My Lords, I am grateful for the opportunity to speak to this important group of amendments. Our universities are a key part of national life and contribute significantly to the public good and economic prosperity. I fully understand that protecting the sector’s reputation is at the heart of many of the amendments. I assure the House that the Government’s reforms are designed to ensure exactly that and that, like now, only high-quality providers will be able to enter the market, award their own degrees and obtain university title. Once again, I assure
noble Lords that the Government are determined to protect institutional autonomy in the Bill every bit as much as the current legislative framework has protected it for the past quarter of a century or so, and I will say a little more about that later.
First, I will address the new clause in Amendment 2. The Government agree that our universities should be expected to have high standards and to do more than simply teach courses. They benefit the communities they are based in, and there is a strong correlation between opening universities and significantly increased economic growth. However, we believe that what matters is this contribution, not the form of the institution. Universities are private, autonomous bodies, not public bodies as such, although of course they contribute greatly to the public good. They therefore come in a variety of forms, as has been discussed, and we value this diversity immensely, as I mentioned in the first debate. We would not wish to exclude excellent institutions such as the University of Law from having full university status simply because it is for-profit. My noble and learned friend Lord Mackay asked why profit is so vilified; he makes a fair point.
Our reforms do not seek to overhaul the current framework for obtaining degree-awarding powers or university title in any major way. Currently any provider, regardless of its corporate form or background, can obtain degree-awarding powers if it passes rigorous scrutiny. Only providers with degree-awarding powers can apply for university title. Again, they need to meet specific criteria but these are not tied to corporate form. The proposed new clause would in effect introduce a two-tier system of universities or degree-awarding providers, when what we are trying to achieve is a more level playing field. It would be a step back in time, rather than further developing a well-functioning system.
To ensure that only high-quality providers can obtain degree-awarding powers, we are planning to keep a track record requirement of three years for all those that seek full degree-awarding powers. However, in parallel, we are also planning to introduce, as has been mentioned, a new route of obtaining degree-awarding powers on a probationary basis. This would mean that high-quality providers that have the potential to achieve full degree-awarding powers can be permitted to award degrees in their own name from the start—crucially, subject to close supervision. As the noble Baronesses, Lady Cohen and Lady Brinton, mentioned, under the current regime new and innovative providers have to wait until they have developed a track record lasting several years before operating as degree-awarding bodies in their own right, no matter how good their offer is or how much academic expertise they have. This stifles innovation, and the new clause would further entrench this system of new providers usually having to rely on incumbents.
However, I assure noble Lords that quality is still paramount. As we set out in one of the published factsheets to accompany the Bill on market entry and quality assurance, in order to be able to access time-limited probationary degree-awarding powers, providers will also need to pass a new and specific test for probationary degree-awarding powers. I realise from the tone of
their remarks that this may not necessarily please the noble Baronesses, Lady Cohen and Lady Brinton, but we believe that this is important as a quality check. We absolutely do not intend a complete overhaul of the system of degree-awarding powers. We fully intend that the current criteria will continue to exist in a broadly similar form.
Returning to institutional autonomy, noble Lords will know that, while this concept has been central to our higher education system for many years, the Further and Higher Education Act 1992, which establishes the current legislative framework, does not explicitly mention institutional autonomy. The Bill goes considerably further by placing in legislation explicit new protections for the freedom of English higher education providers. Those protections apply to all the ways in which the Secretary of State may influence the Office for Students: guidance, conditions of grant, and directions. In each case, the Bill places a statutory duty on the Secretary of State to,
“have regard to the need to protect academic freedom … of English higher education providers”.
We strengthened this further on Report in the other place.
I assure noble Lords that there is no disagreement, as I see it, over the importance that we place on institutional autonomy and academic freedom. We have sought to protect these fundamental principles in the Bill. I agree that they are the cornerstone, as many noble Lords have said this afternoon, of our higher education system’s success. We have heard considered and well-informed debate—more so on this group of amendments—and I am grateful for the views that have been put forward, but we believe that the Bill enshrines and protects academic freedom. Having said that, I recognise the strength of feeling that has been expressed about institutional autonomy. I continue to listen and reflect on views from noble Lords and will reflect further on this issue. I hope that gives some reassurance to the concerns raised on this issue. These provisions represent the most comprehensive suite of explicit statutory protections for institutional autonomy ever contained in a single Bill.
Amendment 55, spoken to by the noble Lord, Lord Kerslake, places a duty on the OfS to have regard to,
“the need to act in a manner compatible with the principle of institutional autonomy”,
when it discharges its statutory functions. I understand and sympathise with the motivation of the amendment, but in the light of the new and additional protections I have just described, the Government do not feel that a statutory duty on the OfS is appropriate. I reassure noble Lords that the existing provisions in the Bill already require that academic freedom and institutional autonomy are taken into account by both the OfS and the Secretary of State. As such, the amendments are unnecessary.
