To consider and report on matters relating to the Scottish economy, business and industry, energy, training, further and higher education, lifelong learning and such other matters as fall within the responsibility of the Minister for Enterprise and Lifelong Learning; and matters relating to tourism, culture and sport and such other matters as fall within the responsibility of the Minister for Tourism, Culture and Sport.
Enterprise and Culture Committee
12th Report, 2004 (Session 2)
Stage 1 Report on the Further and Higher Education (Scotland) Bill
The Committee reports to the Parliament as follows—
EXECUTIVE SUMMARY
1. We are pleased that the Scottish Executive has taken our recommendations on board and has now brought forward the necessary legislation.
2. We consider that the pre-legislative consultation undertaken by the Scottish Executive has been adequate. Moreover, we commend the Scottish Executive for its willingness to respond to the concerns raised and to alter the draft Bill accordingly, although we consider that the draft Bill for consultation might have been drafted more sensitively. We consider this to be a good example of the principle behind pre-legislative consultation and we welcome the Minister’s flexibility in this matter.
3. We recommend that the Minister should consider amending the Bill at Stage 2 to provide information on the criteria that would be used by Ministers when deciding on whether and by how much to vary fees on a particular course or programme.
4. We also recommend that the Executive introduce amendments at Stage 2 such that all orders under section 8(6) should be subject to affirmative resolution.
5. We recommend that the Minister provides clarification as to whether any Scots-domiciled students would pay higher fees were the powers in the draft Bill to be enacted and utilised.
6. We recommend that the Minister, during the debate on our report and perhaps again at Stage 2, is explicit as to his intent now or in the future with regards to the possibility of varying fees on any course or programme other than medicine.
7. We recommend that the Scottish Executive brings forward such amendments as are necessary to ensure parity of treatment in relation to academic freedom between higher education and further education institutions and the individuals employed therein.
8. We recommend that Ministers consider whether the Bill requires further amendments to make divisions of competences between Ministers, the Funding Councils and others more clear.
9. We recommend that the Scottish Executive provides us with additional information on the implications that a change in terminology from “person with learning difficulties” to “person with additional support needs” would have.
10. We recommend that the Scottish Executive resolves the situation and introduces an order that would enable local authority councillors to be considered as the Chair of the governing boards of further education colleges.
11. We consider that the Policy Memorandum is adequate.
12. We recommend that Parliament should be content with the Financial Memorandum as provided by the Scottish Executive.
13. We agree with the Subordinate Legislation Committee that as Section 5(7) creates a power to modify primary legislation, it should be subject to affirmative procedure.
14. We agree with the Subordinate Legislation Committee that as Section 7(1) creates a power to modify primary legislation, it should be subject to affirmative procedure.
15. Taking into account the issues that require further consideration and where the Bill needs amendment, the Committee recommends that the general principles of the Bill should be agreed to.
INTRODUCTION AND BACKGROUND
Introduction
16 The Further and Higher Education (Scotland) Bill (SP Bill 26) was introduced on 30 September 2004 by the Deputy First Minister and Minister for Enterprise and Lifelong Learning, Rt. Hon Jim Wallace QC MSP. The Parliamentary Bureau agreed that the Enterprise and Lifelong Learning Committee should be the lead Committee.
17. Under Rule 9.6 of the Standing Orders, the lead committee has the responsibility to report to the Parliament on the general principles of the Bill. This report summarises the views of the Enterprise and Culture Committee on the general principles of the Bill and completes our work at Stage 1 of the Bill.
18. The Finance Committee took evidence on matters relating to the Financial Memorandum accompanying the Bill. Information relating to the Finance Committee’s scrutiny is attached at Annex A to this report.
19. The provisions of the Bill that confer powers to make subordinate legislation were referred to the Subordinate Legislation Committee under Rule 9.6.2. The Subordinate Legislation Committee’s report is attached at Annex B to this report.
Purpose of the Bill
20. The main purpose of the Further and Higher Education (Scotland) Bill is the merger of the two funding councils - Scottish Higher Education Funding Council (SHEFC) and the Scottish Further Education Funding Council (SFEFC) - to create the Scottish Further and Higher Education Funding Council (SFHEFC). The Bill intends to create a single body that will have a duty to provide ‘coherent strategic decision making’ at a National level covering both sectors.
21. The idea of merging these funding councils was one of the central conclusions in our predecessor committee’s report into lifelong learning[1]. As such we welcome the fact that our idea has now emerged as the purpose of this Bill. We believe this shows how parliamentary committees and their inquiries can be influential in shaping the Scottish Executive’s legislative agenda. We are pleased that the Scottish Executive has taken our recommendations on board and has now brought forward the necessary legislation.
22. The main provisions in the Bill can be summarised as follows[2]:
-
It sets out the general duties of both Scottish Ministers and of the new Funding Council, with Ministers having high level responsibilities for the policy context.
-
It explains the specific responsibilities of the new Funding Council in terms of allocation and administration of funding to the ‘funded bodies’.
-
The Bill establishes a number of criteria and conditions in place for bodies to comply with in order to achieve and maintain ‘funded body’ status, and that it will be the duty of the Council to monitor this.
-
It seeks to extend and standardise the level of autonomy across both the further and higher education sectors, and preserve the distinctive roles of both sectors.
-
As a regulatory measure, a new power is included for the Council to be able to attend and address any governing body meeting of a ‘funded body’ that relates to the issue of financial support.
-
The Bill also proposes to place a duty on the Council to work with and share information with certain key bodies, as well as placing a duty on these bodies to provide information as reasonably required by the Council.
-
Provisions have been included to allow changes in the way that funding is allocated to the Council.
-
A new provision on fees (section 8) is also included to allow for possible fee changes by Ministers i.e. a maximum fee level set, and different fee levels for different courses. It allows Ministers to use the conditions of grant to control tuition fees.
-
The Bill intends to create a power for Ministers to enable the Executive to channel additional funds to the new Funding Council for specific purposes (set out in the bill) and areas of importance, for example the support of collaboration.
