young people's studies. Imagine that. Of course, that was before the Labour Party lost its soul. Under Labour since 1997, everything has been available, as long as people can afford it. Higher education is available as long as people can pay for it; there are life opportunities as long as people can afford them; and peerages—well, enough said.
As I am sure our friends in the blue corner will be more than willing to tell us, when the Conservatives lost power in 1997, students in Scotland still received a maintenance grant. It is true that a loan was involved—it was about half the total amount that could be claimed—but grants were still available to those who needed them. To make it as clear as I can, I say that Margaret Thatcher and John Major both paid student grants and neither imposed blanket tuition fees.
That all changed when Labour came to power. On 14 April 1997, the London Evening Standard published questions that it posed to Labour and the answers that it received. Question 6 was:
"Will Labour introduce tuition fees for higher education?"
The answer was:
"Labour has no plans to introduce tuition fees for higher education."
However, it certainly had plans by July that year—just three months later—and it imposed tuition fees on all Scotland's students. It also got rid of student maintenance grants and replaced them with student loans, which inhibit our graduates' life chances. That serves neither the individual nor our society well. Society loses out because the massive debts that graduates carry are a drag on our economy. If those debts were carried by any other group in society, everyone in the Parliament would call for action to address the problem. Why should Scotland's graduates not receive the same consideration as anyone else would?
What I have said applies to those who reach university, but many do not get there, often because they fail to apply. Individuals are deterred from entering higher and further education by the prospect of ending up with thousands and thousands of pounds of debt that their own Government has forced on them. It is interesting that the people who are least affected by that fear are likely to come from families that have experience of managing debt fairly easily—families with healthy incomes.
Labour's policy decisions in its early years in government created barriers to higher education for the poorest in society—some difference from its 1924 manifesto.
My intervention is not about the Labour Party's 1924 manifesto, although I studied history at university under a Conservative Government that phased out the grants that I was receiving.
In 1999, the SNP proposed the reintroduction of grants at £500, whereas the Lib Dem-Labour Administration established bursaries—grants—of £2,000. If the member is so keen for the SNP to replace loans with grants, why does the SNP's budget not include the money to replace all loans with grants?
We are taking the first step by abolishing the graduate endowment and we are moving from loans to grants for part-time students. That is more than the previous Executive did in the past eight years.
The movement from up-front tuition fees to an end-of-course tuition fee in the graduate endowment early in our new democracy's life was a step in the right direction, but we must go further. We must abolish tuition fees altogether—that is what Richard Baker requested in 1999 when he was an NUS activist, before he started chasing a career in the Labour Party.
Getting rid of the graduate endowment fee will not address student poverty and graduate debt by itself, but having a long way to travel does not mean that we should not take the first steps. I am disappointed in those who would do nothing.
I believe, as does the SNP, that access to education should be based on the ability to learn and not on the ability to pay. Committee members heard the Cabinet Secretary for Education and Lifelong Learning tell us that she is continuing the programme that will lead to the end of student loans and the introduction of maintenance grants for students. We also heard Howard McKenzie of the Association of Scotland's Colleges tell us on 28 November that changes to the funding packages for students would be far more effective. He said:
"The move from loans to grants will widen access more than putting hundreds of thousands more people through courses will. That sounds odd, but we are more likely to change the type of people who come forward and to get better penetration of the groups of people who we need to get back into the economy that way."—[Official Report, Education, Lifelong Learning and Culture Committee, 28 November 2007; c 391.]
Scotland needs a fair deal for her students, who have suffered—and are suffering—because of Labour's mismanagement. Graduates are suffering as a result of the illogical burdens that have been placed on them by Labour policies, and Scotland is suffering because those policies are preventing Scots from entering education, gaining skills and making a valuable contribution to the economy.
Scotland looks to her Parliament and Government to make a difference for her people and improve their lives. We have a duty to take the first steps to establishing a clear, equitable and forward-looking student funding policy for Scotland and to support the general principles of the Graduate Endowment Abolition (Scotland) Bill.
I will focus on wider access and the claims that the minister has made in favour of the bill.
The new Administration's rationale for the bill suggests that abolishing the graduate endowment can open up access to higher education on a more equitable basis. The bill's policy memorandum also asserts that the graduate endowment has failed to widen access and participation, although it was established in the first place to do so. My colleagues and I would be queuing up to support the bill if either argument held water. However, the Government has failed to provide any evidence to substantiate the latter claim, and the first claim is disingenuous and misleading. The pursuit of social justice, which is the Labour Party's raison d'être and can be traced through nearly all Labour Government policy decisions, is but a mask for the bill to hide behind.
SNP members were elected on the simple promise that they would cancel student debt. There is no doubt in my mind that hundreds—if not thousands—of students throughout the country, and probably their families too, were attracted by the unadorned and alluring promise that was made. However, like so many of the SNP's so-called manifesto commitments, that promise has turned out to be worthless and hollow. It is a sham. The election was less than eight months ago, but the new Administration has already walked away from the commitment that was made to Scotland's students. The SNP promised to dump student debt, but it turns out that it has dumped Scotland's students.
It is not only the false prospectus that annoys me most about the way in which the SNP has led students on only to let them down—it is the language that it has used to dress up its claims. The SNP uses the language of social justice. It said that dumping student debt was about widening access to education and increasing the participation of people from non-traditional backgrounds, but student debt and hardship are not being tackled. Instead of making a £2 billion commitment, £17 million has been found to provide a post-graduation benefit for only the 50 per cent or so full-time students who might become liable for the charge, not to tackle up-front living costs for students.
There is no benefit for part-time students in the policy. In fact, the committee heard strong evidence that suggested that part-time students will be further disadvantaged. There is no benefit either for students from non-traditional backgrounds, because they do not pay the graduate endowment. There is no direct benefit for any student from the group for which the policy is supposed to be tailored and the policy removes £17 million from the education budget—money that is used to fund student loans and implement Labour's widening access agenda.
The SNP asserts—I use that word advisedly—in the policy memorandum that the graduate endowment has failed to deliver on the stated aim of removing barriers to widening access and participation, but it has woefully and embarrassingly failed to provide any evidence to back up that assertion, which has been toe curling. When the committee considered the evidence, it found that participation had increased. I will quote from paragraph 30 of the committee's stage 1 report, as the question whether the number of students from deprived backgrounds has increased has been bandied about:
"The Scottish Domiciled Entrants from Deprived Areas to Higher Education in the UK figures show that the percentage of entrants from deprived areas has risen from 14% in 2002-03 to 15% in 2005-06, which covers the period in which the GE came into effect."