The noble Lord, Lord Kerslake, asked whether it is right that the Office for Students can intervene “if it appears” that registration conditions have been breached. Intervention based on “if it appears” is standard legislative drafting and is underpinned by the usual public law considerations so that the OfS cannot act irrationally.
As a public body, the OfS must at all times act reasonably and proportionately in accordance with public law when exercising its powers.
Similarly, I find myself in agreement with the main intention of the amendments relating to the Secretary of State’s powers to set conditions of grant and give directions to the OfS. But I assure noble Lords that the Bill as drafted does not leave any room for a future Secretary of State to be lackadaisical about this duty. The amendments, while well intentioned, do not add much by way of strength to the duty as it stands. As I have outlined, the Bill includes new and additional protections for institutional autonomy. I sympathise with the motivation for these amendments but I am not sure that adding a duty to have regard to institutional autonomy adds much in practice to the protections already in the Bill. I fear that the amendments may require future Secretaries of State to become rather more interventionist than they are now, guiding or directing the OfS to act in particular ways in particular cases to protect institutional autonomy.
Amendments 425 and 431 relate to the Secretary of State’s powers to set conditions of grant and give directions to the OfS. These amendments, while well intentioned, do not add much by way of strength to the duty as it stands and may risk inadvertently weakening other duties of the Secretary of State in the Bill which do not have this amended formulation.
I am entirely sympathetic to the intention behind Amendment 66, which seeks to build on existing protections within the Bill to ensure that when the Secretary of State gives guidance to the OfS, it is prevented from naming individual higher education providers. However, the restrictions on the Secretary of State already in the Bill will have the effect of preventing individual institutions being named in the Secretary of State’s guidance to OfS. Clause 2(6) requires that guidance,
“which relates to English higher education providers must apply to such providers generally or to a description of such providers”.
It is hard to conceive of a scenario where the Secretary of State could comply with these restrictions and yet name individual institutions. On that basis, I assure noble Lords that this amendment is not necessary to ensure the protections it seeks, and that we may rely on these being implicit in current drafting.
I am grateful for the thorough and thoughtful nature of Amendments 65, 71 and 165. The desire and determination of noble Lords to ensure that the Bill protects institutional autonomy is both evident and impressive—again, as we have discussed extensively today. However, I do not believe that these definitions of institutional autonomy and academic freedoms add anything substantive to the protections already enshrined within the Bill. Furthermore, as detailed in my letter to noble Lords following Second Reading, the Bill holds the Haldane principle at its core. The Government are fully committed to the fundamental tenet that funding decisions should be taken by experts in their relevant areas. The amendment risks compelling the Secretary of State to issue guidance to the OfS on issues beyond its remit, which I believe is unintended.
Amendment 165, tabled by the noble Lord, Lord Stevenson, seeks to include in the definition of institutional autonomy the right of providers,
“to constitute and govern themselves”,
as they consider appropriate. It is of course quite correct that providers have this right. However the powers of the OfS, or indeed any other body empowered by the Bill, to influence how providers constitute and govern themselves are already very limited. The public interest governance condition in Clause 14, for example, merely seeks to ensure that the governing documents of providers subject to this condition have best governance practice embedded within them. As now, the public interest principles are not intended to prescribe in any detail how providers are to be governed. We expect that they will continue to operate in tandem with sector-owned codes, such as that of the Committee of University Chairs.
Finally, Amendment 65, as put forward by the noble Lord, Lord Kerslake, would add specific protection for academic staff to speak and challenge freely. Again, there is no disagreement from the Government about the importance of this protection. However, institutions are autonomous and the Government cannot interfere in any decisions regarding academic staff, therefore only the institution itself can protect the freedom of its academics. The Bill already takes steps to ensure that this will continue to be the case by allowing the OfS to place a public interest governance condition on all registered providers, which will ensure that their internal governance must include the principle of freedom for academic staff. We therefore believe that the amendment is not needed.
The amendments that I have just spoken about—and there are quite a few—have understandable and laudable motivations, which the Government share. But on the whole they do not substantively add to the protections for institutional autonomy already contained in the Bill. In some cases, they may interfere with the OfS and UKRI’s distinct areas of responsibility, or create a risk of requiring more intervention from the Secretary of State rather than less. None the less, I will consider carefully the points that have been raised, as the Government agree that it is fundamentally important to ensure that the Bill protects institutional autonomy. The suggestions from noble Lords have been very helpful in understanding some of the concerns about this aspect of the Bill.
Amendment 73 would require providers to operate—