(Great Grimsby) (Con)
I beg to move,
That leave be given to bring in a Bill to require the Secretary
of State to publish proposals for a scheme in which graduates of
specified university courses may be exempt from requirements to
repay a student loan, in full or in part, provided that they are
employed in the United Kingdom in a relevant sector for a minimum
time period; and for connected purposes.
With your permission, Madam Deputy Speaker, before I start, I
would like to take the opportunity to echo Mr Speaker’s
condolences to family and friends on the passing of Lord . He was in this place for
40 years and was born in Great Grimsby, my constituency.
It is my belief that good-quality legislation aimed at
educational reform should not only encourage rising levels of
attainment in both education and skills, but be designed to
develop the workforce of the future. There have been numerous
skills gap and skills mismatch reports over the past few years,
and the path is clear for us to review how higher
education—particularly undergraduate and postgraduate funding
polices—can ensure that the Government provide excellent public
services in the UK that help to keep the country healthy, improve
productivity and grow the economy.
Before I became an MP, I worked in further and higher education
for 22 years, and I believe that I have an insight into what
motivates students to study to degree level and beyond. In my
opinion, in too many cases, the current funding regime encourages
people to study at degree level when it is not suited to the
student’s skills and abilities or future career path. That is
because we live with the effects of new Labour’s higher
educational reforms and, in particular, the way that the student
loan system works.
The policy of increasing the percentage of people who go to
university, regardless of what they study, has led to a huge
growth in poor-quality degrees that have little academic rigour;
the loss of excellent vocational higher education courses, such
as higher national diplomas, which were directly relevant to the
sectors they were aimed at; and a graduate skills mismatch in the
UK that is now so large that we import thousands of graduates
from abroad, which means that other countries lose their highly
skilled graduates to the UK. In addition, if a UK graduate
emigrates, we lose any taxpayer benefit from funding their course
or receiving their outstanding student fees. The Learning and
Work Institute has indicated that the UK skills shortage will
cost the country £120 billion by 2030, and that there will be a
shortfall of appropriately 2.5 million skilled workers in our
economy.
The annual cost to the Treasury of funding undergraduate and
postgraduate courses in England alone is estimated at £20
billion. Graduates are expected to start paying a proportion of
their tuition fees and maintenance grants, which are
means-tested, only once they earn an annual income over a
threshold that ranges between £21,000 and £27,660. We need a new
student loan system that will incentivise students to study the
degrees that we need, rather than a proliferation of degrees that
do not give the country or the individual any added value and
also delay that individual’s entry into a productive career.
Research findings from the Institute for Fiscal Studies and
MoneySuperMarket show that UK student debt amounts to more than
£100 billion, and is projected to hit £1.2 trillion by 2049.
Currently only 27% of all graduates pay back their student loans
in full, and 83% are projected never to do so. The IFS also
estimates that 20% of students would have been better off if they
had not gone to university, which proves that their degree does
not add value to their career. The Open University’s 2023
“Business Barometer” report showed that despite our having a
larger graduate workforce than ever before, 83% of large
organisations face a skills shortage in their workforce.
Moreover, 2023 data from the British Medical Association suggests
that 7% of doctors who train for employment in the NHS leave
after completing their foundation years. That means a loss of
£220,000 per student doctor, costing the taxpayer £146 million a
year. The Government offer bursaries for doctors and dentists in
the final years of their studies to help them with tuition fees
and living costs, but at that stage they are already earning a
wage. This is a back-to-front funding model that does not help us
to recruit doctors and dentists to the NHS and maintain them
there. There are also gaps in a wide range of other public sector
services. Our local authorities, for instance, lack social
workers, speech and language therapists and physiotherapists.
Let me suggest a solution. I should like the Secretary of State
for Education to investigate the possibility of introducing what
I am calling the British GradForce agreement. The model would be
similar to a system that has worked well for decades in the armed
forces: candidates can apply for scholarships and bursaries
funded by the relevant armed force, on the understanding that
they will then complete a minimum term in order to pay back to
the country, in years of service, the investment that the
taxpayer has made in them. Candidates who drop out or are removed
before the end of that period are generally expected to pay back
not only the bursary but their training costs. The system
benefits capable and committed students from more disadvantaged
backgrounds, rewarding them with no debt in return for their
public service.
The Government should use their published skills shortage
research to create a public sector graduate skills shortage list,
so that public sector employers could accredit courses that are
directly linked to skills shortages in particular roles. The
courses would need to meet the quality thresholds required by
organisations such as the Quality Assurance Agency for Higher
Education and professional bodies. Universities running those
courses could then apply for them to be accredited by the
Government, making them eligible for the British GradForce
agreement funding policy. Students applying for and then starting
to study on the relevant courses could opt to sign an agreement,
in which they commit themselves to completing their studies to
the required employment standards, and to working in the relevant
sector for the specified timescale appropriate to their course.
In return for that service commitment, the Government could
choose to write off their student loan fees, up to a maximum
amount, over the specified length of service in that
profession.
We need a policy that incentivises students to choose the degrees
that the country needs by differentiating the funding model for
those degrees from those for all other types of degree. The
changes I am proposing could have a positive and pivotal effect
on the higher education sector. They could encourage students to
choose the courses that the country needs, reduce the debt burden
of those students, be a better deal for the taxpayer, and help to
improve growth and productivity. I hope that the Secretary of
State can investigate the possibility of such a policy.
Question put and agreed to.
Ordered,
That , Sally Ann Hart, , and present the Bill.
accordingly presented the
Bill.
Bill read the First time; to be read a Second time on Friday 19
April, and to be printed (Bill 168).