If the Government has £17 million to spend and wants to tackle barriers that students from non-traditional backgrounds face, why does it not direct that money to young students bursaries? Support for students in this country still falls short of the support that they would be entitled to if they lived in England or Wales. Surely that would be a better use of that funding.
The cabinet secretary makes great play of the claim that the bill will somehow make university education free. In fact, SNP members bandy around the word "free" to describe quite a few of their policies. However, as taxpayers well know, education is not free—it is paid for by the taxes of working people. Who exactly benefits from this so-called free policy? The cabinet secretary makes out that those who are in greatest need—people from more deprived backgrounds, who face the greatest barriers—have most to gain. However, as with free school meals, the biggest gainers are not the worst off but the best off. The bill is not about social justice. If the SNP wants to spend our scarce resources in this manner, let us not have any more pretence that the aim is to give the poorest a hand up.
Has the member taken the trouble to read the London South Bank University, Policy Studies Institute and NOP research that was published by the previous Government in 2005? Forty per cent of those who were questioned in the study said that they had friends who were deterred from going to university because they were worried about the debts that they would build up. There is clear research evidence that debt and the fear of debt put off a sizeable number of people from going to university.
The cabinet secretary makes a lot of assertions about debt, but she uses the term in the context of abolishing £2 billion of student debt. In fact, she plans to use only £17 million to abolish the graduate endowment—that is a post-graduation benefit.
I am grateful to my colleague Richard Baker, who is sitting next to me, for providing a full summary of the research that the cabinet secretary cited selectively. That research found that the majority of those who were questioned—72 per cent—believed that borrowing money to pay for a university education was a good investment. I sat in the right seat this morning.
In the bill, as in so many of its decisions, the new Government has taken the easy option. The bill has the whiff of the populist about it: it is simplistic, headline chasing and short-termist. It is merely a fig leaf behind which the Government hopes to hide the abandonment of its promise to cancel student debt. It is a cheap headline that fails to address any of the long-term anxieties that our universities face or the immediate problems of student hardship. Most galling of all, it is dressed up in the language of widening access, when it does nothing to help students from deprived and non-traditional backgrounds—quite the reverse. I urge the Parliament to support the findings of the committee.
Today I invite members to give free rein to their imaginations. I would like them to imagine a world in which there was no graduate endowment and there were no tuition fees, top-up fees, front-end payments or back-end payments, and in which higher education was freely accessible to everyone who had the ability to take advantage of it. I would like members to imagine a world in which there were grants to assist students from lower-income families with their maintenance and living costs during the period of their studies. I would like members to imagine a world in which the number of students in higher and further education doubled and then trebled in less than 20 years, and in which the number of universities in Scotland increased to match the opportunities that were being made available to our young people and mature students.
Will the member give way?
Not yet—I am coming to my point.
It is not difficult to imagine such a world—it is easy if you try. Christina McKelvie has managed it. Such a world is not the creation of the vivid imaginations of a J K Rowling or a Terry Pratchett—it is not a Hogwarts or a Discworld. It is the way we were during the 18 years of Conservative Governments. Can it be that it was all so different then? Yes, it was. Today, we should begin by congratulating the Cabinet Secretary for Education and Lifelong Learning, Fiona Hyslop, and the SNP Government on seeking to do for students in Scotland what Mrs Thatcher and John Major did for students in Scotland. It is a noble ambition to want to follow in their footsteps and to try to emulate our achievements in government, before the country was afflicted by the new Labour malaise.
Will the member give way?
I am sorry, but Mr Purvis comes first.
I am seeking purely to help the member. I do not need to imagine the world that he has outlined through rose-tinted spectacles—I lived through it. I started my university course in 1993. My dad is an ambulance driver and my mum was a cleaner, and I received a full grant. In the year in which I graduated—1996—I could get no grant. Which party was in government then?
Grants during the period that we were the Administration were, like the grants that the member's party introduced, means tested. Obviously, his parents prospered in the intervening period—and that is no surprise, because they were living under a Conservative Government.
I can pay the SNP no higher compliment than the one that I have paid today. In fairness, abolishing the graduate endowment was in the SNP's manifesto, and the SNP is trying to implement it, rather than seeking to ditch it at the first available opportunity, as it has done with so many other policies.
I thank the member for taking an intervention.
When the member was leader of the Scottish Conservatives, did he approve the campaign poster that I am holding up? It says:
"Y2K? Because they didn't abolish tuition fees. Do something about it. Vote Scottish Conservative."
When did Scottish Conservative policy change on that matter?
I always think that Mr Neil is at his most eloquent when he quotes my remarks.
The answer to the question is quite simple—one has to devise a policy and make a choice based on the circumstances, as we are doing today, and as Murdo Fraser made clear, the choice is hard. We have to decide whether the finite amount of resource should go into funding our universities and the quality of education that our young people receive, or into funding the abolition of the graduate endowment.
Will the member give way?
Sorry—I need to make a little bit of progress.
We note that the Liberal Democrats are supporting the Government today. One might reflect that had they not been so grasping in their desire for office in 1999, there would not be a graduate endowment to abolish eight years later.
I have praised the SNP for seeking to follow in Mrs Thatcher's footsteps. Its members should remember that she was a forward-looking woman, and she would be the first to say that our responsibility is to address today's issues, not the issues of 10, 20 or 30 years ago.
We know that the abolition of the graduate endowment will cost at least £17 million per annum, and that the justification for abolition in terms of access is simply not borne out by the evidence that was given to the committee, as many members have said. The fact of the matter is that the cost of the policy effectively is being extracted from the higher education budget, and that money could be used to finance higher education in Scotland rather than finance student maintenance.
Will the member give way?
I am in my last minute—sorry.
I note that the Government has deferred its plans to eliminate all student debt. That is not because there is a lack of a parliamentary majority for it, but because it is the daftest and most irresponsible policy that has ever been advocated by one of the main parties in the Parliament. In essence, it was an encouragement to present students to borrow up to the hilt and spend, spend, spend, on the basis that an SNP Government would come along and relieve them of those liabilities at taxpayers' expense.
Everyone recognises that the main challenge that our universities face is the lack of resources and funding streams to enable them to compete with universities down south that now have the income from tuition fees—the gap is set to grow. If we do not address that fundamental big issue, we will simply fail to compete in higher education on a British and an international stage, because we will be unable to sustain the quality of our teaching and research.
