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Higher Education and modern life

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mandelson
Lord Mandelson
Birkbeck University

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The result is the fact that our universities have been the source of a huge amount of the progressive and critical thinking on government, education, social welfare and economics that has shaped twentieth century society.

A further result is the fact that while much of the innovative science and research in British life up until the latter half of the nineteenth century took place outside of our universities, a huge amount – if not most of - the best science and innovation since has taken place within them.

Another result is the gradual shift from a country in which higher education was the preserve of a small minority, at the end of adolescence, to one in which only a third of higher students are aged 18-22 and where there are more people enrolled this year in the Open University alone than in the entire university system nearly forty years ago when I was a student. And a society in which, I am glad to say, more than half of higher education students are women, when they made up only a quarter half a century ago.

We’ve gone from having a small number of institutions, with an essentially Victorian idea of what a university education was, to a Higher Education landscape that is now more diverse in its approaches and mission statements than it has ever been. This institution, Birkbeck, with its commitment to research and teaching excellence and its innovative approach to evening study is an exceptional example of this transformation that has taken place in our university sector.

These changes are a response to economic as well as social change. The development of an industrial and then a services economy in which mass literacy and numeracy are important and where technical education and specialization are increasingly required for higher paid employment.

My argument today is that these basic trends and the issues they have raised are still at the heart of higher education policy. Over the last decade we as a country have invested hugely in our universities, more than ever before. We have actively pursued a policy of widening access. We have put knowledge and science at the centre of our vision of our economic future, and protected its funding at unprecedented levels.

We have instituted a fees system that has, in my view, been a radical and signal success in strengthening the resources available to universities without sacrificing accessibility to students.

But we are obviously facing an incredibly difficult decade of rebuilding growth and future strengths in Britain following the international banking crisis and ensuing recession. There are tough decisions ahead. Our graduates face the toughest job market for years. And ultimately those big twentieth-century higher education questions are still with us. For what end? For whom? Paid for how?

Now I’m not even going to try to answer these questions comprehensively today. But they are the backdrop to the Higher Education Framework that I have decided will now be published in the Autumn rather than now.

It will be a flagship policy statement for the new department of Business, Innovation and Skills. I recognise of course that bringing university policy into a department with ‘Business’ in its title has not thrilled everyone in the university world. But it really puts universities in my view at the heart of policy on our future growth and prosperity in our country and I want to argue today that that is exactly where they should be – right at the heart of our policy making and the future of our country, our economy and society.

I want to set out some of my initial thinking on three broad arguments. I will say something about what the economic role of our universities should be in the twenty first century – and how we should understand the very idea of an ‘economic role’ for higher education.

I want to draw some explicit lines between that economic role and the social role of universities, particularly as engines of social mobility and life long learning. Here, Alan Milburn’s report of last week has framed the parameters of the debate extremely well in my view. Finally, I’m going to argue that these conclusions about social mobility have to be part of any debate about university fees in England.

For what end: the economic role of a university

I want to start by talking about the economic role of our universities. By this I mean the uniquely important role that universities play in preparing people for the world of twenty-first century work. And the extent to which we translate the knowledge minted in our universities into economic growth, which is fundamental to our prosperity. I want the universities to focus more on commercialising the fruits of their endeavour.

Before I expand on this, I need to be clear that I do not believe that the function of a university is limited to – or even primarily about - economic outcomes. They are not factories for producing workers. Defining the skills that directly underwrite many skilled jobs in the UK is not the same as defining useful and necessary knowledge. The case for a higher education system that invests in everything from classics to quantum physics is a compelling one.

I say this not just because the utility in knowledge is often impossible to predict. It is because knowledge is an end in itself. Because historical awareness and critical thinking are part of the inventory of a rounded human being.

But also because character and economic competitiveness are actually rather hard to disentangle. If the modern economy is built on specialisms, it is also built on a raft of soft skills such as intellectual confidence, logical thinking, communication and working and collaborating in teams.

I believe that these things come above all not from particular disciplines, but from the discipline of good teaching. And for me, that raises an important challenge for universities. We have become very good at developing criteria for assessing research excellence in universities, and for incentivising research excellence. We also need to look in my view for ways of incentivising excellence in academic teaching – which is not quite the same thing.