-
The remit of the Scottish Public Services Ombudsman will also be extended to include the actions of the further and higher education bodies (currently including the Scottish Agricultural College, but excluding the Open University as it is under UK wide procedures).
23. We return to some of these provisions in subsequent sections of this report.
Adequacy of the Consultation
24. Part of the Committee’s role at Stage 1 is to consider whether the Executive has consulted appropriately at the pre-legislative stage.
25. Prior to formal consultation, the Scottish Executive we heard that the Executive had worked closely with a number of stakeholders in determining the main focus of the Bill. We note that, when draft Bill for consultation was published, there was a good deal of adverse comment from several key stakeholders, largely related to the terminology used in the draft Bill, for example ‘tertiary’ and ‘Scottish Tertiary Education Providers.’ Given the good practice demonstrated in this close working, we were somewhat surprised to find that the draft Bill for consultation attracted so much criticism.
26. The Scottish Executive began its formal consultation with interested parties in April 2004[3]. Written responses were required during July 2004. In addition, the Scottish Executive held five open meetings in Aberdeen, Dundee, Edinburgh, Glasgow and Inverness and held another round of one-to-one meetings with key stakeholders to discuss the Bill and the proposals in greater depth.
27. The Scottish Executive received seventy eight written responses during the consultation. According to the Scottish Executive, of these, “only one of which opposed the merger of the Funding Councils”[4].
28. The Executive reported also that, “There was minimal comment in relation to the fundamental proposals for the powers and duties of the new Council. However, comment was made in relation to the powers of Ministers and as a result of these and other written responses, and follow up discussions with stakeholders, a variety of changes have been made to the draft Bill”.[5]
29. We consider that the pre-legislative consultation undertaken by the Scottish Executive has been adequate. Moreover, we commend the Scottish Executive for its willingness to respond to the concerns raised and to alter the draft Bill accordingly, although we consider that the draft Bill for consultation might have been drafted more sensitively. We consider this to be a good example of the principle behind pre-legislative consultation and we welcome the Minister’s flexibility in this matter.
30. However, we express concerns that certain aspects of the consultations, such as those on alternative proposals to tackle cross-border flows of students, are still ongoing and are unlikely to be completed before Parliament completes Stage 1 of the Bill. This creates difficulties and uncertainties in terms of knowing how the Bill might best be shaped at Stage 2. We recognise, however, that this situation is a result of ongoing deliberations in England and Wales and, as such, is outwith the control of Scottish Ministers.
KEY ISSUES
Fees
31. Section 8 of the Bill introduces a new provision on fees to allow for possible fee changes by Scottish Ministers. This would enable the Scottish Executive both to set maximum fee levels and to set different fee levels for different courses. It allows Ministers to use the conditions of grant to control tuition fees. It would be fair to say that this provision is the single most contentious objective in an otherwise broadly-welcomed Bill.
32. According to the Scottish Executive in its Explanatory Notes accompanying the Bill:[6]
“This section [section 8] will allow Ministers, as part of the terms and conditions on the Council, to require the Council to secure that a set fee is paid by specified persons to fundable bodies if attending specified courses or programmes. Ministers will set the fee level by subordinate legislation, which is subject to the affirmative procedure.”
33. When giving evidence to the Committee, the Deputy First Minister and Minister for Enterprise and Lifelong Learning, Jim Wallace MSP, told us that[7]:
“I have been aware, since the publication of the bill, of concerns about the provision on fees. Some have interpreted that provision as the introduction of top-up fees. I repeat what I have said in other forums: categorically, this provision will not permit top-up fees.
34. As the committee knows, top-up fees will be introduced in England and Wales. That is a reality that we have to face. Our phase 3 higher education review tried to take into account what would happen as a result. The broad consensus among stakeholders and in the Parliament was that we needed to do something to respond to the real challenges that are thrown up by Westminster decisions, not least with regard to the cross-border flow of students. Committee members will recall that I set out to the Parliament in June the measures that we proposed to take. Those decisions have not been easy, but I remain convinced that doing nothing was not an option.”
In effect, if passed, the provisions in the Bill would give Ministers the power, if approved by Parliament, to (i) set a maximum fee level for all courses or programmes in Scotland and also, (ii) set a different level of fee for different courses. According to the Scottish Executive, the former is required to address excessive cross-border flows of students into Scottish HE and FE institutions in general. The latter is needed to resolve the particular problem of ensuring that a sufficient number of Scottish students emerge from Scotland’s medical schools and are recruited by NHS Scotland. It is believed by the Executive that Scots students are more likely than non-Scots to remain in Scotland after graduation and are therefore available to NHS Scotland.
35. This was a view shared by Universities Scotland who told us that[8]:
"Our Scottish medical schools train enough people to meet Scotland's needs, broadly speaking. However, a significant proportion of the intake comes from south of the border and there is a tendency for those people to return south of the border after they qualify. It is reasonable that the Scottish Executive should seek to ensure that Scotland gets good value for money for its investment in medical education. We would not want there to be a large increase in the proportion of medical places taken up by English medical students because the cost of studying medicine was much lower in Scotland than in England. Scotland should get value for money.”
36. We questioned the Minister on the extent of his current powers in this regard and the reasoning behind his proposals to extend these through the provisions in this Bill. When asked if currently - before the Bill is passed – he had the power to vary the fees that universities charge he told us that:[9]
“In general terms, yes, but not the power to have a different level of fee for different courses, which is why we want to take the powers to do so through primary legislation. You might recall that, when I made my statement to Parliament back in June about the impact on cross-border flows, I indicated that we would look to set a higher fee level, which of course would be met by the Executive for Scotland-domiciled students, who would not pay. We could do that with existing powers but, because of the possibility that we might want to set a different fee for medicine, for example—I do not want to nit-pick, but medicine is not specified in the bill; it is mentioned in the accompanying documents, although it is, basically, what we have been discussing and, again, I emphasise that the position will be no different for Scotland-domiciled students who are studying medicine, who will continue to have their fees met—we want to take powers under primary legislation to have a different fee level for a different subject”
37. Having recourse to this provision in the Bill is a relatively simple procedure. In evidence to the Committee, the minister told us that:
“Section 8(6) is the one that obliges all universities and institutions to charge the same fee. The instrument to determine the programme of learning or course would be subject to negative resolution, but the fee level would be subject to affirmative resolution. It is a two-part process, and one is not worth the paper it is written on without the other. The committee might wish to consider whether it thinks that all orders under section 8(6) should be subject to affirmative resolution”
38. Despite the broad welcome given by all organisations that we consulted during the course of our Stage 1 inquiry, views on the provisions contained with section 8 were decidedly mixed.
