Briefing from the Prime Minister’s Official Spokesman on: Tuition Fees and CHOGM/Zimbabwe.
Tuition Fees
Questioned as to whether any Ministers had expressed concern about the way the policy on tuition fees was to be sold, the PMOS said that this issue clearly involved difficult choices for the Government and for families. Everybody recognised that universities needed extra money, not only because of a legacy of under-investment, but because they had to compete on the world market for lecturers, professors and research grants. The question was whether general taxpayers, many of whom had not attended university and had not had the benefit which university provided in terms of earnings power, should have to contribute more money, or whether this should come from graduates. In addition, the shift from paying upfront fees - a disincentive, according to some - to paying fees retrospectively when graduates could afford to do so was seen as a fairer scheme, as well as the assistance which would be given to people from poorer backgrounds. Clearly, in the Government’s view, the merits of the scheme we were proposing outweighed those of other proposals.
Asked why the Prime Minister continued to insist that there was no alternative to his plans when it was clear that a graduate tax could be introduced instead - an idea which the Prime Minister, it appeared, was not prepared to discuss, the PMOS said it was not a question of the Prime Minister refusing to discuss other proposals. It was simply because he believed that the scheme being proposed by the Government was fairer and had built-in protection inasmuch as people would not have to start their repayments until they had begun earning a certain amount. A graduate tax was more difficult because people had found it difficult to produce one which built in fairness in the same way that this scheme did.
Questioned about the potential difficulties of getting the Bill through Parliament, the PMOS said we acknowledged that this was a concept which people needed a bit of time to think through. However, no one should be in any doubt that difficult choices had to be made. For example, should people have the right to go to university if they had the ability? Was it in the interests, not only of the individuals concerned, but of the country as a whole in a competitive global market - particularly in a week in which we had seen relatively low-tech jobs go to India and China and particularly when we knew that other countries were pouring money into their higher education systems while our universities were suffering from decades of under-investment? These were legitimate questions which had to be answered and it was precisely why the Prime Minister believed that we had to - and would - win the argument.
Questioned about the issue of variable fees, the PMOS said it was important to recognise that many of the universities themselves were saying that variable fees would allow them not only to reflect on the different cost of individual courses, but would also help them to sell some courses which were currently under-utilised. It was the universities themselves who were asking for flexibility.
Asked to explain why society as a whole shouldn’t contribute more to higher education through a progressive and fair graduate tax if, as the Prime Minister had said, society as a whole would benefit from more people going to university, the PMOS repeated that those who had examined the idea of a graduate tax and had tried to come up with a scheme which met the same criteria as the one being proposed by the Government had found it hard to do so because of the difficulty in trying to build in the fairness aspect. In answer to further questions, the PMOS said that it was important to be clear about what the Government was proposing. The scheme would shift the balance from upfront fees to retrospective fees. In other words, it would shift the balance from people having to find the money now in order to attend university to finding it after their degree and once they were earning a certain amount, thereby protecting those who earned less than £15,000. It would also allow the money to be paid off over a defined period of time rather than for life. In addition, it would allow for bursaries and grants to be given to students from poorer backgrounds. The scheme therefore, addressed the issues of fairness, repayment and increasing the number of people from poorer backgrounds going to university.
Questioned as to why people from poorer backgrounds should be given help repaying fees after becoming graduates, the PMOS said it was important to recognise that there was an historical imbalance in our higher education system in which more people from well-off backgrounds than those from poorer backgrounds went to university. In the Government’s view, it was right to do everything possible to correct that imbalance and eradicate any disincentives. Put to him that the Prime Minister himself had said that the lower number of people from poorer backgrounds going to university was the result of the quality of secondary school education that they were receiving, the PMOS said that this problem obviously had to be tackled in many different ways. The important point was that people from poorer backgrounds had less expectation of higher education, which was why we believed it was necessary to do all we could to encourage them to go on to university. This was particularly important given the fact that, according to a report from the Council for Industry and Higher Education, 80% of jobs created between now and the end of the decade would require higher education skills. In that report, the Chief Executive of the Logica Group had said, "Our whole industry needs more graduates, not less. If it cannot find them in the UK, it will recruit them overseas and the UK will lose out as a result". The report also contained a quote from the Chairman of Unilever who said, "If business do not have access to graduates, our economy will suffer as night follows day".
Asked if he would agree that direct taxation would be a better way of redressing the current imbalance because that would mean there would be no disincentives at all, the PMOS said that it all came back to the question of whether it was right that those who did not go to university should pay for those who did. The figures for the amount of support already given to students in terms of Government subsidies compared with that given to those lower down the age range in education, showed that it was substantially more. The question, therefore, was whether to use the money which came from general taxation to increase the subsidy or whether it was fairer for those who had benefited from higher education to pay some - not necessarily all- back. Put to him that people paid social security and yet did not receive any benefit from it, so why should higher education be any different, the PMOS pointed out that university education was different in that it gave people the opportunity for considerable higher earnings in later life. The key question, therefore, was whether we could increase the number of people with access to higher education and give them the necessary skills at the same time as increasing, not just maintaining, the quality of that education, given the fact that this country would have to go in that direction anyway if it was going to continue to compete effectively in the world market.
Put to him that the Government appeared to be implying that if you earned above £15,000 a year you were rich, and that it was not prepared to accept any contribution from business despite the fact that business would benefit from having ‘oven-ready CVs’, the PMOS said that he would disagree with both generalisations. As with any scheme, there had to be a cut-off point. The ability to pay was linked to how much would be earned in later life. In addition, business already contributed a lot to higher education in terms of research grants and bursary schemes, for example. Obviously they were very keen to continue increasing the number of graduates. This was why the Lambert report, which had been published by the Chancellor today, was important because it talked about increasing collaboration between universities and business. It went without saying that if business believed that we were not serious about funding higher education properly, they would go elsewhere in the global market to recruit.
CHOGM/Zimbabwe
Asked if the Prime Minister believed that Zimbabwe should remain suspended from the Commonwealth Council, the PMOS took the opportunity to point out that CHOGM was about much more than one country. It was a unique slice comprising one third of the world’s population. It brought together the leaders of hugely diverse countries and gave them a chance to talk together about the issues which mattered to them, such as completing the Doha trade round, stepping up the response to world terrorism and tackling HIV/Aids and polio. Zimbabwe was obviously an issue which would be discussed. There was a general consensus that the country had failed to meet the benchmarks which the Commonwealth itself had laid down in terms of respect for Opposition parties, respect for human rights and respect for the media. It was up to CHOGM to decide what the next steps should be.
Asked if the British Government would support a move to expel Zimbabwe, the PMOS said the Government hoped that Zimbabwe would comply with the benchmarks and that it would return to the Commonwealth on the Commonwealth’s own terms, primarily for the good of ordinary Zimbabweans who were facing a crisis which was not a result of any outside interference. It was purely a government-made crisis, the solution to which lay in the Zimbabwean Government observing the benchmarks laid down by the Commonwealth. Asked if the Commonwealth Secretary General, Don Mackinnon, had the Prime Minister’s support if he stood for a second term, the PMOS said yes.
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