John Denham - UUK Conference

Good morning Chairman and Deputy Mayor. Thank you for asking me to speak today.

I’m delighted to be here as the first Secretary of State in the new Department for Innovation, Universities and Skills.

Let me just say at the beginning, how hard it is to establish a warm, personal relationship across a podium. But I want to establish that quality of working relationship with you and continue to develop it over time. I also want to thank you for your time over the summer.

As many of you have remarked, the new Department - created as one of the first acts of a new Prime Minister - gives Universities – along with of course science, innovation, colleges and skills - a new and more direct voice in Cabinet than you have ever had before. And there’s a responsibility for me as Secretary of State to make the most of that for you.

The formation of DIUS does not mean that past policies, past Ministers, or indeed, Higher Education itself have failed.

If our benchmark was comparing today with a few years ago, this could be a very complacent speech today; full of mutual congratulation and a great deal of back-slapping!

Investment has risen. University finance is now more stable and sustainable

Participation in Higher Education has increased. New opportunities are there for people who in previous generations would never have dreamed of going to University.

Record investment in science has re-established Britain as a world leader in research.

Collaboration between Higher Education and business is improving at an ever-increasing pace.

There’s great deal to be proud of.

You have made this possible, and I want to thank you. Also I want to thank Drummond Bone on behalf of the Government for his leadership of UUK over the past two years. And I hope that it wasn’t symbolic that he was leaving, as I arrived this morning.

The problem is that neither the past, nor even the present should be considered as the benchmark for success.

It is what we must achieve in the future. That benchmark can’t be set just by our own aspirations. It is also set by the ambitions and actions of other countries.

It’s easy to run through a list of the challenges and we do that all the time in speeches. A globalising economy. Climate change. The accelerating pace of technological development. A world in which people, businesses, money and knowledge are increasingly mobile. Powerful emerging nations with huge resources and justifiably great ambitions

Thing to say is these challenges can bring a sense of insecurity in a changing world – to universities, to communities, to businesses and also of course to individuals. And that sort of global change has the harshest impact on those least well-equipped to respond.

It’s my belief and the Government’s belief that we can, though, create new opportunities in a changing world. And that we can and should ensure that no one gets left behind.

But we can only do that as a society if we make the most of the skills and abilities of every single citizen.

Only do it if we carry out world class research and scholarship.

And we will only do it if we translate new knowledge into successful businesses and public services.

Those three challenges are actually the reason for a new Department which brings those aims together in a single focus.

It’s no longer the position that we have one Government Department looking at how science and innovation can lead to successful businesses and public services, and a quite different Department looking at how we can develop the skills to exploit these opportunities.

Responsibilities that had been scattered across Whitehall have now been brought together. I think that that presents a tremendous opportunity – for all of us. A challenge and responsibility for me and an opportunity for all of us.

Above all it is an opportunity to realise, what I want to call, the unfulfilled potential of Higher Education.

In the 1960s, the challenge was to expand and reform Higher Education. So after the Robbins Report, we expanded the university system. But we also created the new polytechnics and the Open University to provide flexible access to Higher Education for thousands more people.

In the 1980s, the renewed expansion of Higher Education culminated in the unification of the sector with the abolition of the binary divide.

But it was left to this Labour government, after the Dearing Report, to provide proper funding for that unified system and to renew the ambition that access to Higher Education should be widened to all those who could benefit.

So today we do have a Higher Education system with greater levels of investment to support excellence in teaching and research, a further expansion of student numbers, a dramatic internationalisation of outlook and a significant shift in the direction of greater interaction with business.

We do have a Higher Education system that is the envy of much of the world.

But what now do we want from - and for - Higher Education in the decades ahead?

I want you to debate the big issues. And many of these issues will echo what Rick raised this morning. To work with me on how we can unlock the full potential of Higher Education. This speech is not a detailed blueprint. So more questions than answers.