39. The most vocal opponents of the general principle of allowing the Scottish Executive to set a different level of fee for different courses were the bodies representing HE and FE students. In evidence to the Committee, the National Union of Students (Scotland) told us that:[10]
“Our policy on the issue is clear: we have a clear stance against any form of differential or top-up fees, whether the fees vary by institution or by course. There is a great deal of evidence to suggest that if variable fees exist, students—primarily those from low-income backgrounds—are more likely to select their courses based on price than on what they have the ability and talent to study. If there was a system in which medicine was more expensive to study than any other course, we would expect that to act as a financial disincentive for significant groups of students.”
40. This view was supported, albeit with less prominence in their submissions, by bodies such as the Association of University Teachers who told us that:[11]
“We share the concerns of the Executive that English students coming to Scotland for purely financial reasons may result in loss of places for Scottish students. However, we are concerned that proposals in section 8 of the Bill could be interpreted as giving power to introduce variable fees. We remain implacably opposed to variable fees in Scotland”
41. However, other bodies such as the Association of Scottish Colleges and Universities Scotland were less concerned over the provisions in section 8. In their joint submission, they stated:
“With regard to the issue of variable fees (section 8) our view is that the provisions in the Bill simply permit Ministers to specify a different fixed fee for certain subjects (such as medicine). We are content with this power so long as it is only used where there is a clearly established case for doing so and that the financial implications for Scottish domiciled HE students are neutral. We are fully supportive of the Scottish Executive’s policy of funding institutions properly without resorting to charging Scottish domiciled students a tuition fee.”
42. On the particular issue of fees for medicine, the British Medical Association (Scotland) told us that:[12]
“” The BMA is very uncomfortable with any plans to increase tuition fees in Scotland, particularly the prospect of a separate higher fee for medicine as it shifts the burden of educational costs further onto students.’
Our concerns
43. The BMA sought confirmation from the Scottish Executive that the ‘class of person ‘ referred to in the legislation would be non-Scottish domiciled UK students. The BMA also sought further details on the level of fees. The BMS submission stated that:
“in conclusion, we would urge the committee to consider the consequences of higher fee levels for medical courses and recommend that more detail be provided on this aspect of the Bill should it progress to Stage 2.”[13]
44. We have five concerns in relation to the provisions of the Bill in section 8. These are addressed below.
45. Our first concern is that of ministerial intent. In the accompanying documents to the Bill, the Scottish ministers are explicit in their view regarding the circumstances when they would choose to have regard to the provision to vary fees. The Executive’s Policy Memorandum states:[14]
“On 24 June 2004, the Deputy First Minister made a statement to Parliament, outlining the Executive’s policy to increase fee levels in order to control demand for places in the Scottish HE system from English/Welsh/Northern Irish students once variable fees are introduced in England and Wales. This plan also raises the possibility that in specific areas such as medicine, where demand is especially high, fees could be raised to a higher level again.
[…]
It is important to be clear that this power if used, is only intended to be used sparingly. Its purpose is to allow Ministers the flexibility to act in situations where Scottish students may be disadvantaged in specific subject areas by an increasing flow of students from elsewhere in the UK. At the moment, the only area this might apply to is medicine. Ministers believe it is essential that any further differentiation is carefully focussed and has the approval of Parliament.”
46. However, the provisions in the Bill itself do not refer explicitly to the study of medicine nor do they exclude the possibility of Ministers setting an additional fee on other courses. In evidence to the Committee, the National Union of Students (Scotland) outlined its fears in this respect[15]:
“We are concerned that a differential fee for non-Scottish medical students would be, in some respects, the thin end of the wedge. For example, we know that more non-Scottish students in Scotland study veterinary medicine than study medicine. If a fee were introduced first for doctors, what would prevent it from being extended to other courses? We fear that that would be the start of a system that could be extended to non-Scottish students on other courses. As the minister has powers over SAAS and student funding, funding could be withdrawn.
In a relatively short time, we could have a system of differential fees throughout Scotland. That would not be the same as the system in England, but it would nevertheless be a system of differential fees.”
47. In his evidence to the Committee, the Minister did not suggest that he was minded to vary fees on any course other than medicine. Whilst we welcome the Executive’s candour that it has no plans in this respect, it is important to note that this can be no guarantee in the future, when other administrations may be in place.
48. The points made by Chris Ballance MSP and Fiona Hyslop MSP were, however, confirmed by officials from the Scottish Executive in their evidence[16]. Thus, regardless of whether the Executive's intention is not to introduce variable fees or to open up the Bill for other uses, it is what Parliament decides and what Parliament passes that makes the difference. Statements made by the Executive in accompanying documents are only an insight into ministerial intent.
49. Our second concern with regards to section 8 is the lack of clarity on the criteria that may be used by the Executive when considering whether to have recourse to the provisions in this section on variable fees. The Bill itself is silent on the method by which the Executive would assess whether to vary fees for a particular course or programme.
50. Our third concern is that of parliamentary process. In evidence to the Committee, the Minister has told us that the decision to alter fees for a particular course or programme was a two-step process:[17]
“Section 8(6) is the one that obliges all universities and institutions to charge the same fee. The instrument to determine the programme of learning or course would be subject to negative resolution, but the fee level would be subject to affirmative resolution. It is a two-part process, and one is not worth the paper it is written on without the other. The committee might wish to consider whether it thinks that all orders under section 8(6) should be subject to affirmative resolution”
51. Our fourth concern is whether fees are the most appropriate mechanism to address wider concerns about the recruitment and retention of medical undergraduates in Scotland. NUS Scotland provided us with five alternative proposals which would address these concerns. These are:
-
Financial incentives could be offered to all students, whether from Scotland or the rest of the UK, to study medicine in Scotland, provided that they practice in Scotland for a defined period of time at the conclusion of their training.