The Government is failing, sadly, to address that big issue. It is addressing the issue incrementally by looking at only one small area that cannot be considered in isolation. I regret to say that the bill is the product of a parochial attitude that betrays the international tradition of Scottish education and wants to limit the horizons of young Scots. For that reason, Parliament should follow the recommendations of its Education, Lifelong Learning and Culture Committee and vote against the bill.
For the record, I have a large student debt that I am currently repaying. Not many of my parliamentary colleagues can relate to the issue at first hand, because the vast majority were fortunate enough to gain their university education at a time when it was paid for by the state. I am fortunate, too, because at the moment, I receive a salary that means that loan repayments do not place an intolerable burden on me, but the vast majority of my peers, including a great many close friends, have not been so lucky.
This is an important debate, and one that is close to my heart, as I graduated only five years ago. It is also a timely debate because, as MSPs, we have the opportunity to send out a positive Christmas message to Scotland's students who are heading home for the festive period. While we, as parliamentarians, are able to indulge in a little time off over the holiday spell, we should spare a thought for the thousands of students who will have to work to ensure that they have enough money to get by when the new academic term starts.
Will the member take an intervention?
No. I want to make some progress.
The bill is about more than just a populist policy. Free education has been an important principle in our country for centuries. That principle ignored income and background. It allowed Scotland to lead the way internationally and boast some of the highest literacy rates in the world. With literacy came the remarkable achievement of the Scottish enlightenment. Indeed, it was so remarkable that it prompted Voltaire to state that his countrymen should
"look to Scotland for all our ideas of civilization."
I doubt whether he would talk so positively about the actions of the Labour Party and its contribution to developments in the past decade.
The member is on a salary of roughly £52,000. Does she accept that it is right that she should make a contribution to students from poorer backgrounds while they are studying at university?
I already do so through my income tax. However, I note that the vast majority of graduates are not as lucky as I am and are burdened by the debt that Rhona Brankin's party brought in.
Labour systematically destroyed the notion of free education, which was left to the SNP Government to restore. Thankfully, the bill that we are debating today—if the Parliament has the common sense to vote for it—will help us on the journey back towards a truly free education system.
The vast majority of members benefited from free university education, including some members of the Education, Lifelong Learning and Culture Committee. Astonishingly, the committee voted against the bill in a bizarre move that seemed to put party-political point scoring ahead of the interests of Scotland's student population and the long-term educational needs of future generations. What were the reasons for that mass opposition to abolishing the graduate endowment? According to Labour members, the bill will not widen access and the money would be better spent elsewhere to help ease the financial burden on students. That position is ironic because it ignores the opinions of students and student representatives. Worst of all, the notion that the Labour Party wants to widen access to education is hypocritical, because it comes from the party that burdened students with fees in the first place back in 1998. I should know about that, because I was one of those students.
Will the member take an intervention?
No.
Of course, Labour now supports the graduate endowment. Labour members can call it whatever they like, but it looks like a tuition fee and it works like a tuition fee. In my eyes, that makes it a tuition fee.
I am with the member in disagreeing with the position of the Labour Party, which now wants to move towards using part of the graduate endowment funds for universities, although that has always been illegal.
The endowment has never been a tuition fee and it does not contribute to tuition. Clear language is important in the debate.
People give a fee for a period of tuition. To me, that makes it a tuition fee.
If someone does not graduate, they do not pay.
The member should let me move on.
Furthermore, the graduate endowment is an ineffective and inefficient tuition fee. The average time that is taken to pay back an income-contingent loan is about 13 years. The associated costs mean that the taxpayer loses about a third of the income that is collected. Of the £26.3 million loan debt that is attributable to the graduate endowment, only £57,000 has been returned to the taxpayer. That is 0.2 per cent. Therefore, the graduate endowment has not even functioned effectively in relation to its purpose—to fund bursaries for students from poor backgrounds.
The graduate endowment is a tuition fee that puts youngsters off embarking on academic careers. In a letter to MSPs, student leaders state that the graduate endowment is a significant disincentive to students from the poorest backgrounds accessing higher education. Indeed, one of my friends told me about her 15-year-old niece, who is academically bright but had been put off even attempting to apply to go to university because of the fear of debt. However, her attitude changed instantly when her auntie told her that the new Government wanted to get rid of the endowment. If that is not a reason to support the bill, I do not know what is.
I accept that the measure that we are discussing today is only a start in the battle to tackle the harsh and burgeoning financial hardship that students experience, but it is a start. The Parliament must work together to find ways to ensure that the plight of students is reversed. I urge each and every member to support the bill because it will restore fairness and equality to higher education. As the cabinet secretary said, members should not act like Scrooge and vote against this yuletide bill.
It is gross hypocrisy for members who enjoyed the benefits of a free education to retain tuition fees. No doubt some of them masqueraded as socialists on campuses during their radical, carefree and loan-free days. I ask members to spare a thought, before tonight's vote, for the debt-ridden students. They are not gullible and they will see through petty political posturing.
I demonstrated and marched against tuition fees when I was a student and a member of the Federation of Student Nationalists, and I am proud to be in a party that has not lost its principles, that has listened to the voices of students and that will finally, after nearly a decade, start work on the restoration of free education. Education in Scotland should be a right, not a privilege.
I am delighted that we are debating the abolition of the graduate endowment. There is no question but that it is unfinished business, which is why I was delighted that two years ago the abolition of the graduate endowment was adopted as Liberal Democrat party policy—a policy that we included in our manifesto for the elections earlier this year and a policy that I believe was the most important in that manifesto.
I was immensely proud that we abolished student tuition fees in Scotland. As Jeremy Purvis pointed out, the most important single measure in the first session of Parliament was to tackle student debt, and that measure was driven by the Liberal Democrats. I find it particularly ironic that, at the time, the Tories pilloried us for creating the graduate endowment, and now they want to keep it. That is unbelievable.
Will the member give way?
No. Murdo Fraser has had his say.
The simple fact is that Scottish students have been paying £2,000 at the end of their studies—not for tuition—instead of up to £9,000 per year for tuition. If I were a student, I know which I would prefer to pay, and it would not be the £9,000. We in the Liberal Democrats believe in the principle of free education—free not only at the point of delivery but after delivery. [Interruption.] The whole point of coalition Government is compromise.
Talking about compromises, we had compromises with the Labour Party in the first session. I say to Rhona Brankin that, if it had been left to the Labour Party, there is no question but that we would still have tuition fees in Scotland. Labour believes in taxing people just because they attend university.
