The following amendments have been selected: amendment 1 in the name of Rebecca Evans, and amendments 2, 3 and 4 in the name of Darren Millar. If amendment 1 is agreed, amendments 2 and 3 will be deselected.

Item 8 on the agenda this afternoon is the Plaid Cymru debate on the higher education sector. And I call on Bethan Sayed to move the motion. Bethan.

Motion NDM7101 Rhun ap Iorwerth

To propose that the National Assembly for Wales:

1. Notes the serious financial crisis facing the Welsh higher education sector, with significant job losses announced over the last twelve months amid concerns as to the financial sustainability of individual institutions.

2. Calls on the Welsh Government to commission an urgent review of the financial sustainability of the Welsh university sector.

3. Calls on the Welsh Government to give HEFCW an explicit mandate to intervene to prevent the bankruptcy of any higher education institution in Wales in the immediate future, by means of an emergency loan if necessary.

4. Calls on the Welsh Government to ensure that any public funding to a Welsh university is contingent on vice-chancellor salaries being no more than five times median earnings.

5. Calls on the Welsh Government to ensure the adequacy and transparency of university oversight and governance arrangements, especially in relation to the expenditure of public funds.

6. Calls on the Welsh Government to remit HEFCW, and any successor body, to exercise a partnership approach with students and university staff at all levels of decision-making, and to require universities to take account of student and staff views in making staffing decisions.

Motion moved.

Diolch yn fawr iawn. Let me start from the outset by saying that we don't want to be holding this debate today. It's not our preference, nor do we take pleasure in coming here to discuss the problems across the higher education sector in Wales, but we feel that this is a debate that needs to be had now, because we support the sector, because it's so integral to our society and the economy. We're not going to be the party that sees an upcoming problem, or even a crisis, and does not sound the alarm, and we would hope that the Welsh Government would feel exactly the same way. Let's be clear, we're holding this debate not only because of the issues that we are detecting on a personal level, or via what's being reported by universities and in the press, but because people on the front line across the sector, including staff, academics and students, are coming to us raising real concerns on a regular basis. We cannot and should not ignore them. They feel, and we agree, that the Welsh Government is not treating the issues coming out of the higher education sector with the seriousness that they deserve, particularly when it comes to the times when I and others have raised some of those concerns in this Senedd directly with the Minister.

The Llywydd took the Chair.

Over recent years, there has been a steady drip-drip of news indicating the worsening financial position of Welsh universities. We have seen successive announcements of job cuts for one, at Trinity Saint David, we are seeing news that there is a potential for up to 170 job cuts, Cardiff has announced up to 380 losses over the next five years, and we know that this is on top of prior job losses and restructuring. Lecturers and academic staff, members of the University and College Union, voted almost 90 per cent in favour of strike action last year. There have been job losses and restructuring at my former university in recent years, in Bangor too, and more projected in the future.

We're also in a situation where applications are falling as well. Last year, there was almost a 6 per cent decline in Wales overall. Amongst EU students, the number was a very worrying 20 per cent reduction in applications, and I do hope that if the Brexit Party spokesperson replies in this debate, they'll be honest enough to admit that their preferred policy of crashing out of the EU without a deal will be a disaster for the Welsh HE sector. So, we come—

Will the Member give way?

Well, I was hoping that you would respond to the—[Interruption.] You're not going—[Interruption.] All right, fine.

I just wanted to say that that is not our preferred policy. We would much prefer a deal, but it's only by being prepared to leave without a deal that there's any chance of getting a decent deal.

Well, I'm not sure that everybody in your party believes that, but thank you for the intervention.

We come to this debate too in the knowledge that financial certainty can change overnight. Financial stability at universities depends on this, particularly in relation to borrowing. Now, I understand that the Higher Education Council for Wales plays a regulatory role in this and that, ultimately, lenders would not lend at all under circumstances of a fundamental lack of confidence in certain universities. But we should also admit that the borrowing of some Welsh universities is high in proportion to overall income. In a situation of an economic shock or a sudden and severe decline in student numbers, how vulnerable are we? What about a situation in which loans given on the expectation of a steady income, derived from fees and student loans, are impacted by a reduction in fees and projected income? How will this impact some universities in Wales? These are the realities we need to address. These questions and others are the basis of why we believe we need an urgent and complete financial stability and sustainability review of the whole sector.

The Diamond review was published in September 2016, and there are elements of that that are not yet in place, and the full financial implications of it are not yet felt. But I hear from across many of the sectors that the so-called Diamond dividend is not going to be the magic bullet here—it isn't going to be able to alleviate many of the financial issues now being experienced, because the landscape under which Diamond was produced has already changed.

In my view, we're still some way off experiencing the effects of Brexit. If Boris Johnson becomes Prime Minister, which seems more and more likely, what will the effects of that be by October, when he has promised to leave the EU come what may? How will Britain's increasingly tarnished and joke status abroad impact international recruitment and the brand of Welsh universities? We already know that the mere prospect of Brexit and the chaos before we've even left have caused a big decline in EU student numbers.

We're experiencing demographic changes and increasing competition from England. Around 40 per cent of Welsh students leave Wales to study elsewhere, worsening our brain drain and the viability of our HE sector, and I believe this needs to be addressed. The Augar review is going to leave parts of Diamond potentially in need of change too, and if that change results in Government change, then we need to understand how that landscape affects Wales, and I'm hopeful that the Welsh Government will tell us how they're going to respond to that particular review. 