-
Institutions should be encouraged to relax the overly stringent academic entry requirements for medical courses, and consider alternative entry criteria, in order to maximise applications from Scottish students. Alternatively, an “access to medicine” foundation course could be provided for those students who obtained excellent Highers, but not entirely at S5.
52. Our fifth concern is clarity on whether no Scots-domiciled students will ever pay higher tuition fees. Initially it was our understanding that this would be the case, and this was supported by the Minister when he told us:
“ Any change in fee levels will have no financial impact on Scotland-domiciled students, but students who are not eligible for fee support from the Scottish Executive will pay more.”[18]
53. Subsequently however we received evidence from the BMA Scotland and from the University of Strathclyde Students’ Association which seems to contradict this view. BMA Scotland state that:
“Currently, Scottish domiciled students studying medicine in Scotland as a second degree are not entitled for the graduate endowment scheme, but instead are required to pay fees at a comparable rate to those from England studying in Scotland. We would seek reassurance that this group will not be affected by measures aimed at controlling demand from students elsewhere in the UK.”[19]
54. Similarly, the University of Strathclyde Students’ Association (USSA) told us that:
“Any rise in tuition fees for certain courses will not only affect non-Scottish students, it will also, in its present format, affect Scottish domiciled students who are not in receipt of SAAS funding for all, or some, of their undergraduate higher education course.”[20]
55. USSA listed those students likely to be affected by this as follows:
-
those who have had to repeat years of study;
-
those who have progressed from an HND into a degree course at Level 1/2 (this may particularly affect those progressing from an HN course into medicine at some ancient universities);
-
those who have changed course during their course of study;
-
those who for various reasons do not meet the residency requirements; and
-
those who are studying their second or subsequent degree - perhaps as a result of having dropped out of an initial course.[21]
56. Whilst we welcome the Minister’s views on his ability to vary fees and his plans to perhaps do so in the case of medicine, we cannot disregard the legal principle that it is the Bill as passed by Parliament that is critical here and not statements of ministerial intent. The Bill as drafted does not restrict variable fees only to medicine.
57. Consequently, it is our view that the Minister should consider amending the Bill at Stage 2 to provide information on the criteria that would be used by Ministers when deciding on whether and by how much to vary fees on a particular course or programme.
58. We would also wish to take up the Minister’s suggestion that the Executive introduce amendments at Stage 2 such that all orders under section 8(6) should be subject to affirmative resolution.
59. We think it would be helpful if the Minister could publish, prior to Stage 2, an analysis of the alternative options presented by NUS Scotland in comparison with the route chosen in the Bill as introduced.
60. We seek clarification from the Minister as to whether any Scots-domiciled students would pay higher fees were the powers in the draft Bill to be enacted and utilised.
61. Finally, we would encourage the Minister during the debate on our report and perhaps again at Stage 2 to be explicit as to his intent now or in the future with regards to the possibility of varying fees on any course or programme other than medicine.
Protecting academic freedom
62. Section 8 of the Bill also makes reference to the principle of “academic freedom”. In particular, the explanatory memorandum states that, “Subsection (12) follows the similar terms of section 42(3) of the 1992 Act in regard to Scottish Higher Education Funding Council, and extends this element of academic freedom from higher education institutions to all fundable bodies”. This was a point confirmed by the Minister in his evidence to the Committee. He went on to state that:[22]
“The reason why there are differences between the position of the pre-1992 universities and that of the others is that the academic freedom that allows staff the freedom to challenge perceived wisdom and express controversial or unpopular opinions without fear for their jobs came in under the Education Reform Act 1988 and therefore, by definition, pre-dated the 1992 legislation. The issue was not picked up in the drafting because the bill is very much focused on the institutions' funding arrangements rather than on their internal organisation. I know that the AUT raised the issue in its evidence. I have asked whether the long title of the bill will allow us to address the issue and I am hopeful that it will”
63.In their evidence to the Committee, the Association of University Teachers makes a very valid point:[23]
“While we welcome the assurance given by 8 (12) that funding decisions by Scottish Ministers will not be tied to conditions affecting particular programmes of learning or courses of education and research, it should be noted that this protects institutional academic autonomy. It does not protect academic freedom properly understood.”
64. This is a view shared by the Educational Institute of Scotland, which states in its written evidence that:[24]
“We welcome the proposal to extend academic freedom to FECs [further education colleges]. However, we would need assurance that the academic freedom enjoyed by higher education academic staff is also extended to further education lecturers.”
65. We consider these to be valid points. We welcome the extension of institutional academic freedom from pre-1992 universities to both post-1992 universities and to the further education sector. However, we also wish to see parity of treatment in relation to individual academic freedom.
66. We encourage the Scottish Executive to bring forward such amendments as are necessary to ensure parity of treatment in relation to academic freedom between HE and FE institutions and the individuals employed therein.
Amending the list of fundable bodies
67. Section 7 of the Bill sets out outlines the criteria that the Council must have regard to the desirability of ensuring are met, before the Council recommends or approves that a new body is added to, or removed from, the list of fundable bodies in schedule 2. The issue for the Committee was extent to which the decision to amend Schedule 2 was a matter for the Council or for the Scottish Executive.
68. In our deliberations on this matter, we have considered whether it is appropriate that the new Council should take decisions on amending Schedule 2 or whether it would be more appropriate for the Council to make recommendations to the Minister and for the Minister to do it.
69. In evidence to the Committee, Chris Masters of the Scottish Higher Education Funding Council told us that in his view[25]:
“I hope that the minister would take advice from the council, as it would be the expert body. Making modifications to the list is certainly a matter for ministers”
70. In his statement to the Committee, the Minister told us that:[26]
“Section 7 indicates that the decision to add or remove fundable bodies would ultimately be one for ministers, because that would have to be done by way of an order. However, it is important—I recollect that this issue came up during the consultation—that any such decision should be based on an objective analysis.
