Cable ‘shares’ fears over threat to WP funding

The business secretary, appearing today before the Business Innovation and Skills committee, also said the grant letter from his department to England’s funding council will be sent “soon”.

The annual grant letter has been delayed because of a dispute within government over whether to cut or scrap the £332 million student opportunity fund, which allocates money to universities based on the number of the poorest students they admit.

Danny Alexander, the Liberal Democrat chief secretary to the Treasury, is said to be seeking the scrapping of the funding, as BIS is required to find cuts to balance an overspend caused by higher than expected student numbers at universities and a failure to control student numbers at private providers.

Paul Blomfield, the Labour MP for Sheffield Central, questioned Mr Cable on the funding. He said that Sheffield Hallam University had written to Nick Clegg, the Lib Dem leader and Sheffield Hallam MP, to urge that the funding be preserved.

Sheffield Hallam had argued it was “those with caring responsibilities, looked-after children, low-income families, disabled students who would be most impacted by the withdrawal of student opportunity funding”, Mr Blomfield said. “Do you think that is right?” he asked the minister.

Mr Cable replied that such a view is “shared by many vice-chancellors. And I share the analysis. Yes, we do have to be very careful in the allocations we make not to damage the wider participation agenda.”

The minister also said: “Within a short period of time you will find that we’ve come to an agreement on how to make these allocations.

“I’m very conscious of the pressure around that particular part of the budget. I can’t give you concrete assurances because we haven’t come to a final decision. But I certainly don’t want to do anything that would damage the wider participation agenda.”

On the timing of the grant letter, he said that “it will be soon, but I’m not giving a date”.

Mr Blomfield also asked the minister about the claim in George Osborne’s autumn statement that the abolition of student number controls would be financed by the sale of student loans (a sale yet to get under way).

That claim was apparently contradicted by Matthew Hilton, the BIS director of higher education, who recently told the committee that there is “no logical follow through from the decision on the loan book to the decision on the expansion of the higher education budget”.

However, the Treasury’s autumn statement document says: “The additional outlay of loans over the forecast period [up to 2018-19] will be more than financed by proceeds from the sale of the pre-reform income-contingent student loan book.”

Mr Cable told the committee: “I don’t think the chancellor intended to say there was a one-to-one linkage between the two things [the sale of loans and the expansion of numbers].”

But Adrian Bailey, the Labour chair of the committee, replied that there was “no other reasonable interpretation of what he [Mr Osborne] said”.

john.morgan@tsleducation.com