Just coming on to some aspects of the motion we submitted and the amendments, obviously we will not be supporting the Government amendment. And I understand that the Lib Dem education Minister, with their record on education, particularly when it comes to higher education during the UK Government coalition, will want to be trying to be self-congratulatory. But I think this is too far and doesn't adequately recognise the seriousness of this issue. We will be supporting amendment 4 from Darren Millar.

We believe that there does need to be a wider review of governance arrangements in the Welsh HE sector, which my colleague Helen Mary Jones will touch on further. I note last week what the Minister said regarding her remit letter to HEFCW, but I personally could not find specific reference to conducting a review in that letter. But, having had my researchers ring HEFCW, they've said that they are conducting a general review of arrangements, so perhaps the Minister, in her reply to this debate, can say what specifically that will mean in relation to governance, and how she will be responding to that particular review.

We are calling for the scandal of vice-chancellors' pay to be dealt with finally. It's absolutely preposterous that vice-chancellors get paid more than the Prime Minister. There are arrangements in Scotland in place that help to deal with these issues, but I see no reason why Wales can't deal with it too. We're also pleased to support calls that have been around for a long time from NUS and others for staff and students to be fully involved in decision-making structures at universities, and this would be no surprise coming from me as a former sabbatical officer. The set-up right now isn't sufficient. There needs to be a more inclusive structure written into law, in our view, and a whole partnership approach to higher education in general.

Ultimately, we believe that universities are critical to the fabric of Welsh life and to our economy. There are whole communities, towns and cities immeasurably richer due to their presence. But we do see clouds on the horizon and in our honest opinion—we're all being honest this week, aren't we—we have to truly recognise this and I hope that the Minister does, too.

We've raised these issues in numerous forums in the past, and have been told not to worry so much. I and others believe it needs greater action and urgency. We also believe, as I've called for in the past, this sector is big enough to warrant having a separate Minister for higher education. When we look at the post-16 landscape, the Minister's proposed PCET reforms, I believe this would warrant direct activity by a separate Minister.

So, I reiterate: a sector facing ongoing financial threats and downsizing; a sector potentially, in some areas, over-exposed to borrowing; universities that in some areas are downsizing their very campuses and presence in some parts of Wales. And we have people working in a sector who tell me and others that transparency isn't enough, that governance is not inclusive enough and does not provide the level of strong oversight, vision or direction that the sector desperately needs. Perhaps the regulator would do well to focus on these concerns, as opposed to engaging with me constantly about what the Minister can and cannot respond to here in this very Chamber. The Minister says, and she will say again today, no doubt, that the universities are autonomous, and, yes, we do understand that. But we believe that there can be greater expectations, drive and vision to preferred outcomes. Right now, everyone in Wales, particularly students and staff in the higher education sector, need to be entirely confident for the future. I'm afraid, at this present moment in time, that they are not.

I have selected the four amendments to the motion, and, if amendment 1 is agreed, amendments 2 and 3 will be deselected. I call on the Minister for Education to formally move amendment 1, tabled in the name of Rebecca Evans.

Amendment 1—Rebecca Evans

Delete all and replace with:

1. Recognises:

a. that Universities in Wales and the UK are independent and autonomous institutions;

b. the financial challenges facing the Higher Education sector across the UK, including Brexit and the decline in the number of 18 year olds;

2. Welcomes:

a. the introduction by the Welsh Government of the most generous student support system in the UK, and the significant increases in the number of part-time and post graduate students in Wales;

b. the introduction of a fair and sustainable funding settlement for Welsh universities and the commitment to increase funding to HEFCW in each financial year for the lifetime of this Welsh Government;

c. the sector-wide commitment in Wales to pay the real living wage to all staff, the increased openness and transparency in the reporting of senior pay, measures being taken to address the gender pay gap and the adoption of the Code of Practice on Ethical Employment in Supply Chains;

d. that Wales is the best performing nation in the UK for student satisfaction;

3. Notes the Welsh Government’s remit to HEFCW to work in partnership with the sector to increase openness and transparency around the use of fee income and to strengthen governance and accountability.

Amendment 1 moved.

Formally.

I call on Suzy Davies to move amendments 2, 3 and 4, tabled in the name of Darren Millar.

Amendment 2—Darren Millar

Delete point 3.

Amendment 3—Darren Millar

In point 4, delete 'is contingent on vice-chancellor salaries being no more than five times median earnings' and replace with 'includes conditions to tackle excessive vice chancellor and senior leadership pay'.

Amendment 4—Darren Millar

Add as new point at end of motion:

Calls on the Welsh Government to publish the information about the higher education sector's financial position that it takes into consideration before agreeing the sector's annual budget allocation.

Amendments 2, 3 and 4 moved.

Diolch yn fawr, Llywydd, and thank you to Plaid for tabling this debate. I move our amendments.

Although we don't agree with everything in the motion, there's quite a lot we do agree with, which is why you can see what our amendments look like. Neither can we simply accept the complacency inherent in the Welsh Government amendment, because actually, yes, they are right in recognising that universities are independent and autonomous; that's why we can't support the more heavily interventionist approach in some of Plaid's motion. But higher education institutes are in receipt of public funds, and for those they absolutely should be accountable, and accountable not just for the spend, but how effective that spend is. We as Welsh Conservatives consider accountability to include universities explaining how spending that money, our money, contributed to the value of a bigger picture, not just what that money was spent on. And questions need to be asked, such as: what would have been lost had Welsh Government not invested, via HEFCW routes or other routes? What sources of other money might have been available for the work? How much could a university raise itself? So, in amendment 4, we do ask Welsh Government to tell us what it considers about the sector's own finances before setting its annual budget allocation, which goes hand in hand, I think, with point 2 of the motion. If the sector's in the trouble that the tone of this debate would have us believe, then it is Welsh Government’s decisions that need our scrutiny just as much, if not more, than those of higher education institutions themselves.

