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Report of Discussion

Tuesday, 27 April 1999. A discussion was held in the Senate-House of the following Reports:

The Second Report, dated 15 March 1999, of the Council on amendments of Statute G, II (Financial relations between the University and the Colleges: the Colleges Fund) (p. 472).


Mr Deputy Vice-Chancellor, the catastrophe of the Colleges becoming publicly-funded institutions under section 28 of the 1998 Teaching and Higher Education Act undoes the settlement reached as the result of the last Royal Commission. The 1923 Oxford and Cambridge Act and the 1926 University and College Statutes which followed it enabled the University to receive public funds, with therefore a degree of public control, whilst at the same time protecting the Colleges from such interference, thus deliberately preserving their historic independence within the University.

The precipitate and tyrannical action of the Government over College fees should have been exposed for the deeply political act it was. Instead, the University and Colleges treated it as just another financial trial. I was not joking when I remarked in the Senate-House on 3 March last year, 'how odd, when the rest of the world might expect us to be discussing College fees, that the Council should send us up a Report on academical dress'.

Today's Report is the first opportunity for the Regent House, as governing body, to discuss the matter, yet there is nothing left to discuss. 'After extensive negotiations, a settlement was announced'. All that is left is for us to nod through the imposed changes of Statute G, II. A Bursars' sub-committee has given us some history to chew on, but not the history that matters. I shall give an account of the history that matters so that future historians can more readily understand the forces which contemporary Cambridge chose to ignore.

In 1967 the Government coerced the Council of the Senate into proposing higher composition fees for overseas students than for home students by what has since become the customary method, stating that in calculating the University's grant the higher fees would be assumed to have been charged. The Regent House rebelled and threw out the proposal by 244 votes to 213. The following year a timid Council invented the constitutional device of simultaneous Graces, one to do nothing and the other to charge differential fees, so that they could themselves sit on the fence (a device I would surely have challenged had I then been a member of the Regent House). Differential fees won by 190 votes to 124, but the real winner was the Government, who now knew that their control of university fees was henceforth secure, notwithstanding the buffer of the University Grants Committee.

In November 1976 the Secretary of State for Education and Science turned the screw a little harder by announcing much-increased fees as part of a scheme to charge overseas students more realistic amounts. An intended effect was to make Local Education Authorities pay home students' fees in full without a parental means test, so that overall, taking into account the parallel reduction in the UGC grants, the public purse would only be worse off by the small amounts being contributed by some parents towards the former small fees. But an unintended effect arose because the Department had forgotten that, by their own Statutory instrument (which I recall consulting as a Tutor), the Oxbridge College fee was included in the mandatory fee. Moreover, it was by no means small, for unlike the University fee it had to be realistic. So the Department had inadvertently ended means-testing of the College fee, and one may suppose that Oxbridge parents were more taxed by means-testing than most. Ironically this adoption by the state of responsibility for paying what would now be called 'top-up fees' was made by a Labour government.

The Department, finding itself hoist by its own petard, now had the problem of substantial fees which it could not control by the customary blackmail because the Colleges were not in receipt of any grant which it could reduce. In March 1977 the Minister of State met the Oxbridge Vice-Chancellors, and on 18 April he wrote them a courteous and helpful letter about the problem he faced. He suggested that by negotiation between his Department and representatives of the Colleges a limit should be set to the amount which a student with a mandatory award would receive from his Local Education Authority in respect of his College fee, but that his College would still be at liberty to set the total fee as before.

I was a member of the General Board at that time, and the letter was circulated for the meeting of 4 May. I was also a member of Gonville and Caius College Council so I prepared a memorandum arguing for acceptance of the Minister's proposal. It opened:

I regard this question as one of the most important that has come before the Council during my membership at least, and urge the Council to consider it with great care. My reason for thinking this is that the long-term danger of coming to some arrangement which would prejudice our freedom of action is very great, and we might be tempted to solve the immediate problem at the expense of our future independence. Specifically, we might find ourselves controlled financially by the Department of Education and Science within quite a short time through their determining the fees.

My warning went unheeded, and the Bursars, I suppose it must have been, argued instead for the whole of the fee to be mandatory, thus rejecting the compromise proposal on offer. If the proposal had been accepted, as I had wanted, 'top-up fees' would by now have been entrenched in the system. But then if you leave negotiations to Bursars you must expect them to go for the money. That is their job.