Does the member accept that abolishing the graduate endowment will take £17 million out of the higher education budget? What will the Liberal Democrats do to replace that money?
Labour wants to reintroduce tuition fees in Scotland—that is clear. We are entirely opposed to the position of both the Labour Party and the Conservatives.
Answer the question.
Answer the question.
I am delighted to answer the question—it is the SNP Government's job to bring forward the budget. I think that I will oppose the budget in February—I hope that both Labour members and Conservative members will do so as well.
The SNP manifesto stated:
"An SNP government will abolish the Graduate Endowment".
So far, so good. However, the manifesto went on to say:
"We will remove the burden of debt repayments owed by Scottish domiciled and resident graduates."
The SNP said that it would dump student debt. Indeed, it said that it was time to dump student debt. This has been said often before, but I repeat that the only thing that the SNP seems to dump is its commitment. John Swinney says that there is no parliamentary support for the debt proposal, but I say that he should bring it on.
If such a bill were introduced, would the member vote for it?
I would be delighted if John Swinney introduced a bill to that effect so that it could be debated in the Parliament. Let us see what people's positions are. However, the SNP is afraid to do that.
I am afraid that I do not accept the argument advanced by both the Labour Party and the Conservatives that it is acceptable for students and graduates to contribute—that is a nice word—towards the cost of their education because they will benefit from that education by earning a higher salary in later years. What tosh. Graduates do not necessarily earn larger salaries, but even if they do, we already have a system in place that ensures that those who earn more pay more. It is called income tax. It goes without saying that the Exchequer will benefit from any graduate who earns a higher salary as a result of a university education through their paying more income tax. Income tax is by far the fairest and most progressive form of taxation, because it takes into account the amount that people earn, not the fact that they have attended university.
Will the member give way?
I have taken enough interventions.
Funding through income tax is undoubtedly preferable to the graduate endowment, which Labour and the Tories want to keep.
Graduates leave Scottish universities with crippling debts. There is no question but that issues to do with debt deter many people from entering education. The SNP has gone back on its manifesto promise to remove the burden of student debt. It has failed even to try to bring its proposals to the Parliament so that they can be debated and voted on. Alex Salmond told us that there would be a new politics in which he would bring proposals to the Parliament and persuade the other parties. We were to have real debates about the issues, but on student debt Alex Salmond has hidden away.
The removal of the graduate endowment will make a huge difference to students by reducing their debts. In Scotland we have a tremendous opportunity to send a powerful message to the rest of the United Kingdom that education is a right, not a commodity and that access to higher education should be based on the ability to learn, not the ability to pay.
I think that the Parliament can agree on one thing: all members are keen that access should be widened and that more people from poor backgrounds should enter higher and further education.
In 1999, along with the associate dean at the University of Glasgow, Dr Lumsden, we established a programme at Glasgow and the University of Stirling to widen access to medical, dental, veterinary and allied health professional training. The UK Government, to give it its due, has put nearly £1 million into the programme. Such practical approaches to widening access are important. Sixty schools in Scotland are involved in the programme. Their pupils' aspirations were often stifled by the schools' failure to realise that those pupils could enter the health professions. We interviewed some of the young people involved and I remember that one person had been told, "Medicine is a bit tough. Perhaps you should consider becoming a nurse or a care assistant."
The big problem in Scotland is denigration of aspiration; it is not money or funding. If members want evidence of that, they should consider a recent social sciences research paper by the University of Kent, which examines the situation not in Scotland but in England since the introduction of tuition fees and finds no evidence of a reduction in access for people from poorer backgrounds—and that is in England, where the fees are much greater. There is no evidence that money is the important determinant. Access is about aspirations.
The Government is profligately giving to the better off. Members should remember that only 50 per cent of graduates pay the endowment. We protected graduates on poor incomes, disabled graduates and people whose aspirations had come late and who entered university as mature students, after having been independent—those people do not pay. People who completed a higher national diploma or higher national certificate course—
Will the member give way?
I am in full flow; I will take an intervention from Mr Ingram in a minute.
People who completed their university course after completing an HNC do not pay the endowment—I could go on. We protected 50 per cent of graduates from paying the endowment. That is social justice. Such an approach encourages people to enter higher and further education and safeguards access.
If I were asked how I would spend the money that the Government is profligately giving to the better off, I would reply that I would spend it on nurses and midwifes, because an incredible number of people leave nursing and midwifery courses—up to 30 per cent of participants, in some cases. People often leave such courses for reasons to do with finance and child care. We provided and increased bursaries, and that is how we should spend the money.
The SNP has agreed to cut the number of nurses and midwives that we will recruit into training programmes. SNP members may frown, but its documentation says that it will reduce the number of students in nursing and midwifery. It hopes that it will retain more of those students, but it will have to find a way of doing that. I suggest that applying the money that will be needed to abolish the graduate endowment would be one way of doing it.
Access is of fundamental importance, but the future of our universities is also important. This Government is in the business of trying to spend money twice. I was talking to my grandchildren yesterday about what they would like for Christmas. In reply, they asked me what I would like for Christmas. I said that I would like access to Santa Swinney's money tree. This profligate Government is giving money away to the better-off. If members do not believe me, they should look at what is happening.
What will this Government give to a small businessman who has two children at school, who is suffering from a thyroid condition, who has a house in band G and who is due to retire in 2011? He will get £4,600 from the freeze in council tax over the next three years, £200 from free school meals when that is introduced, £170 from free prescriptions and £4,500 from the abolition of business rates. If he happens to live in an area in which he has had to pay tolls, he will no longer have to do so. When his children grow up, he will not have to pay the graduate tax for them, either.
Let us compare that with the situation of a single mother from Fife, whose baby has complex needs and who is waiting to get out of care. What will they get? Fife Council has not allowed them to come out of hospital—they are still there, even though they are fit to come home. They will gain nothing from any of the Government's giveaways that I have mentioned. This Government is a regressive rather than a progressive Government, and the abolition of the graduate endowment tax is part of that regression.
Tony Blair told us that education, education, education would be Labour's priority. Instead, we got tuition fees, tuition fees, tuition fees and debt, debt, debt. This morning we are talking about the problem of student debt, but that pile of debt has been created over the past 10 years under Gordon Brown.