In tabling just one amendment, Minister, you have actually forced us to accept or reject the whole lot. So, I'm afraid we have to reject the whole lot, not least because Scotland might argue a different interpretation of your point 2a, and universities may want to challenge your assessment of their settlement in point 2b. I might also want to push you further on being able to commit to what sounds a little bit like multi-year budgeting for HEFCW. But, strangely, we can't do that for schools. But I’ll leave that teaser for a future debate.

Turning now to the motion itself, the challenges facing the higher education sector are exciting and frightening, I think in equal measure. Yes, some providers in the sector are making cuts; they're realigning finances. They have shrunk that deficit by a considerable margin, for which they should be congratulated, because we recognise that the level of public funds going into the sector has been very difficult for institutions in recent years—too difficult, perhaps, in 2016-17. But, going back to the point, universities are private bodies and they can only complain about public funding to a point. I’ll make this one exception, because, when it comes to research, I think an apparent drop in funding from Government says something about Government's confidence, and that can risk a faculty's, let alone a whole institution's, reputation for original working or partnership working.

The number of 18-year-olds has fallen. The demands of global economies are changing rapidly. Students taking on debt are far less forgiving of courses that aren’t value for money or unattractive to employers. Those Tony Blair 'degrees for everybody' days are now, mercifully, being displaced by a more sensible culture of degrees for those who can gain advantage from them, and something else of equal value for others. And institutions must respond. They must regenerate for the modern age or fail. Diamond and Augur spell out the problem that we are all paying for a supply that outstrips demand, so what universities supply needs to change.

The two universities in my region have been transformed in the time I’ve been an Assembly Member, bringing an atmosphere of ambition to Swansea. And now we may well want to examine whether doing that on the projection of a growth in numbers at a time of a demographic dip was wise, or whether building ambition on the promise of unsecured finances, which—. I'm talking about the city deal here. But I don't think it can be for HEFCW to make good bad bargains if governing bodies mess that up, hence the change in our second amendment there. 

But that doesn't let HEFCW off the hook, which is why we've not challenged point 5 of the motion, which calls the bluff of you, Minister, in point 3 of your amendment. Governance needs to keep up with changing ambitions—internally for institutions and for HEFCW. And, if something’s not right, and HEFCW needs more powers or more accountability to help get the sector onto an even keel, then we shouldn't ignore that opening.

I think good vice-chancellors are crucial to the success of universities—which is why we don’t accept point 4 of the motion—but greedy vice-chancellors don't help the reputation of institutions either, and that's something that institutions need to consider.

But I just want to finish on the role of Welsh Government here, because it's got a serious role here, and it's not just about money per se. If it could get a move on with degree apprenticeships, then universities could start offering those and ditch more courses that nobody wants any more. If they're confident in the governance, perhaps they could pick up on the pace of the Swansea bay city deal sign-off, make some of the payments that are due. That would show that some of these risks are worth taking. Show a bit more ankle, perhaps, on the Reid review, because I think our universities still can lead the way to us being an innovation nation, which does know what it’s doing on the economy.

Diolch yn fawr, Llywydd. I'm particularly pleased to take part in this debate today, though, like Bethan Sayed, I wish we weren’t having to bring it forward. Members will know that, until very recently, I was employed by one of our universities, and that was certainly a very good experience for me, as it is for many.

I’d like to start with what I think we can all agree. We can all agree about the importance of universities to the communities in which they’re based, to us a nation, to the economy. They are forums of debate, they are forums where independent thought is brought forward, they produce world-class research, and of course they are educators, and not only for young people, but primarily for young people. Our higher education sector has much that it can be proud of. But I think we can also all agree that the sector is under pressure.

The question before us this afternoon is what is to be done. We've brought this debate forward because the current Government's response seems to be, essentially, 'Nothing is to be done', and that was reflected in their amendment, which tells us that everything is fine. Universities are independent, Government tells us, so let them get on with it. The read-across from that is, potentially, 'Let them sink or swim', and we don't think on these benches that that is good enough, and neither do the students, the families of students, and the workers at universities who speak to us think that it's good enough. 

The motion before us today proposes practical ways forward to address some of the governance concerns and the concerns about long-term stability and viability of this really important sector. I want to refer briefly, Llywydd, today to two particular examples, current examples, that illustrate the veracity of our concerns. 

No-one will be surprised to see me pressing again about the really serious governance concerns at Swansea. We've raised it here many times and I'm not the only one. We've had these extraordinary suspensions of really senior staff, disciplinary processes no closer to being clear or transparent or resolved than they were almost nine months ago; we now see that there are serious issues with financial reporting. There is no transparency. Students don't know what's going on and the staff don't know what's going on. 

The Minister, when we've raised this before, has asked us to take her word for it that HEFCW is on the case. Well, nine months down the line, if I believed it nine months ago, I don't believe it now, and I remain far from convinced. The general point is that something like this could potentially happen in any of our higher education institutions, because, while it is vital that they are independent and that their academic freedom is protected and we don't want them to be totally answerable to Government—nobody would want that—the governance arrangements in all these institutions are archaic, they are opaque. It is very unclear what the powers of the court of the university are when senior management of the university, as they have at Swansea, can persist in cancelling the meetings of the court. There is nobody to hold them to account. Our current governance arrangements, Llywydd, are based on the assumption from the middle of the last century that essentially everybody working in this sector are good chaps and they can be trusted and relied on to conduct themselves honourably. Well, I wish that it were so, but the shenanigans going on at Swansea clearly show that there are some chaps in charge who are very far from good. 