Another ten years passed, during which the annual negotiation between the Bursars and the Department over fees seemed to deliver the necessary increases, but the Department was still without the control over the Colleges on which it had set its sights. Then, in February 1987, came the inevitable next step. The Croham Committee's review of the UGC recommended its replacement by a Universities Funding Council, and in its White Paper of 1 April the Government agreed. In particular, the Government accepted the recommendation, no doubt slipped in by the Department's civil servants, that the new funding council should take over responsibility for Oxbridge college fees. In mid-May the Department sent out a paper 'Changes in structure and national planning for higher education' which invited comments by the end of the month, and stated that the Department would 'be consulting representatives of the colleges and of the two Universities about future arrangements'. The development which I had feared ten years before was now upon us, in clear and unambiguous language.

As it happened, I was once again on Caius College Council, and once again I drafted a memorandum, this time attaching a proposed letter for the College to send to the Secretary of State. The Council met on 27 May, four days before the deadline, and agreed to my draft which, with minor changes, was sent under the hand of the Master, Professor Sir William Wade, QC, the next day. I believe there was no other collegiate response before the deadline, but the Colleges Committee did meet on 6 June and authorize the drafting of a letter for approval by circulation.

From now on the Colleges knew precisely what was on the Department's agenda, and on 20 November 1987 the Education Reform Bill was published without, so far as I know, any of the promised consultations having taken place. I bought a copy and prepared a memorandum for my College Council which met on 25 November. After describing the implications of the Bill I wrote:

This Bill seems to open a route for the complete control of the affairs of the College by the Secretary of State. It is only necessary for the Secretary of State to channel students' fees and maintenance grants thorough the UFC, in accordance with a recommendation of the Croham Committee which the Government has welcomed, for that control to be activated. Even if this development can be postponed for a while through the current (?) negotiations, it is difficult to see how it can be held off for long given that the Bill, through the inclusion of clause 144 ... seems deliberately drafted with the Colleges in mind.

The Colleges Committee met on 23 January 1988 and the Master of Caius asked me to attend as his representative. I listened to a long discussion of the implications of the Bill during which it dawned on me that members were ignorant of section 144. It turned out that they were working from a brief based not on a reading of the Bill itself but on the extract published in the Reporter which had not included section 144. I had not intended to speak, but after a while I felt I had to point out that the interests of the Colleges were greatly affected by a clause from section 144 which appeared to have been overlooked: 'In this Act 'university' includes a university college and any college, or institution in the nature of a college, in a university'. I recall a pregnant pause, followed by an embarrassed resumption of the former discussion as if I had not spoken.

Despairing of the attitude of my colleagues, I wrote to my Member of Parliament, Sir Anthony Grant, and met him on 27 February. On 22 February The Times published a letter from me arguing for the amendment of section 144 (which drew a note of congratulation from the Chairman of the Colleges Committee, Sir Hermann Bondi), and simultaneously I started a long correspondence with Mr Robert Jackson, the Parliamentary Under-Secretary, which carried on until my letter of 14 June which went unanswered. Readers of this correspondence judge that I won on points, but I got nowhere. The civil servants were in control. Sir Hermann Bondi reported to me that the Permanent Secretary had given him an assurance that there was no intention of routing the fees through the UFC. I smiled. The Department was evidently going to bide its time.

The Bill was passed in July. During October and November the Master of Pembroke College, the late Lord Adrian, who had recently been Vice-Chancellor, and I had discussions and correspondence over its precise implications, and I am sure he would not have minded my now quoting the last paragraph of his last letter: 'I am reinforced ... in my view that we, the Colleges, should prepare a position for the almost inevitable decision to channel College fees via the UFC'.

Another ten years passed, and all it needed was a change of government for the long-awaited blow to fall. Conservative Ministers could not have better prepared the ground for a Labour Minister, even getting the Dearing Committee to smooth the path. In October 1997 rumours of impending legislation started circulating, and on 19 November I wrote a piece 'Why the Oxbridge colleges will lose' in an attempt to galvanize those responsible into action. It so unerringly predicted the details of what was about to happen that one Vice-Chancellor elsewhere observed that HEFCE must have used it as a template, and in March 1998 the Secretary of State announced exactly what I had anticipated. Whatever negotiations had taken place, they had not moved the Department one inch from its original position of twenty years earlier.