[…]
The criteria are set out in section 7. If the funding council believes that an institution meets all the criteria, or fails to meet them, it can make the appropriate recommendation to the minister to add or remove the body, and ministers can then make the decision. When ministers take the initiative and feel that a body should be added or removed, the safeguard is that the funding council would make the appropriate checks before action was taken. Although the council would be required to approve such a proposal, that would not be the final approval. It would be more in the nature of an endorsement, because ministers would have to lay an order.”
71. We welcome this clarification and believe that this is the appropriate course to follow.
72. Related to this is the issue of the decisions on the actual funding of a fundable body. It is clear from the Bill and from evidence that the final decision to alter the list of fundable bodies rests with Ministers after advice from the funding Council. However, as confirmed by the Executive:[27]
“The designation of a body as a fundable body does not carry with it an obligation on the funding council to fund it.”
73. This is an important distinction. We welcome the clarification provided by the Executive that a decision to include an institution in the list of fundable bodies does not guarantee that it is funded and that any decision to do so is a matter for Ministers.
Scottish Credit and Qualifications Framework
74. A related issue to that of fundable bodies is that of the Scottish credit and qualification framework (SCQF). Our concern in respect to the SCQF was that the drafting of the Bill in relation to the division of responsibility between Ministers and the new Council might require clarification and definition and may be better expressed in different terms.
75. In evidence to the Committee, the Association of Scottish Colleges and Universities Scotland told us that[28]:
“This sounds like a technical point, but what we were driving at in our point on the qualifications framework is that the funding body is just that—a funding body. It is not an educational body or an awarding body. The decision on what is an appropriate qualifications framework really ought to be taken by the universities, as the degree-awarding bodies, and by the awarding bodies that we use—in particular, the Scottish Qualifications Authority—under the directional co-ordination of ministers. There is a simple oddity in the wording of the bill and we feel that it can easily be tidied up.
[…]
It is important that advice on the qualifications framework should largely come from the sector, which works at the sharp end of the issue. We would expect the funding council to be in the middle of those conversations, from where it can transmit views to ministers and receive, one hopes, approvals for proposals. The sector should participate in shaping what comes out of the qualifications frameworks so that people can understand where they are. We seek clarification, rather than any fundamental change”
76. The Bill as introduced states that, "The Council is to promote such credit and qualification framework as it may adopt" (section 14(1)). In evidence to the Committee, the Minister said that:[29]
“The funding council has the necessary expertise, working in collaboration with the colleges and universities, to determine which framework should be adopted but, clearly, if ministers were to disagree with that, there would still be the option of a ministerial direction, which would be subject to a parliamentary debate. I think that I am right in saying that ministers can give a direction on that.
Promoting the SCQF is not an exclusive responsibility of the funding council. We as ministers, and the sector itself, would wish to do that as well. Bringing the SCQF within the ambit of legislation has been widely recognised and acknowledged. We have struck the right balance, but if the committee feels that tweaking is needed I will have regard to what it says, provided that the general thrust is observed”
77. We welcome the Bill’s reference to “a framework” rather than “the framework” as it may be that in due course changes need to be made. In making these changes it is right that the Council should determine the nature of the credit and qualification framework that should be adopted but that the final decision rests with Scottish Ministers. Finally, we believe that decisions on such matters should not be funding driven.
78. Ministers may wish to introduce amendments at Stage 2 which clarify the division of labour between the funding Council and themselves in relation to the credit and qualifications framework.
Encouraging the Funding Council to collaborate with others
79. Section 22 of the Bill, and specifically section 22(1)(b) seems to place a statutory duty on the funding Council to “seek to secure the collaboration” of a range of persons, including Scottish Enterprise, Highlands and Islands Enterprise, Scottish Qualifications Agency, Local Enterprise Companies etc.
80. Esther Roberton of the Scottish Further Education Funding Council outlined her concerns with regards to this duty when she gave evidence to us. She told us that:[30]
“… when my council considered the bill, we were very uneasy about the notion that a duty to secure collaboration should be placed on us, because although we will do all that we can from our side of the table, it is very difficult to force the issue if there are players who do not want to play; we are not saying that there are such players. The duty should require us to act collaboratively or, if it is a duty to secure collaboration, it should be placed on all the players.”
81. Whilst we welcome the provisions in the Bill to encourage collaboration between the funding Council and others, we consider that the Council—and other organisations—should have a statutory duty to collaborate, but that the duty to secure collaboration should be ministerial. In essence, a statutory duty to collaborate is different from a statutory duty to secure collaboration.
82. We would encourage the Executive to consider whether the provisions in the Bill regarding collaboration could be better expressed and bring forward amendments where necessary.
Equal opportunities
83. In evidence provided to the Committee, Skill Scotland, the Disability Rights Commission and others raised a series of issues in relation to disabled people and the provisions in the Bill. The first issue relates to the ability of disabled students to access discretionary funding from local authorities to attend course or programmes outwith Scotland. In Skill Scotland’s opinion:[31]
“At the moment, if a disabled person chooses to go to a college south of the border—which may be because there is a specialist college there—the funding comes via local authorities. Local authorities have only the discretion to fund; they do not have a duty to do so. Our concern is that that funding is on quite a different footing from the rest of student funding, which, as you know, is all nationalised, through the Student Awards Agency for Scotland or through the funding councils. Students can choose to go to university south of the border. Although disabled people make up a small group, that small group has real difficulties getting funding. We have had quite a lot of inquiries to our information service about it. I do not know whether the committee can do anything to affect the bill, but it is an opportunity that might be missed to get that sorted out.”
84. We consider it an important principle that students with disabilities should receive parity of treatment irrespective of which local authority area in Scotland they live in. We would want to see some consistency of approach adopted to enable a disabled person to go to a college south of the border, perhaps because there is a specialist college or course there. We recognise that this would have implications for local authority funding and would encourage the Scottish Executive and CoSLA to work out a mutually agreeable solution, which may require additional resources to be provided by central government. We recognise that the funding Council may not be the most appropriate body to administer any new scheme of this type.
