“After section A5 of the Higher Education and Research Act 2017 (inserted by section 2) insert—

‘A5A Resourcing of students’ unions

The provider must take steps to ensure that students’ unions have sufficient resources to carry out their duties under sections A4 and A5 of this Act.’”—

Brought up, and read the First time.

I beg to move, That the clause be read a Second time.

This important provision is all about having sufficient resources. As we have debated at some length, student unions will bear a considerable burden of cost and resource to make the duties work on campuses. It is an administrative burden that hitherto they have managed to cope with, but this greatly exceeds what they would have done in the past.

We have to remind ourselves that we are talking about the full plethora of institutions from larger universities to smaller higher education institutions and further education colleges. The Department for Education’s impact assessment quotes a cost to student unions of £800,000 a year to implement and update the code of practice. The impact assessment also makes it clear that student unions will face the heaviest burden because of their unfamiliarity with the new administrative requirements; most universities already have in place good codes of practice on freedom of speech.

The Bill disproportionately affects a variety of SUs, such as those at FE colleges. The Association of Colleges points out in its briefing that 165 FE colleges are registered higher education providers on the Office for Students’ list. The recent submission by Durham University, which I am sure is of particular interest to two Committee members, makes it clear that clause 6 could represent a significant additional administrative burden on organisations. Jim Dickinson of Wonkhe highlighted in his submission that

“the funding and resultant capacity and capability of an SU to undertake these duties is usually wholly dependent on a negotiation between the SU and the provider. Without a duty on the provider to resource the SU appropriately to carry out the duty there is a material risk that they will be unable to. Vexatious complaints surrounding, for example, SU elections may not succeed but would cause an SU committee to need to seek costly legal advice which it may not be funded to obtain.”

Given that the Government have voted down all our attempts to amend the Bill in a satisfactory manner, the new clause is a form of backstop to ensure that the legislation will not challenge the viability of SUs up and down the country through the need to withstand these costs and the potential for vexatious litigants. The new clause is yet another constructive amendment that we want included in the Bill to recognise the immense financial burden and responsibility faced by student unions in the wide mix of institutions and colleges that the measures will affect. We think it important that the Government recognise that student unions will face that burden, which could seriously affect their viability.

In local government, the health service, education and other areas, there is a doctrine known as the new burden doctrine. It is a sensible doctrine whereby if a new burden is put upon a body—particularly in local government and in educational bodies under local government—the Government shall make provision to pay for that new burden, or they will provide for that body to be able to raise revenue to cover the new burden.

Higher education institutions have income-raising capacity, although I am sure they would say that the cap should be lifted or the funding formula should be changed. They can make that an argument to the Chancellor at the spending review, and I know that many of them have. I desperately hope that the burden is not put on poorer students, as we are reading in the papers. Personally, I would move to a proper graduate tax, or even free education. A new graduate tax could be introduced for the young, and an old-age social care tax for those who are older, so we could have one joint intergenerational tax that allows a bit of intergenerational solidarity—but I digress.

Despite my desire for free education or a proper graduate tax that does not put people in debt, universities can go and make their case to the Chancellor. They have powers to raise revenue, either by seeking research funding or through student fees. They can get more students in, in fact—they could squeeze two or three more students into lecture halls. Student unions have none of those abilities. They do not, on the whole, raise revenue. Some, which are now the exception, still run some commercial businesses, but that is a rarity in higher education—even in campus universities. Most campus university student unions do not even run their own bars now.

Government Members who think that student unions can raise the money need to look again at student union finances, the vast majority of which come from the good will of the institution. The problem is that if the institution deprives the student union of money, the financial penalty for that student union and its duty do not transfer back to the institution; the liability is not reduced. I suspect that the liability will be covered by the student union’s paying basic insurance, but if it is deprived of money it will have no ability to pay for that, while still having the liability.

The new clause does not specify an amount; all it says is that the institution, in appointing the student union—because it appoints the body that is the student union; its job is to say, “This is our registered student union”—has to make sure that the student union has sufficient resources. If the student union has bars and commercial services, the institution can say, “We’ve ensured that you have the right resources because we can see that you have an income. No problem.” If the student union has none of those resources, all the new clause requires is that the institution takes steps to ensure that it has. Perhaps it will give a bar over to the student union to run, so that it generates the resources, or perhaps it will give over an amount of money. The new clause requires that to happen. The guidelines will explain how that happens, of course, but without this provision I am deeply worried that we will be imposing a new burden.

I have been reading the impact assessment and I can quite understand where the hon. Gentleman is coming from. It suggests that the annual enforcement costs would be around £400,000 a year and that the total ongoing costs directly applying to student unions would be £1.2 million a year nationwide. However, there are over 100 academic institutions and many student unions across the country; if we divide that cost by 100 academic institutions, we are not talking about a huge amount of money per institution. Does the hon. Gentleman not think that student unions should be able to deal with the small extra costs?