No longer a member of the Council of the Senate or of my own College Council I was not privy to any of the recent discussions. But I have formed the impression that not only were the Colleges unprepared for the development which some of us had warned about for so long, but that they and the University failed to grasp that it was not merely a financial matter but a political, legal, and constitutional one which struck at the very foundations of College existence, of the idea of a collegiate university.

On 16 July 1998 the Teaching and Higher Education Act became law, making the Oxbridge Colleges publicly-funded institutions and effectively denying these charitable educational corporations the elementary right to charge home students a fee. The Regent House was not consulted, and neither in the Commons nor the Lords was any voice raised against this nationalization of the Colleges.

I am ashamed that it is my generation in the University of Cambridge that has allowed this to happen.

Professor T. D. LAMB:

Deputy Vice-Chancellor, the Appendix to this Report, prepared by the sub-committee, is quite misleading in one respect. In paragraph 5, it is stated that 'the rates of contribution were increased to 4%, 11%, and 21% from 1986-87 onwards'. Yet the fact is that the rates of 4%, 11%, and 21% were introduced in 1928, and they applied continuously until the date just mentioned. Indeed these rates are still retained in the existing wording of Statute G, II, 6, subject of course to modification by Schedule G.

Neither the Council nor the sub-committee have given any reason for the removal from Statute G, II, 6 of the rates that have been specified there for over seventy years, even though the issue was considered by the Council as recently as July 1995 (Reporter, 1994-95, p. 966). I shall not rehearse my remarks at the Discussion of 7 March 1995, but simply remind the Council of their decision that 'the Council have agreed to amend their proposal so as to retain the existing tax levels in the Statute; the intended simplification of the rates of contribution would then be achieved by revision of Schedule G'. Exactly the same solution that has worked so well in the past should be adopted again: thus, the Council should widen the lower rate bands, but retain the rates of contribution that have always applied in the Statute, subject to modification according to Schedule G.

Secondly, I turn to the redistribution that these changes are intended to achieve. A major short-coming of the scheme proposed in this Report is that it contains no in-built provision for adjustment, in the case that the actual redistribution falls short of target. All that the sub-committee suggest is that another review be carried out, five years down the line. That would entail yet another round of negotiations, and further revisions of the Statutes or Schedule, again requiring the consent of all the Colleges.

My third point is that the Report fails to make clear that after the ten-year transitional period the income of the Colleges Fund will be less in real terms than it is at present. The top rate will again be 10%, as it is now, yet the level at which this rate comes into effect will have risen from £10,000 to at least £500,000 - the actual figure may be even higher, as the bands could be increased by Grace under the provisions of the new G, II, 6. In order to maintain the status quo, in the face of massively widened lower-rate bands, the incremental rate at the end of the transitional period should be higher than it is at present.

A solution to this last problem (which would also provide a partial solution to the second, and which could readily be accommodated in a solution to the first), would be to increase the rates of contribution by 1%, for each entry in the second band, and by 2%, for each entry in the third band. Thus the top rate would begin at 21% in 1999-2000, at exactly the level specified by Statute since 1928, and would taper to a steady-state level of 12%, thereby counteracting the post-2009 reduction in income that would otherwise result from the widening of the bands.

In the event that this modification of the scheme were to lead to the target figure of £30m being redistributed too rapidly, the University could simply increase the first and/or second band, as is provided for in the new G, II, 6. That is certainly a better prospect than the alternative one - of being unable to implement the level of redistribution that has already been agreed with government.

Finally, Deputy Vice-Chancellor, I wish to raise the issue of accountability. For the academic years 1993-94 to 1998-99, the Reporter lists the income of the Colleges Fund as £1.80m, £1.78m, £2.20m, £1.33m, £1.41m, and £1.34m, a total of some £9.86m. By Regulation 4 for the Colleges Fund (Ordinances, p. 874), the Council are required to publish to the University all grants from the Fund. But for the years 1993-94 to the present I have only been able to find two notices of disbursement, of £1.3m (Reporter, 1995-96, p. 378) and £1.6m (Reporter, 1997-98, p. 722), a total of £2.9m. Could the Council please direct me to their notices listing the disbursement since June 1993 of the other £7m?


Mr Deputy Vice-Chancellor, I trust I do not startle by the brevity and relevance of what I say this afternoon. I should be reluctant to disappoint those members of the Council and General Board who enjoy not reading my speeches (for they certainly do not reply to them, except in tiny corners of the small print of Council papers where it turns out that some committee has had to concede that I was right about something).