Over the past 10 years, the Labour Government has presided over the redistribution of income and wealth from those who have not to those who have, so we will not take any lessons on egalitarianism from the Labour Party. As Aileen Campbell pointed out, the irony is that every Labour MSP and every member of Brown's Cabinet benefited from not having to pay tuition fees when they were at university. They have the cheek to say that this and future generations will not get the access to free education that every one of them got under previous Labour and Conservative Governments.
Karen Whitefield represents the constituency of Airdrie, Shotts and the surrounding villages. The fact that she voted, not once but twice, to maintain tuition fees for people who cannot afford to pay them will not be forgotten at the next election, especially in the surrounding villages.
I do not want to interrupt you in full flight, but can you tell me whether the people who voted for you will remember your manifesto promise to dump student debt?
I remind members not to use the second person.
We are running at 40 per cent in the opinion polls; Labour is running at 28 per cent. When we get an overall majority in the Parliament, we will be able to do all the things that we want to do in Scotland.
Mary Mulligan derides the reduction in debt that the passing of the bill will bring about. Let us consider the average student debt in Scotland. The impact of the bill will be to reduce student debt by more than 20 per cent. That is a major milestone by any standard and will be good not just for those affected but for the whole of Scottish society.
Of course, we have the problem that only 14 or 15 per cent of people in lower income groups go to university, when the average across income groups is 48 or 49 per cent. Richard Simpson says that that has nothing to do with money. I suggest to him that he talk to the 30-odd per cent in lower income groups who would like to go to university but think that they cannot afford to. I agree that money is not the only barrier—there are many other barriers to such people going to university—but people who say that money is not one of the major barriers are living in cloud-cuckoo-land.
Talking of cloud-cuckoo-land, I will say a word or two about the Conservatives. I quote Annabel Goldie on the graduate endowment:
"The truth is that in the bill, we have a penal tax"—
a penal tax the Conservatives are going to vote to keep. She said:
"It is a thorn, which pricks and draws blood."
That is why the Tories could not support the graduate endowment.
David McLetchie said:
"There is nothing voluntary about the graduate endowment. It is simply a tax and one that will kick in at a ludicrously low level of income."—[Official Report, 31 January 2001; c 766, 756.]
However, today he is voting to keep it.
When David McLetchie was still the Conservative leader and still one of the best speakers in the Parliament—although usually on the wrong side of the argument—he said:
"At the end of the day, whether the charge is called a fee, an endowment or a tax, it is a liability".—[Official Report, 22 December 2004; c 5109.]
Today, he is going to vote to keep that liability.
In the 2003 election, the Scottish Conservatives made a pledge that they retained for at least a year after. They put up a poster headed "Investing in our future"—although it turned out that Mr McLetchie didnae have one—which said:
"Scottish Conservatives will create a diverse education system which extends opportunity for all."
There were four action items, one of which was that the Scottish Conservatives would
"abolish the £2,000 graduate tax and guarantee access to our universities and colleges purely on the basis of merit."
That was a return to the fairy-dust days of Margaret Thatcher and John Major that Mr McLetchie described earlier.
Will the member give way?
I am in my last minute.
How can the Tories, along with the Tory Labour Party, betray the future generations of Scotland by voting to keep this penal tax called the graduate endowment?
I ought to declare an interest—I have three children at university, all of whom would benefit from the bill. In fact, my family would be some £7,000 better off if the bill is passed. However, that will not make me vote for it. I make it clear to Mr Neil that when I went to university, the taxpayer paid for my tuition and my parents paid for my living costs. I certainly did not have a free education in Edinburgh in the 1970s. I do not know where the myth comes from that there was some great time of universal free education. At all times, taxpayers paid, and quite often parents paid too.
I know that the member went to university many years before me but, like me, as well as getting her tuition fees paid by the state, did she not receive a substantial maintenance grant?
No, Mr Neil, I did not, because both my parents were in full-time employment. I did not therefore receive much of a maintenance award.
I move to the concerns referred to by Karen Whitefield. The Finance Committee—as Mr Neil knows, because he is a member of it—had a number of concerns about the financial memorandum. In our report, we expressed particular concerns about its quality. Fortunately, the Scottish Parliament information centre produced a detailed and informative report without which it would have been extremely difficult to interpret the financial memorandum at all.
I still have concerns about the accuracy of the estimate that the cost to the Government will be £17 million, because that figure does not include the £1.95 million that was outstanding and awaiting debt recovery on 1 April this year—we presume that some of that will eventually be recovered.
The other issue that concerns me is that the graduate endowment was in operation for only three years and there is no evidence that it had reached a steady state. In 2005, 82 per cent of students who would have been liable to pay the fee in April turned out not liable because they were still in education. The following year that figure was 50 per cent, and in the year after that it was 40 per cent.
Correspondence from the bill team suggests that there could be a further £1 million per annum in liability arising from students who are studying first degree courses of six years or more, such as medical, veterinary and dental students. I still do not know how the number of students who have gone on to study second degrees—masters or PhD courses—and who will not become liable until those courses are complete is captured in that £17 million, which could turn into at least £20 million when we include debt recovery and the students who stay on in education. I am not happy, and the Finance Committee was unanimously not happy, that the margins of cost were adequately reflected in the financial memorandum.
I question whether exempting families such as mine from payment of around £7,000 is the best way to support students. Despite the fact that I or my children might spend the £7,000 in Scotland, I question whether that would contribute to achieving the Government's overarching purpose of growing the Scottish economy in a sustained way.
Would the member apply that same principle to tuition costs?
I am not sure whether I completely understand the member's question.
Can I try again?
No, because I want to address an issue that I heard Jeremy Purvis raise on the radio in debate earlier with my colleague Richard Baker. It is a bit of a red herring to suggest that the graduate endowment should be used to fund universities. I pursued that matter at the Finance Committee. Paragraphs 23 to 25 of the financial memorandum make it clear that the graduate endowment fee is directly appropriated and releases existing budgets to meet in-year pressures. It is not earmarked for something else such as the Scottish consolidated fund; it comes in to augment end-year flexibility. That was confirmed to me at the Finance Committee meeting on 6 November by Gavin Gray.
Another red herring is the question that the cabinet secretary raised: why did the graduate endowment loan cost 31 per cent of the pound? I also asked about that at the meeting on 6 November. That 31 per cent is not a result of a bad arrangement; it is predominantly made up of a subsidy to the loan to ensure that it has a real interest rate of 0 per cent and increases only with the retail prices index. It costs 31 per cent because it is a subsidised loan, and not because it is a poor or inefficient system.