We need robust, transparent governance arrangements for our universities that are fit for the twenty-first century and, as Suzy Davies has said, for the very large institutions that we're talking about now, employing hundreds and thousands of people, dealing with thousands and thousands of students. We need those robust arrangements to ensure that the voices of students and staff are clearly heard in those processes and we need more consistency across institutions. This, to me, is crucial if the Government is serious in resisting the English-style marketisation of the sector, which it says that it is. 

So, I want to refer briefly to one very current example of financial instability and the dangers that that presents, and I want to highlight here the difficulties facing University of Wales Trinity Saint David. I want to focus briefly to begin with on the example of Lampeter university, as it was, a much-loved institution. Not many of us realise it's the fourth oldest higher education institution in Wales, Scotland and England; I was trying to see whether it was across these islands, but I couldn't get the date for Dublin. It's vital to its community. It plays a huge part, even reduced as it is, and I've been contacted by many constituents who are really, really concerned. We've seen a drop of student numbers and numbers of staff over the years, and there are some people contacting me who are questioning Trinity Saint David as an institution's long-term commitment to the Lampeter campus.

Constituents are also really worried about the potential impact of these difficulties on the further education services provided by Coleg Sir Gâr. This is an example of how these institutions have grown, and they are groups of institutions and they must have governance arrangements that work in that context. We face risks to our further education sector across Carmarthenshire because of financial problems in other parts of the University of Wales Trinity Saint David sector, because the college is part of that group. This is an example of how the fragility of the universities financially can have potential impacts beyond their own borders. 

My constituents expect the Welsh Government to hold the university to account for these problems and to be there to support it. I have to say, with regret, that I entirely concur with Bethan Sayed that the Government's amendment is nothing but self-congratulatory nonsense. If the Minister really believes that there are no serious problems in our higher education sector, she is clearly not living in the same country that I live in. She asks us to believe that everything is fine. Staff at the universities know that it is not, students know that it is not, the communities where those universities are based know that it is not. I urge the Senedd to reject all the amendments except amendment 4 and to support the motion as it stands, to ensure a fresh start and a secure future for these vital institutions. 

The higher education sector, as we know, plays a critical and vital role in the social, cultural and economic life of Wales, and maintaining and developing a vibrant and successful higher education sector is therefore at the very heart of the Welsh Government's vision in developing a world-class education system. It is unfortunately the case that higher education in Wales, much like the rest of the UK, is facing significant financial pressures. A drop in the number of 18-year-olds as well as international uncertainties around Brexit have also exacerbated these pressures. These are real pressures. With regard to the Tory UK Government's cuts imposed on Wales, this is also significant. The Welsh Government's budget is down £800 million in real terms, compared to 2010-11. And despite these huge challenges caused by Tory austerity, funding to Wales's higher education has actually increased by over £250 million since 2012. 

Will the Member take an intervention?

I will, briefly.

Completely acknowledging the scale of that public investment, does the Member agree with me that there are real challenges facing the governance in higher education?

I absolutely concur that there are real pressures and real challenges, but not just for the higher education sector, bearing in mind the topic of this debate. 

The radical reforms this Welsh Labour-led Government has implemented in response to the Diamond review are radical and they will create a strong and sustainable funding settlement. This radical and progressive approach will also mean students are better supported. So, we listened to students' concerns around the costs of living, and we will therefore be the first country in Europe to provide equivalent living costs support in both grants and loans to full-time and part-time undergraduates, because we've listened, we heard and we have acted.

And while the UK Government has cut back on grants for English students, Wales has moved further and has fostered support to those students from homes with a lower household income, and this is also right. Labour Governments have a proud record of expanding higher education, opening new institutions, establishing the Open University and improving access for people of all backgrounds. And here in Wales, with the ongoing Diamond suite of reforms, we are continuing that radical trajectory and tradition.

But, of course, in response to Helen Mary's interjection, we also have to and must recognise that there are very real pressures within the sector, in particular the concerns around job losses and the sustainability of some institutions, and that is a great worry to many. But it is also right that Welsh Government has called on Welsh universities to become living wage employers, and I would very much like to underscore that. 

So, Minister, I would therefore like to ask what representations has the Welsh Government made to institutions' staff and trade unions around the impact of job losses announced by Welsh institutions. And with regard to the projected Brexit implications on Welsh higher education institutions as well, in particular the calamitous 'no deal' Brexit, what support has the Welsh Government put in place to support institutions through this very difficult time for the sector and, by a result, the Welsh economy? 

Certainly, HEIs that are strong are very important economically, culturally and socially, in terms of contributing to our prosperity as a nation. I want to talk about the economic impact of higher education, mainly. It happens on a number of levels, and the problems and the crisis that we face in the sector at present should be ringing very loud alarm bells, in terms of the economic risks.

On the economic contribution to the areas that the universities are in, we talk more and more, as we should, about the foundational economy’s value. In the communities and the regions where the universities work, they are some of the biggest contributors to the foundational economies there. We’re talking about a great number of staff and we’re talking about good salaries for the staff—too high, in some cases, for some vice-chancellors, which is a very important issue to tackle. Where there are hundreds of jobs that have been lost already, the economic impact of that is to be felt heavily. We’re talking about supply chains locally, from maintaining the estate, to food for staff and students and the night-time economy, which I probably indulged in too much. There is a broad economic contribution.