'Will in future be made available through the University' (Reporter, p. 472). A profound shift takes place in the relationship of the University to the Colleges with the alteration in the funding structure which has prompted this Report. I seize the moment to press for some hard thought about the implications of that shift. It was in his work on Venn diagrams that Dr Edwards made one of his most important discoveries; we need his unparalleled expertise in the constitution of the University and Colleges to assist in setting out for us now the least damaging way in which the separation of the jurisdictional frameworks may be altered to a pattern of intersection or even coincidence by what we are being forced by Government fiat to do.

Let me concentrate on just one thing. We have a variety of disciplinary procedures applicable to the students and to the employees of the autonomous University and the autonomous Colleges (and grievance procedures likewise, though, for our students, still no complaints procedure at all). If you have a problem involving someone in a different jurisdictional circle, no-one may have authority to help you. The Colleges do good work pastorally, at least for their students, but when the going gets tough, that may not be enough.

Nor do we have at present any means of honouring a contractual obligation to a student who has a problem involving a member of staff who stands in a different contractual relationship as an employee of College or University.

You have to be careful to get into your difficulties with someone in the same circle of jurisdiction, and that takes foresight. We may at last be able to tackle this.

Only a College can admit an undergraduate. But, when it does so, the University as well as the College acquires a new member. Only the University can award a degree, so could it in theory decline to recognize a College's undergraduates as its own and examine them? I do not think we really know. The first step is to think through the way these funding changes challenge the old paradox of the simultaneous autonomy and symbiotic relationship of Colleges and University. I hope we can do that before we frame the 'arrangements to be agreed between the University and the Colleges to deal with the new system of payments' (p. 472). I understand that it is arguable in law that students can get away with not paying tuition fees at all. Their chances of doing so will be much improved if we allow the usual Cambridge cockup to muddy our new arrangements. 'More power to their elbows' many of us may cry, but that does not make muddle the more forgivable in a great University with some of the best (if most unrewarded) minds in the world on hand to frame its domestic laws. It may be that we do not like what we have to do, but let us at least do it well and get some good out of it.


Mr Deputy Vice-Chancellor, I recently spoke at a Discussion (Reporter, p. 516) on a Council Report closely related to the one we are discussing today, namely the Council's Report on the College contributions in the financial year 1998-99. Those contributions referred to in the earlier Report will be the last to occur under the present arrangements should the Regent House accept the proposals now before us. I explained in March that I had felt unable, as a member of the Council, to sign the present Report because it failed to include a proposal that the form of College accounts should be changed; this failure will, as I explained, prevent us from monitoring the effect of the redistributive measures now being suggested. I will not go over that ground again, but I do want to take this opportunity to add a small gloss to the substantive proposal I made last month. I suggested then that Part One of the College accounts should consist of 'the accounts of the College prepared in accordance with the Statement of Recommended Practice as issued and modified from time to time by the Charity Commission.' I want now to make clear that I am not in fact particularly wedded to the Charity Commission SORP; another appropriate SORP would do nicely, and the HEFCE SORP which is used by the University may well be a more appropriate SORP for the Colleges than the Charity Commission SORP. I have no strong feelings about which should be adopted; I do however feel strongly, for reasons that I have explained, that one or other should be adopted forthwith, as an integral component of the present proposals to alter the level of College contributions.

I would also like to take this opportunity to correct an impression that I may have created towards the end of my earlier speech. I stated that there had been 'no sign of any action' from the College Bursars on this matter. I have since been informed that a College Accounts Working Party of the Bursars' Committee has in fact met more than twenty times, and has issued three working papers and three interim reports to the Bursars' Committee, and is about to produce a fourth. I apologize to the Bursars for my ignorance. I suppose my position could be likened to that of a reporter standing outside the Vatican during a Papal election; until the puff of white smoke goes up, he can honestly, without being guilty of vilification or slander, say that 'there is still no sign of any action', even if he knows of the feverish activity going on in secret. It is good to know that there is some activity; its sheer scale, coupled with the lack, so far, of any concrete proposals to change the form of College accounts, is fully consistent with my expressed view that the process of devising new accounting formats just for Cambridge would indeed be a 'complex and time-consuming task'. I realized that it would not be easy, which was why I suggested a labour-saving measure, i.e. simply using an appropriate SORP as it stands, and publishing College accounts both in that format as well as in the old format.