As with freezing council tax, the Government seeks to be popular and populist by giving everybody a share of the action instead of targeting money to support those who need it most, as argued by my Labour Party colleagues. The money should not be given to everybody; it should not be given to families such as mine. It should be targeted at students in need to widen access.
I will start my winding-up speech in this interesting and informative debate by asking a question of the SNP Government: how many different ways are there to break promises? When we look at the Government's track record, we note that it is finding more ways to break promises than the average misanthrope. Police numbers—broken promise. Affordable housing—broken promise. Class sizes, student debt, university funding—broken promises. Now, we are at last receiving, belatedly, the Christmas present of a welcome attempt by the SNP to redress the balance.
Will the member give way?
Give me a couple of minutes, please.
Regrettably, on its own, this measure will make as much impact on student numbers and student debt as using a water pistol on a forest fire. That is not to say that it is a bad thing—far from it. Indeed, it formed part of the Liberal Democrat commitment on this issue.
I thank the member for giving way. I did not want to interrupt his expressions of enthusiasm for the bill.
Does the member accept that this measure alone would, on average, reduce student debt by more than 20 per cent?
I am quite happy to accept that. Does that surprise the member?
Is that what you call a water pistol?
The fact is that there is slightly less water in the pistol than there would have been if the SNP had implemented its full manifesto commitment.
Compared with the SNP's approach to its manifesto commitment, we costed not just our proposal for dealing with the graduate endowment but a panoply of measures on, for example, housing and living costs. The fact is that after a year, the average medical student in Scotland is £5,000 in debt. That is not tuition debt, but cost of living debt. We need to address that issue.
Does the member agree that, as an average junior doctor's first-year salary is £35,000, they are in an entirely appropriate position to repay their debt?
From memory and from my limited experience of the income tax system, I believe that an average junior doctor will, like many of us in the Parliament, also have to pay tax at a rate of 40 per cent on some of that salary.
The bill would have minimal impact on widening access. After all, less than 50 per cent of students are liable to pay the graduate endowment fee. Indeed, BMA Scotland has said:
"Whilst we welcome the abolition of the graduate endowment fee, we fear that it will do little to address the issue of widening access to courses such as medicine".
NUS Scotland made similar comments to the Education, Lifelong Learning and Culture Committee, noting that the bill was not the complete answer. I accept that, but it at least represents a small step. I would have been much happier to discuss the measure in the context of the SNP's manifesto commitment to abolish student debt entirely, but perhaps we will have that debate if the SNP gets round to introducing such legislation.
Will the member give way?
I think that I have taken enough interventions.
In 2003, the Joseph Rowntree Foundation found that young people from disadvantaged backgrounds are often deterred from entering full-time education. Apart from Aileen Campbell, I must be the only member in the chamber who carries student debt. I was a mature student and know exactly the kind of difficulties that such students face. I can say that £2,000 makes very little difference in the scheme of things; we need to address the cumulative effect of debt.
Students from disadvantaged backgrounds will have more personal debt because their parents are not able to provide financial support. Indeed, parental contributions to maintenance costs vary markedly by social class; about 54 per cent of students from semi-skilled and unskilled backgrounds rely on bursaries, grants and loans for additional funding. The whole issue of student funding must be addressed, not just tinkered with at the edges. Although this proposal is welcome, we have heard nothing about, for example, the introduction of grants or improvements to the bursary scheme.
With this very small step, the SNP has gone for the cheap and easy option, which we will certainly support, but this matter should not be dealt with in isolation. There is a shortfall on the SNP's commitment, and I want to see and debate its proposals for implementing its full manifesto commitment to dump the debt.
No fewer than five of Scotland's universities are placed in the top 200 in the world. For a small nation, that is a remarkable achievement—and the universities richly deserve it for their unfailing pursuit of academic excellence and the contribution that they make to our rich social, cultural and economic heritage.
Our universities and colleges, ancient and modern, are an irreplaceable and priceless asset, and it is incumbent on all members of the Scottish Parliament to ensure that they remain so. Our universities and colleges must be capable of delivering the highest possible standards of education and intellectual challenge. Theirs is a proud history that successfully combines strong teaching and research with enterprise, creativity and an ability to adapt to the changing needs of society.
Universities Scotland's recent claim for £168 million was undoubtedly ambitious. It was impossible for the Government to meet it in full without making punitive cuts in other spending areas, but it was a reflection of the serious predicament in which the university and college sector finds itself—we ignore their argument at our peril.
Will the member take an intervention?
Not just now.
I refer in particular to the concern that top-up fees in England and the possibility of the removal of the cap on those fees means that there will no longer be a level playing field in the provision of higher education resources.
I hear the charge that university and college funding and student debt are two separate matters. Of course we could debate them separately, but it would be folly to do so. The debate that we should have is on the delivery route for a first-class higher education system that matches the needs of our students. It should be on the supply side of our tertiary education sector, not on a narrow, demand-driven policy that focuses on student numbers rather than on the quantity and quality of places that are available. Frankly, holding one debate without the other serves only to make a nonsense of the approach that we should be taking.
Will the member take an intervention now?
I will not.
As many members have said, the methodology behind the bill is seriously flawed. Instead of putting money into the sector, the policy that lies behind the bill will take money out. The policy does absolutely nothing to provide a secure strategic funding base to allow our universities and colleges to plan ahead for their long-term future.
Before Mr Neil reaches into his wonderful supply of Tory posters again—it is nice to see that he cherishes them—I say to him that we might have been persuaded on some of the arguments. The graduate endowment needs reform. However—
Is the member taking any interventions?
No. I am taking no interventions just now. The point is a serious one.
When it came to producing the evidence for the current proposals, there was not only an absence of convincing facts but no analysis to prove that the policy stands up against other policy means of achieving the same objective.
When the Government team was questioned by none other than Mr Jeremy Purvis at the Education, Lifelong Learning and Culture Committee, its response was that
"no other options have been considered".—[Official Report, Education, Lifelong Learning and Culture Committee, 7 November 2007; c 238.]
I cannot speak for a Liberal interpretation of the English language, but the response was totally unsatisfactory. There is absolutely no compelling evidence that the graduate endowment is a barrier to access—a statement that the Scottish funding council also made strongly in its evidence, and which is endorsed by the fact that, in England, the number of students has increased, despite the heavier fee regime there.
Worse still, the Government seemed naively determined to base its supposition on the findings of just one report—the Rowntree report. Not only was that report commissioned in 2003, which pre-dates the introduction of the graduate endowment, but its findings were not specific to Scotland.
