My Lords, this amendment stands in my name and that of the noble Baroness, Lady Garden.
Before explaining why this slightly technical-sounding amendment is the way it is, I should like to explain that I tabled it because quite technical issues are central to the purpose of the Bill and to the Government’s commitment to preserve and raise the quality of the higher education system, ensuring that students throughout the country and the system get a fair and quality deal from the institutions that they attend and to which many of them now pay a great deal of money.
One of the slightly curious aspects of the Bill is that the sanctions which it mentions, and which can be brought to bear by the Office for Students when an institution appears not to live up to its promises and commitments and to the requirements placed on it, seem to be either rather draconian or very restricted. The sanctions are either a draconian response of withdrawing degree-awarding powers or university title,
or a whole range of fines, which might be in response to a fraud, on which there is a whole schedule allowing powers of entry. However, what is striking about the sanctions is that they are very different from the way in which, for example, the regulators in the health or school sectors tend to approach their task, which is much more about maintaining or improving something as a going concern—that is, how they might work with it.
I have raised the issue of certain powers, which we understand from the Minister are seen as not as relevant under the proposed new regime as they were under the old one, both because closing down an institution in which students are studying should be seen as an absolutely last resort—I think we all share the Government’s determination that institutions should be of high quality and serve their students—and because a bit of history is in order.
In recent years we have seen a very large increase in the number of institutions in this country that provide higher education. Some have been universities, where numbers have increased, and many have been alternative providers, where numbers have increased enormously. Some of the alternative providers have degree-awarding powers and some award higher national diplomas or certificates, but many of them also have tier 4 sponsor status, which allows them to enrol students from outside the EU. Between May 2010 and September 2016, no fewer than 968 institutions had their tier 4 sponsor status withdrawn. That is a fairly terrifying number, because all those institutions had students in them, who were studying and had paid money—and, basically, they had their education and their plans pulled out from under them.
As part of this recent history, there was also a somewhat fraught hearing with the Public Accounts Committee, which I seem to remember was not happy with the way that the Government had been regulating these institutions, and an NAO report. Following that, BIS, as it then was, took additional powers, which included imposing student number controls on alternative providers. One of the other things that has happened in the last few years is that student number controls for universities have been lifted, so universities can recruit and enrol as many students as they wish. I am not implying that an alternative provider is a bad thing—actually, I am strongly in favour of greater diversity and of an open, diverse and innovative sector—but, in a spirit of risk-based regulation, we have to take account of that recent history.
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The Minister has said that in future he would not expect to use student number controls as they were used in the past. I have to admit that I am slightly unclear about the legal status of imposing any student number controls on anybody who has degree-awarding powers and university title. But is this wise? Is this very small repertoire of sanctions, which the Government seem to envision, really sensible? Is it in line with what we know about risks and is it fair to students? When something goes wrong, it is a personal tragedy and a catastrophe for the students who are involved. I found—quite randomly—a small story on the BBC website from March 2016, when the London School of Business
and Finance, which is owned by Global University Systems and operates in this country, lost its tier 4 status. What was striking about this story was how terrible this was for the students who were involved. One student said:
“I paid £8,500 up front, which is a lot of money”.
It is, indeed, a lot of money. It is a great deal of money, particularly for the groups of students who—and this is highly commendable as long as it is properly regulated—come from families which do not have a history of higher education, or from recent immigrant groups, or minority groups, or from overseas and who have often saved up vast sums of money to come to the UK. They are, in other words, many of our most vulnerable students.
We also have to be aware that things can go catastrophically wrong. One reason why I am very conscious of the risks that can follow from inadequate oversight, inadequate care and inadequate powers to intervene before things go wrong, is because of much of what has happened in the United States where, with a great deal of optimism and in many cases, realised optimism, it became increasingly easy for institutions to set up and, above all, expand. We then had, a little bit further down the road, the catastrophe for students who were enrolled at Corinthian, which went bankrupt overnight. This happened because when you are going bankrupt, you wait until the last minute and you hope it will not happen, but suddenly your students are told that you do not exist anymore and that the institution to which they have given their money is now in the hands of the receivers. As a result, students have an incomplete degree and a debt which they cannot pay off. I am not saying that is not something that happens to all institutions—and I am not saying that the public sector is good and the private sector is bad. I am saying that these are areas where we know the risks are high and we therefore know the importance of having risk-based regulation and a whole repertoire of ways of responding and picking up on situations which threaten catastrophe for the students concerned.
That is why I have tabled this amendment. I do not expect for a moment for it to become law, but I would like to draw to the Minister’s and to your Lordships’ attention, the importance of making sure that, if we are having this integrated sector with a single regulator and a single register, we do not, in the process, abandon a range of sanctions, tools and approaches which were developed very recently by this Government’s immediate predecessor for very good reason. What sanctions will remain in the hands of the Office for Students, if it feels as if things are going wrong, other than imposing a fine and other than going for a draconian closure? Is the Office for Students expected to take any sort of active role in not only spotting risk but doing something to mitigate it and ensure that students are not left in the situation of that young man whose story I have just quoted? I beg to move.