It is possible that some members of the Regent House might formally submit an amendment to the present proposals, should the Council decide to seek that they be approved as they now stand. Were that to happen, the Regent House would need to vote on the matter, and could face a choice of three possible outcomes: (a) that the proposals in the Report be approved without amendment; (b) that the proposals in the Report be approved with the amendment that the format of the College accounts should be altered along the lines I have suggested so as to provide a true and fair view; or (c) that the proposals be rejected. The voting would take place according to Single Transferable Vote regulations, and I'm afraid that we have evidence which suggests that some members of the Regent House have not yet fully grasped how these regulations work.

We recently held a vote on an amendment to proposals from the General Board concerning supplementary payments to Professors; here too, financial transparency emerged as an issue, though in this case the amendment sought to achieve transparency of professorial salaries rather than transparency of College accounts. The Regent House faced three choices: (a) approve supplementary payments which would remain strictly confidential; (b) approve supplementary payments, but only if the recipients and the amounts were made public; or (c) reject supplementary payments. A total of 1,068 voted, and when the first-preference votes were counted, fewer than half (495 to be precise) voted for Option (a) (secret payments); 335 voted for Option (b) (published payments); and 238 voted for Option (c) (reject the payments). Now I may be accused of trying to second-guess the electorate, but, if the 238 whose first preference had been outright opposition to any payments had been asked the following question: 'OK, so you don't want these payments, but if they are to happen, whether you like it or not, would you prefer them to be secret or non-secret?', then I would wager that most, if not all, of those 238 people would have preferred published payments to secret payments. The beauty of the STV procedure is that it did indeed provide an opportunity to those opposed to the payments to express their views on that secondary question; those views could have been of great importance, if, as happened, opponents of any kind of payments lost the vote on whether or not there should be payments, secret or non-secret.

So how did opponents of payments vote? Of the 238 who did not want the payments, just 76 took the opportunity to express as their second preference the view that the payments, if approved, should be published rather than be secret. As one would have expected, none of them expressed the view that the payments, if made, should be secret. But 162 did not express any second preference, which suggests (improbably, it seems to me) that the majority of those opposed in principle to the payments did not care one way or the other whether, if payments had to occur, they would be secret or non-secret. Of the 238 opposed to payments, 162 failed to take the opportunity to express a view on that issue. Mr Deputy Vice-Chancellor, I fear that we have lived so long in this country with the first-past-the-post voting system that some of us, in our haste, may, when faced with a bewildering array of different-coloured ballot papers, fail to exercise our full voting power.

In summary, this was the way that ballot went: 495 voted for secret payments as their first preference and 573 voted against secret payments. The transfer of the votes of those voting against payments of any kind resulted in just 76 votes being added to those which had been expressed in favour of non-secret payments. So we ended up with the bizarre result that, in spite of the clear opposition of the majority of voters to secret payments, secret payments won the day. Unless we change our minds, we will now have secret payments. Was that really the outcome that the Regent House wanted?

I recount this, Mr Deputy Vice-Chancellor, to illustrate the subtlety and power of the STV system, but also as a cautionary tale. I hope that, should the proposals contained in the present Report be the subject of an amendment - perhaps, dare I say, one which requires College accounts to present a true and fair view - members of the Regent House, faced again with three options, will exercise at least as much care in expressing their second-preference option as they will in expressing their first-preference option. For myself, my first preference would be for a greater redistribution of wealth between the Colleges (as proposed by the Council in this Report) but coupled with College accounts which present a true and fair view. But, if my preference for that outcome did not prevail, then my second preference, for which I would feel a good deal of distaste, would be for the proposed greater redistribution of wealth between the Colleges even without a change in the present opaque (and legally questionable) form of College accounts, as opposed to the third and even less desirable option of retaining the less redistributive system which operates at present. If I get the chance, I shall aim to vote accordingly.

No remarks were made on the following Reports:

The Report, dated 15 March 1999, of the General Board on the establishment of a second Professorship of Chemical Engineering (p. 477).

The Report, dated 15 March 1999, of the General Board on the re-establishment of the Sheila Joan Smith Professorship of Immunology (p. 478).

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Cambridge University Reporter, 6 May 1999
Copyright © 1999 The Chancellor, Masters and Scholars of the University of Cambridge.