And then there is a contribution that stems from the skills that are provided by the sector, and individuals benefit from learning skills through the HE sector—communities and the whole of Wales benefit from that. Unfortunately, I don’t think that we’ve taken full advantage of that potential. I think that the failure to invest in an HE system that’s effective is part of the reason why we have too many people with low levels of skills, and that leads, then, to low pay. There is potential that has been locked in the people of Wales that has not been released, as it could be through the HE sector.

I’ll use this opportunity as well to talk about the brain drain that we face at present. To be clear, I and Plaid Cymru believe that students from Wales should be able to study in the best universities in the world, and to have an opportunity to live and work overseas, as I did. But, we have to face up to the situation that Wales is suffering a net loss in terms of graduates. Seeing funding systems and the Welsh Government’s policy—through the Seren programme in particular—they do encourage the brain drain. What country with any kind of self-respect and ambition would want to see our best people leaving without making an effort to try to keep them or attract them back here?

So, if we want to support students to go wherever they want to go to gain new skills—as I said, I don’t oppose that—and if we do send money after them, out of Wales, we have to ensure that that doesn’t undermine the institutions that we have, in a financial sense, which leads then to a lack of investment and a risk of a lowering of standards, and making them less appealing to students from Wales, who then consider going to study in England. It’s a vicious cycle that we can’t ignore.

We can’t just say goodbye to students for their university years without (a) tracking them very carefully to know exactly where they’re going and what they’re doing—and it would be good to hear from the Minister about what tracking system is in existence and what the aims of that scheme are, and what schemes we have to keep in contact with the students—and without then (b) having a clear plan to attract them back after graduating, including through using financial incentives.

Finally, research is vital for our universities—research, of course, that drives economic growth. I’ll talk about Cardiff; I have the figures here. As a key contributor to the Welsh economy, in 2016-17 the university contributed more than £3 billion to the UK economy, and more than £2 billion of that was a boost for Wales specifically. Quality-related research is a critical part of this, but expenditure on research and development is falling behind other parts of the UK—falling behind Scotland, certainly. That does affect the ability of Wales to innovate. Cardiff University says that the Welsh Government should, for example, be doing much more to fund what they called challenge-led innovation research, as well as maintaining the QR research. That would go some way towards undoing the disadvantage that Wales faces at present. Very simply, if Wales wants to be prosperous, we have to have a prosperous sector being engendered by universities.

So, to close, it’s clear that the HE sector is vital for our economy. If we don’t ensure the sustainability of that sector, we are sure to pay a very heavy price.

Following on from the theme explored by Helen Mary Jones, but almost certainly not as eloquently as she has put it, I wanted to discuss the governance of the institutions that are charged with delivering our higher education. Whilst we acknowledge the financial crisis now faced by the higher education sector and regret the substantial job losses over the last few years, we also have to realise that, being autonomous, the higher education sector has been responsible for their own financial governance. Two motions, one by Plaid and one by the Conservatives, have acknowledged the enormously high salaries awarded to vice-chancellors. One has to ask: is this indicative of the general financial controls exercised by the sector? All the institutions in the sector now control enormous sums of money. What scrutiny is applied to their financial decisions? We are all aware of the controversy with regard to the vice chancellor of Swansea University, and yet the details of the inquiry are scant, and they were also late in producing their annual accounts.

We accept the importance of the autonomous nature of these institutions, both in Wales and in the UK in general, but surely we should be able to scrutinise their financial probity, given that HEFCW is the Welsh Government body responsible for funding higher education. The education Minister has already set out how she wants universities to contribute to the Welsh Government's civic mission, and we understand that Welsh universities are responding to the standards she has set for them. Why can't this be done for the financial sustainability and good governance of the universities? We are sympathetic to the financial difficulties now faced by universities, but we are also mindful of the need to make sure that public funds are spent in the most cost-effective manner.

I wish lastly to address the comments made by Bethan Sayed with regard to the fall in foreign students. It is the uncertainty that now surrounds Brexit that stops students coming here, and that uncertainty can be placed firmly at the door of the remainers not accepting the democratic vote, particularly by the Welsh people.

Will you take an intervention?

Yes, of course, David.

Thank you for taking an intervention; I do appreciate that. You've just said the uncertainty is down to the remainers. Actually, following the referendum in 2016, the decline happened then. So, it wasn't uncertainty; it was the fear of what leaving would mean for EU citizens within the UK and their education status. It's not the remainers who have anything to do with it; it's actually the whole process that's at fault.

Well, I will very quickly reply to that, David. I quite agree that the whole process has been very badly mishandled. And I would not stand here and defend the Tory Government and their handling of the matter. Thank you.

David Rees. You're back on. 

Diolch. I'd like this afternoon to perhaps join colleagues in appreciating the efforts and the commitment of the higher education sector in Wales and the positive impact it has on civil life as well as our economy. As Helen Mary has indicated, I'm proud to have been a part of that before I became an Assembly Member. For many years, I worked in the sector. I do recognise that, over those years since as well, there have been some considerable changes in the sector with respect to the structure and organisation. We've seen an expansion in the number of students, the different numbers of providers available, the provision—the expansion of programmes—and the research has increased dramatically. Greater variation of providers exists in Wales, and there's an increase in the number of HE courses now being offered within further education institutions. There is a whole different set-up to what existed, perhaps, when I left eight years ago.

Now, a significant feature of this changing landscape has been a trend towards greater consolidation with the merger—. We now see eight universities. You mentioned the University of Wales Trinity Saint David. Well, that was, of course, Lampeter, Trinity college and Swansea Metropolitan University put together—and the University of Wales, actually—and it now includes FE colleges as well. So, there has been a dramatic change, with many FE colleges offering degree courses now as well. So, those FE colleges you talk about actually are offering HE level courses, level 6 courses.