In its conclusions, the Rowntree report said:
"Young people from disadvantaged backgrounds are often deterred from both entering full-time education in the first place and from continuing within higher education … because of the economic hardships they suffer, in particular debt."
Let us assume that that is correct. What happens in Scotland? The answer is that the number of applicants from the most deprived fifth of the Scottish student population actually increased. The argument is not persuasive.
I hear the Government's charge that we are somehow traitors to the principle of restoring free education. It can call us traitors if it will—
Traitors!
I say to Mr Rumbles that however much that principle might be a quick fix for winning votes, it is no longer sustainable for the delivery of modern-day public services—in exactly the same way as we cannot fund a health service entirely from the public purse. Perhaps our policy is less populist, but it is firmly in tune with reality and the needs of modern Scotland.
If the Government is keen to listen to what Andrew Cubie has to say, perhaps we can finish with a quotation from him:
"Each and every Scottish university is equal to the challenge of competition but will not be able to compete without support well beyond that offered by the Scottish Government".
That is why the bill must be opposed.
Today, Parliament has a choice: it can proceed with the Government's bill, which will do nothing to improve higher education in Scotland, or it can back the committee's findings, which mean that the Parliament can vote for greater investment in higher education and funding for students while they study and when they need it. We will vote for better bursaries for students to help them get to university and to enable them to stay there and succeed. Voting against those recommendations will not serve students or higher education in Scotland.
The debate has been polarised between members who realise the strength of their argument and those who support the bill, which is clearly motivated by political expediency rather than a real desire to widen access to higher education. The committee found no evidence that abolishing the graduate endowment would help to widen access—a point that Karen Whitefield and others have made eloquently. Indeed, Jeremy Purvis was diligent and effective at the committee in taking apart the Government's argument that the endowment has been a deterrent to participation. He also took apart the report to which Mr O'Donnell referred. That is why it is surprising that he backs the Government's position.
Will Richard Baker confirm that the Labour Party's position is simply to tax students for attending university? Is that the case?
Mr Rumbles and I have often been in agreement recently, but on that we are not agreed at all. He misrepresents my party's position entirely and he will find nothing in the committee's report that links the retention of the endowment to tuition and maintenance costs.
Will Richard Baker give way?
I have answered the question clearly. We will have a little less mischief on the issue and a little less misrepresentation of our position from Mr Purvis. I agree with him that we need the far wider measures that his amendment mentions, but that is not sufficient and we cannot accept lip service to the wider measures that are required. We agree—as do the Conservatives—that there should be a much broader review of higher education and student funding, but why pre-empt such wider measures with a first step that will help neither students nor universities?
It is no surprise that scrapping the endowment will have no impact on encouraging more people from poorer backgrounds to study because it is not a charge on students, as it has been portrayed as being. It is a contribution that is made by graduates when they are in work and benefiting from the education that they received. Alex Neil and others fail to recognise that half of students do not become eligible to pay it—I point out to Mr O'Donnell that that also applies to mature students.
Abolition of the graduate endowment is not aimed at helping students; it is a measure that the SNP has calculated will help it politically. We prefer to help students. The endowment was introduced to enable the provision of young students bursaries.
Does Richard Baker agree that the imposition of the graduate endowment raises the average debt by 20 per cent and that that is a major deterrent to people going to university?
I do not agree with any of that. What will raise debt is if students get into credit card debt because they do not have enough money—through bursaries, for example—to live on while they study. Believe me—because I know—credit card debt is far more punitive than any constructive system of graduate repayment that we proposed.
Over the previous parliamentary session, bursaries and the number of students who could receive them increased substantially—19,000 students now qualify for a full bursary. In contrast, the Scottish Government, while making its costly commitment on the endowment, has agreed to raise the young students bursary only by the rate of inflation. Continuing to invest income from the endowment in bursaries would mean substantially more generous support, particularly for students from poorer backgrounds.
The Scottish Government's failure to produce such proposals means that the poorest students in Scotland now receive about £2,000 less support every year than their colleagues in England. Even with the previous increases in bursaries, drop-out rates in Scotland are higher than those in other parts of the UK, particularly at universities that have a strong record of attracting students from poorer backgrounds. The proposed abolition of the endowment is a perverse priority, whereas giving students extra support while they study could make the difference between dropping out and successfully completing their degree.
Student organisations have made their views on the graduate endowment clear. They have also made their views on student hardship clear—and that is something on which we have clear proposals while the Government has none. Students have told us about those who struggle financially and get into credit card debt. That debt creates real problems, as the interest rates are far more punitive than those for loan and endowment repayments combined, which might be about £9 a month once someone is earning £15,000.
If we asked students who are struggling financially now, whose studies are being affected now, and who might never become liable for the endowment in any event, whether they would prefer to be let off paying off the endowment, which they pay once they are in work and benefiting from their education, or to have an extra £1,000 bursary now, when they badly need it, the answer would be clear. Abolition of the endowment will do nothing to help students from poorer backgrounds, who should be the priority. It will not give one penny more to one more student while they are studying.
As the committee has established, the paucity of the funding settlement for universities is also relevant to the debate. That was highlighted by Rhona Brankin and Murdo Fraser. Students in Scotland want to study in well-resourced institutions that are competing internationally, but that has been put at risk by the SNP, which has introduced a funding cut for universities next year. That is a £20 million funding gap, we are told by Universities Scotland.
The unfortunate irony is that the funding settlement was announced by John Swinney, who argued in January 2004 that giving a
"funding advantage to universities south of the border"
would be followed by
"a draining of Scotland's academic resources and Scotland's universities put to the financial sword."
It is the Cabinet Secretary for Finance and Sustainable Growth's budget settlement that means that, for the first time, a 5 per cent funding gap will emerge between our universities and English institutions. That is a bitter irony indeed.
It is more than ironic that the Labour party is being accused of not doing the right thing for Scotland's students today—and not just because we are doing the right thing. The accusation is remarkable also because it comes from a party that said again and again during the election campaign that it would end not just the endowment but all loan repayments by graduates.
Abolishing the endowment gives students a fraction of what was promised to them. The SNP says that graduate debt is the problem, but it is scrapping only £2,000 of what it says is graduates' £11,000 average debt. For graduates, it is like expecting to get a PlayStation 3 as a Christmas present, only to unwrap it and find socks. A clear manifesto pledge has been dumped; a massive promise has been broken. The student community vilifies the SNP for abusing the trust of so many of its number, who cannot take at face value anything the SNP says ever again. I say that it should not take the SNP at face value on this issue. The abolition of the graduate endowment is not a measure to widen access to university; it is a fig leaf for the SNP's failure to adhere to its manifesto promise.