I go back to my point. This is not a huge burden on institutions, but we should require institutions to ensure that there are those resources, given that some student unions have almost zero resources—only a few hundred pounds in the bank account. For many student unions there will be no problem, but provision will be needed for others. The new clause just says to the institution, “Check that your student union can do this.” It might just be a matter of a few hundred pounds for the insurance premium. It is fair for the institution to be required to do that. I hope the Minister will take that on board, either in the guidelines or in Lords amendments.

I try not to get cross, Mrs Cummins, but I am going to get a little bit cross now, and then calm down again.

As I have said many times, this whole Bill has been written with Oxford, Cambridge and all the Russell Group universities in mind. The intervention on my hon. Friend the Member for Brighton, Kemptown by the hon. Member for North West Durham reinforces that view. I keep going back to the 165 FE colleges that are affected by the Bill. How is a small FE college with no full-time student union representatives or independent income going to pay the insurance costs? The assumption is that all will need insurance to cover themselves against any liability. How will they be able to afford that and keep going if all the Bill applies to them?

The Minister says that the provision has to apply to FE colleges because they are higher education institutions, but it does not directly apply to junior common rooms. I will not repeat the long debate that we had about that, but if there is one rule for JCRs, why not look again at further education colleges? All the new clause does is say that there must be adequate resources. I said on Monday that the outcome of the Bill could be the creation of shell-like structures of student unions outside all the ones that can afford it—those of the Russell Group and Oxford and Cambridge. Beyond that, student unions would not exist in any meaningful way, which would be a travesty.

The Minister now has responsibility for further education and higher education, and the Government have spoken about parity and the importance of both. I believe in the importance of both, and in colleges and higher education institutions such as Hull College having just as good a student union as the University of Hull. However, the student union of the University of Hull has more resources than that of Hull College. All the amendment is saying is they should be given enough resources so that both student unions can abide by the rules that the Government are putting on them, and both can afford to keep going. If the Minister rejects the amendment, which sadly I think she will, she needs to look again at the affordability of the Bill for some of those smaller institutions—in particular further education colleges.

Earlier, I was too eager to get to new clause 2. The new clause would require providers to take steps to ensure that student unions have sufficient resources to carry out their duties under proposed new sections A4 and A5 of the Higher Education and Research Act 2017.

There is universal agreement about the importance of freedom of speech in university life. We saw that in the evidence sessions. There is also broad consensus about the important role that student unions play in protecting freedom of speech on campuses. Many student unions do fantastic work in that area, including having their own codes of practice, which often involve collaborative relationships with the provider. We fully expect that to continue, and for providers and student unions to work together, hand in hand, in relation to freedom of speech. That may include, where appropriate, a provider taking steps to ensure its student union is adequately resourced to carry out its duties. It may also involve the sharing of good practice, or a provider assisting the student union with the development of its own code of practice.

The measures are about protecting fundamental principles, not creating more red tape. There is huge diversity among student unions in the ways they are established and funded, reflecting the huge variety in the higher education sector as a whole and in further education. It is important that we reflect that variety in the Bill and do not seek to regulate the relationship between providers and student unions with a one-size-fits-all policy. Some student unions are heavily reliant on funding from their university; others may be more financially independent. Many have developed innovative portfolios as a way to generate income to contribute to a fulfilling university experience for students. The amendment does not reflect that variety or the differing, often complex arrangements that exist between providers and their student unions.

It is also important to note that the duties in proposed new sections A4 and A5 apply only to student unions of approved fee cap providers. Student unions of small, specialist providers that are not approved fee cap providers are not in scope of the Bill. In that way, we are ensuring that the Bill’s measures are not overly bureaucratic and follow the approach in the Education Act 1994, which sets out regulatory requirements relating to student unions at a number of institutions, including approved fee cap providers, but not other providers. In contrast, new clause 2 would place an additional, unnecessary regulatory requirement on providers in relation to student unions. In addition, we expect that there will be guidance from the Office for Students in due course that will help student unions to understand how to comply with their duties and assist them in drafting their code of practice.

If the student union has nothing more than a petty cash box and no staff or sabbatical officers—there are some such student unions—how does the Minister suggest that they draft a professional code of conduct without the institution ensuring that they have the resources to do so? The new clause does not talk about cash; it could be secondment of staff.

I thank the hon. Member for that very good point. While not wanting to predetermine the work of the new director, I fully anticipate that they will look at drawing up templates of such codes of practice to assist.

I trust that I have been able to reassure the Committee that we are taking appropriate and proportionate actions to ensure that student unions can address freedom of speech in a way that is not overly bureaucratic and that reflects the variety in their composition, size and financial arrangements.

I hear the Minister, but the Opposition believe that it will lead to considerable red tape, even if there are templates to be adopted and so on. I just do not believe that many student unions would be able to cope. There will be associated stresses and certainly great costs, such as the insurance we picked up on the other day. The right hon. Lady talks about there being many student unions that have developed innovative revenue raising. Perhaps there are a number of such cases—I would be interested to know how many there have been among the hundreds we are talking about—but we will press the clause to a vote, because we think there is serious concern about the viability of student unions.

Question put, That the clause be read a Second time.

The Committee divided: Ayes 7, Noes 9.

Question accordingly negatived.