They have some of the highest satisfaction rates in the UK, Welsh universities have, so let's actually congratulate them on some of the work that they do, because the students are actually seeing good provision and a good experience, and they wouldn't have those satisfaction results if they didn't. Believe you me, I've been with students during those results; I know exactly what they say—they'll tell you as it is. So, if they are actually giving you a good satisfaction result, they are seeing universities as offering something beneficial to them and they're happy with that.

Now, I'm not going to hide from the fact of the other aspects, but let's also recognise the voice of the student, because I haven't heard much about the voice of the student in this debate. It's all been about governance. I'll come back to that; I will come back to governance. But let's talk about the students and remember that, because I also highlight—. We talk about health very often; we talk about a patient-centred agenda. Perhaps we should be looking at a student-centred agenda, a student-focused agenda when we talk about education, and particularly higher education as well. And I do recognise, unfortunately, the challenges from governance and financial aspects of HE institutions that exist today, but they're not new, unfortunately. I remember being a trade union officer at the time when the then Swansea Institute was under threat of closure or being basically taken over following questions of governance and academic standards. 

I'm very grateful to David Rees for taking the intervention. You've just talked about how much the sector has changed and how much bigger the institutions now are. You've pointed out that these issues with governance are not new. Would you agree with me that it's now time that something is done to address those problems since they're not new?

Well, I was going to come on to some concerns I have with governance, and I do agree that greater transparency is required in governance and greater participation by staff and by students. They should never ever be blocked out from taking part in meetings of whichever governing body it is, because I remember being a trade union member on a governing body and I wasn't allowed in certain meetings because it was felt it was inappropriate. Now, that's got to stop; the governance has to be open, has to be transparent, and those voices must be heard clearer and louder. So, I totally agree with that aspect.

We all remember, on financial aspects, universities get their money from various sources. The Brexit Party Member talked about HEFCW. HEFCW's no longer the main funder. Many years ago, it stopped being the main funder. It used to be. All the teaching moneys used to come from HEFW, but it doesn't any more; it comes through student fees. So it's been changed; it's student fees, R&D grants and projects, commercial activities—let's not forget the commercial activities they undertake—and a smaller proportion now of public funding through the funds from HEFCW. Much, much smaller than they used to be. They do depend upon student numbers. Student universities actually do depend upon that, home and abroad, and it is very deeply concerning that we are seeing the overseas students declining, particularly from the EU, because that has always been a supporter. Because even though they paid home fees—[Interruption.] Hang on a minute. Even though they paid home fees from the EU, they were numbers, they were coming in and they were adding to the experience of the individual students in their programmes.

Does the Member recognise there has been a significant fall, as he states, in EU students in Wales, but that has not been replicated in England? So, there may be lessons for some universities in the sector in Wales rather than necessarily just blaming Brexit.

I can't answer on the numbers in England; I actually haven't studied the numbers in England. I'll take you on your word, if that's the case. But I think what we are seeing is that we used to have a very good relationship with many institutions in Europe, and students would come over. Now, if the fall in EU students in Wales is happening, what we've got to say is, 'Why?' And it's not because of the relationship or the experience they get here; it's because students are very worried about the consequences of Brexit—end of—and that's a fact. So, we have addressed that.

I do want to highlight one thing, Llywydd, before I go, because I haven't talked about it and I think it's very important. We don't always mention the pathway of part-time study. It is important to many people, and I want take the opportunity today to add my congratulations to the Open University on its fiftieth anniversary. The work they do is fantastic, and I welcome very much the way the Welsh Government is now supporting part-time students on their pathways, because that is another avenue that universities have been following. They are looking at the expansion of pathways on the part-time programmes, and that is crucial. I think, for Welsh citizens, we should welcome and congratulate the expansion of that to so many people because people in work, people who want to part-time study, if people want to get back into work, people who want to raise their prospects and opportunities, part-time work is very often there and we tend to forget about that sometimes. And universities are huge in that and they work with FE colleges as well in delivering a combination of programmes.

Llywydd, I will conclude because I see my time is well up. I do agree that we need to have and look at the governance. I do think there is a question on how we ensure transparency and openness is available to us, but there are some points in there I disagree with in the motion. On the vice-chancellors' salary, by the way, yes, I totally agree. Sorry. I do think we need to do something about it, but let's not forget the benefits they get because they'll get a figure, but if we want to attract them, you've got to match them with England, unfortunately, within that competitive market. And if you want good vice-chancellors, we've got to look at the whole university sector across the UK. If we do it just for Wales, we may end up not having the quality of people we want to drive our universities forward.

The education Minister, Kirsty Williams.

Thank you very much, Presiding Officer. Any opportunity to discuss and promote our higher education sector is always a welcome one. And in speaking in favour of the Government's amendment, I more than recognise the challenges facing the sector, including Brexit, the decline in the number of 18-year-olds, and domestic and global competition. But I also welcome the success of the sector and, as David Rees said, a sector that is outperforming the rest of the United Kingdom for student satisfaction, for leading in Wales and across the UK in paying the real living wage to its staff, and for the progress, working with HEFCW, on senior pay transparency and strengthened governance. I am committed to the local, national and international success of our universities. Our institutions are national assets held in high regard throughout the world, and they achieve this as autonomous institutions working in partnership with Government.