But, as I say, the modern global economy puts a premium on specialization. It is an economy of supply chains and niches. The sectors in which British firms have potential comparative advantage in the next decade – low carbon, digital communications, life science, the creative industries: these are all absolutely reliant on high levels of knowledge, of skill and innovation. They will also draw heavily on our capacity for research and our ability to commercialise it. So our universities are inescapably central to our economic future.

I am struck that we are building on very strong foundations here. Graduate employment rates and wage premia suggest we are developing highly employable people. British universities and businesses are collaborating at record levels. Increasingly they are doing this in areas beyond the well-established research-intensive sectors such as pharmaceuticals. Just last week the Royal Society published a report highlighting the value of research collaboration in the services sector.

The quality of the UK’s universities and research base has played a critical role in attracting inward investment from knowledge-intensive businesses like Microsoft and Pfizer. These companies are not here out of fellow-feeling –they are here above all for a world-class university system and a science base that is second only to that of the US in productivity.

That same level of quality has also seen us become the second biggest destination for another kind of import: overseas students, for whom the UK is now the second largest destination after the United States.

We live in a world where 2 billion people are younger than 25 and where the appetite for Anglophone education is simply immense. So this is something we value hugely and we will continue to welcome genuine international students and ensure that the country’s immigration system, and the implementation of the student tier of the points-based approach, will fully support this recruitment in future – and I have my eagle eye well trained.

We will also throw our weight behind UK universities looking to export their brands globally as the Prime Minister and I are already doing in our own foreign investment visits.

As far as producing employable people is concerned, the key is surely the relationship between universities, employers and students. Some of our biggest companies will still say they can’t find sufficient well-qualified graduates in Britain – especially in core disciplines like engineering. We need employers to communicate clearly and constructively to universities the skills they need so that courses can adapt and evolve – something that businesses have not always done effectively. Perhaps they have been shy or felt that they would not receive a hearing? We need universities to communicate to students the career trajectories from different subject choices, and the likely market demand for their skills.

But we also need to have some sense of the wider strategic picture on skills and national capabilities. Not least because public resources are finite and it is hard to justify having no collective sense of where the marginal pound in British higher education should be properly focused. That is why we tied the funding for 10000 additional students this year to the skills that the economy will need for the future, particularly science, technology, engineering and mathematics degrees.

We also need to encourage and assist universities in exploiting the intellectual property they generate to drive wider economic growth. The Innovation Investment Fund that Paul Drayson developed and that we launched as part of Building Britain’s Future will provide a huge new pool of venture capital for university spinouts. I hope that over the coming 10 years the Innovation Investment Fund will grow to £1 billion and we have already as a Government set the seeds for that growth.

But we also need to look for ways to encourage further collaboration between researchers and industry. It strikes me that one of the biggest challenges here lies not with universities, but with businesses. Especially with small firms, who simply don’t realize the resources they have down the road in the local lab.

This is why we need to keep looking for innovative ways to bring businesses and researchers together, including incentives for collaboration in the new Research Excellence Framework.

I am also keen to do some further work on the unique role of postgraduate education, which is often the point where students develop specialist skills to complement a more general undergraduate education. It is also a major export earner for the UK, and one which we have perhaps taken too much for granted. For that reason, I have decided to launch a review of postgraduate provision in Britain, led by Professor Adrian Smith, the director general of Science and Research in my department. It will draw on expertise from universities and businesses and report back in early 2010.

So, to sum up, it seems to me that in defining the economic role of universities we come up with a set of linked challenges all of which are tied to the critical role of universities at the heart of a knowledge economy.

Equipping people as rounded intellectual beings but also giving them the skills they will need in a global economy.

Turning more of the knowledge that is generated in UK universities into jobs and growth, especially by bringing businesses and universities together to collaborate even more than they do now.

These are management challenges for individual universities; but they are a strategic challenge also for the UK as a whole. The diversity of mission statements and the autonomy of universities in defining precisely how they serve their students and customers is clearly vital. But there is also a need for a collective strategic vision for the sector and its role in our national economic life. That is the balance we will aim to strike in the Higher Education Framework when we publish in the Autumn.