I want to say today that over the next two years, I want to work with the Higher Education sector and other stakeholders to address these key questions.

Your views will be important. And what you told us this morning – that you want to be proactive in debate is good news.

My ministerial colleagues and I want to make our own contributions.

In due course we shall need to set out conclusions.

Politicians, like nature, abhor a vacuum. If we can’t find a consensus, decisions will still need to be made.

But the opportunity, to shape the future together is absolutely genuine.

Nothing I say today - this is the health warning! - should be interpreted as giving any signals on the forthcoming independent review of full-time undergraduate fees. There are many significant questions that can and must be tackled aside from the fees issue.

The fees debate is, in my view, for another time. When we can see how the new system has bedded down, the impact it has had on university finance, and how improved financial support including bursaries have helped students.

You musn’t think that issue is a panacea for resource issues. A preoccupation with fees and funding shouldn’t at the end of the day be what defines the future role and shape of HE in our society and economy over the coming decades.

I want to touch on 7 areas of debate today.

How Government and HE should work together to achieve the shared vision of unlocking potential that I set out earlier.

How we continue to make sure we do not waste talent, or deny opportunity to anyone who could benefit from Higher Education.

How Higher Education responds as the number of potential young students falls, demands from older students increase and the need to educate today’s workforce becomes more urgent.

How universities and business can work more effectively together to their mutual, and the national advantage.

How universities themselves, as well as the nation, can benefit fully from the research and scholarship that they undertake.

How academia and government - you and I - could work more effectively together in the shaping of public policy. Not just in the area of HE.

How, in an increasingly diverse Higher Education system we develop a genuine parity of esteem and support each university in their chosen mission.

There will be other issues you will want to raise, And Rick raised a number of these this morning that could have been in this speech. But let me raise those.

Firstly, the relationship between Government and Higher Education.

Between 1997-98 and 2005-06, state funding for Higher Education has increased by 23%. Funding per student, which fell by 36% over the previous ten years, has risen. We are committed to maintaining funding per student in real terms.

We have also honoured our pledge to spend more on UK research. Since 1997, funding for the ringfenced science budget has increased from £1.3 billion to £3.4 billion.

I simply want to say do not underestimate the difficulty of securing this increase in funding. It has been won against many other pressures on government spending - elsewhere in education, the health service, pensions and criminal justice. And I think it does demonstrate our real commitment to Higher Education.

None of this is a settled national consensus, of course. The recent Tory policy launched by John Redwood and David Cameron abandons the aspiration of expanding participation. It restricts HE to students with specific A-levels and opens the door to future cuts in funding.

So I say to you there is still a job to be done in winning the case for universities.

As a Government we have not shied away from difficult decisions in the interests of Higher Education. We introduced variable fees to put your finances on a stronger footing.

We recently made another difficult choice: to prioritise taxpayers’ support for students who have never been to university over those wanting to do a second degree. And we, through HEFCE, will work with affected institutions as they adapt.

We expect real value for money from increased public investment.

But while we will take difficult decisions that fall to us to take, we will also respect and nurture your institutional autonomy. That autonomy makes you much more able to deliver what the nation needs. And each institution must determine the role it develops within the Higher Education system.

At the same time, it is striking how relatively small investments, like the Higher Education Innovation Fund, have brought about wide ranging changes in university support for innovation. The value of improved collaboration with business must have vastly outstripped the initial investment.

The funds HEFCE have ear-marked for employer co-financed places must have as far reaching an impact on the ways universities offer Higher Education to new groups of students and to employers.

So in this debate I am interested in how, without compromising your independence, we can work with Higher Education Institutions to make the most of future opportunities.

Participation has broadened and deepened – with a steady increase in students from lower income groups and from communities with no tradition of Higher Education. But there is a long way to go.

It should not need restating, but improving participation is not about political dogma or hitting statistically satisfying targets. It is about ending a huge waste of talent and ability.