Now, others across this Chamber may prefer that universities function as an arm of the Government. We prefer that they take their place in that public square of debate, discussion and discourse, and offer both challenge and contribution to Government thinking for the good of our nation. 

I'm grateful to the Minister for taking an intervention. Has she heard anybody on these benches suggest that we would want the universities to operate as an arm of Government? I thought I made myself completely clear; we want their autonomy and their academic freedom, but they need to be open and accountable. 

Supporting, Presiding Officer, a sustainable and world-renowned higher education system is a priority for this Government, and we do indeed have a robust statutory framework of regulation in place that assures both the quality and the financial sustainability of the sector. And if some Members need reminding, many people in this very Chamber passed the Higher Education (Wales) Act 2015 that gave additional powers to HEFCW to strengthen those arrangements, although that seems to have been forgotten here this afternoon. 

Now, we will continue to work in partnership with the sectors and others to advance the interests of our higher education institutions in a UK, EU and global context. Through our reforms to student finance and HE funding, we have provided the security and sustainability necessary to help the institutions meet these ongoing challenges that we have outlined. This system of support is the first in Europe that provides equivalent maintenance support across all modes and levels of study. And what I will not do this afternoon, Presiding Officer, is make any apology for the fact that that student support package is also portable for wherever a student wishes to study.

And I must say, the most depressing bit about the contributions this afternoon is the failure to appreciate the very hard work of our Seren co-ordinators that are providing our young people with such wonderful, wonderful experiences and opportunities.  

Will you take an intervention? It's not about the individuals driving the policy and working very, very hard on it; it's what it achieves in driving students out of Wales, driving a brain drain, and, as I said, what country would want to do that? 

What country would want to curtail the ambitions of its citizens to study at first-class institutions wherever they would be? That would be an inward-looking nation, not an outward-looking nation that wants to give its students those opportunities to fulfil their potential wherever that potential may best be supported.

Will the Minister give way? 

Yes, I will. 

I've previously questioned a number of times around the Seren scheme. Can I just say from these benches that we really do appreciate the efforts that the co-ordinators have gone to and wish her and them well with the continued success of the scheme?  

Well, I'm glad that somebody here recognises the hard work and the success of the scheme, but also, apart from supporting those students, our student support package has seen a massive increase in the new applications for part-time and postgraduate students, and that's proof that this reform is working. It's delivering for social mobility, it's delivering for economic opportunity, and it is delivering, crucially, for all students no matter what their background is.

But, Presiding Officer, there is always more that we can do, and so today I can confirm a new bursary scheme to attract Welsh students to do their Master's degrees here in Wales. These bursaries will be aimed at prospective Master's students in subject areas where we know that there is a high demand for postgraduate qualifications. Providing incentives for graduates to remain in or to return to Wales is one of my priorities in meeting our economy's skills needs. This scheme will support our universities to incentivise the recruitment of the most talented Welsh students, in line with our economic action plan and my response to the Diamond review.  

I've also made a commitment to increase funding to HEFCW in each year of this Government, subject to the usual processes. The allocations I have made to HEFCW since the last election have increased from £117.5 million in 2016-17 to more than £151 million in 2019-20. This increase in funding will clearly continue as long as we are able to do so, and it demonstrates our commitment to the long-term stability of the sector in Wales. And, Suzy Davies, I have no intention of showing a bit more ankle, or indeed, any other part of my anatomy, when responding to the Reid review. I have made £6.6 billion available to help support institutions to deliver on that agenda.

Now, since coming into office, I have set clear expectations of the sector and HEFCW in my annual remit letters. I have raised our expectations of what Government investment should deliver from the partnership that we have with HEFCW and the sector. This year, this includes asking the council, working with other administrations where appropriate, to consider whether arrangements regarding academic integrity and reporting on fee income, should be strengthened, and I have asked for a report on this. I've also used my remit letters to encourage greater openness and transparency on senior pay, but also on pay equality and gender pay and other measures to encourage fair working practices. We have already seen progress in reporting on these. Our reporting is more transparent than it is across the border, and I would hope that Members across the Chamber would recognise the work of the sector as good, civic actors.

I'm pleased with the progress that our institutions have made on paying the real living wage to all directly employed HE staff and, crucially, towards implementing it across their outsourced HE activity. I'm also very proud that Welsh universities are the first whole sector to sign up to the code of practice on ethical employment in supply chains.

Rather than the picture that has been painted by some Members this afternoon, we have provided HEFCW with enhanced responsibilities in relation to the regulation of tuition fees, monitoring compliance with commitments made in institutions' fee and access plans, and assessing the quality of provision and financial stability through the adoption of a financial management code, which nobody has seen fit to mention. In addition, I have discussed with HEFCW the work they have in hand to strengthen governance arrangements in HE in Wales working with Universities Wales and the chairs of those universities, and I'm looking forward to an update when this work has been progressed significantly.

But, of course, looking to the future, our post-compulsory education and training reforms will establish a new funding and regulatory body that will oversee higher education, further education, apprenticeships and sixth forms. And the commission will have powers related to the oversight of public funds awarded to universities, higher education providers and other publicly funded PCET providers. This will, of course, include ensuring the financial sustainability of our universities. The commission will also have a key role in ensuring that the interests of our learners and their sponsors are protected, that students continue to have a voice in institutional affairs as well as safeguarding the reputation of the Welsh PCET sector through regulatory levers that it will have at its disposal. And given that there is a great enthusiasm in this Chamber this afternoon for regulatory reform, I look forward to enjoying the support of the Chamber when this Bill comes to the floor.

