Amendment 1

Part of Lifelong Learning (Higher Education Fee Limits) Bill - Report – in the House of Lords am 6:01 pm ar 5 Medi 2023.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Baroness Garden of Frognal Baroness Garden of Frognal Deputy Chairman of Committees, Deputy Speaker (Lords) 6:01, 5 Medi 2023

Amendment 1 proposes the widely accepted requirement that the learning hours associated with credit must be consistent with sector-wide standards. It would be beneficial to have 10 hours written in the Bill in order to cement its definition, because that would mean that no new definition could be introduced or imposed at a later date for the purposes of setting fee limits.

We continue to express concern that the lack of detail in the Bill could mean that in the future the policy could significantly change from the intentions of the current Government, and there is little constraint against decisions made by the Secretary of State—often a “here today, gone tomorrow” Minister—but I recognise that on Report we are unlikely to be able to change the powers of the Secretary of State.

Amendment 2 proposes the insertion of a new clause to review the provisions in the Act. Businesses are reporting having difficulty recruiting employees with the relevant skills. In August 2022, the Federation of Small Businesses found that 80% of small firms faced difficulties recruiting applicants with suitable skills in the previous 12 months. The Recruitment and Employment Confederation estimates that if labour shortages are not addressed, the UK economy will be £39 billion worse off each year from 2024.

Despite the rising population, many employers are facing skills gaps. Some 28,300 London employers report that not all their employees have the right skills for the job. Almost a quarter—23%—of all vacancies in London are due to a lack of applicants with the right skills, while almost half of firms—42%—are not confident that they will be able to recruit people with the higher-level skills their organisation needs over the next five years. It is possible that many of the migrants waiting to be processed will have the skills that the country urgently needs, so when will the Home Office speed up the processing so that we can see if that is the case?

We are not convinced that the introduction of the lifelong loan entitlement will help to plug the gaps. The Liberal Democrats have called for grants, rather than loans, to encourage adult reskilling, concerned that many adults will be reluctant to take on debt for their further training. Will the LLE allow people to upskill effectively? Will they want to take out loans to upskill? It will be important for the Government to review the impact of the provisions of the Bill to assess whether these measures alleviate the skills shortages.

I am not my party’s expert on sharia finance, but I am aware of the Islamic belief that benefiting from lending money by charging interest or repaying more than the initial amount borrowed—riba—is forbidden. The investments made by loan companies, which might be in industries such as gambling or alcohol, are also considered problematic. For these reasons, Muslim students are deterred from taking out student loans from the Student Loans Company to cover the tuition fees and living costs associated with higher education. Research has shown this can act as a barrier to higher education for Muslims or cause financial hardship for those who do choose to study at university.

The UK Government first proposed a student finance product consistent with Muslim beliefs about interest-bearing loans in 2013. The Higher Education Research Act 2017 allows the Government to introduce such a product, but it has yet to do so. The issue has been raised in Parliament a number of times, with the delay described as shameful by my noble friend Lord Sharkey, who is indeed an expert on sharia finance.

In March 2023, in their response to the consultation on the lifelong loan entitlement, the Government said that a sharia-compliant alternative student finance product would not be available as part of the launch of the LLE in England in 2025. In July 2023, the Government said that they remain committed to delivering alternative student finance as soon as possible after 2025. Can the Minister say why the Government have yet to do this? It would be useful to understand their thinking behind the delays and whether they could explain how the introduction of the LLE would impact those who require sharia-compliant loans.

The other part of the amendment calls for a review before the end of 2026, and preferably earlier. I have also added my name to Amendment 4, which Labour will introduce. I look forward to the Minister’s response, and I beg to move.