No one could seriously argue that the current social bias across Higher Education and in individual institutions - including some of the most sought after – reflects a system that reaches all of our most talented young people.

We are removing the main financial barriers to study. We are recognising the contribution of hard working families who support their children in going to university.

And as you will know, from next year a third of students will receive full maintenance grants. Another third will receive partial grants. 16 and 17 year olds who receive EMA will have their support in Higher Education guaranteed. Students from disadvantaged backgrounds will be mentored by undergraduate peers. And the repayment of student loans, which is already linked to earnings not the size of the debt, will be more flexible.

Much has already been done to encourage universities to consider all the factors indicating a student’s ability to succeed. Much has been done to promote widening participation initiatives that are consistent and effective.

We need to build on that.

But universities cannot offer places to talented students who do not apply. Even the most talented must be sufficiently well prepared to study and succeed.

So I think university partnerships with schools will become ever more important: to help schools deliver the high standards you want, and to identify and nurture the young students of the future.

That is why we are keen for Universities to enter into formal partnerships with schools by means of Academies and Trusts, about which we will have more to say soon. It’s why the PM in his Mansion House speech this year said he’d like every secondary school to have a Higher Education partnership.

Now I am well aware that public debate about Higher Education tends to focus on full-time students in their late teens and early 20s. The undergraduates, I suspect, most of us in this room once were. The full-time UK based young undergraduate is a minority in our HE system which is why we introduced the first financial support for part-time students in HE and why the funding council provides additional support for part-time provision.

But I think two important trends are coming together which will inevitably have consequences for universities.

The first is that the rising tide of 18-year olds will begin to ebb – as your own analysis this week shows. We estimate that the population figures for 18 year olds in England will drop by just over 14% from 675,800 in 2006 to 579,300 in 2020.

Secondly, as a country we simply cannot afford to have a Higher Education sector that is focused only on school and college leavers. As Sandy Leitch’s report made clear, 70% of the workforce in 2020 has already left school. And many of them need university level education.

Both trends push you to change your intake. We certainly cannot meet the country’s needs purely by educating the rising generation.

I want to hear from you whether responsibility for this change should lie solely with institutions that already offer opportunities to older students. Or should the universities that focus on traditional undergraduates and overseas students take a fresh look at their role.

Important decisions will rest on the answer to that question.

I am confident we can make the changes we need. Look how in the last forty years, business schools developed to serve a new market for students and employers. And have become an established and respected part of some of the world’s finest universities.

As we change, so too will students’ expectations and needs. And I am determined that DIUS must be a champion for students. We should have a role in ensuring that students get value for their fees and that the taxpayer gets value for their continuing support of teaching costs.

Meeting the needs of older students, who need to study in new ways, balancing work and family and be financed in new ways, is just one of the areas that must bring Higher Education and employers closer together. Now I’ve already seen fine examples of this relationship working well on taught courses, on fundamental research and the application of new knowledge.

But seeing examples of good practice – which is an occupational hazard of being a minister – inevitably raises the question of how much more could be done.

Over the next few months we need to develop a shared view of the full potential of collaboration between business, public services and Higher Education and the best ways of encouraging it.

Of course, and I echo here what was said earlier, the responsibility does not just lie with Higher Education. As I told a CBI conference on skills yesterday, there is no point in talking about an employer-led skills system without employers who are prepared to lead. Businesses that assume that Higher Education has nothing to offer are every bit as much of a problem as university departments who fear or avoid the consequences of close engagement.

Both must accept the responsibility to change. And my job, I hope, is to make it easier.

One advantage of leading a new department covering the Research Councils, the Technology Strategy Board, the Intellectual Property Office and employer engagement with higher level skills is that I can look at many different ways in which the collaboration between universities and business can be enhanced.

My sense is that in the past engagement between business, Government and universities has been disjointed. There has been one set of questions about knowledge transfer and innovation; and another about workforce skills.

I hope we can bring this together.