Universities will need to continue to act transparently in the eyes of the commission with regard to public funds, as is currently the case. But I've also been clear on the need for the commission to take due account of the need to preserve institutional autonomy and academic freedom. We must recognise that universities are and will continue to be autonomous bodies despite their vital role in delivering a public service and generating public value. There are, Presiding Officer, some significant challenges ahead, and we need to make sure that we have a system that will enable us to meet those challenges, identify and make the most of the opportunities that arise whilst ensuring that we continue to have high-quality, high-performing, sustainable institutions, and that's why those reforms will be undertaken by this Government.

I call Bethan Sayed to reply to the debate.

Diolch yn fawr iawn, and thank you to everybody who has taken part in this debate. I welcome the announcement that's been made with regard to the Master's degree. Although, I must say, every time I raise issues with higher education, I feel that the Minister is always very defensive, and we raise these issues because, like I said in the beginning, we have heard concerns. And this is not to try and bash the university sector, as it's interpreted; it's to try and raise valid concerns about what we believe can change and can be amended in the sector to suit the needs of the people of Wales.

And it's worth noting that it's the university sector that is feeding us with those concerns that we are able to raise here on the floor of the Assembly.

Yes, and that's why we are raising this debate today, and I do not make any apologies for doing so, and want to assure that everything we're saying has been brought to us by people in the sector who want us to raise these concerns and want us to do that in this particular Chamber.

I'm not sure how much time I have, but I wanted to thank Suzy Davies for her intervention in relation to being constructive, and recognising the point in relation to how important research is and the fact that there is a level of complacency in the higher education sector. We need to be accountable. I know we differ, to an extent, there. Where we would differ again, I guess, is where we've seen the Conservatives support more marketisation in the higher education sector, and I think that's where many of these problems do lie, so I truly hope you raise that with your colleagues on a UK level as well.

Helen Mary Jones spoke passionately about her experiences, and I think if you've worked in the sector, you will know first hand how some of these issues have affected people on the ground. Ultimately, they are educators, and people should feel that, whatever they want to study, they're able to do so, regardless of people being forced to think about employment before they're ready to do that. They want to go to university to have the experience of going to university.

I don't really want to get into the governance issues at Swansea here today, I know that I've raised them on many occasions, and there are differing opinions about what is happening there. All I know is that we need to ensure that this process is done properly. I'm hearing that it's flawed, and that's evidence that I've received. I don't want it to be flawed, but that's something I can't ignore when people raise that with me. So, I truly hope that HEFCW are abreast of these particular issues.

And Lampeter—you mentioned Lampeter, well, I spent every summer of my youth there when I was on the National Youth Orchestra of Wales and know how important Lampeter is to the ecosystem of the universities. It's gone from 1,500 to 350 students, and I think that's tragic for such an excellent university.

Rhianon Passmore, you always do a great job in defending the Labour Government, I must hand it to you, and the radical trajectory that you talk about. But, whether you like it or not, I'm in politics because of Labour, because of the introduction of tuition fees by the Labour Government. So, I do remember the legacy that is not so radical as well, I'm sorry.

To Rhun, thank you for explaining the economic impact of higher education. You said that alarm bells should be ringing about what’s happening across the whole of Wales, and how important HE is in terms of local economies. I've spoken to people in the sector who are saying, 'If this university were to disappear, then the whole town would die.' So, we have to be alive to that when we're talking about the future viability of the HE sector.

You mentioned a tracking system and how to attract students back to Wales. On the committee that I chair—the Welsh language committee—dentists had come in to talk about Welsh language regulations, and they say that they don't have Welsh-speaking dentists because they all study in England. Well, we have to be concerned about that, surely. We do have to encourage them to remain in Wales to study in Wales.

If I could say, I'm aware of constituents that I have who want to study medicine in Wales, who have gone through the Seren system and attempts have been made to attract them to universities in England.

Well, that’s why some of us do have concerns about that system, and it’s important that we raise those concerns about the Seren system too.

I don't really think I want to address the Brexit Party concerns regarding Brexit, because we know why people are not coming here—because they feel that they're not welcome and because of Brexit. You can say it's because of the remainers until you're red in the face, but the fact is, people don't want to come here because they don't feel welcome, and we have to own that responsibility. I know people who've told me they don't want to come here because of the way that they feel about Brexit.

Could the Member explain why they're still going to England in the same numbers that they were before?

No, because I'm not responsible and I'm holding the Welsh Government to account, so I want to see the numbers rise here in Wales. But the reality is that is how they feel, having talked to people who want to come to Wales, but feel that there is no welcome for them in that regard.

Then, we had David Rees mentioning a good point about the FE offering, as well. We can't have this debate without mentioning that further education does offer a lot in relation to higher education.

I would say that I mentioned students in my speech, so I think that's integral to what we do in relation to higher education—how they can feel fully included. In Swansea at the moment, when the structures are not happening, how are students supposed to take part in those conversations? When I was student president, those—the court and the senate—were the ways in which we could engage. We sat there and we took part. So we have to ensure that they're not undermined by problems with governance in any of these particular universities.

I'd like to hope that this isn't the end of the debate on higher education. I'm sure after I finish this debate I'll have lots of e-mails from the higher education institutions and from the regulators saying that there's no problem, and everything's hunky dory, and if it's not then I'm hopeful they will be able to engage constructively with us in future as opposed to potentially seeing us as hostile, when all we want to do is improve the situation so that everybody can be proud here in Wales of our higher education institutions. 

The proposal is to agree the motion without amendment. Does any Member object?

That was an objection? Yes. I just had to check there, sorry. 

I will defer voting under this item until voting time.

Voting deferred until voting time.