For whom: social mobility and lifelong learning

This picture of the economic role of higher education has some immediate and obvious implications for how we see its social role. If a university education is an entry ticket to the best paid employment and a preparation for a globalised world of work, then access to it will inevitably define the degree of social mobility that we’re able to achieve in Britain.

We are doing better, but not well enough. I am impatient about this progress and intend to turn up the spotlight on university admissions.

Alan Milburn’s report was a milestone. As he set out, this is a much bigger issue than just higher education. It has implications for parental attitudes and the whole education system, especially the journey towards or away from university that begins in the early teens, or indeed even earlier than that.

In thirteen years as MP for Hartlepool I saw first hand the damage that can be done by low expectations and by barriers to social mobility. I have always believed that a fair Britain is one in which the daughter of a Hartlepool shopkeeper has the same shot at being a High Court Judge as the son of a Surrey stockbroker.

Now of course it is true that university education is not the only way to prepare successfully for modern economic life. Indeed I believe that one of the great challenges for this government is now further defining and promoting different pathways into non-graduate careers, building on our strengths in further education and developing adult skills. We now have quarter of a million apprentices in this country – five times more than we did a decade ago when this Government started out - which opens up the potential to develop over time a whole new offer to young British people for professional development.

Nevertheless, a university education remains the gateway to the professions and a ticket to higher lifetime earnings on average. So I think we have to ask: why, for all the work in the sector and all the seriousness with which it has tackled this question are we still making only limited progress in widening access to Higher Education to young people from poorer backgrounds – especially at our most selective universities?

We clearly need to look again at how, and how early we identify and engage potential candidates for university. I am attracted to the idea of stronger links between the professions, universities and schools - work experience, early mentoring, clearer lines of communication about what preparing for university and a career in the professions means at every stage of secondary education.

And I agree with Alan that as well as the usual criteria of standardized testing, there is a strong case for using other more contextual benchmarks for talent spotting that look at the way candidates have exploited the opportunities open to them in their lives. Some universities in the UK are using such approaches already. There is good evidence that they work. And any Vice Chancellor that takes a broad and innovative approach to identifying talent will have the firm backing of the government and of me.

I also think we need to ask whether the higher education system adequately supports mature students and part timers. I think we have taken huge steps in all these areas – not least in the pathbreaking model of the Open University and here at Birkbeck, which openly positions itself as “London’s evening university”.

But we need to be that serious about adult skills and life-long higher and further education, for a number of simple reasons. First: almost half of British university students are already mature students. Second, most of the future British workforce of the 2020s is already in their twenties or older, and it is their skills that will determine our economic capabilities at that critical point. Third, the demographics of an ageing population mean that even with an influx of foreign students, the student market is going to get progressively older, and demand will reflect that.

There is clearly a place for the conventional, campus-based, full time, away-from-home model of study leading to a final degree – to state the obvious. But we need to keep encouraging the alternatives that are springing up: two-year honours degrees, part time modular degrees, modular programmes that don’t have to lead to a full degree.

These are controversial issues and they evoke passionate views. But they need reasoned debate and I don’t shy away from that. My provisional conclusion, suggested by the ideas I have just floated, is that we need to do more in these directions.

Rightly, we have invested heavily in excellence in British universities. We have an obligation to ensure that the chance to benefit from that excellence is determined by natural talent rather than social background. We also need to ensure that higher education can be an integral part of a whole working life, not just its antechamber.

Paid for how: funding and access

Which brings me to my final point, which is about funding. Bluntly put: excellence is not cheap. When this Government came to office, we faced the challenge of maintaining a world class university sector, with higher participation rates. And I was in the Cabinet Office at the start of the Government’s term and I

remember sitting in meetings as we took on the funding gap in the order of many millions of pounds, which was accompanied by debate from all sides. We now face the same challenge with inevitable pressure on public resources. We cannot duck the issue: everything we want to achieve in higher education depends on a solid, sustainable system of funding for higher education.