85. The second issue is one of definition. In evidence to the Committee, Skills Scotland notes that section 12 of the Bill states that the funding Council must have regard to “persons with learning difficulties”. In their opinion, this terminology is no longer appropriate, nor does it place a sufficient duty on the funding Councils to ensure that all students can fully participate in learning. Skill Scotland urged us to amend the Bill so that the Council should have regard to persons with “additional support needs”.
86. We agree in principle that the use of “additional support needs” is a more appropriate term and is consistent with other legislation. We encourage the Scottish Executive to provide additional information to us on the implications that such a change in terminology would have.
87. We are still unclear as to the implications that a change in terminology from “persons with learning difficulties” to “additional support needs” would have. We would seek to work with the Minister and others during Stage 2 to see what, if any improvements can be made to the Bill in this regard. We would seek the Minister’s assurance that he would work collaboratively on this point.
Governance
88. In relation to governance within the HE and FE sector, we have two issues. First, although we do not see that there is a need to amend the Bill in any way, we would like to encourage the new funding Council to pay particular attention to the promotion of best practice in terms of employment issues and procedures. In recent months, there have been occasions when such practices and procedures have been substantially below that which should be expected in an institution of this type. We would not want to see such practices and procedures becoming commonplace or being persistent.
89. Second, we encourage the Scottish Executive to review the situation that prevents local authority councillors from chairing the governing boards of FE colleges. This is a consequence of the Further and Higher Education (Scotland) Act 1992. This states at Schedule 2, paragraph 12(1) (d) to the Act that "the board shall appoint one of their members, not being a person who is a member (whether elected or appointed) or an employee of a local authority……to be chairman". As matters currently stand, local authority employees and councillors are caught by this restriction even if they are employed by, or elected to serve, a different Council area to that in which the college is located. This is an issue on which the Scottish Executive has consulted but not yet finalised its views.
90. In evidence to the Committee, the Minister indicated that this situation was under review but that it there was a desire to, “change it, the change could be made by way of an order and would not require to be incorporated into the bill”[32].
91. We encourage the Scottish Executive to resolve the situation and introduce just such an order that would enable local authority councillors to be considered as the Chair of the governing boards of further education colleges.
Composition of the Funding Council
92. In evidence to the Committee, Chris Masters of the Scottish Higher Education Funding Council suggested that in relation to the composition of the Council:[33]
“… it is important that the funding council should continue to include people from both the public sector and the private sector who have the appropriate range of skills and experience. It is also important that, where possible and appropriate, we should look to attract people from outwith Scotland to participate on the council.”
93. We consider it important that the Council’s composition is varied and not limited to representatives of Scottish organisations. To achieve this aim, we do not consider it necessary to amend the Bill. We would like, however, to encourage those taking decisions on the composition of new funding Council to take the benefits of attracting members from outwith Scotland into account.
94. We do not consider it appropriate that the new funding Council is made up of representatives of various sectoral interests on those grounds alone. We would like to see a Council comprising of people with the necessary skills, which would include those with experience of the issues faced by students and staff.
Other issues
95. In relation to the calls for a specific “skills committee” to complement the provisions for a research committee, we do not consider that the Bill should be amended to allow for a statutory “skills committee”. We would encourage the Council when properly constituted and operational to consider the need for a “skills committee” as an early priority.
96. The Bill as introduced gives students, however funded, and other aggrieved persons the right to refer complaints about colleges or universities to the ombudsman when institutional mechanisms fail them. This is a provision that has been universally welcomed. We add our approval to the views expressed by others and make no further suggestions with regards to the ombudsman.
97. Finally, in relation to section 20(1) of the Bill, which covers the Council’s exercise of its functions, we welcome the non-hierarchical listing of the three criteria, namely that within its work that Council would have regard to (a) skills needs in Scotland, (b) issues affecting the economy of Scotland and (c) the social and cultural issues in Scotland.
POLICY MEMORANDUM
98. Under Rule 9.6.3 the Committee is required at Stage 1 to consider and report on the Policy Memorandum. The Scottish Executive has prepared a Policy Memorandum, which accompanied the Bill when introduced.
99. We consider that the Policy Memorandum is adequate.
FINANCIAL MEMORANDUM
100. In the Financial Memorandum accompanying the Bill, the Scottish Executive states that the Bill does not:[34]
“… give rise to any new costs or savings, since it simply reorganises the structures through which money is paid to fundable bodies. That is, the Bill does not in itself alter the number of fundable bodies or do anything else which will alter the amount of money paid to the tertiary education sector.”
101. It does note, however, that:[35]
“There are, however, likely to be one-off set-up costs associated with creating the new body. These are not expected to be significant, and can be met from existing Departmental resources.”
102. In the longer term, the Executive considers that:[36]
There are likely to be savings resulting from the merger of the actual Councils in terms of board membership. Currently there are fourteen members on each Council, including the Chair. These positions attract a salary and expenses. However, these minor savings may be offset by the establishment of additional Committees within the new body, reflecting the broadened range of activity.
103. Finally, in relation to the additional work that can be expected of the Ombudsman’s office, the Executive states that:[37]
“We have, in consultation with the Ombudsman, sought information from educational establishments to estimate the impact on the Ombudsman’s workload. The returns suggest that the Ombudsman could expect around 30 complaints a year from both sectors, though we need to factor in the possibility that extending the remit of the Ombudsman may cause more complaints to be put to the Ombudsman. Initially the Ombudsman will have to devote effort to awareness raising and education about the role of the Ombudsman – that was the Ombudsman’s experience with the Enterprise networks which were brought within the Ombudsman’s jurisdiction. The Ombudsman’s office has calculated the likely cost implications for 2005/06 to be in the order of £50,000-£60,000. This can be met from within existing Departmental budgets.”