I can tell Christina McKelvie that I have been consistent: I supported the endowment as president of the National Union of Students Scotland and, eight years later, I am supporting it today. It took the SNP eight months to break its promise to students. In response to what Alex Neil said, I was going to raise some points about his manifesto, but I cannot find a copy—presumably he has been going around gathering up the remaining copies to destroy them, so that we cannot refer to it.
The bill represents another broken promise—a promise to students broken. Presiding Officer, you shall know this Government by the trail of broken promises. The bill is not about helping poorer students; it is about the political posturing of the SNP. The Parliament should have no truck with it. We should reject this flawed bill and agree with the recommendations in the committee's report, which would make a real and positive difference to higher education in Scotland.
After the wide-ranging debate that we have just had, it is important, in summing up, for me to get back to the basic intentions of the bill. Let us consider the facts: the fact that abolition of the graduate endowment fee would immediately benefit 50,000 students by allowing them to enter the workforce without an unnecessary, state-sponsored debt burden; the fact that the current policy continues to fail them and their hard-working families; and the fact that the graduate endowment fee is a waste of every taxpayer's money.
Will the minister take an intervention?
Not at the moment. I want to make some progress.
The proposal to abolish the endowment is our first step towards a truly free higher education system. We have set out a wide range of measures that will see us improve support for part-time students and extend bursaries as part of our commitment to remove student loans completely. The combination of all those policies will ensure that access to higher education is based on the ability to learn, not the ability to pay.
Will the minister take an intervention?
Will the minister take an intervention?
Not at the moment. I will answer the questions on our plans for our remaining manifesto commitments. Not only have we proposed to invest an additional £120 million in student support over three years but, as we said when our programme for government was published in September, we will consult on the other aspects of our manifesto commitments next year. We have been consistent on that from day one.
Will the minister take an intervention?
I will not take an intervention at the moment.
I am not surprised.
In 2001, I opposed the imposition of this unfair fee on our graduates. More than six years later, it is clear that the policy has failed. The evidence is clear and incontrovertible. It has not raised the income that it was claimed it would raise. It has not widened access and the levels of bursary support have been maintained without requiring the income from the endowment. All the endowment has done is place an unnecessary burden on our graduates and created an unnecessary barrier to those who might consider applying to university.
Abolition of the graduate endowment fee is therefore not only an entirely just and justifiable measure but it has wide public support. Even its architect, Andrew Cubie, who a number of members have mentioned, said that he does "not grieve" at its passing.
Will the member take an intervention?
I want to finish quoting Mr Cubie. He said:
"The Scottish Government, after all, has helpfully committed to substituting individual graduate contributions to the fund by public contribution—ie, from taxpayers. The target of our original support is, therefore, still addressed."
Given the evidence and the balance of informed opinion in favour of abolition, I find it astonishing that Labour and Conservative members had the temerity to vote against the principles of the bill in committee and have carried that opposition into the chamber today.
Is the minister brave enough to take an intervention yet?
Let me say what I think of the Labour Party's approach. There must be many former and current Labour Party supporters who are wondering why Labour members here have turned their back on the principle of free education from which many of them have benefited so much.
Richard Baker covers his embarrassment by claiming that the cash raised by the fee is needed to boost bursaries for the poorest students and to give a hand-out to the hard-up universities. I remind members that the fee raises a net £17 million, which pales into insignificance compared with the £530 million that this Government will be spending on student support in year 3 of the spending review period. It is a mere drop in the bucket of the billions that we are spending on the higher education sector every year.
I spoke to Andrew Cubie last night. He is very concerned about the selective quoting that ministers are going in for. He agrees with the principle of a graduate contribution and is extremely upset that £17 million has been taken out of the higher education budget.
Why, then, did he make the comments that I quoted in his article in The Scotsman?
I will return to my critique of the Labour Party's position. We can dismiss the arguments that Richard Baker put forward, especially when Labour's track record is so readily to hand. I think that the reason for its position relates to the prevalence within Labour of an attitude that anyone who can afford to go to university is fair game. I recall John Prescott justifying the introduction of tuition fees south of the border by asking why a bus driver should be asked to subsidise a lawyer's education. It clearly had not occurred to him that the lawyer in question could be the bus driver's son or daughter. Alternatively, perhaps the motivation behind Labour's position is even simpler and uglier: political spite born out of the party's loss of power and the position that Labour members had come to see as theirs as of right.
What are we to make of the curious case of Conservative recanting? As Fiona Hyslop pointed out in her opening speech, people who were vociferous opponents of the graduate endowment six years ago have turned into some of its most steadfast supporters. Try as I might, I cannot detect any principled reason for the U-turn and Conservatives' desire to remove the student-support fig leaf from a back-end tuition fee. I suspect that coming into line with David Cameron's acceptance of tuition fees down south has much to do with it. So much for wrapping themselves in the saltire—nature will out; they cannot resist those tattered old union flags, stained or not.
The bill is about reducing the debt burden for young people and the fear of debt, which puts off students from less-well-off backgrounds. Richard Simpson was incorrect: the graduate endowment is not means tested. Students are not exempted from paying it on the ground of income. That gives the fee a particularly menacing edge. I note that Jeremy Purvis described it as a poll tax on graduates.
If I may clarify, my point is that if, as the Labour Party and the Conservatives are proposing, part of the funds that are raised are no longer ring fenced for student support but, instead, go straight to universities, it would become a poll tax on graduates.
I thank Jeremy Purvis for clarifying his position. As I said, we are giving careful consideration to his amendment.
It is disappointing that, in light of all the evidence and the wide support from across the higher education sector, student bodies, unions and the public at large, some members of the Education, Lifelong Learning and Culture Committee still choose to defend the maintenance of the debt burden on students. Not only that, they want to turn it into a backdoor tuition fee, which is what we always knew the graduate endowment was. The majority of people who have provided evidence to the committee and responded to our consultation supported the intentions of the bill. It is disappointing that the committee failed to recognise that and decided, on a casting vote, to reject the benefits that this bill will clearly bring to Scottish graduates and their hard-working families.
The failure of the graduate endowment fee is clear, as is the need to abolish it. Therefore, I commend the bill to Parliament.