Part of the solution must be widening the sources of funding universities can draw on. This might be a more professional and confident approach to seeking endowments and donations. It can be growing income from research collaboration with industry or even government. It can be marketing a university brand around the world. Universities are doing more of all of these and I welcome and encourage that. But they alone do not represent a sustainable funding model for the sector as a whole.

Inevitably we are going to come back to the balance of state and user funding. And this raises the issue of fees, and their role in paying for world class institutions. I have no intention of pre-empting the independent fees review that we will launch in the Autumn on this question. But I would make a simple point that follows from everything I have just said.

I do not believe that we can separate the issues of fees, access and student support. Any institution that wants to use greater costs to the student to fund excellence must face an equal expectation to ensure that its services remain accessible to more than just those with the ability to pay.

There is a lively debate in this country on how we should fund higher education and I welcome that debate and I am going to nurture it. It is time for that debate to reach some absolutely hard and fast conclusions. But whatever funding mix for higher education we develop, there must always be a link between what an institution charges and its performance in widening access and supporting those without the ability to pay.

Conclusion: higher education in modern life

I realize that this is an audience probably used to sitting through overlong lectures, but I have no intention of pushing my luck, so let me sum up. I’ve sketched out what I think are some of the biggest issues that I want to tackle in setting the direction of higher education in our new framework in the Autumn. I haven’t been exhaustive this morning and I’ve asked more questions than I have answered, but that was partly the point because you are going to have to help me and the Government find these answers. We won’t find them alone.

However, I think I’ve made it clear what sort of Universities Secretary I am and where I am coming from. I’ve argued that in a modern economy and society universities are a social trust. They have three great roles: passing on existing knowledge, generating new knowledge, and helping ensure that new knowledge underwrites our collective prosperity wherever possible. I believe that the way we enable and equip our universities to do these things will say more about how we understand the unique challenges of prospering in a globalised economy and culture at the start of the third millennium than almost anything else a government can do.

I’ve argued that there is no tension between a more strategic view of Britain’s universities as critical to our knowledge economy and our future economic growth and their essential autonomy or their cultural and civilisational role. That is fundamental to my entire approach to policy in respect of universities. The man in Whitehall – and increasingly the woman - does not know best how to run a university.

Far from the gross caricature of academic insularity, I have been incredibly struck, since my appointment, by the massive appetite in the sector for what I can only call ‘relevance’ to our economic and social challenges in a globalised economy. I have yet to find a Vice-Chancellor in an ivory tower in respect of dealing with these economic challenges – maybe by the chance I have covered the length and breadth of the country I will, but not so far. I’ve been asked many times by university leaders with respect to the economy: ‘how can universities help?” For that reason, I believe the logical home for university policy is in a new department whose core remit is investing in economic growth, investing in our future. Building our national strengths in knowledge and innovation. These are also the remits of a modern university.

However, I’ve argued that we are at risk – as are all countries that aspire to excellence in their higher education sector – of failing properly to exploit the role of university education as a means of social mobility.

I think that the historic anti-elitism of some parts of the left on education policy has often been a dead end because it has confused excellence and privilege. Those two things are not the same. But the only way to square that circle is a higher education system that widens access and increases social mobility even as it fosters excellence. It is not enough for universities simply to confer life advantages from one generation of professionals to their children. Everyone should be able to aspire to those advantages – on the basis of merit, not the lottery of birth.

Finally, I argued that we cannot separate these issues from the question of how higher education is funded in England. We have to face up to the challenge of paying for excellence. But whatever the outcome of the fees review, our expectations of institutions in widening access and supporting poorer students must advance in lockstep. The path to an equal opportunity Britain must run through all our universities.

I started by suggesting the last hundred and fifty years have seen a revolution in British universities. I’ll finish by saying that it seems to me that this has been an undeniably progressive revolution.

It has embedded science in our national intellectual culture and widened access to knowledge, education and critical thinking to a degree that is hard to exaggerate. It has fundamentally reshaped our liberal arts culture and our democracy. It has underwritten the creation of new industries and better jobs for literally millions of people and played a crucial role in equipping British people to prosper in a globalised economy and culture.

However, for us as a country it is also an unfinished revolution. And in that fact, for us, lies both the challenge and also the huge opportunity.


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