Ten years ago, Universities were criticised for being ivory towers. I entirely accept relationships between universities and business have now changed but we need to agree where and how far the relationship should go.

And as part of that we should look at how Universities should benefit from their research and scholarship.

Research and scholarship should benefit your institution as they also benefit individuals, the tax payer and wider society. So let’s discuss further how we optimise all those benefits and the different approaches, whether long term strategic relationships, one-off collaboration or a focus on intellectual property. What are the best vehicles for working with multi-national or with small local firms.

And how do we ensure academic staff who work closely with business should not have to compromise their research career or their scholarship, let alone their integrity. And give the proper support.

To an extent, seeing how we develop the relationship between Higher Education and business is mirrored in my mind by the relationship between Higher Education and government policy. Lord Giddens, no stranger to the corridors of power over recent years, recently asked why the relationship between politics and academia was much weaker in the UK than in France, Italy or the USA.

Perhaps you think we don’t listen; perhaps we think you don’t produce research in a form that can inform policy! But it’s a discussion we should have.

Incidentally one clear and relevant responsibility I do have is to promote greater scientific awareness and influence in public policy. And that’s a debate I want to take forward.

Finally, there are the issues about how we integrate diversity of mission with parity of esteem.

If I’m honest as an incoming Secretary of State, I sense that the sector is not always at ease with its own diversity.

I have already found that too often the tendency is to talk about what others are less good at, rather than to emphasise strengths. There is a need to become more confident, I think, and less defensive in telling the story of what universities do for the economy and society.

Sometimes, intentionally or otherwise, the way the activity of the so-called mission groups is portrayed can work against parity of esteem and a mutual respect for each others’ role.

Institutions who tailor courses to meet business and local community need may not top research assessment tables. But they deserve the same esteem as those who do.

Institutions that pioneer new admission routes and support students from non-traditional backgrounds are as vital to our social and economic well-being as those who educate the people with a huge array of excellent A-levels.

And this is not an abstract discussion. Higher Education, universities must have a collective self-confidence in the role that it and individual institutions play, if government is to support you well and appropriately in your chosen mission.

It is often suggested that some individual posts, some individual departments, and, indeed, some individual universities don’t operate as part of a national Higher Education system but a global system. One in which the competition for talent and resources is truly international.

I think it’s time to examine this argument in depth and ask how well our current policies support them.

Of course all universities have an international dimension. Research and its practical applications are increasingly collaborative and therefore international. Spin offs and the recruitment of students and staff are all increasingly international. And so is the education that a 21st century UK student needs. Higher Education is in its own right, through its international work, a significant element in the UK’s economy.

So the international nature of Higher Education will be a thread running consistently through debates over the next two years.

I was a bankbench MP at the time of the fees debate. And I think

many of you like me will look back at the tuition fees debate and recognise that the issues I’ve raised this morning were left unresolved when the fees policy was finally decided. The fees issue will not be considered again for another two years. These same issues cannot be left unresolved again. Let’s work together to resolve them.

I began by thanking Drummond Bone for his contribution over the past two years. I also want to welcome Rick Trainor as his successor. And as I want UUK to play a leading role in the debate we’re launching.

Finally could I end on a personal note.

Discussion of Higher Education policy often sounds very utilitarian.

And as I deliver it, this speech probably helps to contribute to that! It is 30 years since I left postgraduate research at Southampton, putting aside dreams of being a professional scientist to pursue other interests.

There have been countless times in my working and my political life where I have been grateful for Higher Education. A knowledge of scientific concepts; the collection and use of evidence, a knowledge of statistics, probability and risk. And, in the wider student experience, the chance to test whatever talents I had in leadership, communications and decision-making.

So my personal experience taught me to appreciate the intrinsic value of learning. A highly educated society has a strength and resilience in a rapidly changing world that goes far deeper than the particular jobs that individuals are doing at any one time. And a university system which lost sight of this central reality would not be a good one.

As we work together I want to make sure that my Department does not lose sight of that truth.