104. As part of its work, the Finance Committee considered the Financial Memorandum at its meeting of the 26 October 2004. The Finance Committee agreed, as per its new procedures, that the Financial Memorandum should be scrutinised at “level 1” of its working procedures.
105. Level 1 scrutiny requires the Finance Committee to circulate a questionnaire to all stakeholders and interested parties, seeking views on the Financial Memorandum.
106. Four responses were received, from the two existing funding councils, the Scottish Public Sector Ombudsman and Universities Scotland. These are attached as Annex A. No substantive concerns were raised by those consulted.
107. We recommend, therefore, that Parliament should be content with the Financial Memorandum as provided by the Scottish Executive.
SUBORDINATE LEGISLATION
108. The provisions of the Bill that confer powers to make subordinate legislation were referred to the Subordinate Legislation Committee under Rule 9.6.2. The Subordinate Legislation Committee examined these provisions in detail at its meetings on 7 and 14 December 2004 and discussed a number of issues with the Scottish Executive. That Committee’s report is reproduced in full at Annex B.
Proposed amendments
109. We welcome the Executive’s undertaking in correspondence to bring forward an amendment to provide that the powers under section 8(6) will be subject to affirmative procedure.
110. We also welcome the Executive’s undertaking to consult and to bring forward an amendment to this effect at stage 2. We share the Subordinate Legislation Committee’s view that the wording of any amendment to require consultation should include a provision that Ministers should take full cognisance of the response received to any such consultation.
111. Section 22(4)(j) provides a power for Ministers to add to, but not to amend, a list of persons and bodies with which the new Council must consult and collaborate. We welcome the Executive’s undertaking to bring forward an amendment at stage 2 to provide for Ministers to amend and add to the list of persons and bodies with which the new Council must consult and collaborate.
Outstanding issues
112. A number of substantive issues arise from the Subordinate Legislation Committee’s report, as follows.
Section 5(7) Fundable further and higher education
113. Section 5(7) defines provision that is fundable as further and higher education. The Subordinate Legislation Committee was of the view that this was an appropriate issue for subordinate legislation. However, the Committee noted that the power to “modify” subsections (1) to (6) creates wide powers for future subordinate legislation, which it considered should be subject to affirmative rather than negative procedure, particularly given that it is additionally a Henry VIII power.
114. We agree with the Subordinate Legislation Committee that as Section 5(7) creates a power to modify primary legislation, it should be subject to affirmativeprocedure.
Section 7(1) Fundable bodies: further provision
115. This Section sets out the procedure by which Ministers can amend the list of fundable bodies. Again, the Subordinate Legislation Committee considered that, as this power modifies primary legislation, it should be subject to affirmative procedure.
116. We agree with the Subordinate Legislation Committee that as Section 7(1) creates a power to modify primary legislation, it should be subject to affirmative procedure.
CONCLUSIONS AND RECOMMENDATIONS
Introduction
117. The Further and Higher Education (Scotland) Bill (SP Bill 26) was introduced on 30 September 2004 by the Deputy First Minister and Minister for Enterprise and Lifelong Learning, Rt. Hon Jim Wallace QC MSP. We were appointed by the Parliamentary Bureau as the lead committee.
118. Under Rule 9.6 of the Standing Orders, the lead committee has the responsibility to report to the Parliament on the general principles of the Bill. This report summarises the views of the Enterprise and Culture Committee on the general principles of the Bill and completes our work at Stage 1 of the Bill.
Purpose of the Bill
119. The main purpose of the Further and Higher Education (Scotland) Bill is the merger of the two current funding councils - Scottish Higher Education Funding Council (SHEFC) and the Scottish Further Education Funding Council (SFEFC) - to create the Scottish Further and Higher Education Funding Council (SFHEFC). The Bill intends to create a single body that will have a duty to provide coherent strategic decision making at a National level covering both sectors.
120. The idea of merging these funding councils was one of the central conclusions in our predecessor committee’s report into lifelong learning. As such we welcome the fact that our idea has now emerged as the purpose of this Bill. We believe this shows how parliamentary committees and their inquiries can be influential in shaping the Scottish Executive’s legislative agenda. We are pleased that the Scottish Executive has taken our recommendations on board and has now brought forward the necessary legislation.
121. We are also pleased that the Scottish Executive responded so positively to the views it received during its pre-legislative consultation. Substantial amendments were made to the draft Bill before it was introduced. We believe this demonstrates the worth of the legislative procedures in the Scottish Parliament and Ministers should be commended for being responsive to the opinions they received.
Our issues
Fees
122. The introduction of variable fees is the single most controversial aspect of the Bill. The provisions in the Bill, if passed, would enable Ministers to both set a maximum fee for all courses and programmes in Scotland and set an additional fee for specific courses. It is suggested that these provisions are necessary to tackle cross-border flows of students attending Scottish higher and further Education institutions, and to tackle the lack of Scotland-domiciled students entering and graduating from medical schools in particular.
123. Whilst we welcome the Minister’s views on his ability to vary fees and his plans to perhaps do so in the case of medicine, we cannot disregard the legal principle that it is the Bill as passed by Parliament that is critical here and not any statements of ministerial intent. The Bill as drafted does not restrict the use of variable fees only to medicine.
124. Consequently, we recommend that the Minister should consider amending the Bill at Stage 2 to provide information on the criteria that would be used by Ministers when deciding on whether and by how much to vary fees on a particular course or programme.
125. We also recommend that the Executive introduce amendments at Stage 2 such that all orders under section 8(6) should be subject to affirmative resolution.
126. We recommend that the Minister provides clarification as to whether any Scots-domiciled students would pay higher fees were the powers in the draft Bill to be enacted and utilised.
127. Finally, we recommend that the Minister, during the debate on our report and perhaps again at Stage 2, is explicit as to his intent now or in the future with regards to the possibility of varying fees on any course or programme other than medicine.
Academic Freedom
128. We welcome the extension of institutional academic freedom from pre-1992 universities to both post-1992 universities and to the further education sector. However, we also wish to see parity of treatment in relation to individual academic freedom.
129. We recommend that the Scottish Executive brings forward such amendments as are necessary to ensure parity of treatment in relation to academic freedom between higher education and further education institutions and the individuals employed therein.
Role of the Funding Council and the role of Scottish Ministers
130. Certain parts of the Bill require greater clarity in terms of the relative role of the new Funding Council and that of Scottish Ministers. These include the process of amending the list of fundable bodies and decisions on which would receive funds, the development of a Scottish Credit and Qualifications Framework and the means of securing collaboration between the funding Council and other statutory bodies, such as the enterprise agencies.
131. We welcome the clarification that although the Funding Council has a substantial role in the process, it is Ministers that will take final decisions on both the list of fundable bodies and any amendments, and decisions on whether to fund a fundable body. This is the appropriate course to follow.
132. We also welcome the clarification that that the Funding Council should determine the nature of the credit and qualification framework that should be adopted but that the final decision rests with Scottish Ministers.
133. Finally, whilst we welcome the provisions in the Bill to encourage collaboration between the Funding Council and others, we consider that the Council—and other organisations—should have a statutory duty to collaborate, but that the duty to secure collaboration should be ministerial.
134. We recommend that Ministers consider whether the Bill requires further amendments to make divisions of competences between Ministers, the Funding Councils and others more clear.
Equal opportunities
135. We consider it an important principle that students with disabilities should receive parity of treatment irrespective of which local authority area in Scotland they live in. We would want to see some consistency of approach adopted to enable a disabled person to go to a college south of the border, perhaps because there is a specialist college or course there. We recognise that this would have implications for local authority funding and we would encourage the Scottish Executive and CoSLA to work out a mutually agreeable solution (which may require additional resources to be provided by central government). We recognise that the funding Council may not be the most appropriate body to administer any new scheme of this type.
136. We agree in principle that the use of “additional support needs” is a more appropriate term for this Bill than “person with learning difficulties”. It is also consistent with other legislation on the statute book. We recommend that the Scottish Executive provides us with additional information on the implications that a change in terminology from “person with learning difficulties” to “person with additional support needs” would have.
Governance
137. In relation to governance within the higher and further education sectors, we have two issues. First, although we do not see that there is a need to amend the Bill in any way, we would like to encourage the new Funding Council to pay particular attention to the promotion of best practice in terms of employment issues and procedures. In recent months, there have been occasions when such practices and procedures have been substantially below that which should be expected in an institution of this type. We would not want to see such practices and procedures becoming commonplace or being persistent.
138. Second, we encourage the Scottish Executive to review the situation that prevents local authority councillors from chairing the governing boards of further education colleges. We recommend that the Scottish Executive resolves the situation and introduces an order that would enable local authority councillors to be considered as the Chair of the governing boards of further education colleges.
Composition of the Funding Council
139. We consider it important that the Funding Council’s membership is varied and not limited to representatives of Scottish organisations. To achieve this aim, we do not consider it necessary to amend the Bill. We would like, however, to encourage those taking decisions on the composition of new Funding Council to take the benefits of attracting members from outwith Scotland into account, as well as ensuring that it comprises of people with the necessary skills, which would include those with experience of the issues faced by students and staff.
General Principles
140. The Committee shares the desire of the Minister to create a single Funding Council that will have a duty to provide coherent strategic decision making at a National level covering both the higher and further education sectors. In the preceding sections, the Committee has drawn attention to some of the main areas in which the Bill could be improved. Additionally, a number of issues have been identified on which the Committee requests further information from the Minister. The Committee urges the Minister to respond to it in writing on all these requests for further information or recommendations for further consideration. The Committee urges him to do so as soon as possible, and in good time before the start of Stage 2 proceedings.
141. Taking into account the issues that require further consideration and where the Bill needs amendment, the Committee recommends that the general principles of the Bill should be agreed to.
Footnotes
[1] “Final Report on Lifelong Learning”, 9th Report 2002, Enterprise and Lifelong Learning Committee, The Scottish Parliament, SP Paper 679.
[2] “Further and Higher Education (Scotland) Bill” (04/73), SPICe briefing (Fiona Mullen), The Scottish Parliament, 28 October 2004
[3] “A changing landscape for tertiary education and research in Scotland”, Consultation Paper, Scottish Executive, April 2004.
[4] Responses to “A Changing Landscape for Tertiary Education and Research in Scotland”, Scottish Executive, http://www.scotland.gov.uk/library5/lifelong/rclte-00.asp
[5] Ibid.
[6] “The Further and Higher Education (Scotland) Bill - Explanatory Notes”, page 5, paragraph 17, The Scottish Parliament, SP Bill 26–EN
[7]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1261ff.
[8]Official Report, Enterprise and Culture Committee, Tuesday 2 November 2004, Column 1257
[9]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1267.
[10]Official Report, Enterprise and Culture Committee, Tuesday 9 November 2004, Column 1207
[11] Written submission provided to the Committee
[12]British Medical Association Scotland, written submission provided to the Committee
[13] Ibid
[14] “Further and Higher Education (Scotland) Bill, Policy Memorandum”, paragraph 35 ff, SP Bill 26–PM
[15]Official Report, Enterprise and Culture Committee, Tuesday 9 November 2004, Column 1216
[16]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1270
[17]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1274
[18] Official Report, 16 November 2004, col 1262
[19] BMA Scotland, written submission
[20] University of Strathclyde Students’ Association, written submission
[21] Ibid
[22]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1275
[23] Written submission to the Committee
[24] Written submission to the Committee
[25]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1248
[26]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1263 ff
[27]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1265
[28]Official Report, Enterprise and Culture Committee, Tuesday 2 November 2004, Column 1159ff
[29]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1264
[30]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1259
[31] Written evidence submitted to the Committee
[32]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1279
[33]Official Report, Enterprise and Culture Committee, Tuesday 16 November 2004, Column 1246ff
[34] “Further and Higher Education (Scotland) Bill, Explanatory Notes”, paragraph 55, SP-Bill 26
[35] Ibid. paragraph 62.
[36] Ibid. paragraph 61.
[37] Ibid. paragraph 63.
back to top